Document:

Exhibit 10.1

 

15 March 2006

 

SIRVA UK LIMITED

 

CROWN RELOCATION SERVICES LIMITED

 

CROWN WORLDWIDE HOLDINGS LIMITED

 

 

AGREEMENT

for the sale and purchase of Sirva UK Limited’s

Records Management and Crate Hire operations in

the UK and Ireland

 

 

 

 

CONTENTS

 

	
  Clause

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  1.

  	
  SALE AND
  PURCHASE

  	
  1

  
	
   

  	
   

  	
   

  
	
  2.

  	
  PRICE

  	
  1

  
	
   

  	
   

  	
   

  
	
  3.

  	
  PRE CLOSING
  SELLER UNDERTAKINGS

  	
  2

  
	
   

  	
   

  	
   

  
	
  4.

  	
  CONDITION TO
  CLOSING

  	
  2

  
	
   

  	
   

  	
   

  
	
  5.

  	
  CLOSING

  	
  3

  
	
   

  	
   

  	
   

  
	
  6.

  	
  SELLER
  WARRANTIES

  	
  3

  
	
   

  	
   

  	
   

  
	
  7.

  	
  PURCHASER
  WARRANTIES

  	
  3

  
	
   

  	
   

  	
   

  
	
  8.

  	
  CONDUCT OF
  PURCHASER CLAIMS

  	
  3

  
	
   

  	
   

  	
   

  
	
  9.

  	
  NO RIGHTS OF
  RESCISSION OR TERMINATION

  	
  4

  
	
   

  	
   

  	
   

  
	
  10.

  	
  BUSINESS
  ASSETS, CONTRACTS AND LIABILITIES

  	
  4

  
	
   

  	
   

  	
   

  
	
  11.

  	
  EXISTING
  BUSINESS PROPERTIES AND TARGET COMPANY PROPERTIES

  	
  5

  
	
   

  	
   

  	
   

  
	
  12.

  	
  BUSINESS
  EMPLOYEES

  	
  5

  
	
   

  	
   

  	
   

  
	
  13.

  	
  TAX

  	
  6

  
	
   

  	
   

  	
   

  
	
  14.

  	
  INSURANCE

  	
  9

  
	
   

  	
   

  	
   

  
	
  15.

  	
  PAYMENT OF
  INTER-COMPANY DEBT

  	
  9

  
	
   

  	
   

  	
   

  
	
  16.

  	
  GUARANTEES AND
  OTHER THIRD PARTY ASSURANCES

  	
  9

  
	
   

  	
   

  	
   

  
	
  17.

  	
  INFORMATION,
  RECORDS AND ASSISTANCE POST-CLOSING

  	
  10

  
	
   

  	
   

  	
   

  
	
  18.

  	
  PROTECTIVE
  COVENANTS POST-CLOSING

  	
  10

  
	
   

  	
   

  	
   

  
	
  19.

  	
  POST-CLOSING

  	
  11

  
	
   

  	
   

  	
   

  
	
  20.

  	
  TAX INDEMNITY

  	
  12

  
	
   

  	
   

  	
   

  
	
  21.

  	
  PAYMENTS

  	
  13

  
	
   

  	
   

  	
   

  
	
  22.

  	
  ANNOUNCEMENTS

  	
  13

  
	
   

  	
   

  	
   

  
	
  23.

  	
  CONFIDENTIALITY

  	
  13

  
	
   

  	
   

  	
   

  
	
  24.

  	
  ASSIGNMENT

  	
  15

  
	
   

  	
   

  	
   

  
	
  25.

  	
  FURTHER
  ASSURANCES

  	
  15

  
	
   

  	
   

  	
   

  
	
  26.

  	
  COSTS

  	
  15

  
	
   

  	
   

  	
   

  
	
  27.

  	
  NOTICES

  	
  15

  
	
   

  	
   

  	
   

  
	
  28.

  	
  CONFLICT WITH
  OTHER AGREEMENTS

  	
  17

  
	
   

  	
   

  	
   

  
	
  29.

  	
  WHOLE
  AGREEMENT

  	
  17

  
	
   

  	
   

  	
   

  
	
  30.

  	
  WAIVERS,
  RIGHTS AND REMEDIES

  	
  18

  

 

 

	
  31.

  	
  COUNTERPARTS

  	
  18

  
	
   

  	
   

  	
   

  
	
  32.

  	
  VARIATIONS

  	
  18

  
	
   

  	
   

  	
   

  
	
  33.

  	
  INVALIDITY

  	
  18

  
	
   

  	
   

  	
   

  
	
  34.

  	
  NO THIRD PARTY
  ENFORCEMENT RIGHTS

  	
  18

  
	
   

  	
   

  	
   

  
	
  35.

  	
  GUARANTEE

  	
  19

  
	
   

  	
   

  	
   

  
	
  36.

  	
  GOVERNING LAW
  AND JURISDICTION

  	
  19

  
	
   

  	
   

  	
   

  
	
  SCHEDULE 1 THE BUSINESSES

  	
  21

  
	
   

  	
   

  	
   

  
	
  SCHEDULE 2 SELLER
  WARRANTIES

  	
  25

  
	
   

  	
   

  	
   

  
	
  SCHEDULE 3 LIMITATIONS ON
  LIABILITY

  	
  35

  
	
   

  	
   

  	
   

  
	
  SCHEDULE 4 PURCHASER
  WARRANTIES

  	
  38

  
	
   

  	
   

  	
   

  
	
  SCHEDULE 5 CONDUCT OF THE
  TARGET ENTERPRISE PRE-CLOSING

  	
  39

  
	
   

  	
   

  	
   

  
	
  SCHEDULE 6 CLOSING
  ARRANGEMENTS

  	
  40

  
	
   

  	
   

  	
   

  
	
  SCHEDULE 7 BUSINESS
  CONTRACTS

  	
  43

  
	
   

  	
   

  	
   

  
	
  SCHEDULE 8 BUSINESS
  PROPERTIES AND TARGET COMPANY PROPERTIES

  	
  44

  
	
   

  	
   

  	
   

  
	
  SCHEDULE 9 POST-CLOSING
  FINANCIAL ADJUSTMENTS

  	
  83

  
	
   

  	
   

  	
   

  
	
  SCHEDULE 10 DEFINITIONS AND
  INTERPRETATION

  	
  91

  

 

Exhibits referred to in this
Agreement

 

	
  EXHIBIT 1

  	
   

  	
  THIRD PARTY ASSURANCES

  
	
  EXHIBIT 2

  	
   

  	
  INFORMATION ON THE TARGET COMPANY

  
	
  EXHIBIT 3

  	
   

  	
  TRANSACTIONS FOUNDATIONS DATABOOK APPENDIX

  
	
  EXHIBIT 4

  	
   

  	
  KEY MANAGERS

  
	
  EXHIBIT 5

  	
   

  	
  ASSIGNMENT OF INTELLECTUAL PROPERTY

  
	
  EXHIBIT 6

  	
   

  	
  EMPLOYEES

  

 

 

 

AGREEMENT

 

dated 15 March 2006

 

BETWEEN:

 

1.                                       SIRVA UK LIMITED a company incorporated under the laws of England and Wales whose
registered office is at Heritage House, 345 Southbury Road, Enfield, Middlesex,
EN1 1UP (the Seller);

 

2.                                       CROWN RELOCATION SERVICES LIMITED a company incorporated under the laws of Scotland whose registered
office is at Cullen Square, Deans Road, Deans Industrial Estate, Livingston,
West Lothian EH54 8SJ (the Purchaser);
and

 

3.                                       CROWN WORLDWIDE HOLDINGS LIMITED a company incorporated under the laws of Hong Kong whose registered
office is at Suite 2001, MassMutual Tower, 38 Gloucester Road, Wanchai,
Hong Kong (the Guarantor),

 

(together, the parties).

 

Words and expressions used in this Agreement
shall be interpreted in accordance with Schedule 10.

 

IT IS AGREED:

 

1.                                      SALE AND PURCHASE

 

1.1                                 The Seller shall sell, and the
Purchaser shall purchase, the Shares and the Businesses on the terms set out in
this Agreement.

 

1.2                                 The Shares shall be sold with
all rights attaching to them at Closing including the right to receive all
distributions and dividends declared, paid or made in respect of the Shares
after Closing.

 

1.3                                 Each Business shall be sold as
a going concern with effect from Closing, on and subject to the terms of this
Agreement.

 

2.                                      PRICE

 

2.1                                 The overall price for the
Shares and the Businesses shall be the aggregate of the price for the Shares,
the RM Business and the CH Business, as set out in this clause 2.

 

2.2                                 In relation to the Shares, the
price (the Final Share
Price) shall be £3,287,200 (the Initial Share Price) as adjusted pursuant
to Schedule 9.

 

2.3                                 In relation to the RM Business
and the CH Business together, the total price (the Final Business Price)
shall be £46,712,800 (the Initial
Business Price) as adjusted pursuant to Schedule 9.

 

2.4                                 At Closing, in relation to the
Initial Share Price and Initial Business Price, the Purchaser shall pay to the
Seller the amounts which it is required to pay under the terms of Schedule 6.

 

 

2.5                                 The Final Share Price and the
Final Business Price shall be calculated after Closing on the basis set out in Schedule 9.
To the extent allowable under applicable laws and regulations, any payments
required to be made under the Financial Adjustments shall be treated as
adjusting the Initial Share Price or the Initial Business Price, as
appropriate, thus resulting after such adjustment in the Final Share Price and
the Final Business Price. The Final Share Price and the Final Business Price
shall (subject to any further adjustment, if applicable, pursuant to clause 2.6
or clause 2.7) be adopted for all tax reporting purposes, with the Final Business
Price being apportioned on the basis that:

 

(a)                                  the aggregate amount out of
the Final Business Price to be allocated to the Business Assets overall shall
be such amount as the Seller specifies, acting reasonably (the parties agree
that, to the extent allowable under applicable laws and regulations, that
aggregate amount shall be between £9,888,888 and £11,188,888); and

 

(b)                                 that aggregate amount shall
then be allocated as between the relevant Business Assets on such basis as the
Seller shall specify, acting reasonably.

 

The Seller
shall notify the Purchaser of any apportionment that it proposes to make in
accordance with this clause 2.5 and the Seller and the Purchaser shall discuss
such allocation in good faith.

 

2.6                                 Any payment made under clause
19.4 or in satisfaction of a liability arising under a Seller Obligation or a
Purchaser Obligation shall (subject to clause 2.7) be made on the basis that it
shall adjust the Final Share Price or the Final Business Price, as the Seller
and the Purchaser agree to be appropriate in the circumstances; or in the
absence of such agreement it shall adjust pro rata the Final Share Price and
the Final Business Price.

 

2.7                                 If any payment made in
satisfaction of a liability under a Seller Obligation or any adjustment pursuant
to the Financial Adjustments would in either case reduce the Final Share Price
or the Final Business Price to less than £1, then whichever of the Final Share
Price or Final Business Price it is shall be reduced to £1 and the balance
shall further adjust the other.

 

3.                                      PRE CLOSING SELLER
UNDERTAKINGS

 

From the date
of this Agreement until Closing, the Seller shall (except as may be
approved by the Purchaser) ensure that the Target Enterprise is carried on in
all material respects only in the ordinary course and shall comply with the
obligations set out in Schedule 5.

 

4.                                      CONDITION TO CLOSING

 

4.1                                 Closing shall be conditional
on receipt by SIRVA Worldwide Inc of the approval of the lenders under the
credit agreement dated 1 December 2003 (as amended from time to time)
between SIRVA Worldwide Inc, the foreign subsidiary borrowers from time to time
parties thereto, the several lenders from time to time parties thereto,
JPMorgan Chase Bank, as administrative agent, Banc of America Securities LLC,
as syndication agent, and Credit Suisse First Boston, Deutsche Bank Securities, Inc.
and Goldman Sachs Credit Partners L.P. as documentation agents, to the Proposed
Transaction (the Condition).

 

4.2                                 The Seller shall use all
reasonable endeavours to ensure that the Condition is fulfilled as soon as
reasonably practicable after the date of this Agreement. The Seller shall
notify the Purchaser promptly upon becoming aware that the Condition has been
fulfilled. The first Business Day in London on which the Condition has been
fulfilled is the Unconditional
Date.

 

2

 

5.                                      CLOSING

 

5.1                                 Closing shall take place at
the London offices of the Seller’s lawyers. The date on which Closing shall
take place shall be determined as follows:

 

(a)                                  if the Unconditional Date
falls on or before 28 March 2006 Chicago time then, subject to
clause 5.2 below, Closing shall take place on 31 March, 2006, Hong Kong
time; otherwise

 

(b)                                 Closing shall take place on
the last Business Day of the calendar month during which the Unconditional Date
falls, save that if the Unconditional Date is on or before halfway through the
calendar month in question, or if the third Business Day after the
Unconditional Date would be in the next calendar month, then in either case
Closing shall take place on the third Business Day after the Unconditional
Date,

 

(the date on
which Closing is required to take place under this clause 5 being referred to
as the Closing Date).

 

5.2                                 The Seller shall have the
right to give notice to the Purchaser in writing no later than close of
business in Chicago on 23 March 2006 that the Seller requires Closing to
take place on 30 March, 2006, Hong Kong time (an Earlier Closing Notice);
for the avoidance of doubt, Closing shall only in fact take place on 30 March,
2006 if the Unconditional Date falls on or before 28 March, 2006 Chicago
time. If the Seller serves an Earlier Closing Notice, then clause 5.1(a) shall
be deemed to be amended to refer to 30 March 2006 rather than
31 March, 2006 and shall be construed accordingly.

 

5.3                                 At Closing each of the Seller
and the Purchaser shall deliver or perform (or ensure that there is
delivered or performed) all those documents, items and actions respectively
listed in relation to that party or any of its Affiliates in Schedule 6.

 

6.                                      SELLER WARRANTIES

 

6.1                                 The Seller warrants to the
Purchaser as at the date of this Agreement in the terms of the Warranties. The
Warranties are given subject to the limitations set out in Schedule 3.

 

6.2                                 None of the limitations in Schedule 3
shall apply to any Claim which arises (or to the extent that it is increased)
as a consequence of fraud or fraudulent misrepresentation by any director or
officer of any member of the Seller Group.

 

7.                                      PURCHASER WARRANTIES

 

The Purchaser
warrants to the Seller as at the date of this Agreement in the terms of the
warranties set out in Schedule 4.

 

8.                                      CONDUCT OF PURCHASER CLAIMS

 

8.1                                 If the Purchaser becomes aware
of any claim or potential claim by a third party (a Third Party Claim),
or of any other matter or circumstance, which might result in a Claim being
made, the Purchaser shall:

 

(a)                                  promptly (and in any event
within 20 Business Days of it becoming aware of it) give notice of the Third
Party Claim or other matter or circumstance to the Seller and ensure that the
Seller and its representatives are given all reasonable information and
facilities to investigate it;

 

3

 

(b)                                 not (and ensure that each
member of the Purchaser Group shall not) admit liability or make any agreement
or compromise in relation to the
Third Party Claim without prior written approval of the Seller;

 

(c)                                  (subject to the Purchaser or
the relevant member of the Purchaser Group being indemnified by the Seller
against all reasonable out of pocket costs and expenses incurred in complying
with its obligations under this paragraph (c) in respect of that
Third Party Claim) ensure that it and each member of the Purchaser Group shall:

 

(i)                 take such action as the Seller may reasonably
request to avoid, resist, dispute, appeal, compromise or defend the Third Party
Claim;

 

(ii)              subject to the obligations under clause 8.2
below, allow the Seller (if it elects to do so) to take over the conduct of all
proceedings and/or negotiations arising in connection with the Third Party
Claim; and

 

(iii)           provide such information and assistance as
the Seller may reasonably require in connection with the preparation for
and conduct of any proceedings and/or negotiations relating to the Third Party
Claim.

 

8.2                                 In the event that the Seller
takes conduct of any Third Party Claim in accordance with clause 8.1(c)(ii) above
it shall prior to taking any material action or entering into any settlement
with any third party notify the Purchaser in writing of any proposed action
and/or settlement and the Seller and the Purchaser will, as soon as is
reasonably practicable, enter into discussions in good faith in relation to the
Third Party Claim and the manner in which it should be handled or settled. Nothing
in this clause 8.2 will operate to prevent the Seller from taking any action or
entering into any compromise in the event that the Buyer and the Seller are
unable to reach agreement.

 

9.                                      NO RIGHTS OF RESCISSION OR
TERMINATION

 

9.1                                 Other than pursuant to clause
9.2, the Purchaser shall not be entitled to rescind or terminate this Agreement
in any circumstances whatsoever (whether before or after Closing). This shall
not exclude any liability for (or remedy in respect of) fraudulent
misrepresentation.

 

9.2                                 The Purchaser may, on 5
Business Days notice in writing to the Seller, terminate this Agreement at any
time prior to Closing if a Material Adverse Change occurs.

 

10.                               BUSINESS ASSETS, CONTRACTS
AND LIABILITIES

 

10.1                           Nothing in this Agreement
shall operate to transfer any of the Excluded Assets to the Purchaser or make
the Purchaser liable for any of the Excluded Liabilities (for the avoidance of
doubt, this is without prejudice to the Purchaser’s obligations under any other
Transaction Document). The Seller shall from Closing indemnify on demand the
Purchaser and each of its Affiliates against any and all Excluded Liabilities
and any and all Costs suffered or incurred by any of them as a result of any
such Excluded Liabilities.

 

10.2                           The Purchaser shall from
Closing (i) assume and discharge when due any and all Assumed Liabilities
of the Seller (including obligations arising under the Business Contracts) and (ii) indemnify
on demand the Seller and each of its Affiliates against any and all such
Assumed Liabilities and any and all Costs suffered or incurred by any of them
as a result of any such Assumed Liabilities or any failure to perform and
discharge any obligations arising under the Business Contracts.

 

4

 

10.3                           The provisions of clauses 10.1
and 10.2 above are in each case subject to the provisions of Schedule 8.

 

10.4                           After Closing, the Purchaser
shall at its cost execute and deliver all such further documents and/or take
such other action as the Seller may reasonably request in order to effect
the release and discharge in full of the relevant member of the Seller Group
from any Assumed Liabilities or the assumption by the Purchaser as the primary
obligor in respect of any Assumed Liabilities in substitution for the relevant
member of the Seller Group (in each case on a non-recourse basis to any member
of the Seller Group).

 

10.5                           The provisions of Schedule 7
shall apply if and to the extent that the benefit and/or burden of any of the
Business Contracts and Business Claims cannot be assigned or transferred to the
Purchaser except by an agreement of novation or without obtaining a consent,
approval, waiver or the like to the assignment or transfer from a third party
(such agreement of novation or consent, a Third Party Consent).

 

11.                               EXISTING BUSINESS PROPERTIES
AND TARGET COMPANY PROPERTIES

 

The provisions
of Schedule 8 shall apply in respect of the Existing Business Properties
and the Target Company Properties.

 

12.                               BUSINESS EMPLOYEES

 

12.1                           The parties intend that the
contracts of employment of the Employees of the Businesses will have effect
from the close of business on the Closing Date as if originally made between
the Purchaser and those Employees. Accordingly, if the rights, powers, duties,
liabilities and obligations of the Seller in respect of any contracts of
employment with those Employees in force immediately before the Closing Date do
not transfer to the Purchaser in accordance with local applicable laws:

 

(a)                                  the Purchaser or a member of
the Purchaser Group shall make offers of employment to the relevant Employees
to take effect on close of business on the Closing Date on terms and conditions
(which shall include treating any period of service with any member of the
Seller Group as if it were service with the Purchaser) which are no less
favourable taken as a whole than those on which each such Employee was employed
by the relevant member of the Seller Group immediately prior to the Closing
Date or as required by applicable law; and

 

(b)                                 where those Employees accept
such offers of employment, the Seller will ensure that they are released from
employment with the relevant member of the Seller Group with effect from the
close of business on the Closing Date or on the date of acceptance of
employment with the Purchaser, if later.

 

12.2                           The Purchaser shall indemnify
and hold harmless the Seller against any Liabilities or Costs incurred by the
Seller Group to the extent they arise from or are attributable to the
employment or termination of employment of the Employees after the Closing Date
including, without limitation (i) any Liability or Costs arising out of
any failure by the Purchaser or any member of the Purchaser’s Group to offer
terms and conditions of employment and working conditions which are no less
favourable than those which apply to Employees up to the Closing Date or as
required by law; and (ii) any Liability or Costs arising from an Employee
declining an offer of Employment made by the Purchaser or any member of the
Purchaser’s Group in accordance with clause 12.1.

 

5

 

12.3                           The Seller shall
indemnify and hold harmless the Purchaser against any Liabilities or Costs
incurred by the Purchaser Group:

 

(a)                                  to the extent
they arise from or are attributable to any breach or default by the Seller
prior to the close of business on the Closing Date in respect of any of its
obligations or duties to, or in relation to, any of its employees or former
employees; and/or

 

(b)                                 to the extent
they otherwise relate to any employee of the Seller who is not an Employee,

 

and
in each case which the Purchaser or any member of the Purchaser’s Group may incur
or suffer as a result of succeeding to the Seller in relation to the contracts
of employment of Employees or any other employee or former employee of the
Seller, whether by operation of law or as a result of making offers of
employment under clause 12.1, save in each case to the extent that any such
Liability or Claim arises directly or indirectly from any failure by the
Purchaser to provide the Seller with the information required from the
Purchaser to enable the Seller to comply with its obligations.

 

12.4                           The Purchaser
shall provide the Seller with such information as the Seller may reasonably
request in writing as is necessary for the Seller to comply with any legal
requirement (whether statutory or pursuant to any written agreement with, or
the constitution of, any employee body) in relation to the Proposed
Transactions to consult with or inform the Employees (or any of them), a relevant
trade union or any other employee representatives.

 

12.5                           The Purchaser
shall assume from the Closing Date liability for leave entitlements
attributable to Employees.

 

12.6                           The Seller shall,
within 60 days of Closing, calculate the amounts which would have been payable
to any of the Employees participating in the Seller’s Management Bonus Scheme
if a bonus had been calculated for them on the terms of that scheme but:

 

(a)                                  based on the
results of the Target Enterprise for the period from and including 1 January 2006
to and including the Effective Date; and

 

(b)                                 calculated using
target numbers which are (i) for any completed quarter, the targets in the
budget of the Target Enterprise for that quarter; and (ii) for any part of
a quarter, a pro rata percentage of the targets in the budget of the Target
Enterprise for that quarter,

 

(as
so calculated, the Part-Year
Bonus Payments). Having made that calculation, the Seller shall
notify the Purchaser in writing of the amounts concerned and the Employees
to whom they are respectively owed. The Seller shall pay to the Purchaser an
amount equal to the aggregate of such Part-Year Bonus Payments plus an
amount equal to any employer’s national insurance contributions which
would be payable in respect of payments in those amounts being made to the
relevant Employees. The Purchaser shall then promptly pay to each relevant
Employee an amount equal to the respective Part-Year Bonus Payment, after
deducting the applicable employee national insurance contributions and PAYE,
and then both account for the national insurance and PAYE amounts so deducted
and pay the applicable employer national insurance contributions to HMRC.

 

13.                               TAX

 

13.1                           All sums payable
under this Agreement shall be paid free and clear of all deductions or
withholdings whatsoever except only where the law requires it; the Purchaser
agrees that it

 

6

 

shall
neither make any withholding nor seek any clearance certificate pursuant to section 980
of the Irish Taxes Consolidation Act, 1997.

 

13.2                           Any sum payable
by the Purchaser to the Seller under this Agreement is exclusive of any
applicable VAT.

 

13.3                           The Seller and
the Purchaser consider that the transfer of each of the Businesses should for
VAT purposes constitute the transfer to the Purchaser of part of the
business of the Seller as a going concern and the transfer of the Business
Assets other than the Non-TOGC Properties (so far as made in the United
Kingdom) should accordingly fall within Article 5 of the Value Added Tax
(Special Provisions) Order 1995 (SI 1995/1268) (Article 5) so as to be treated as
neither a supply of goods nor a supply of services for the purposes of VAT.

 

13.4                           If it has not
done so prior to the date hereof, the Seller (or its advisers) shall send to
H.M. Revenue & Customs a letter seeking a direction that the Seller be
permitted to keep and preserve following Closing the records referred to in section 49(1)(b) of
the VATA so far as they relate to the carrying on of the Businesses prior to
Closing. If such direction is given, the Seller shall preserve such records in
good order and in such manner and for such period as shall be required by law
and shall give the Purchaser reasonable access to such records during normal
business hours. If such direction is not given and H.M. Revenue &
Customs do not determine that Article 5 does not apply to the transfer of
any part of the Businesses, the Seller shall deliver such records to the
Purchaser as soon as possible after Closing and the Purchaser shall preserve
such records in good order and in such manner and for such period as shall be
required by law and shall give the Seller reasonable access to such records
during normal business hours.

 

13.5                           The Seller
represents and warrants to the Purchaser that it is registered for the purposes
of VAT. There is set out in Part J of Schedule 8 a list of all those
Existing Business Properties in relation to which the Seller or a relevant
associate (as defined in paragraph 3(7) of Schedule 10 to the VATA)
of the Seller has made or will make before the relevant date within the meaning
of paragraph (3) of Article 5 an election under paragraph 2 of Schedule 10
to the VATA to waive the exemption from VAT (so far as TOGC Properties, the TOGC Taxable Properties and
so far as Non-TOGC Properties, the Non-TOGC Taxable Properties).

 

13.6                           The Purchaser
represents, warrants and undertakes to the Seller:

 

(a)                                  that it is, and
until at least the day after Closing will remain, a registered taxable person
for the purposes of VAT; and

 

(b)                                 that it intends
to use the Business Assets relating to each Business to carry on the same kind
of business as that Business with effect from Closing.

 

13.7                           The Purchaser
undertakes to the Seller:

 

(a)                                  (if it has not
done so prior to the date hereof) to make an election to waive the exemption in
respect of the TOGC Taxable Properties pursuant to paragraph 2 of Schedule 10
to the VATA, such election to have effect no later than the relevant date and
that it has not and will not revoke such election under the provisions of
paragraph 3(5)(a)(i) of Schedule 10 to the VATA;

 

(b)                                 to give written
notification of such election as required by paragraph 3(6)(b) of Schedule 10
to the VATA, together with any other information referred to in that paragraph,
no later than the relevant date; and

 

7

 

(c)                                  to supply to the
Seller at or prior to Closing evidence reasonably satisfactory to the Seller
that it is a registered taxable person for the purposes of VAT, copies of all
elections and of the notification of those elections submitted to H.M. Revenue &
Customs referred to in sub-clauses 13.7(a) and (b) above and of any
acknowledgement received from H.M. Revenue & Customs,

 

(relevant date having
the meaning given to it by paragraph (3) of Article 5).

 

13.8                           In relation to
the TOGC Taxable Properties, the Purchaser hereby notifies the Seller that
paragraph (2B) of Article 5 does not apply to the Purchaser and the
Purchaser undertakes to promptly notify the Seller in writing if paragraph (2B)
of Article 5 becomes applicable to the Purchaser at any time on or before
Closing.

 

13.9                           Save in respect
of the Non-TOGC Taxable Properties, if H.M. Revenue & Customs
determine that VAT is chargeable in respect of the transfer of all or any part of
the Businesses pursuant to this Agreement (which for the purposes of this
clause includes VAT chargeable in respect of the transfer of any of the
Business Assets pursuant to this Agreement), the Purchaser shall, in addition
to the purchase price, pay to the Seller on Closing or, if later, five Business
Days after receipt of notice from the Seller of that determination and against
delivery of a valid VAT invoice the amount of any VAT which is chargeable in
respect of the transfer of the Businesses.

 

13.10                     If the Purchaser
is in breach of clause 13.7, has notified the Seller that paragraph (2B) of Article 5
has become applicable to it under clause 13.8 (a notification of applicability) or is
reasonably believed by the Seller to be in breach of clause 13.6, the Seller
shall be entitled to treat the transfer of the Business (in the event of a
breach of clause 13.6) for all purposes as if it did not fall within Article 5
or (in the event of a breach of clause 13.7 or notification of applicability
under clause 13.8 but not in the event of a breach of clause 13.6) as if the
transfer of the TOGC Taxable Properties (or, as the case may be, those
TOGC Taxable Properties in respect of which the Purchaser is in breach of
clause 13.7 or a notification of applicability is made under clause 13.8) was a
supply thereof and the Purchaser shall forthwith on receipt of an appropriate
VAT invoice (or, if later, at Closing) pay to the Seller an amount equal to the
VAT shown thereon, together with any interest or penalty incurred by the Seller
in connection therewith. Such VAT shall be refunded by the Seller to the
Purchaser if and to the extent that H.M. Revenue & Customs confirm
that VAT is not chargeable PROVIDED THAT if the Seller has already accounted
for such VAT to H.M. Revenue & Customs, no amount shall be refunded
under this clause unless and to the extent that the Seller has received
effective repayment or credit in respect of such VAT.

 

13.11                     The Purchaser
shall indemnify the Seller (on an after tax basis and for itself and on behalf
of other members of any relevant VAT group) against any interest or penalties
assessed by H.M. Revenue & Customs on the Seller as a result of the
transfer of any of the Business Assets other than the Non-TOGC Properties not
falling within Article 5, provided that the Purchaser shall not be liable
under this clause 13.11 to the extent that such interest or penalties arise by
reason of the Seller paying such VAT more than three Business Days after
receipt by the Seller of an amount equal to such VAT from the Purchaser under
this clause 13.11.

 

13.12                     The Purchaser
represents and warrants to the Seller that it does not intend or expect that
any of the Non-TOGC Taxable Properties will become or continue to be exempt
land within the meaning of paragraph 2(3AA) of Schedule 10 to the VATA.

 

8

 

13.13                     The Purchaser
shall, in addition to the purchase price, pay to the Seller on Closing and
against delivery of a valid VAT invoice the amount of any VAT which is
chargeable in respect of the transfer of the Non-TOGC Taxable Properties.

 

14.                               INSURANCE

 

14.1                           From the date of
this Agreement until (and including) the Closing Date, members of the Seller
Group and the Target Company shall continue in force, all policies of insurance
maintained by them in respect of the Target Enterprise (including in respect of
each of the Properties, except for those Properties where there is a Lease and
there is an obligation on the landlord to insure).

 

14.2                           Upon Closing all
insurance cover arranged in relation to the Target Enterprise or otherwise in
relation to the Target Company by the Seller Group (whether under policies
maintained with third party insurers or other members of the Seller Group)
shall cease (whether in relation to insured events taking place on, before or
after Closing) and the Purchaser shall procure that no member of the Purchaser
Group shall make any claim under any such policies. The Seller shall be
entitled to make arrangements with its insurers to reflect this clause.

 

15.                               PAYMENT OF
INTER-COMPANY DEBT

 

15.1                           The Seller shall
procure that at Closing there is no outstanding Inter-Company Non-Trading Debt
outstanding. To the extent that there is any Inter-Company Non-Trading Payable
outstanding prior to Closing, the Seller shall be entitled to subscribe for
additional shares in the capital of the Target Company in order to provide it
with the funds necessary to repay the applicable Inter-Company Non-Trading
Payable. If that occurs, then the shares that are so allotted and issued to the
Seller shall, from that time, be treated for the purposes of this agreement as “Shares”
and shall be transferred on and subject to the terms of this Agreement and the
parties’ obligations under this agreement shall be construed accordingly.

 

15.2                           The Purchaser
shall procure that any Inter-Company Trading Debt which is owed by the Target
Company as at Closing is paid to the relevant member of the Seller Group within
30 days of the Closing Date; such payments shall be made in accordance with
clause 21.1.

 

15.3                           The Seller shall
procure that any Inter-Company Trading Debt which is owed by any member of the
Seller Group as at Closing is paid to the Target Company (or, as the case may be,
the Purchaser) within 30 days of the Closing Date; such payments shall be made
in accordance with clause 21.2.

 

16.                               GUARANTEES AND
OTHER THIRD PARTY ASSURANCES

 

The
Purchaser shall ensure that at Closing each member of the Seller Group is
released in full from all Third Party Assurances listed in Exhibit 2 given
by it in respect of obligations of the Target Company or relating to any
Business Contract. In addition, the Purchaser shall use its reasonable efforts
to ensure that, as soon as reasonably practicable after becoming aware of any
other Third Party Assurance in respect of any obligations of the Target Company
or relating to any Business Contract, each member of the Seller Group is
released in full from such Third Party Assurance. Pending release of any Third
Party Assurance referred to in this clause 17, the Purchaser shall indemnify
the Seller and each of its Affiliates against any and all Costs arising after
the Effective Date (provided that Closing takes place) under or by reason of
that Third Party Assurance.

 

9

 

17.                               INFORMATION,
RECORDS AND ASSISTANCE POST-CLOSING

 

17.1                           For 7 years
following the Closing Date, each member of the Purchaser Group shall provide
the Seller (at the Seller’s cost) with reasonable access at reasonable times to
(and the right to take copies of) the books, accounts, customer lists and all
other records held by it after Closing to the extent that they relate to the
Target Enterprise and to the period up to Closing (the Records).
This obligation is subject to the provisions of clause 23
(Confidentiality).

 

17.2                           For 7 years
following the Closing Date, no member of the Purchaser Group shall dispose of
or destroy any of the Records without first giving the Seller at least 2 months’
notice of its intention to do so and giving the Seller a reasonable opportunity
to remove and retain any of them (at the Seller’s expense).

 

17.3                           Each member of
the Purchaser Group shall (at the Seller’s expense) also give such assistance
to any member of the Seller Group as the Seller may reasonably request in
relation to any third party proceedings by or against any member of the Seller
Group so far as they relate to the Target Enterprise, including proceedings
relating to employees’ claims or taxation.

 

18.                               PROTECTIVE
COVENANTS POST-CLOSING

 

18.1                           Neither the
Seller nor any of its Affiliates shall carry on or be engaged in any Competing
Business in the Protected Territories during a period of 3 years after the
Closing Date. For this purpose:

 

(a)                                  Competing Business means a business which
competes with any business carried on at the Closing Date by the Target Company
or, in relation to the Target Enterprise, the Seller; provided that carrying on
or being engaged in any Permitted Business shall not be regarded as a Competing
Business;

 

(b)                                 Permitted Business means carrying on or being
engaged in (i) any trade or business carried on at the date of this
Agreement by any member of the Seller Group (other than the Seller) or (ii) any
trade or business, other than the Target Enterprise, carried on at the date of
this Agreement by the Seller; or (iii) for the avoidance of doubt, the
storage of any records or documents by any member of the Seller Group
where it is for purposes ancillary to that member of the Seller Group’s
other business activities from time to time or is otherwise in the course of
any trade or business of that member that has not been actively marketed as a
records management business; or (iv) for the avoidance of doubt, the
rental or loan of any crates or other containers by any member of the
Seller Group where it is for purposes ancillary to that member of the
Seller Group’s other business activities from time to time or is otherwise
in the course of any trade or business of that member that has not been
actively marketed as a crate hire business;

 

(c)                                  Protected Territories means the United Kingdom and
Ireland.

 

18.2                           Nothing in this
clause 18 shall prevent, after Closing, the Seller or any of its Affiliates
from:

 

(a)                                  owning securities
in any company dealt in on a stock exchange which do not exceed 15 per cent. in
nominal value of the securities of that company;  or

 

(b)                                 acquiring any one
or more companies and/or businesses (taken together, the Acquired Business)
where at the time of the acquisition the activities of the Acquired Business

 

10

 

include a Competing Business (the Acquired Competing Business)
and subsequently carrying on or being engaged in the Acquired Competing
Business, if the turnover attributed to the Acquired Competing Business in its
last financial year prior to such acquisition is less than 25 per cent. of the
turnover of the Acquired Business as a whole; or

 

(c)                                  performing its
obligations under this Agreement and/or under any other agreement which it may enter
into with a member of the Purchaser Group.

 

18.3                           The Purchaser
shall not and shall each procure that none of its Affiliates shall (in each
case, whether alone, jointly with another, directly or indirectly), for 2 years
after Closing, offer to employ or seek to entice away from the Seller Group any
person who was employed by the Seller Group at any time during the 12 months
ending on the Closing Date and with whom the Purchaser had or has contact in
the course of negotiating or implementing the Transaction Documents or otherwise
in relation to the Proposed Transactions.

 

18.4                           The Seller shall
not and shall each procure that none of its Affiliates shall (in each case,
whether alone, jointly with another, directly or indirectly), for 2 years after
Closing, offer to employ or seek to entice away from the Purchaser Group any
person who was employed by the Purchaser Group at any time during the 12 months
ending on the Closing Date and with whom the Seller had or has contact in the
course of negotiating or implementing the Transaction Documents or otherwise in
relation to the Proposed Transactions.

 

19.                               POST-CLOSING

 

19.1                           On or as soon as
possible after Closing, the Purchaser and the Seller shall send out a joint
notice in the Agreed Form to an agreed list of the suppliers, customers
and clients of the Target Enterprise advising them of the transfer of the
Target Enterprise.

 

19.2                           Within a
reasonable period after Closing, the Seller shall change the names of Irish
Security Archives Limited (Northern Ireland) and GB Nationwide Crate Hire Limited
to such alternative names as it may determine and such alternative names
shall not, in the reasonable opinion of the Seller, be associated with the
Businesses or the Target Company.

 

19.3                           If the Effective
Date is not the Closing Date then, from the Closing Date until the end of the
calendar month during which Closing takes place, the Purchaser shall ensure
that the Target Enterprise is carried out in all material respects in the
ordinary course (including as to settlement of liabilities and timing of
expenditure).

 

19.4                           Other than in the
event that the Closing Date is 30 March, 2006, if the Effective Date is not the
Closing Date then, as soon as reasonably practicable after the monthly
accounting information for the Target Enterprise in relation to the calendar
month during which Closing took place (the Full Month Accounts) has been prepared by the
Seller pursuant to the Transitional Services Agreement, the Seller shall
prepare a net cashflow statement for the Businesses in respect of that calendar
month (the Net Cashflow
Statement) and shall notify the Purchaser in writing of the
Pre-Closing Net Cashflow Amount in respect of the Businesses; for the avoidance
of doubt, the cashflow of the Target Company shall be ignored for this purpose.
The Net Cashflow Statement shall be prepared in accordance with the Seller’s
normal monthly accounting policies and procedures and based solely on the
information in the Full Month Accounts, with such adjustments being made to
that information as the Seller reasonably considers appropriate. The Seller
shall ensure that the Purchaser shall be given reasonable access to the
supporting documentary evidence and calculations for the Net Cashflow Statement
and shall provide all assistance reasonably

 

11

 

requested by
the Purchaser to verify the Pre-Closing Net Cashflow Amount. In the absence of
manifest error, the Net Cashflow Statement shall be final and binding. For the
purpose of this Agreement, Pre
Closing Net Cashflow Amount means, in relation to the
Businesses, an amount equal to

 

(CF x Y/X) – (T + V)

 

where:

 

(a)                                  CF = the aggregate cashflow of the Businesses as reflected in the Net
Cashflow Statement (being the aggregate cash inflow minus the aggregate cash
outflow of the Businesses during the calendar month during which Closing took
place and excluding any amounts paid or received in respect of corporation tax
or VAT);

 

(b)                                 T = corporation tax for which the Seller is liable on the taxable profit
(if any) attributable to the Businesses during the period from and including
the first day of the calendar month during which Closing took place to and
including the Closing Date;

 

(c)                                  V = the net VAT liability of the Seller in relation to supplies made to
and by it in respect of the Businesses during the period from and including the
first day of the calendar month during which Closing took place to and
including the Closing Date, save in so far as they relate to the transfer of
the Businesses to the Purchaser;

 

(d)                                 X = the number of calendar days in the calendar month during which
Closing took place; and

 

(e)                                  Y = the number of calendar days from and including the first calendar
day of the calendar month during which Closing took place to and including the
Closing Date.

 

If the Pre-Closing
Net Cashflow Amount is a positive amount, the Seller shall pay an amount equal
to that Pre-Closing Net Cashflow Amount to the Purchaser and if the Pre-Closing
Net Cashflow Amount is a negative amount, the Purchaser shall pay an amount
equal to that Pre-Closing Net Cashflow Amount to the Seller. Such payment shall
be made within 5 Business Days of notification pursuant to this clause 19
of the Pre-Closing Net Cashflow Amount, in accordance with clause 21.

 

19.5                           The Seller shall use its
reasonable endeavours to liaise with the Purchaser and the third party provider
of the Freephone/Lo-call Numbers with a view to ensuring that the Purchaser is
able to use the Freephone/Lo-call Numbers immediately after Closing.

 

19.6                           As soon as reasonably
practicable after Closing and in any event within 3 months afterwards, the
Target Company and the Businesses shall cease to use or display any trade or
service name or mark, business name, logo or domain name used or held by any
member of the Seller Group or any mark, name or logo which, in the reasonable
opinion of the Seller, is substantially or confusingly similar to any of them,
save in each case specifically permitted under the Transaction Documents.

 

20.                               TAX INDEMNITY

 

20.1                           The Seller hereby covenants
with the Purchaser to pay to the Purchaser the amount of any tax which the
Target Company is liable to pay arising in respect of any income, profits or
gains earned, accrued or received on or before 31 December 2005, except to
the extent that that liability:

 

12

 

(a)                                  is due to a voluntary
transaction, act or omission of the Purchaser or the Target Company at any time
after Closing; or

 

(b)                                 is reduced by the surrender of
any relief by any Seller Group Company pursuant to clause 20.2.

 

20.2                           The Purchaser shall take and
shall procure that the Target Company will take all steps reasonably required
by the Seller to effect the surrender to the Target Company of any relief by
any Seller Group Company. The amount of any reduction in the relevant tax
liability under clause 20.1(b), (i) shall be paid by the Target Company to
the relevant Seller Group Company and (ii) shall be paid by the Seller to
the Purchaser.

 

21.                               PAYMENTS

 

21.1                           Any payment to be made
pursuant to this Agreement by the Purchaser (or any member of the Purchaser
Group) shall be made to the Seller’s Bank Account. The Seller agrees to pay
each member of the Seller Group that part of each payment to which it is
entitled.

 

21.2                           Any payment to be made
pursuant to this Agreement by the Seller (or any member of the Seller Group)
shall be made to the Purchaser’s Bank Account. The Purchaser agrees to pay each
member of the Purchaser Group that part of each payment to which it is
entitled.

 

21.3                           Payment under clause 21.1 and
21.2 shall be in immediately available funds by electronic transfer on the due
date for payment. Receipt of the amount due shall be an effective discharge of
the relevant payment obligation.

 

21.4                           If any sum due for payment in
accordance with this Agreement is not paid on the due date for payment, the
person in default shall pay Default Interest on that sum from but excluding the
due date to and including the date of actual payment calculated on a daily
basis.

 

22.                               ANNOUNCEMENTS

 

22.1                           Until 3 months after the Closing
Date, neither the Seller nor the Purchaser (nor any of their respective
Affiliates) shall make any announcement or issue any circular in connection
with the existence or subject matter of this Agreement (or any other
Transaction Document) without the prior written approval of the other (such
approval not to be unreasonably withheld or delayed).

 

22.2                           The restriction in clause 22.1
shall not apply to the extent that the announcement or circular is required by
law, by any stock exchange or any regulatory or supervisory body or authority
of competent jurisdiction, whether or not the requirement has the force of law.
If this exception applies, the party making the announcement or issuing the
circular shall use its reasonable efforts to consult with the other party in
advance as to its form, content and timing.

 

23.                               CONFIDENTIALITY

 

23.1                           For the purposes of this
clause 23:

 

(a)                                  Confidential Information means:

 

(i)                    (in relation to the obligations of the
Purchaser and the Guarantor) any information received or held by the Purchaser
(or any of its Representatives)

 

13

 

relating to the Seller Group or, prior to Closing, the
Target Company and/or the Businesses; or

 

(ii)                 (in relation to the obligations of the
Seller) any information received or held by the Seller (or any of its
Representatives) relating to the Purchaser Group or, following Closing, the
Target Company and/or the Businesses; and

 

(iii)              information relating to the provisions of,
and negotiations leading to, this Agreement and the other Transaction
Documents,

 

and includes
written information and information transferred or obtained orally, visually,
electronically or by any other means;

 

(b)                                 Representatives means, in relation to a party, its
respective Affiliates and the directors, officers, employees, agents, advisers,
accountants and consultants of that party and/or of its respective Affiliates.

 

23.2                           Each of the Seller and the
Purchaser shall (and shall ensure that each of its Representatives shall) maintain
Confidential Information in confidence and not disclose Confidential
Information to any person except (i) as this clause 23 permits or (ii) as
the other party approves in writing.

 

23.3                           Clause 23.2 shall not
prevent disclosure by a party or its Representatives to the extent it can
demonstrate that:

 

(a)                                  disclosure is required by law
or by any stock exchange or any regulatory, governmental or antitrust body
(including any tax authority) having applicable jurisdiction (provided that the
disclosing party shall first inform the other party of its intention to
disclose such information and take into account the reasonable comments of the
other party);

 

(b)                                 disclosure is of Confidential
Information which was lawfully in the possession of that party or any of its
Representatives (in either case as evidenced by written records) without any
obligation of secrecy prior to its being received or held;

 

(c)                                  disclosure is of Confidential
Information which has previously become publicly available other than through that
party’s fault (or that of its Representatives);

 

(d)                                 disclosure is required for the
purpose of any arbitral or judicial proceedings arising out of this Agreement
(or any other Transaction Document).

 

23.4                           Each of the Seller and the
Purchaser undertakes that it (and its Affiliates) shall only disclose
Confidential Information to Representatives if it is reasonably required for
purposes connected with this Agreement and only if the Representatives are
informed of the confidential nature of the Confidential Information and agree
to maintain the Confidential Information in accordance with the provisions of
this clause 23.

 

23.5                           If this Agreement terminates,
the Purchaser shall as soon as practicable on request by the Seller:

 

(a)                                  return to the Seller all written
documents and other materials relating to the Seller, the Target Company, the
Businesses or this Agreement (including any Confidential Information) which the
Seller (or its Representatives) have provided to the Purchaser (or its
Representatives) without keeping any copies of them;

 

14

 

(b)                                 destroy all information or
other documents derived from such Confidential Information; and

 

(c)                                  so far as it is practicable to
do so, expunge such Confidential Information from any computer, word processor
or other device.

 

24.                               ASSIGNMENT

 

Unless the
Seller and the Purchaser specifically agree in writing, no person shall assign,
transfer, charge or otherwise deal with all or any of its rights under this
Agreement nor grant, declare, create or dispose of any right or interest in it.
Any purported assignment in contravention of this clause 24 shall be void.

 

25.                               FURTHER ASSURANCES

 

25.1                           Each of the Seller and the
Purchaser shall, for a period of 6 months from the Closing Date, execute (or
procure the execution of) such further documents as may be required by law
or be necessary to implement and give effect to this Agreement.

 

25.2                           Each of the Seller and the
Purchaser shall procure that its Affiliates comply with all obligations under
this Agreement which are expressed to apply to any such Affiliates.

 

26.                               COSTS

 

26.1                           Subject to clause 26.2
and except as otherwise provided in this Agreement (or any other Transaction
Document), the Seller and the Purchaser shall each be responsible for its own
costs, charges and other expenses (including those of its Affiliates) incurred
in connection with the Proposed Transactions.

 

26.2                           The Purchaser shall bear or
procure that its Affiliates shall bear all stamp duty, notarisation fees or
other documentary transfer or transaction duties, and all stamp duty reserve
tax, stamp duty land tax and any other transfer taxes including in each case
any related interest or penalties arising as a result of this Agreement or of
any of the other Transaction Documents.

 

27.                               NOTICES

 

27.1                           Any notice in connection with
this Agreement shall be in writing in English and delivered by hand, fax,
registered post or courier using an internationally recognised courier company.
Any notice sent by fax shall also be sent by email, and vice versa. A notice
shall be effective upon receipt and shall be deemed to have been received (i) at
the time of delivery, if delivered by hand, registered post or courier or (ii) at
the time of transmission if delivered by fax and email provided that in either
case, where delivery occurs outside Working Hours, notice shall be deemed to
have been received at the start of Working Hours on the next following Business
Day.

 

27.2                           The addresses of the parties
for the purpose of clause 27.1 are as set out on the first page of
this Agreement and their fax numbers for the purpose of clause 27.1, and
the person for whose attention any notice is to be marked, are respectively:

 

Seller

 

Address:                                                                                               SIRVA UK Limited

Heritage House

 

15

 

	
   

  	
  345
  Southbury Road

  
	
   

  	
  Enfield

  
	
   

  	
  Middlesex
  EN1 1UP

  
	
   

  	
   

  
	
  Fax:

  	
  +44 (0)20 8219 8101

  
	
   

  	
   

  
	
  Email:

  	
  Company.secretary@sirva.co.uk

  
	
   

  	
   

  
	
  For the
  attention of:

  	
  Company
  Secretary

  
	
   

  	
   

  
	
  Purchaser

  	
   

  
	
   

  	
   

  
	
  Address:

  	
  Crown Relocation Services Limited

  
	
   

  	
  c/o Crown Worldwide Ltd

  
	
   

  	
  19 Stonefield Way

  
	
   

  	
  South Ruislip

  
	
   

  	
  London

  
	
   

  	
  Middlesex HA4 0BJ

  
	
   

  	
   

  
	
  Fax:

  	
  (+44) (0)20 88398167

  
	
   

  	
   

  
	
  Email:

  	
  dmuir@crownrelo.com

  
	
   

  	
   

  
	
  For the
  attention of:

  	
  David Muir

  
	
   

  	
   

  
	
  Guarantor

  	
   

  
	
   

  	
   

  
	
  Address:

  	
  Crown
  Worldwide Holdings Limited

  
	
   

  	
  Suite 2001,
  MassMutual Tower

  
	
   

  	
  38
  Gloucester Road

  
	
   

  	
  Wanchai

  
	
   

  	
  Hong Kong

  
	
   

  	
   

  
	
  Fax:

  	
  (852) 2528 0177

  
	
   

  	
   

  
	
  Email:

  	
  kmadrid@crownworldwide.com

  
	
   

  	
   

  
	
  For the
  attention of:

  	
  Ken Madrid

  
	
   

  	
   

  
	
  27.3          Any
  notice to the Seller shall be copied to:

  
	
   

  	
   

  
	
  Address:

  	
  SIRVA, Inc.

  
	
   

  	
  700 Oakmont
  Drive

  
	
   

  	
  Westmont

  
	
   

  	
  Illinois

  
	
   

  	
  USA

  
	
   

  	
   

  
	
  Fax:

  	
  +1 (630) 468 4706

  
	
   

  	
   

  
	
  Email:

  	
  eryk.spytek@sirva.com

  
	
   

  	
   

  
	
  For the
  attention of:

  	
  General
  Counsel

  
	
   

  	
   

  
	
  27.4          Any
  notice to the Purchaser shall be copied to:

  

 

16

 

	
  Address:

  	
  Crown
  Worldwide Holdings Limited

  
	
   

  	
  Suite 2001,
  MassMutual Tower

  
	
   

  	
  38
  Gloucester Road

  
	
   

  	
  Wanchai

  
	
   

  	
  Hong Kong

  
	
   

  	
   

  
	
  Fax:

  	
  (852) 2528 0177

  
	
   

  	
   

  
	
  Email:

  	
  kmadrid@crownworldwide.com

  
	
   

  	
   

  
	
  For the
  attention of:

  	
  Ken Madrid

  
	
   

  	
   

  
	
  and

  	
   

  
	
   

  	
   

  
	
  Address:

  	
  Eversheds LLP

  
	
   

  	
  Cloth Hall Court

  
	
   

  	
  Infirmary Street

  
	
   

  	
  Leeds

  
	
   

  	
  LS1 2JB

  
	
   

  	
   

  
	
  Fax:

  	
  +44 (0)113
  245 6188

  
	
   

  	
   

  
	
  Email:

  	
  robinjohnson@eversheds.com

  
	
   

  	
   

  
	
  27.5          Any
  notice to the Guarantor shall be copied to:

  
	
   

  	
   

  
	
  Address:

  	
  Eversheds LLP

  
	
   

  	
  Cloth Hall Court

  
	
   

  	
  Infirmary Street

  
	
   

  	
  Leeds

  
	
   

  	
  LS1 2JB

  
	
   

  	
   

  
	
  Fax:

  	
  +44 (0)113 245 6188

  
	
   

  	
   

  
	
  Email:

  	
  robinjohnson@eversheds.com

  
	
   

  	
   

  
	
  For the
  attention of:

  	
  Robin
  Johnson

  

 

28.                               CONFLICT WITH OTHER
AGREEMENTS

 

If there is
any conflict between the terms of this Agreement and any other agreement, this
Agreement shall prevail (as between the parties to this Agreement and as
between any members of the Seller Group and any members of the Purchaser Group)
unless (i) such other agreement expressly states that it overrides this
Agreement in the relevant respect and (ii) the Seller and the Purchaser
are either also parties to that other agreement or otherwise expressly agree in
writing that such other agreement shall override this Agreement in that
respect.

 

29.                               WHOLE AGREEMENT

 

29.1                           This Agreement and the other
Transaction Documents together set
out the whole agreement between the parties in respect of the sale and purchase
of the Shares and the Businesses and supersede any prior agreement (whether
oral or written) relating to the Proposed Transactions. It is agreed that:

 

17

 

(a)                                  no party shall have any claim
or remedy in respect of any statement, representation, warranty or undertaking
made by or on behalf of any other party (or any of its Connected Persons) in
relation to the Proposed Transactions which is not expressly set out in this
Agreement or any other Transaction Document;

 

(b)                                 any terms or conditions
implied by law in any jurisdiction in relation to the Proposed Transactions are
excluded to the fullest extent permitted by law or, if incapable of exclusion,
any right, or remedies in relation to them are irrevocably waived;

 

(c)                                  the only right or remedy of a
party in relation to any provision of this Agreement or any other Transaction
Document shall be for breach of this Agreement or the relevant Transaction
Document; and

 

(d)                                 except for any liability in
respect of a breach of this Agreement or any other Transaction Document, no
party (or any of its Connected Persons) shall owe any duty of care or have any liability in tort or
otherwise to any other party (or its respective Connected Persons) in relation
to the Proposed Transactions,

 

provided that
this clause shall not exclude any liability for (or remedy in respect of)
fraudulent misrepresentation. Each party agrees to the terms of this clause 29
on its own behalf and as agent for each of its Connected Persons. For the
purpose of this clause, Connected
Persons means (in relation to a party) the officers, employees,
agents and advisers of that party or any of its Affiliates.

 

30.                               WAIVERS, RIGHTS AND REMEDIES

 

Except as
expressly provided in this Agreement, no failure or delay by any party in
exercising any right or remedy relating to this Agreement or any of the
Transaction Documents shall affect or operate as a waiver or variation of that
right or remedy or preclude its exercise at any subsequent time. No single or
partial exercise of any such right or remedy shall preclude any further
exercise of it or the exercise of any other remedy.

 

31.                               COUNTERPARTS

 

This Agreement
may be executed in any number of separate counterparts, each of which is
an original but all of which taken together shall constitute one and the same
instrument.

 

32.                               VARIATIONS

 

No amendment
of this Agreement (or of any other Transaction Document) shall be valid unless
it is in writing and duly executed by or on behalf of all of the parties to it.

 

33.                               INVALIDITY

 

Each of the
provisions of this Agreement and the other Transaction Documents is severable.
If any such provision is held to be or becomes invalid or unenforceable in any
respect under the law of any jurisdiction, it shall have no effect in that
respect and the parties shall use all reasonable efforts to replace it in that
respect with a valid and enforceable substitute provision the effect of which
is as close to its intended effect as possible.

 

34.                               NO THIRD PARTY ENFORCEMENT
RIGHTS

 

A person who
is not a party to this Agreement shall have no right under any statutory
provision to enforce any of its terms.

 

18

 

35.                               GUARANTEE

 

35.1                           In consideration of the Seller
agreeing to sell the Businesses and the Target Company on the terms of this
Agreement, the Guarantor unconditionally and irrevocably guarantees:

 

(a)                                  the due, punctual and full performance
by the Purchaser (or any of its Affiliates, as the case may be) of all of
its obligations under this Agreement and the other Transaction Documents;

 

(b)                                 the payment by the Purchaser
(or any of its Affiliates, as the case may be) when due of any amount
payable under this Agreement and the other Transaction Documents,

 

as if the
Guarantor were the principal obligor under this Agreement and the other
Transaction Documents and not merely a surety.

 

35.2                           The Guarantor shall indemnify
the Seller against all reasonable costs which the Seller may pay or incur
in collecting or enforcing the payment of any amount payable by the Purchaser
(or any of its Affiliates, as the case may be) under this Agreement or the
other Transaction Documents.

 

35.3                           The guarantee set out in
sub-clause 35.1 is a continuing guarantee and shall remain in full force and
effect until all the obligations of the Purchaser (or any of its Affiliates, as
the case may be) guaranteed by this clause 35 have been discharged in
full. It is in addition to and shall not prejudice nor be prejudiced by any
other guarantee, indemnity or other security or right against any third party
which the Seller may have for the due performance of these obligations.

 

35.4                           Before making any demand under
sub-clause 35.1 the Seller shall make a written demand of the Purchaser (or any
of its Affiliates, as the case may be) specifying the payment or
obligation to be performed. If the demand is not fully satisfied within 2
Business Days of its receipt by the Purchaser (or any of its Affiliates, as the
case may be), the Seller shall be entitled to make written demand upon and
proceed directly against the Guarantor in respect of any specified payment or
obligation which is due for performance and remains unsatisfied.

 

35.5                           The Guarantor acknowledges
that its liability under this clause 35 shall not be discharged or affected in
any way by time or any other indulgence or concession being granted to the
Purchaser or by any other act, omission, dealing, matter or thing whatsoever
(including without limitation any change in the memorandum or articles of
association of the Purchaser (or any of its Affiliates, as the case may be)
or the Guarantor, any amendment to this Agreement or any other Transaction
Document or the liquidation, dissolution, reconstruction or amalgamation of the
Purchaser (or any of its Affiliates, as the case may be) or the Guarantor
or the illegality or enforceability of this Agreement or any other Transaction
Document) which but for this provision might operate to release the Guarantor
from its obligations under this clause 35.

 

36.                               GOVERNING LAW AND
JURISDICTION

 

36.1                           This agreement and the legal
relationships established by or otherwise arising in connection with this
agreement shall be governed by, and interpreted in accordance with, English
law.

 

36.2                           If any dispute, controversy or
claim arises out of or in connection with this agreement including the breach,
termination or invalidity thereof (Dispute), the Purchaser or the Seller may serve
formal written notice on the other party that a Dispute has arisen (a Notice of

 

19

 

Dispute). The Notice of Dispute shall describe the
material points of the Dispute in sufficient detail to enable the parties to
reach an amicable settlement pursuant to the procedure set out in the remaining
provisions of this clause 36.

 

36.3                           Following the service of a
Notice of Dispute, the parties shall use all reasonable endeavours to settle
such Dispute amicably through negotiations between their respective authorised
representatives within a period of thirty (30) days starting from the date of
receipt of the Notice of Dispute by the relevant party. The Seller and the
Purchaser may by written agreement extend such thirty (30) day period and
take all such other steps as they mutually agree will assist them in reaching
an amicable settlement of the Dispute, including the joint appointment of a
person who is an expert in the subject matter of the Dispute.

 

36.4                           If the Dispute is not resolved
by the signing of written terms of settlement by authorised representatives of
the relevant parties within such thirty (30) day period (or such longer period
as may have been agreed between them) as provided under clause 36.3, then
the Dispute shall be finally settled under the Rules of Arbitration of the
International Chamber of Commerce by three arbitrators appointed in accordance
with the said Rules. The seat of the arbitration shall be London. The language
of the arbitration shall be English.

 

AS WITNESS THIS AGREEMENT HAS BEEN EXECUTED AND DELIVERED AS A DEED ON BEHALF OF THE PARTIES THE
DAY AND YEAR FIRST BEFORE WRITTEN.

 

20

 

CONFORMED
COPY

 

SCHEDULE 1

 

THE BUSINESSES

 

PART A
: CATEGORIES OF BUSINESSES ASSETS

 

The Businesses
include the following (but in each case exclude the Excluded Assets and the
Excluded Liabilities):

 

(a)                                  the Properties;

 

(b)                                 Business Loose Plant and
Equipment;

 

(c)                                  Stock;

 

(d)                                 Trade Debtors as at Closing;

 

(e)                                  benefit of all Business
Contracts;

 

(f)                                    Business Claims;

 

(g)                                 Business Information;

 

(h)                                 Owned IP, the Trade Name and
the Service Mark;

 

(i)                                     IT Systems used by the Seller
that relate exclusively to the Businesses; and

 

(j)                                     Business Goodwill,

 

(together the Business Assets).

 

PART B
: EXCLUDED ASSETS

 

1.                                       The Excluded Contracts
(including any amounts due under the Excluded Contracts and any assets or
rights provided or licensed under the Excluded Contracts.

 

2.                                       Non-Exclusive
Information.

 

3.                                       Any cash (whether at bank or
in hand) or cash equivalents owned by any member of the Seller Group.

 

4.                                       The benefit of any insurance
policies held by the Seller Group which relate to the Target Enterprise or
otherwise to the Target Company.

 

5.                                       Any information and
communication systems (including hardware and software) which are used at
Closing in relation to the Businesses and which are located in premises
occupied by a member of the Seller Group which are not Properties.

 

6.                                       Any right of any member of the
Seller Group to repayment of tax and the benefit of any other claim in respect
of tax.

 

21

 

7.                                       The benefit any
member of the Seller Group has of any prepayments made prior to Closing in
relation to insurance.

 

8.                                       For the avoidance
of doubt, the waste licences, data protection registrations and other licences
or permits issued by, or registrations with, any governmental authority in
relation to the Businesses.

 

9.                                       Any right or
benefit in relation to any items to the extent that, in the Seller’s accounting
system, they would fall within any of the accounting codes in the accounting
records of the Seller with the following names:

 

(a)                                  Rent Restatement
Provision;

 

(b)                                 Q1 Overcharge;

 

(c)                                  Q2 Charge to
Branch for rent awaiting invoices;

 

(d)                                 Q2 Rates variance
– pending confirmation of budget.

 

10.                                 The shares in
Allied Pickfords Limited.

 

11.                                 The names “Pickfords”
and “Pickfords Records Management”.

 

12.                                 The domain name
www.pickfordsrm.com.

 

13.                                 Save as provided
in Schedule 8, all property interests in the New Lease Properties and the
New Underlease Consent Properties.

 

14.                                 The shares in
Irish Security Archives Limited (Northern Ireland) and GB Nationwide Crate Hire
Limited.

 

PART C : EXCLUDED CONTRACTS

 

1.                                       Any contracts of
the Seller to the extent that they relate to Excluded Business Debt.

 

2.                                       Site Facility
Agreements to the extent that they relate to the New Lease Properties and the
New Underlease Consent Properties.

 

3.                                       All Business
Contracts (for the avoidance of doubt, other than Site Facility Agreements) to
the extent that they relate to the purchasing or procurement of goods or stocks
in connection with the Businesses.

 

4.                                       The contracts and
arrangements relating to the “Oracle” Financial Software package used in
relation to the Target Enterprise.

 

5.                                       Bank accounts in
the name of the Seller.

 

 

22

 

PART D : EXCLUDED
LIABILITIES

 

1.                                       Any liabilities
under the Excluded Contracts, including any Excluded Business Debt owed by the
Seller.

 

2.                                       Any tax for which
any member of the Seller Group is liable in respect of any Business or Business
Asset.

 

3.                                       Any liability in
respect of insurance premiums accrued for as at the Closing Date.

 

4.                                       Any liability of
the Seller in respect of pension, retirement indemnity or other post-retirement
benefits in relation to any of the Employees as at the Closing Date.

 

5.                                       Any audit fees
outstanding as at the Closing Date.

 

6.                                       Any liabilities
of the Seller in respect of Trade Creditors as at the Effective Date, other
than Capital Creditors.

 

7.                                       Any liability in
relation to any items to the extent that, in the Seller’s accounting system,
they would fall within any of the accounting codes in the accounting records of
the Seller with the following names:

 

(a)                                  A/P Vendor;

 

(b)                                 Remittance
Control;

 

(c)                                  A/P Overpayments
to Accounts Payable;

 

(d)                                 Accrued Other;

 

(e)                                  Accr Pay –
Facilities (PLH);

 

(f)                                    NI on cars;

 

(g)                                 Maintenance
accrual;

 

(h)                                 Telecom
Provision;

 

(i)                                     Other (Comms
Cost);

 

(j)                                     Accr Pay – Comms.

 

8.                                       Any liability on
the part of the tenant of the existing leases held by a Seller Group Company of
each Existing Business Property which is also (i) a Leasehold Property and (ii)
either a New Lease Property or a New Underlease Consent Property (but without
prejudice to the obligations and Liabilities of the Purchaser pursuant to
Schedule 8 and the terms of the New Leases and New Underleases).

 

9.                                       Any liability of
the freehold owner of each Existing Business Property which is held freehold by
a Seller Group Company and which is also a New Lease Property (but without
prejudice to the obligations and Liabilities of the Purchaser pursuant to
Schedule 8and the terms of the New Leases).

 

23

 

10.                                 Any liability on
the part of the tenant of the existing leases of each Existing Business
Property which is also an Assignment Consent Property to pay rent, estate
service charge, business rates and insurance prior to the Effective Date.

 

11.                                 Any liability to
the extent (but not otherwise) that it arises from a breach by the Seller of
any of the Business Contracts prior to the Closing Date.

 

References in Parts B to D of
this Schedule 1 to the Seller Group or any member of the Seller Group
shall not, for the avoidance of doubt, be taken to refer to the Target Company.

 

24

 

SCHEDULE 2

 

SELLER
WARRANTIES

 

In this Schedule where a
statement is made referring to the Seller it shall be construed as including a
reference, and applying, to the Businesses and not to any other business of the
Seller.

 

PART A :
GENERAL/COMMERCIAL

 

1.              The Seller Group, the Shares
and the Businesses

 

1.1         Authorisations, valid
obligations, filings and consents.

 

(a)                                  The Seller has
obtained all corporate authorisations and (other than to the extent relevant to
the Conditions) all other governmental, statutory, regulatory or other consents,
licences or authorisations required to empower it to enter into and perform its
obligations under this Agreement where failure to obtain them would adversely
affect to a material extent its ability to enter into or perform its
obligations under this Agreement.

 

(b)                                 Entry into and
performance by each member of the Seller Group of this Agreement and/or any
Transaction Document to which it is a party will not (i) breach any provision
of its memorandum and articles of association, by-laws or equivalent constitutional
documents; or (ii) (subject to fulfilment of the Conditions) result in a breach
of any laws or regulations in its jurisdiction of incorporation or of any
order, decree or judgment of any court or any governmental or regulatory
authority, where (in either case) the breach would adversely affect to a
material extent its ability to enter into or perform its obligations under this
Agreement.

 

1.2         The Seller Group, the Shares
and the Businesses.

 

(a)                                  Each of the
Seller and the Target Company is validly incorporated, in existence and duly
registered under the laws of its jurisdiction of incorporation and has full
power under its memorandum or articles of association, by-laws or equivalent
constitutional documents to conduct its business as conducted at the date of
this Agreement.

 

(b)                                 The Seller is or
will at Closing be entitled to transfer (or procure the transfer of) the Shares
on the terms of this Agreement.

 

(c)                                  All the Shares
are fully paid or properly credited as fully paid and the Seller is or will at
Closing be the sole legal and beneficial owner of the Shares free from all
Third Party Rights.

 

(d)                                 No member of the
Seller Group has entered into any agreement whereby any person has the right
(exercisable now or in the future and whether contingent or not) to call for
the issue of any share or loan capital in the Target Company.

 

(e)                                  The Shares
constitute the whole of the issued share capital of the Target Company.

 

25

 

(f)                                    The information
on the Target Company set out in Exhibit 2 is accurate in all material
respects.

 

1.3         The Businesses. The Seller has or will at
Closing have the right, title and authority to sell to the Purchaser the legal
and beneficial ownership of all material Business Assets comprised in the
Businesses as detailed in Schedule 1 Part A free from all Third Party
Rights other than Permitted Encumbrances.

 

1.4         Other interests. The Target
Company neither owns nor has any interest of any nature in any shares,
debentures or other securities issued by any undertaking.

 

2.              Financial Matters

 

2.1         Transactions Foundations
Databook Appendix. The Transactions Foundations Databook Appendix has
been prepared in all material respects in accordance with the policies and
methods set out in the Transactions Foundations Databook Appendix (or, to the
extent that the treatment or characterisation of the amount or item concerned
or any equivalent item or amount is not dealt with in the Transactions
Foundations Databook Appendix, then in accordance with UK GAAP as at 21 May
2005) and the Transactions Foundations Databook Appendix does not materially
misrepresent the state of affairs of the Businesses and the assets and
liabilities of the Businesses as at 21 May 2005.

 

2.2         Position with regard to the
Businesses since 21 May 2005. Since 21 May 2005, the
Businesses have been carried on in the ordinary course.

 

2.3         The Last Accounts. The Last
Accounts fairly present the state of affairs of the Target Company and its
assets and liabilities as at the Last Accounts Date and the results thereof for
the financial year ended on the Last Accounts Date.

 

2.4         Position of the Target Company
since Last Accounts Date. Since the Last Accounts Date:

 

(a)                                  the Target
Company has carried on business in the ordinary course;

 

(b)                                 the Target
Company has not declared, authorised, paid or made any dividend or other
distribution, nor has it reduced paid-up share capital (except for any
dividends provided for in the Accounts);

 

(c)                                  the Target
Company has not issued or agreed to issue any share or loan capital;

 

(d)                                 the Target
Company has not repaid any borrowing or indebtedness in advance of its stated
maturity.

 

2.5         Statutory books. The statutory
books of the Target Company and
of the Seller required to be kept by applicable laws in its jurisdiction of
incorporation have been maintained in all material respects in accordance with
such laws.

 

26

 

3.              Financial Debt

 

3.1         The Target Company does not
owe any material Financial Debt to any person outside the Seller Group.

 

4.              Regulatory Matters

 

4.1         Licences. Neither the
Seller nor the Target Company has received any written notice from a
Governmental Entity in the 12 months prior to the date of this Agreement
alleging that the Seller or the Target Company has not obtained a material
licence, permission, authorisation (public or private) or consent required for
carrying on the Target Enterprise effectively in the places and in the manner
in which it is carried on at the date of this Agreement in accordance with all
applicable laws and regulations. A licence, permission, authorisation or
consent is material for
this purpose if failure to obtain it would have a cost (including, for these
purposes, a loss of profit) to the Target Enterprise of £65,000 or more.

 

4.2         Compliance. So far as the
Seller is aware, in the 12 months prior to the date of this Agreement:

 

(a)                                  the Seller and
the Target Company have conducted its business and corporate affairs in all
material respects in accordance with its memorandum and articles of
association, by-laws or other equivalent constitutional documents; and

 

(b)                                 there has been no
default by the Seller or the Target Company under any order, decree or judgment
of any court or any governmental or regulatory authority in the jurisdiction in
which it is incorporated which applies to the Target Enterprise (or any part of
it) where such default has had or is likely to have a cost (including, for
these purposes, a loss of profit) to the Target Enterprise of £65,000 or more.

 

5.              The Business Assets

 

For the purposes of this
paragraph 5, a material
asset shall
mean an asset with a book value in the Last Accounts of £65,000 or more but
does not include any of the Existing Business Properties or the Target Company
Properties.

 

5.1         Ownership. The Seller
and/or the Target Company owns or are entitled to use all the material assets
necessary to carry on the Target Enterprise in all material respects as
currently carried on. Neither the Seller nor the Target Company has (outside
the ordinary and normal course of business) disposed of, or agreed to dispose
of, any material asset of the Target Enterprise included in the Last Accounts.

 

5.2         Possession. So far as the
Seller is aware, the material assets of the Target Enterprise are in the
possession or under the control of the Target Company or the Seller.

 

27

 

6.              Contractual Matters

 

6.1         Material contracts. Neither the
Seller nor the Target Company is a party to any agreement:

 

(a)                                  under the terms
of which, as a direct result of the entry into and performance of the
Transaction Documents (i) any other party will be entitled to be relieved of
any material obligation or become entitled to exercise any material right
(including any termination or pre-emption right or other option) or (ii) the
Seller or the Target Company will be in material default, where such relief,
exercise or default is likely to have a cost (including, for this purpose, a
loss of profit) to the Target Enterprise of £65,000 or more;

 

(b)                                 which is material
and is not in the ordinary course of business;

 

(c)                                  which is material
and is with any member of the Seller Group and is not on an arm’s length basis;
or

 

(d)                                 which is a joint
venture, consortium, partnership or profit (or loss) sharing agreement.

 

6.2         Defaults. So far as the
Seller is aware, neither the Seller nor the Target Company has received written
notice in the 12 months prior to the date of this Agreement that it is in
material default under any contract to which it is a party; for this purpose, material means a
default which is likely to have a cost (including, for this purpose, a loss of
profit) to the Target Enterprise of £65,000 or more.

 

7.              Litigation and Investigations

 

7.1         Litigation. Neither the
Seller nor any Target Company is involved as a party in any material
litigation, arbitration or administrative proceedings and, so far as the Seller
is aware, no such proceedings have been threatened in writing by or against a
Target Company or the Seller. For this purpose:

 

(a)                                  material means proceedings which (if
successful) are likely to result in a cost, benefit or value to the Target
Enterprise of £65,000 or more; and

 

(b)                                 any proceedings
for collection by a Target Company or the Seller of debts arising in the
ordinary course of business and, for the avoidance of doubt, any proceedings in
respect of claims identified in the Disclosure Letter and/or Data Room as
insured claims are excluded.

 

7.2         Investigations. Neither the
Seller nor the Target Company has received written notice in the 12 months
prior to the date of this Agreement of any current or pending material (as
defined above) investigation by a Governmental Entity concerning the Target
Company or the Seller.

 

8.              Insolvency etc.

 

8.1         Winding up. No member of the
Seller Group or the Target Company has received any written notice that an
order has been made, petition presented or meeting 

 

28

 

convened for the winding up of the Seller or the
Target Company or for the appointment of any provisional liquidator.

 

8.2         Administration and
receivership. No member of the Seller Group or the Target Company
has received any written notice concerning the appointment of a receiver
(including any administrative receiver or the equivalent to a receiver or
administrative receiver in the relevant jurisdiction) in respect of the whole
or any material part of the property, assets and/or undertaking of the Target
Enterprise.

 

8.3         Voluntary arrangement etc. Neither the
Seller nor the Target Company has made any voluntary arrangement with any of
its creditors in the 2 years prior to the date of this Agreement.

 

PART B : IP/IT

 

1.                                       Business IP. Schedule 1 to
the Assignment of Intellectual Property sets out all Owned IP and is correct. The
licences of Intellectual Property Rights granted to, and by, the Target Company
or the Seller, and which are material to the Target Enterprise, are disclosed
in the Data Room. The Owned IP is not subject to any security interest, option,
mortgage, charge or lien.

 

2.                                       No infringement. Neither the
Seller nor the Target Company has, in the 12 months prior to the date of this
Agreement, received a written notice alleging that the operations of the Target
Enterprise infringe the Intellectual Property Rights of a third party or sent a
written notice alleging that a third party is infringing the Business IP.

 

3.                                       Information
technology. The IT Systems are owned by, or licensed or leased
to, the Target Company or the Seller. Copies or details of all material
licences and leases relating to the IT Systems have been disclosed in the Data
Room. Neither the Seller nor the Target Company has, in the 12 months prior to
the date of this Agreement, received written notice from a third party alleging
that the Target Company or the Seller is in default under licences or leases
relating to the IT Systems. So far as the Seller is aware, the IT Systems have
not, in the 12 months prior to the date of this Agreement, failed to any
material extent and the data that they process has not been corrupted to any
material extent.

 

4.                                       Data protection. In relation to
the Target Enterprise, neither the Seller nor the Target Company has, in the 12
months prior to the date of this Agreement, received a written notice alleging
that the Target Company or the Seller has not complied with applicable data
protection laws.

 

PART C : REAL
ESTATE

 

1.                                       General. The Existing
Business Properties and the Target Company Properties comprise all the land and
buildings owned, leased, controlled, occupied or used by the Target Company or
in respect of the Businesses, by the Seller Group.

 

29

2.                                       Possession and
occupation.

 

(a)                                  The Target
Company is in possession of the whole of each of the Target Company Properties
and a Seller Group Company is in possession of the whole of each of the
Existing Business Properties and none of the Target Company Properties and the
Existing Business Properties are vacant, and no other person is in or actually
or conditionally entitled to possession, occupation or use of any of the
Properties.

 

(b)                                 The principal use
of the Properties falls within Class B8 of the Town and Country Planning (Use
Classes) Order 1987 (as amended) with ancillary offices and commercial parking.

 

3.                                       Title. There is no
Third Party Right in or over or affecting any of the Existing Business
Properties or the Target Company Properties. No Existing Business Property or
Target Company Property is the subject of a subsisting contract for sale and
the Target Company is not party to any uncompleted agreement to acquire any
freehold or leasehold property. The Target Company or a Seller Group Company is
the sole beneficial owner of, and otherwise absolutely entitled to, each of the
Existing Business Properties and the Target Company Properties. The title deeds
to each of the Assignment Consent Properties and the Target Group Properties
are in the possession of the Seller and are free from Third Party Rights.

 

4.                                       Adverse Interests. So far as the
Seller is aware:

 

(a)                                  none of the
Existing Business Properties or the Target Company Properties is subject to any
matter which materially adversely affects the Target Company’s or Seller’s
ability to continue to carry on its existing business from any Existing
Business Property or the Target Company Property in the manner as at present;
and

 

(b)                                 neither the
Seller, a Seller Group Company nor the Target Company is in breach of any
covenant, restriction, condition or obligation (whether statutory or otherwise)
which is material and affects the Existing Business Properties or the Target
Company Properties and in respect of which a Seller Group Company has received
written notice.

 

5.                                       Outgoings. The Existing
Business Properties and the Target Company Properties are not subject to the
payment of any outgoings other than the usual rates and taxes and, in the case
of leaseholds, rent, insurance rent and service charge.

 

6.                                       Disputes. So far as the
Seller is aware, there are no disputes, claims, actions or complaints relating
to or in respect of the Existing Business Properties or the Target Company
Properties or their use.

 

7.                                       Planning Matters. So far as the
Seller is aware, the current use of each of the Existing Business Properties
and the Target Company Properties is an authorised use under any legislation
intended to control or regulate the use of land and any orders, bye-laws or
regulations made or granted under any of them and the Seller is not aware of
any outstanding material restrictions and conditions imposed by or pursuant to
such legislation which are yet to be complied with.

 

8.                                       Property Liabilities. The Target
Company has no actual or contingent obligation or liabilities in relation to
any freehold or leasehold property other than under its existing title to the
Target Company Properties.

 

9.                                       Leasehold Properties. In relation to
those Existing Business Properties and the Target Company Properties which are
leasehold:

 

30

 

(a)                                  there are no
subsisting notices served on behalf of the landlord alleging a material breach
of any covenants, conditions and agreements contained in the relevant leases,
on the part of the tenant or in any licences or approvals issued under such
leases and all rents due under any leases have been paid when due and the last
demand for rent if issued was unqualified;

 

(b)                                 no rent is
currently under review;

 

(c)                                  neither the
Seller, a Seller Group Company nor the Target Company has commuted any rent or
other payment or paid any rent or other payment ahead of the due date for
payment;

 

(d)                                 no surety has
been released, expressly or by implication; and

 

(e)                                  no tenancy is
being continued after the contractual expiry date whether pursuant to statute
or otherwise.

 

10.                                 Due Diligence and
information. The Seller has provided copies of all material deeds
and documents relating to the Seller Group’s or the Target Company’s interest
in or use of any of the Existing Business Properties or the Target Company
Properties, which in each case are accurate in all material respects.

 

11.                                 The replies to
the Agreed Form bundle of replies to enquiries referred to in paragraph 5.6 of
Schedule 8 are true, complete and accurate in all respects.

 

12.                                 None of the
Target Company Properties is or, within the last 7 years has been, a family
home within the meaning of the Family Home Protection Act 1976 (under the Law
of Ireland).

 

PART D :
ENVIRONMENTAL

 

For the purpose of this Part
D, material shall
be deemed to refer to facts, matters, circumstances, issues or events, which
have resulted in, or are likely to result in, an aggregate cost to the Target
Enterprise of £65,000 or more.

 

1.                                       Compliance with
Environmental Laws. So far as the Seller is aware:

 

(a)                                  neither the
Seller nor the Target Company is (nor has it been within the period of
3 years prior to Closing) in material breach of any Environmental Laws
relating to any activities or operations carried on at any site (a Site) owned or
occupied by the Seller or any Target Company in relation to the Target
Enterprise;

 

(b)                                 there are no
material claims or proceedings pending against the Seller or the Target Company
with respect to any breach of or liability under Environmental Laws relating to
the Target Enterprise; and

 

(c)                                  neither the
Seller nor the Target Company has received any written statutory complaints or
statutory notices alleging or specifying any material breach of or material
liability under any Environmental Laws relating to the Target Enterprise.

 

31

 

2.                                       Environmental
Consents. So far as the Seller is aware, all material
Environmental Consents required for any activities at any Site have been
obtained and are being complied with in all material respects.

 

3.                                       Environmental
Reports and Audits. So far as the Seller is aware, all reports and audits
commissioned by the Seller Group or the Target Company within the last 2 years
relating to Environmental Matters at any Site have been disclosed.

 

PART E :
EMPLOYMENT

 

1.                                       Employees. The Employees
comprise all persons employed by the Seller and the Target Company (i) in
relation to the Target Company and (ii) wholly or substantially in relation to
the Businesses, at the date of this Agreement.

 

2.                                       Data Room items. The Data Room
contains copies of the contracts of employment for all Key Managers and copies
of the standard terms and conditions of employment applicable to all Employees
of the Target Company and the Businesses.

 

3.                                       Trade Unions. The Data Room
contains copies of all current recognition, produced, collective of other
agreements between the Seller or Target Company and any trade union or other
body representing the Employees or any of them.

 

4.                                       Incentive schemes. Neither the
Seller nor the Target Company has, nor has any of them agreed to introduce, any
share incentive scheme, share option scheme or profit sharing, bonus, commission
or other such incentive scheme for any directors or Employees or other workers
engaged in the Target Enterprise.

 

5.                                       Notice on
termination. There exists no written or unwritten contract of
employment with any Employee that cannot be terminated by the Seller or the
Target Company on six months notice or less without giving rise to a claim for
damages or compensation (other than a statutory redundancy payment or statutory
compensation for unfair dismissal or, in either case, the equivalent in any relevant
jurisdiction).

 

6.                                       Records. The Data Room
contains details of Employees’ job titles, grades, salaries, ages, length of
service and notice periods.

 

7.                                       Disclosure of
retirement schemes etc. The Data Room contains details of all benefits
provided of general application or of application to a particular grade or
category of employee.

 

8.                                       Key Managers. No Key Manager
has given notice which has not yet expired terminating his or her employment.

 

9.                                       Amounts owing. There are no
amounts owing to any Employees in relation to the Businesses or the Target
Company (other than amounts representing remuneration accrued for the current
pay period or for reimbursement of reasonable business expenses). The only
entitlement to accrued but untaken holiday leave that the Employees have is in
relation to the current holiday year.

 

10.                                 Disputes. The Seller is
not involved, and has not during the 12 months prior to the date of this
Agreement been involved in any strike, lock out, industrial or trade dispute or
any 

 

32

 

negotiations with any trade
union or body of employees or workers in connection with the Businesses or the
Target Company.

 

11.                                 Compliance. The Seller has,
in relation to all Employees and former employees of the Businesses and the
Target Company, complied in all material respects with all statutes,
regulations and orders relating to employment and relations with employees and
trade unions and has complied in all material respects with all agreements for
the time being having effect as regards such relations or the conditions of
service of its employees (whether collectively or individually).

 

PART F :
RETIREMENT BENEFITS

 

1.                                       Retirement
Benefits/Seller Employee Benefit Plans. All Seller Employee Benefit
Plans are listed in the Disclosure Letter. Other than those Seller Employee
Benefit Plans (and any statutory social security plans operated under public
law, statute or regulation in the relevant jurisdiction), neither the Target
Company or any member of the Seller Group provides or contributes to or is
liable to provide or contribute to the provision of Retirement Benefits for or
in respect of any Employee.

 

2.                                       No Proposals. No proposal has
been announced and no agreement has been made to establish any other arrangement
for providing any Retirement Benefits or to continue or increase any Retirement
Benefits under any Seller Employee Benefit Plan for or in respect of any
Employee, or to maintain any such Retirement Benefits or the level of any such
Retirement Benefits generally for any period.

 

3.                                       Disclosure of
Documents. In the Data Room and/or the Disclosure Letter there
are:

 

(a)                                  all documents
containing material provisions currently governing each Seller Employee Benefit
Plan;

 

(b)                                 material
announcements that have not been incorporated into the documents referred to in
paragraph 4(a) and copies of all current explanatory booklets or summary plan
descriptions relating to each Seller Employee Benefit Plan;

 

which, in each case, are
accurate in all material respects as at the date of this Agreement.

 

4.                                       Payments in
respect of the Seller Employee Benefit Plans. The rates at which
contributions to each Seller Employee Benefit Plan are paid are set out in the
Data Room and/or the Disclosure Letter.

 

5.                                       Compliance. Each Target
Company and each member of the Seller Group and as far as the Seller is aware
the trustees, administrators, managers, custodians and fiduciaries (as
applicable) of each Seller Employee Benefit Plan currently comply in all
material respects with their respective obligations under the Seller Employee
Benefit Plans.

 

PART G : TAX

 

1.                                       Returns, payments
etc. The Target Company has duly, and within any appropriate time limits,
made all returns, given all notices and supplied all other information required
to 

 

33

 

be supplied to the relevant
tax authorities and made all payments required to be made to the relevant tax
authorities and has maintained all records required to be maintained for tax
purposes; all such information was and remains complete and accurate in all
material respects and all such returns and notices were and remain complete and
accurate in all material respects and were made on the proper basis and do not,
and so far as the Seller is aware are not likely to, reveal any transactions
which may be the subject of any dispute with, or any enquiry raised by, any tax
authority.

 

2.                                       Disputes,
investigations. So far as the Seller is aware, the Target Company is
not involved in any material current dispute with any tax authority nor is it
or has it in the last six years been the subject of any investigation or non-routine
visit by any tax authority. So far as the Seller is aware no investigation or
non-routine visit is planned by any tax authority in relation to the Target
Company.

 

3.                                       Residence/permanent
establishment. The Target Company is and has at all times been
resident for tax purposes in the Republic of Ireland and the United Kingdom and
is not and has not at any time been treated as resident in any other
jurisdiction for any tax purpose (including any double taxation arrangement). The
Target Company is not subject to tax in any jurisdiction other than the
Republic of Ireland or the United Kingdom by virtue of having a permanent
establishment or other place of business in that jurisdiction. The Target
Company is not liable for any tax as the agent of any other person or business
and does not constitute a permanent establishment of any other person, business
or enterprise for any tax purpose.

 

4.                                       Value added tax. So far as the
Seller is aware:

 

(a)                                  the Target
Company is registered for the purposes of value added tax in the Republic of
Ireland, has been so registered at all times in the last six years that it has
been required to be registered by value added tax legislation of the Republic
of Ireland, and such registration is not subject to any conditions imposed by
or agreed with the relevant tax authority; and

 

(b)                                 the Target
Company has complied with and observed in all material respects the terms of
value added tax legislation of the Republic of Ireland in the last six years.

 

5.                                       Stamp Duty. All documents in
the possession or under the control of the Seller or to the production of which
the Seller is entitled which establish or are necessary to establish the title
of the Seller to any Business Asset or under which the Seller has any rights
which relate to the Businesses have been duly stamped and any applicable stamp
duties or charges in respect of such documents have been duly accounted for and
paid, and no such documents which are outside the United Kingdom would attract
stamp duty if they were brought into the United Kingdom.

 

34

 

SCHEDULE 3

 

LIMITATIONS
ON LIABILITY

 

1.                                       Time Limits. The Seller shall
not be liable for any Claim unless the Seller receives from the Purchaser
written notice (within 30 days of the Purchaser becoming aware of such Claim)
containing reasonably specific details of the Claim including the Purchaser’s
estimate (on a without prejudice basis) of the amount of the Claim:

 

(a)                                  prior to 30 April
2007, in the case of a Non-Tax Claim; or

 

(b)                                 prior to the
sixth anniversary of the date of this Agreement, in the case of a Tax Claim.

 

2.                                       Thresholds for
Claims. The Seller shall not be liable for any single Claim:

 

(a)                                  unless the amount
of the liability pursuant to that single Claim exceeds £65,000; and

 

(b)                                 unless the
aggregate amount of the liability of the Seller for all Claims not excluded by
sub-paragraph (a) exceeds an amount equal to 2.5% of the aggregate of the
Initial Business Price and the Initial Share Price, in each case as adjusted by
the Financial Adjustments only (in which case the Purchaser shall only be
entitled to claim for the excess over such amount).

 

3.                                       Maximum limit for
all Claims. The aggregate amount of the liability of the Seller
for all Claims shall not exceed an amount equal to 25% of the aggregate of the
Initial Business Price and the Initial Share Price, in each case as adjusted by
the Financial Adjustments only.

 

4.                                       Claim to be
withdrawn unless litigation commenced. Any Claim shall (if it has
not been previously satisfied, settled or withdrawn) be deemed to have been
withdrawn 6 months after the notice is given pursuant to paragraph 1 of
this Schedule or, in the case of a contingent liability, 6 months after
that liability becomes an actual liability, unless arbitration proceedings in
respect of it have been commenced by being both issued and served, in
accordance with clause 36.4. No new Claim may be made in respect of the
facts, matters, events or circumstances giving rise to any such withdrawn
Claim.

 

5.                                       Claims only to be
brought under relevant Warranties. The Purchaser acknowledges
and agrees that the only Warranties given in relation to:

 

(a)                                  Intellectual
Property Rights and information technology or any related claims, liabilities
or other matters (IPR
Matters) are set out in Part B of Schedule 2 and no
other Warranty is given in relation to IPR Matters;

 

(b)                                 real estate and
planning and zoning matters or any related claims, liabilities or other matters
(Real Estate Matters)
are those set out in of Part C of Schedule 2 and no other Warranty is
given in relation to Real Estate Matters;

 

(c)                                  Environment or
any related claims, liabilities or other matters (Environmental Matters) are those set out
in Part D of Schedule 2 and no other Warranty is given in relation to
Environmental Matters;

 

(d)                                 the employment of
any past or present employee of the Target Company or any member of the Seller
Group or any related claims, liabilities or other matters 

 

35

 

(Employee Matters)
are set out in Part E of Schedule 2 and no other Warranty is given in
relation to Employee Matters;

 

(e)                                  retirement
benefits, pensions or superannuation or any related claims, liabilities or
other matters (Retirement
Benefits Matters) are set out in Part F of Schedule 2
and no other Warranty is given in relation to Retirement Benefits Matters,

 

(f)                                    taxation or any
related claims, liabilities or other matters (Tax Matters) are those set out in
Part G of Schedule 2 and no other Warranty is given in relation to
Tax Matters.

 

6.                                       Matters disclosed. The Seller shall
not be liable for any Claim for breach of the Warranties if and to the extent
that the fact, matter, event or circumstance giving rise to such Claim is
fairly disclosed by this Agreement, any other Transaction Document, the
Disclosure Letter or any document disclosed in the Data Room.

 

7.                                       Matters provided
for or taken into account in adjustments. The Seller shall not be
liable for any Claim if and to the extent that the fact, matter, event or
circumstance giving rise to the Claim is disclosed, allowed, provided or
reserved for in the Last Accounts or the Databook Appendix or is provided for
or otherwise taken into account in the Effective Date Statement or any
consequent adjustment to the Initial Share Price or Initial Business Price.

 

8.                                       Contingent
liabilities. If any Claim is based upon a liability which is
contingent only,  the Seller shall not be
liable to make any payment unless and until such contingent liability gives
rise to an obligation to make a payment (but the Purchaser has the right under
paragraph 1 of this Schedule 3 to give notice of that Claim before
such time).

 

9.                                       No liability for
Claims arising from acts or omissions of Purchaser. The Seller shall
not be liable for any Claim to the extent that it would not have arisen but
for, or has been increased or not reduced as a result of, any voluntary act,
omission or transaction carried out:

 

(a)                                  after Closing by
the Purchaser or any member of the Purchaser Group (or its respective
directors, employees or agents or successors in title) outside the ordinary and
usual course of business of the Target Company as at Closing; or

 

(b)                                 before Closing by
any member of the Seller Group or the Target Company at the direction or
request of the Purchaser or any member of the Purchaser Group.

 

10.                                 Purchaser’s duty
to mitigate. The Purchaser shall procure that all reasonable steps
are taken to avoid or mitigate any loss or damage which it may suffer in
consequence of any breach by the Seller of the terms of this Agreement or any
fact, matter, event or circumstance likely to give rise to a Claim.

 

11.                                 Insured Claims. The Seller
shall not be liable in respect of any Claim to the extent that the amount of
such Claim (or any part of it) is recovered by the Purchaser under any policy
of insurance, and the amount for which the Seller is liable in respect of any
such Claim shall be reduced by an amount equal to the amount recovered by the
Purchaser. In the event that in relation to a Claim the Purchaser recovers an
amount under any policy of insurance having first received a payment from the
Seller (the Seller
Amount) in
respect of that Claim, the Purchaser shall repay to the Seller an amount equal
to the amount so recovered or an amount equal to the Seller Amount, whichever
is less.

 

12.                                 Recovery from
third party after payment from Seller. Where the Seller has made a
payment to the Purchaser in relation to any Claim and the Purchaser or any
member of the Purchaser Group is entitled to recover (whether by insurance,
payment, discount, credit, relief 

 

36

 

or otherwise) from a third
party a sum which indemnifies or compensates the Purchaser or any member of the
Purchaser Group (in whole or in part) in respect of the liability or loss which
is the subject of a Claim, the Purchaser or relevant member of the Purchaser
Group shall (i) promptly notify the Seller of the fact and provide such
information as the Seller may reasonably require (ii) take all reasonable steps
or proceedings as the Seller may require to enforce such right and (iii) pay to
the Seller as soon as practicable after receipt an amount equal to the amount
recovered from the third party (net of taxation and less any reasonable costs
of recovery).

 

13.                                 No liability for
legislation or changes in rates of tax. The Seller shall not be
liable for any Claim if and to the extent it is attributable to or the amount
of such Claim is increased as a result of any (i) legislation not in force at
the date of this Agreement (ii) change of law (or any change in interpretation
on the basis of case law), regulation, directive, requirement or administrative
practice or (iii) change in rates of taxation from the rates in force at the
date of this Agreement.

 

14.                                 No double
recovery. The Purchaser shall not be entitled to recover
damages or obtain payment, reimbursement, restitution or indemnity more than
once in respect of any one liability, loss, cost, shortfall, damage,
deficiency, breach or other set of circumstances which gives rise to more than
one Claim, and for this purpose recovery by the Purchaser shall be deemed to be
a recovery by each of them.

 

15.                                 Purchaser’s
knowledge. The Seller shall not be liable for any Claim for
breach of any of the Warranties if and to the extent that Mr Ken Madrid, Mr
David Muir, Mr Philip Britton, Mr Robert Foote, Mr Gary Maguire, Mr Nelson
Akinrinade or Mr Tze Shen Kong are actually aware at the date of this agreement
of the fact, matter, event or circumstance which is the subject matter of the
Claim and having regard to the circumstances actually known to such individuals
at the date of this agreement could reasonably have foreseen that the fact,
matter, event or circumstance would have given rise to a Claim.

 

16.                                 Waiver of right
of set-off. The Purchaser waives and relinquishes any right of
set-off or counterclaim, deduction or retention which the Purchaser might
otherwise have in respect of any Claim against or out of any payments which the
Purchaser may be obliged to make (or procure to be made) to the Seller pursuant
to this Agreement or otherwise.

 

17.                                 Seller to have
opportunity to remedy breaches. If a breach of the Warranties
is capable of remedy, the Purchaser shall only be entitled to compensation if
it gives the Seller written notice of the breach and the breach is not remedied
within 30 days after the date on which such notice is served on the Seller. Without
prejudice to its duty to mitigate any loss, the Purchaser shall (or shall
procure that any relevant member of the Purchaser Group shall) provide all
reasonable assistance to the Seller to remedy any such breach.

 

18.                                 Consequential
losses. The Seller shall not be liable in relation to any Claim for any loss of
profits, business, anticipated savings or goodwill or any indirect or
consequential loss or damage of any kind.

 

37

 

SCHEDULE 4

 

PURCHASER
WARRANTIES

 

1.                                       The Purchaser is
validly incorporated, in existence and duly registered under the laws of its
jurisdiction and has full power to conduct its business as conducted at the
date of this Agreement.

 

2.                                       The Purchaser has
obtained all corporate authorisations and (other than to the extent relevant to
the Conditions) all other governmental, statutory, regulatory or other
consents, licences and authorisations required to empower it to enter into and
perform its obligations under this Agreement where failure to obtain them would
adversely affect to a material extent its ability to enter into and perform its
obligations under this Agreement.

 

3.                                       Entry into and
performance by each member of the Purchaser Group of this Agreement and/or any
Transaction Document to which it is a party will not (i) breach any provision
of its memorandum and articles of association, by-laws or equivalent
constitutional documents or (ii) (subject, where applicable, to fulfilment of
the Conditions) result in a breach of any laws or regulations in its
jurisdiction of incorporation or of any order, decree or judgment of any court
or any governmental or regulatory authority, where (in either case) the breach
would adversely affect to a material extent its ability to enter into or
perform its obligations under this Agreement and/or any Transaction Document to
which it is a party.

 

4.                                       Neither the
Purchaser nor any Affiliate is insolvent or bankrupt under the laws of its
jurisdiction of incorporation, unable to pay its debts as they fall due or has
proposed or is liable to any arrangement (whether by court process or
otherwise) under which its creditors (or any group of them) would receive less
than the amounts due to them. There are no proceedings in relation to any
compromise or arrangement with creditors or any winding up, bankruptcy or
insolvency proceedings concerning the Purchaser or any of its Affiliates and no
events have occurred which would justify such proceedings. No steps have been
taken to enforce any security over any assets of the Purchaser or any of its
Affiliates and no event has occurred to give the right to enforce such
security.

 

5.                                       So far as the
Purchaser is aware, neither the Purchaser nor any Affiliate is subject to any
order, judgment, direction, investigation or other proceedings by any
Governmental Entity which will, or are likely to, prevent or delay the
fulfilment of any of the Conditions.

 

6.                                       The Purchaser has
available cash or available loan facilities which will at Closing provide in
immediately available funds the necessary cash resources to pay the Initial Cash
Price and meet its other obligations under this Agreement and, in the case of
loan facilities, they involve no material pre-conditions and the Purchaser will
be able to satisfy all conditions of drawdown to such loan facilities at or
prior to Closing.

 

38

 

SCHEDULE 5

 

CONDUCT OF
THE TARGET ENTERPRISE PRE-CLOSING

 

1.                                       From the date of
this Agreement until Closing, the Seller shall (unless otherwise required or
permitted by the terms of any Transaction Document or as may be approved by the
Purchaser, such approval not to be unreasonably withheld or delayed) ensure
that:

 

(a)                                  No agreement is
entered into to vary, renew or revoke any agreement, lease, licence or other
agreement relating to the occupation of the Target Company Properties;

 

(b)                                 the Target
Company does not declare or pay any dividend or other distribution (whether in
cash, stock or in kind) or reduces its paid-up share capital;

 

(c)                                  the Target
Company does not issue or agree to issue or allot any share capital;

 

(d)                                 all transactions
between the Target Company and any member of the Seller Group take place in a
manner and on terms consistent with previous practice in the 12 months prior to
the date of this Agreement;

 

(e)                                  no member of the
Seller Group or the Target Company (i) employs or agrees to employ any new
persons fully or part time in a senior managerial capacity in the Target
Enterprise or (ii) make changes (other than those required by law) in terms of
employment (including pension fund commitments) in each case in circumstances
which are likely to increase in aggregate the total staff costs of the Target
Enterprise by more than 15% per annum;

 

(f)                                    neither the
Seller nor the Target Company enters into or terminates any contract in
relation to the Target Enterprise which has an annual value or is likely to
involve expenditure in excess of £65,000 per annum or which cannot be performed
within its terms within 3 years after the date on which it is entered into;

 

(g)                                 neither the
Seller nor the Target Company:

 

(i)                  institutes or settles any
litigation in relation to the Target Enterprise (except for collection in the
ordinary course of trading debts) where that action is likely to result in a
payment to or by the Target Company or the Seller of £65,000 or more; or

 

(ii)               institutes or
settles any litigation for collection in the ordinary course of any trading
debt in relation to the Target Enterprise which exceeds £65,000;

 

(h)                                 neither the
Seller nor the Target Company creates any Third Party Right over the Shares,
Business Assets or the shares or assets of the Target Company other than a
Permitted Encumbrance.

 

2.                                       The Purchaser
shall not exercise any of its rights pursuant to this Schedule 5
(including the right to refuse to approve any particular transaction or action)
in such a manner as could disrupt unreasonably the efficient operations of the
Target Company or the Business.

 

39

 

SCHEDULE 6

 

CLOSING
ARRANGEMENTS

 

PART A : SELLER
OBLIGATIONS

 

1.                                       At Closing, the
Seller shall deliver or ensure that there is delivered to the Purchaser (or
made available to the Purchaser’s reasonable satisfaction):

 

(a)                                  duly executed
transfers into the name of the Purchaser in respect of all the Shares;

 

(b)                                 the share certificates
relating to all the Shares;

 

(c)                                  the resignation
of each director, company secretary and auditor of the Target Company as may be
notified by the Purchaser not later than 7 Business Days prior to Closing;

 

(d)                                 a copy (certified
by a duly appointed officer as true and correct) of a resolution of the board
or, as applicable, supervisory board of directors of the Seller (or, if
required by the law of its jurisdiction or its articles of association, by-laws
or equivalent constitutional documents, of its shareholders) authorising the
execution of and the performance by the Seller of its obligations under this
Agreement and each of the Transaction Documents to be executed by it;

 

(e)                                  an irrevocable
power of attorney in the Agreed Form whereby the Purchaser is appointed as the
attorney of the Seller to receive notice of and to attend and vote at any
meetings of the Target Company, during the period following Closing that the
Seller remains the registered holder of the Shares;

 

(f)                                    a copy of the
board minutes of the Target Company approving (i) the resignations referred to
in paragraph 1(c) above; (ii) the transfer referred to in paragraph 1(a) above
and (iii) the appointments of any additional directors notified to the Seller
by the Purchaser not later than 7 Business Days prior to Closing; and

 

(g)                                 subject to the
provisions of Schedule 8, possession of the Business Properties and of the
other tangible Business Assets agreed to be sold under this Agreement.

 

PART B : PURCHASER
OBLIGATIONS

 

1.                                       At Closing, the
Purchaser shall:

 

(a)                                  deliver (or
ensure that there is delivered to the Seller) a copy of a resolution (certified
by a duly appointed officer as true and correct) of the board or, as
applicable, supervisory board of directors of the Purchaser and the Guarantor
(or, if required by the law of their respective jurisdictions or their articles
of association, by-laws or equivalent constitutional documents, of their
respective shareholders) authorising the execution of and the performance by
the relevant company of its obligations under this Agreement and each of the
Transaction Documents to be executed by it;

 

40

 

(b)                                 deliver a legal
opinion in a form which is customary and reasonably acceptable
to the Seller from a recognised and reputable Hong Kong law firm in relation to
the Guarantor and its entry into, and performance of its obligations under, the
Agreement and the documents that are contemplated to be entered into
pursuant to Schedule 8, for the benefit of the Seller and the
first purchaser of the reversionary freehold interest to New
Lease Properties and the reversionary headlease interest in the New Underlease
Consent Property at Edinburgh covering, without limitation, due execution,
capacity, and recognition and enforcement of judgments (including for a
sum of money) in the English Courts without any requirement for a new
hearing on the issue;

 

(c)                                  pay to the
Seller:

 

(i)  the amount in
US Dollars which results from converting the Notified Conversion Amount (as defined
in Part C below) into US Dollars using the spot rate of exchange as between
pounds sterling and US Dollars (closing mid-point) on 24 March, 2006, as
quoted in the Asian edition of the Financial Times first published after that
date or, where no such rate is published in respect of that currency for such
date, at the rate quoted by HSBC as at the close of business in London on 24
March, 2006; and

 

(ii)  the amount in
sterling which is equal to the Notified Sterling Amount (as defined in Part C
below);

 

(d)                                 (other than if
the Closing Date is 30 March, 2006) if the Closing Date is not the Effective
Date, pay to the Seller an amount in sterling (the Interest Amount)
equivalent to interest (calculated on a daily basis) at the Interest Rate on
the Initial Cash Price from and including the day following the Effective Date
to and including the Closing Date.

 

PART C : GENERAL

 

1.                                       The Seller and
the Purchaser shall negotiate in good faith with a view to agreeing before the
Closing Date the final form of any Transaction Document which is not in Agreed
Form at the date of this Agreement. If not so agreed by the Closing Date, the
Transaction Document shall be in the form reasonably specified by the Seller
provided it is consistent with the terms of this Agreement.

 

2.                                       At or before
Closing, the Seller and the Purchaser shall execute and deliver to each other
(or procure that their relevant Affiliates shall execute and deliver) the
following other documents in the Agreed Form required by this Agreement to be
executed on or before Closing, namely:

 

(i)             the Crate Hire Agreement;

 

(ii)          the Assignment of
Intellectual Property;

 

(iii)       the Transitional Services
Agreement;

 

(iv)      the Licence Agreement;

 

(v)         the power of attorney referred
to in Part A, 1(e) above;

 

41

 

(vi)      the notice to suppliers and
customers referred to in clause 19.1; and

 

(vii)   the Agreed Form documents
referred to in Schedule 8.

 

3.                                       All documents and
items delivered at Closing pursuant to this Schedule 6 shall be held by
the recipient to the order of the person delivering the same until such time as
Closing shall be deemed to have taken place. Simultaneously with:

 

(a)                                  delivery of all
documents and all items required to be delivered at Closing (or waiver of its delivery
by the person entitled to receive the relevant document or item); and

 

(b)                                 receipt of an
electronic funds transfer to the Seller’s Bank Account in immediately available
funds of the Initial Cash Price,

 

the documents and items
delivered in accordance with this Schedule shall cease to be held to the order
of the person delivering them and Closing shall be deemed to have taken place.

 

4.                                       Except as
otherwise provided in this Schedule 6, title to all Business Assets
(excluding New Businesses Properties) which are capable of transfer by delivery
shall pass by delivery.

 

5.                                       In the event that
the Closing Date is 30 or 31 March, 2006, the Purchaser, the Guarantor and the
Seller shall, on or prior to 29 March, 2006, execute, and deliver all documents
respectively to be entered into by them at Closing to their respective
solicitors to hold to their respective client’s order pending Closing.

 

6.                                       The Seller shall,
no later than close of business in Chicago on 24 March, 2006, notify the
Purchaser in writing of:

 

(a)                                  the proportion
(if any) of the Initial Cash Price (as reduced, if applicable, pursuant to
paragraph 7(a) of Part C of this Schedule 6) which it wishes to
receive in sterling (the Notified
Sterling Amount); and

 

(b)                                 the proportion
(if any) of the Initial Cash Price (as reduced, if applicable, pursuant to
paragraph 7(a) of Part C of this Schedule 6) which it wishes to
receive in US Dollars (the Notified
Conversion Amount).

 

If the Seller has not served
such a notice by that date, then the Notified Conversion Amount shall be deemed
to be zero and the Notified Sterling Amount shall be deemed to be the amount in
sterling equal to the Initial Cash Price (as reduced, if applicable, pursuant
to paragraph 7(a) of Part C of this Schedule 6).

 

7.                                       In the event that
the Closing Date is 30 March, 2006:

 

(a)                                  the Initial Cash
Price shall be reduced by an amount equal to one day’s interest at the Interest
Rate on the Initial Cash Price and the Initial Business Price shall be treated
as reduced accordingly; and

 

(b)                                 the conversion
rate used in the calculation of the amount in US Dollars to be paid pursuant to
paragraph 1(c)(i) above shall be the rate taken from 23 March 2006 rather than
24 March 2006; and

 

(c)                                  the latest date
for the Seller to serve a notice under paragraph 6 above shall be close of
business in Chicago 23 March 2006 rather than 24 March 2006.

 

42

 

SCHEDULE 7

 

BUSINESS
CONTRACTS

 

43

 

SCHEDULE 8

 

BUSINESS
PROPERTIES AND TARGET COMPANY PROPERTIES

 

44

 

SCHEDULE 9

 

POST-CLOSING
FINANCIAL ADJUSTMENTS

 

PART A :
PRELIMINARY

 

1.                                       In this Agreement
(subject, where applicable, to the remaining provisions of this Part A), Working Capital means
the aggregate working capital of the Target Company and (in relation to the
Businesses) the Seller as at the Effective Date, comprising each of the line
items set out in the Annex to this Schedule 9 against which there is a
cross in the “Measured” column of Part B or Part C of that Annex, as
applicable, and no others. For the avoidance of doubt, but subject in each case
to paragraph 2 below, Working Capital includes all Trade Creditors of the
Target Company, all Trade Debtors and all interest (except on Financial Debt or
cash at bank) payable or receivable accrued, in each case as at the Effective
Date.

 

2.                                       None of the
following are included in Working Capital and, accordingly, none of them shall
be included in the Effective Date Statement:

 

(a)                                  Excluded Assets
or Excluded Liabilities of the Seller;

 

(b)                                 any record of, or
provision or accrual for, any liability of the Seller or the Target Company in
respect of pension, retirement indemnity or other post-retirement benefits;

 

(c)                                  any accrual in respect
of employee bonuses;

 

(d)                                 any amount in
respect of deferred tax (whether as a liability or an asset);

 

(e)                                  any amount in
respect of corporation tax, amount in respect of group relief or any other
amount in respect of tax on income, profits or gains (whether as a creditor,
provision, debtor or otherwise);

 

(f)                                    Capital
Creditors;

 

(g)                                 for the avoidance
of doubt, the Assumed Business Debt and any liability which the Target Company
has in relation to any finance lease;

 

(h)                                 any provision or
accrual for audit fees;

 

(i)                                     in relation to
the Businesses only, any liability in relation to any items to the extent that,
in the Seller’s accounting system, they would fall within any of the accounting
codes in the accounting records of the Seller with the following names:

 

(i)           AR - Accrued Revenue;

 

(ii)        Prepaid mobile phone;

 

(iii)     Other prepayments – external;

 

(j)                                     any Costs
incurred by the Seller or the Target Company in connection with the Proposed
Transactions;

 

83

 

(k)                                  any cash at bank
or in hand save for any amount to be included in the line items entitled “A/R -
Customer” (Account Code 1611/12) or “A/R – Unidentified Cash” (Account Code
1641) in the calculation for the Target Company; and

 

(l)                                     any amount in respect
of inventory.

 

3.                                       In preparing the
Effective Date Statement:

 

(a)                                  the items and
amounts to be included in the calculation of Working Capital for the purposes
of the Effective Date Statement shall be identified by applying the definition
in paragraph 1 above (subject, where applicable, to the provisions of
Part A of this Schedule);

 

(b)                                 in applying that
definition and the provisions of Part A of this Schedule and determining
which items and amounts are to be included in the Effective Date Statement, if
and to the extent that the treatment or characterisation of the relevant, or
any equivalent, item or amount or type or category of item or amount:

 

(i)           is dealt with in the
accounting principles, policies, treatments, practices and categorisations as
set out in the Transactions Foundations Databook Appendix (the Accounting Principles)
the applicable Accounting Principle(s) shall apply (including in relation to
the exercise of accounting discretion and judgement); and

 

(ii)        is not dealt with in the
Accounting Principles, UK GAAP as at the Effective Date shall apply.

 

4.                                       For the purposes
of calculating Working Capital, any amounts which are to be included in such
calculation which are expressed in a currency other than sterling shall be
converted into sterling at the Exchange Rate as at the Effective Date.

 

5.                                       Information
available for Effective Date Statement. Information available up
until the date of delivery of the draft of the Effective Date Statement under
paragraph 1 of Part B below shall be taken into account insofar as it provides
evidence of the state of affairs of the Target Enterprise at the Effective
Date.

 

6.                                       No re-appraisal
of asset values. The Effective Date Statement shall not re-appraise
the value of any of the assets of the Target Company or the Businesses or
Business Assets as a result of the change in their ownership (or any changes in
the business of the Target Company or either of the Businesses since the
Effective Date, following such change in ownership) except only as specifically
set out in this Schedule.

 

PART B : EFFECTIVE
DATE STATEMENT

 

1.                                       The Seller shall,
or shall procure that the Seller’s accountants shall, after the Effective Date,
prepare a draft statement (the Effective Date Statement) showing the Working Capital of
the Target Enterprise.

 

2.                                       The Effective
Date Statement shall be in the form set out in the Annex to this
Schedule 9 showing the calculation of the Working Capital of the Target
Enterprise. The Seller shall use its reasonable endeavours to deliver the draft
Effective Date Statement to the 

 

84

 

Purchaser within 60 days after
Closing and shall in any event deliver it within 90 days of Closing.

 

3.                                       No individual
adjustment for an amount of less than £10,000 shall be made to the draft
Effective Date Statement as a result of the process described in this
Part B unless the parties agree otherwise.

 

4.                                       The Purchaser
shall notify the Seller in writing (an Objection Notice) within 30 days after
receipt whether or not it accepts the draft Effective Date Statement for the
purposes of this Agreement. An Objection Notice shall set out in detail the
Purchaser’s reasons for such non-acceptance and specify the adjustments which,
in the Purchaser’s opinion, should be made to the draft Effective Date
Statement in order for it to comply with the requirements of this Agreement. Except
for the matters specifically set out in the Objection Notice, the Purchaser
shall be deemed to have agreed the draft Effective Date Statement in full.

 

5.                                       If the Purchaser
serves an Objection Notice in accordance with paragraph 4, the Seller and
the Purchaser shall use all reasonable efforts to meet and discuss the
objections of the Purchaser and to agree the adjustments (if any) required to
be made to the draft Effective Date Statement, in each case within 15 days
after receipt by the Seller of the Objection Notice.

 

6.                                       If the Purchaser
is satisfied with the draft Effective Date Statement (either as originally
submitted or after adjustments agreed between the Seller and the Purchaser
pursuant to paragraph 5) or if the Purchaser fails to give a valid Objection
Notice within the 30 day period referred to in paragraph 4, then the draft
Effective Date Statement (incorporating any agreed adjustments) shall constitute
the Effective Date Statement for the purposes of this Agreement.

 

7.                                       If the Seller and
the Purchaser do not reach agreement within 15 days of receipt by the Seller of
the Objection Notice, then the matters in dispute may be referred (on the
application of either the Seller or the Purchaser) for determination by Ernst
& Young, London or, if that firm is unable or unwilling to act, by such
other independent firm of chartered accountants of international standing as
the Seller and the Purchaser shall agree or, failing agreement, appointed by
the President for the time being of the Institute of Chartered Accountants in
England and Wales (the Firm). The
Firm shall be requested to make its decision within 21 days (or such later date
as the Seller, the Purchaser and the Firm agree in writing) of confirmation and
acknowledgement by the Firm of its appointment. The following provisions shall
apply once the Firm has been appointed:

 

(a)                                  the Seller and
Purchaser shall each prepare a written statement within 15 days of the Firm’s
appointment on the matters in dispute which (together with the relevant
supporting documents) shall be submitted to the Firm for determination and
copied at the same time to the other;

 

(b)                                 following
delivery of their respective submissions, the Purchaser and the Seller shall
each have the opportunity to comment once only on the other’s submission by
written comment delivered to the Firm not later than 10 days after receipt of
the other’s submission and, thereafter, neither the Seller nor the Purchaser
shall be entitled to make further statements or submissions except insofar as
the Firm so requests (in which case it shall, on each occasion, give the other
party (unless otherwise directed) 10 days to respond to any statements or
submission so made);

 

(c)                                  in giving its
determination, the Firm shall state what adjustments (if any) are necessary,
solely for the purposes of this Agreement, to the draft Effective Date 

 

85

 

Statement
in respect of the matters in dispute in order to comply with the requirements
of this Agreement and to determine finally the Effective Date Statement;

 

(d)           the Firm shall act as an
expert (and not as an arbitrator) in making its determination which shall, in
the absence of manifest error, be final and binding on the parties and, without
prejudice to any other rights which they may respectively have under this
Agreement, the parties expressly waive, to the extent permitted by law, any
rights of recourse they may otherwise have to challenge it.

8.       The Seller and the Purchaser shall each be responsible for their own
costs in connection with the preparation, review and agreement or determination
of the Effective Date Statement.  The
fees and expenses of the Firm shall be borne equally between the Seller and the
Purchaser or in such other proportions as the Firm shall determine.

9.       To enable the Seller to meet its obligations
under this Schedule 9, the Purchaser shall provide to the Seller and the
Seller’s accountants full access to the books and records, employees and
premises of the Target Company and, where relevant, of the Purchaser in
relation to the Target Enterprise for the period from the Closing Date to the
date that the draft Effective Date Statement is agreed or determined.  If the Purchaser serves an Objection Notice,
it shall ensure that the Seller and the Seller’s accountants shall be given
reasonable access to the Purchaser’s and the Purchaser’s accountants’ working
papers relating to the adjustments proposed in the Objection Notice and any
other submissions by or on behalf of the Purchaser in relation to the Effective
Date Statement.  The Purchaser shall co-operate fully with the
Seller and shall permit the Seller and/or
the Seller’s accountants to take copies (including electronic copies) of the
relevant books and records and shall provide all assistance reasonably
requested by the Seller to facilitate the preparation of the Effective Date
Statement.

10.     When the Effective Date Statement has been agreed or determined in
accordance with the preceding paragraphs, then the amount shown in the
Effective Date Statement as the Working Capital shall be final and binding for
the purposes of this Agreement.

 

PART C : FINANCIAL ADJUSTMENTS

 

1.             When the Effective Date Statement has been
finally agreed or determined in accordance with this Schedule 9:

 

	
  (a)

  	
   

  	
  if the Working Capital is
  greater than £2,935,364 (the Target Working Capital), then the Purchaser
  shall pay an amount equal to the difference to the Seller; or

  
	
   

  	
   

  	
   

  
	
  (b)

  	
   

  	
  if the Working Capital is
  less than the Target Working Capital, then the Seller shall pay an amount
  equal to the difference to the Purchaser,

  

 

provided that no payment shall be made at all pursuant to this
paragraph 1 if the amount of the difference between the Working Capital and the
Target Working Capital is less than £100,000.

 

2.       If any payment is required to be made
pursuant to paragraph 1 above, such payment shall be treated as adjusting the
Initial Share Price and the Initial Business Price by

 

86

 

respectively increasing or decreasing each of them pro rata to the
proportions which they respectively represent of the Initial Cash Price.

 

3.       Any payment required to be made pursuant to
paragraph 2 of this Part C shall be paid by the Seller or the Purchaser
(as the case may be) together with an amount equivalent to interest on such
payment at the Interest Rate for the period from (but excluding) the Effective
Date to (and including) the due date for payment pursuant to the relevant
clause, calculated on a daily basis.

 

4.       Such payment shall be made within 5 Business
Days of the date on which the Effective Date Statement is agreed or so
determined, in accordance with the provisions of clause 21.1 or 21.2 of this
Agreement, as the case may be.

 

87

 

ANNEX TO SCHEDULE 9

 

Form of Effective Date Statement

 

A.      Summary Effective
Date Statement

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  RM Business and CH Business

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Working Capital

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Notes

  	
   

  	
  Measured

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Current Assets:

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  A

  	
   

  	
  Accounts receivable

  	
   

  	
   

  	
   

  	
  X

  	
   

  
	
  C

  	
   

  	
  Other current assets

  	
   

  	
   

  	
   

  	
  X

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  X

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Current Liabilities:

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  D

  	
   

  	
  Accounts Payable

  	
   

  	
   

  	
   

  	
  N/A

  	
   

  
	
  E

  	
   

  	
  Other current liabilities

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  
	
  F

  	
   

  	
  Deferred revenue

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  X

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  WORKING CAPITAL

  	
   

  	
   

  	
   

  	
  X

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Irish Security Archives Limited

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Current Assets:

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  A

  	
   

  	
  Accounts receivable

  	
   

  	
   

  	
   

  	
  X

  	
   

  
	
  C

  	
   

  	
  Other current assets

  	
   

  	
   

  	
   

  	
  X

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  X

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Current Liabilities:

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  D

  	
   

  	
  Accounts Payable

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  
	
  E

  	
   

  	
  Other current liabilities

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  
	
  F

  	
   

  	
  Deferred revenue

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  X

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  WORKING CAPITAL

  	
   

  	
   

  	
   

  	
  X

  	
   

  

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Total Target Enterprise

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Working Capital

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Notes

  	
   

  	
  Measured

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Current Assets:

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  A

  	
   

  	
  Accounts receivable

  	
   

  	
   

  	
   

  	
  X

  	
   

  
	
  C

  	
   

  	
  Other current assets

  	
   

  	
   

  	
   

  	
  X

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  X

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Current Liabilities:

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  D

  	
   

  	
  Accounts Payable

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  
	
  E

  	
   

  	
  Other current liabilities

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  
	
  F

  	
   

  	
  Deferred revenue

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  WORKING CAPITAL

  	
   

  	
   

  	
   

  	
  X

  	
   

  

 

88

 

B.      Statement of
Calculation of the Effective Date Statement for the Businesses

 

	
  Account

  Code

  	
   

  	
  Account Name

  	
   

  	
  Notes

  	
   

  	
  Measured

  	
   

  	
  

  Excluded

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1611

  	
   

  	
  A/R - CUSTOMER

  	
   

  	
   

  	
   

  	
  X

  	
   

  	
  —

  	
   

  
	
   

  	
   

  	
  A/R - ACCRUED REVENUE

  	
   

  	
   

  	
   

  	
  —

  	
   

  	
  X

  	
   

  
	
   

  	
   

  	
  BAD DEBT RESERVE

  	
   

  	
  1

  	
   

  	
  (X)

  	
   

  	
  —

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  A

  	
   

  	
  Accounts Receivable

  	
   

  	
   

  	
   

  	
  X

  	
   

  	
  —

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  B

  	
   

  	
  Inventory

  	
   

  	
   

  	
   

  	
  —

  	
   

  	
  X

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1711

  	
   

  	
  Q2 Rent Prepayment

  	
   

  	
   

  	
   

  	
  X

  	
   

  	
  —

  	
   

  
	
  1712

  	
   

  	
  Property rates control

  	
   

  	
   

  	
   

  	
  X

  	
   

  	
  —

  	
   

  
	
   

  	
   

  	
  Prepaid mobile phone

  	
   

  	
   

  	
   

  	
  —

  	
   

  	
  X

  	
   

  
	
  1752

  	
   

  	
  PPMTS - Purchase Ledger On A/C

  	
   

  	
   

  	
   

  	
  X

  	
   

  	
  —

  	
   

  
	
   

  	
   

  	
  Other prepayments - external

  	
   

  	
   

  	
   

  	
  —

  	
   

  	
  X

  	
   

  
	
  1714

  	
   

  	
  Payments due to Landlords

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  	
  —

  	
   

  
	
  1714

  	
   

  	
  Rent Review Provision

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  	
  —

  	
   

  
	
  1714

  	
   

  	
  Cardiff Dilapidation

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  	
  —

  	
   

  
	
  1714

  	
   

  	
  Poole Dilapidation

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  	
  —

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  C

  	
   

  	
  Other Current Assets

  	
   

  	
   

  	
   

  	
  X

  	
   

  	
  —

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  CAPITAL CREDITORS (IDENTIFIED)

  	
   

  	
   

  	
   

  	
  —

  	
   

  	
  X

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  D

  	
   

  	
  Accounts Payable

  	
   

  	
   

  	
   

  	
  X

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2410/11

  	
   

  	
  PAYROLL - NIC

  	
   

  	
   

  	
   

  	
  —

  	
   

  	
  (X)

  	
   

  
	
  2420/21

  	
   

  	
  PAYROLL - PAYE

  	
   

  	
   

  	
   

  	
  —

  	
   

  	
  (X)

  	
   

  
	
   

  	
   

  	
  PAYROLL - OTHER

  	
   

  	
  2

  	
   

  	
  (X)

  	
   

  	
  —

  	
   

  
	
  2610

  	
   

  	
  ACCRUED PTE/DIRECT COSTS

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  	
  —

  	
   

  
	
  2620

  	
   

  	
  ACCRUED WAGES

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  	
  —

  	
   

  
	
  2665

  	
   

  	
  ACCRUED VACATION/HOLIDAY

  	
   

  	
   

  	
   

  	
  —

  	
   

  	
  (X)

  	
   

  
	
   

  	
   

  	
  ACCRUED BONUS

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  E

  	
   

  	
  Other current liabilities

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  	
  —

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  F

  	
  2720

  	
   

  	
  Deferred revenue

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  	
  —

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  WORKING CAPITAL

  	
   

  	
   

  	
   

  	
  X

  	
   

  	
  —

  	
   

  
											

 

Notes to table:

 

1.       Separate calculation performed.

 

2.       Accounts 2435, 2451, 2452, 2453, 2454, 2455,
2456, 2458, 2464

 

89

 

C.      Statement of
Calculation of the Effective Date Statement for the Target Company

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Irish Security Archives Limited

  
	
  Account

  Code

  	
   

  	
  Account Name

  	
   

  	
  Notes

  	
   

  	
  Measured

  	
   

  	
  Excluded

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  1611/12

  	
   

  	
  A/R - CUSTOMER

  	
   

  	
   

  	
   

  	
  X

  	
   

  	
  —

  
	
   

  	
   

  	
  1617/18

  	
   

  	
  A/R - UNAPPLIED CASH

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  	
  —

  
	
   

  	
   

  	
  1641

  	
   

  	
  A/R - UNIDENTIFIED CASH

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  	
  —

  
	
   

  	
   

  	
  1761/62

  	
   

  	
  A/R - ACCRUED REVENUE

  	
   

  	
   

  	
   

  	
  X

  	
   

  	
  —

  
	
   

  	
   

  	
   

  	
   

  	
  BAD DEBT RESERVE

  	
   

  	
  1

  	
   

  	
  (X)

  	
   

  	
  —

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  A

  	
   

  	
   

  	
   

  	
  Accounts Receivable

  	
   

  	
   

  	
   

  	
  X

  	
   

  	
  —

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  B

  	
   

  	
   

  	
   

  	
  Inventory

  	
   

  	
   

  	
   

  	
  —

  	
   

  	
  X

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  1712/13/55

  	
   

  	
  PREPAID OTHER EXPENSE

  	
   

  	
   

  	
   

  	
  X

  	
   

  	
  —

  
	
   

  	
   

  	
   

  	
   

  	
  PREPAID INSURANCE

  	
   

  	
   

  	
   

  	
  —

  	
   

  	
  X

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  C

  	
   

  	
   

  	
   

  	
  Other Current Assets

  	
   

  	
   

  	
   

  	
  X

  	
   

  	
  —

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  2110

  	
   

  	
  A/P - VENDOR

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  	
  —

  
	
   

  	
   

  	
   

  	
   

  	
  CAPITAL CREDITORS (IDENTIFIED)

  	
   

  	
   

  	
   

  	
  X

  	
   

  	
  —

  
	
   

  	
   

  	
  1883

  	
   

  	
  REMITTANCE CONTROL

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  	
  —

  
	
   

  	
   

  	
   

  	
   

  	
  A/P - OVERPAYMENTS TO ACCOUNTS PAYABLE

  	
   

  	
   

  	
   

  	
  X

  	
   

  	
  —

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  D

  	
   

  	
   

  	
   

  	
  Accounts Payable

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  	
  —

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  2420

  	
   

  	
  PAYROLL - NIC

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  	
  —

  
	
   

  	
   

  	
  2410

  	
   

  	
  PAYROLL - PAYE

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  	
  —

  
	
   

  	
   

  	
  2455

  	
   

  	
  PAYROLL - OTHER

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  	
  —

  
	
   

  	
   

  	
  2610

  	
   

  	
  ACCRUED PTE/DIRECT COSTS

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  	
  —

  
	
   

  	
   

  	
   

  	
   

  	
  INSURANCE RESERVES/ACCRUALS

  	
   

  	
   

  	
   

  	
  —

  	
   

  	
  X

  
	
   

  	
   

  	
   

  	
   

  	
  ACCRUED INCOME TAX

  	
   

  	
   

  	
   

  	
  —

  	
   

  	
  X

  
	
   

  	
   

  	
  2362/73/78

  	
   

  	
  VAT

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  	
  —

  
	
   

  	
   

  	
  2690

  	
   

  	
  ACCRUED OTHER

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  	
  —

  
	
   

  	
   

  	
   

  	
   

  	
  ACCR PAY - FINANCE (Audit accrual)

  	
   

  	
   

  	
   

  	
  —

  	
   

  	
  X

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  E

  	
   

  	
   

  	
   

  	
  Other current liabilities

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  	
  —

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  F

  	
   

  	
  2720

  	
   

  	
  Deferred revenue

  	
   

  	
   

  	
   

  	
  (X)

  	
   

  	
  —

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  WORKING CAPITAL

  	
   

  	
   

  	
   

  	
  X

  	
   

  	
  —

  
													

 

90

 

SCHEDULE 10 

DEFINITIONS AND INTERPRETATION

 

1.       Definitions. In this Agreement, the following words and
expressions shall have the following meanings:

 

Accounting Principles has the meaning given in
Part A of Schedule 9;

 

Accounts means:

 

(a)           in relation to any financial year
of the Target Company, the audited balance sheet of the Target Company (and,
where relevant, the audited consolidated balance sheet of the Target Company
and its subsidiary undertakings) and the audited profit and loss account of the
Target Company (and, where relevant, the audited consolidated profit and loss
account of the Target Company and its subsidiary undertakings) as at the Accounts
Date in respect of that financial year; and

 

(b)           in relation to any financial year
of the Seller, the audited balance sheet of the Seller, insofar as it relates
to the Businesses and the audited profit and loss account of the Seller,
insofar as it shows the results of operations of the Businesses, as at the
Accounts Date in respect of that financial year,

 

each in the form contained in the Data Room together, in each case,
with any notes, reports, statements or documents included in or annexed or attached
to them;

 

Affiliate means, in relation to any party,
any subsidiary or parent company of that party and any subsidiary of any such
parent company, in each case from time to time;

 

Agreed Form means, in relation to a document,
the form of that document as initialled on the date of this Agreement for the
purpose of identification by or on behalf of the Seller and the Purchaser (in
each case with such amendments as may be agreed in writing by or on behalf of
the Seller and the Purchaser);

 

amount in respect of group relief means any payment in respect of
the surrender of any loss or other relief (including without limitation any
tax, tax refund or credit) or in respect of any reallocation of any gain, loss,
disposal or other matter for any tax purpose;

 

Assignment of Intellectual Property means the assignment of
intellectual property attached at Exhibit 5 to this Agreement;

 

Assumed Business Debt means, in relation to each
Business, all amounts owed by the Seller (in relation to the Businesses) at
Closing under the Master Sale and Leaseback Agreement dated 27 September 2001
between HSBC Equipment Finance (UK) Limited and the Seller;

 

Assumed Liabilities means all Assumed Business Debt,
all Business Liabilities and all Liabilities relating to the Existing Business
Properties and the Target Company Properties, in each case whether arising on,
before or after Closing, but in each case excluding the Excluded Liabilities;

 

Businesses means the RM Business and the CH
Business;

 

91

 

Business Assets means all the property,
undertaking, rights and assets of the Seller relating exclusively or
predominantly to the Businesses, including any assets falling into the
categories of assets set out in Part A of Schedule 1 but excluding
the Excluded Assets;

 

Business Claims means the benefit of all rights
and claims arising exclusively or predominantly from the carrying on of the
Businesses by the Seller (whether arising on, prior to or after Closing) but
excluding rights and claims to the extent that they relate to taxation or to
any of the Excluded Contracts, the Excluded Assets or the Excluded Liabilities;

 

Business Contracts means all contracts, engagements,
licences, guarantees and other commitments to the extent that they relate to
the Target Enterprise entered into by or on behalf of, or the benefit of which
is held on trust for or has been assigned to, the Seller prior to Closing
(including, for the avoidance of doubt, the Master Sale and Leaseback Agreement
dated 27 September 2001 between HSBC Equipment Finance (UK) Limited and the
Seller) (but excluding (i) agreements, leases or other documents relating to
ownership or occupation of Existing Business Properties, Target Company
Properties and (ii) the Excluded Contracts); each Site Facility Agreement shall
be treated as a Business Contract to the extent that it relates to any part of
any Assignment Consent Property, not just to the extent that it relates to the
parts of the Assignment Consent Property which relate to the Target Enterprise;

 

Business Day means a day other than a Saturday
or Sunday or public holiday in England and Wales on which banks are open in
London for general commercial business;

 

Business Goodwill means the goodwill relating to
each Business, together with the exclusive right for the Purchaser to represent
itself as carrying on such Business in succession to the Seller;

 

Business Information means, in relation to each
Business, all information in respect of which the Seller has a right to
transfer possession to a member of the Purchaser Group to the extent that such
information relates exclusively to that Business;

 

Business IP means the Owned IP and all other
registered Intellectual Property Rights materially used by the Target Company
and, in relation to the Target Enterprise, the Seller;

 

Business Liabilities means, in relation to each
Business, all Liabilities of the Seller (including Capital Creditors) to the
extent that they relate to the Businesses and/or the Business Assets and Business Liability means
any one of them;

 

Business Loose Plant and Equipment means, in relation to each
Business, all the loose plant, machinery, equipment, tooling, computer
hardware, furniture and vehicles of the Seller (not being business fixtures and
fittings) used exclusively for the purposes of that Business;

 

Capital Creditors means liabilities and accruals for
work done in relation to projects undertaken by the Target Company or the
Seller to the extent that they relate to the purchase, replacement, repair,
refurbishment or improvement of, or addition to, any tangible fixed assets
owned or leased by the Target Company or Seller (in relation to the
Businesses), including property, plant and equipment, furniture, fittings and
furnishings and floor coverings;

 

CH Business means the Seller’s crate hire
business in the United Kingdom operated from the Existing Business Properties;

 

Claim means any claim under or for
breach of this Agreement;

 

92

 

Closing means completion of the sale and
purchase of the Shares, the Businesses and the Business Assets in accordance
with the provisions of this Agreement;

 

Closing Date has the meaning given in
clause 5.1;

 

Condition has the meaning given in
clause 4.1;

 

Confidential Information has the meaning given in clause
23.1;

 

Costs means losses, damages, costs
(including reasonable legal costs) and expenses (including taxation), in each
case of any nature whatsoever;

 

Crate Hire Agreement means the agreement for the
exclusive provision of crate hire services to be entered into at Closing
between the Seller and the Purchaser in the Agreed Form;

 

Data Room means the data room comprising the
documents and other information relating to the Target Company and the Target
Enterprise made available by the Seller as listed on the data room index in the
Agreed Form;

 

Default Interest means interest at LIBOR plus 3
per cent.;

 

Disclosure Letter means the letter from the Seller
to the Purchaser executed and delivered immediately before the signing of this
Agreement;

 

Effective Date means either:

 

(a)   31 March, 2006 (in the event that
the Closing Date is 30 March, 2006); or

 

(b)   the Closing Date (in the event
that the Closing Date is the last Business Day in a calendar month); or

 

(c)   the last calendar day of the
calendar month immediately preceding the calendar month during which Closing
takes place (in the event that the Closing Date is not the last Business Day in
a calendar month and is not 30 March, 2006).

 

Effective Date Statement has the meaning given in Schedule 9;

 

Employees means:

 

(a)           the employees of the Target
Company immediately prior to Closing; and

 

(b)           those employees of the Seller who
are immediately prior to Closing engaged wholly or substantially in the
Businesses,

 

as listed in Exhibit 6.

 

Environment means all or any of the following
media, namely air (including the air within buildings or other natural or
man-made structures above or below ground), water or land;

 

Environmental Consents means any material permit,
licence, authorisation, approval or consent required under Environmental Laws
for the carrying on of the Target Enterprise or the use of, or any activities
or operations carried out at, any site owned or occupied by the Seller or the
Target Company;

 

93

 

Environmental Laws means all international, European
Union, national, state, federal, regional or local laws (including common law,
statute law, civil and criminal law) which are in force and binding at the date
of this Agreement, to the extent that they relate to Environmental Matters;

 

Environmental Matters means all matters relating to the
pollution or protection of the Environment;

 

Environmental Warranties means the warranties set out in
Part D of Schedule 2;

 

Exchange Rate means, with respect to a
particular currency for a particular day, the spot rate of exchange (the
closing mid-point) for that currency into sterling on such date as published in
the London edition of the Financial Times first published thereafter or, where
no such rate is published in respect of that currency for such date, at the
rate quoted by HSBC as at the close of business in London on such date;

 

Excluded Assets means, in relation to any
Business, those properties, rights and assets relating to that Business described
in Part B of Schedule 1;

 

Excluded Business Debt means the Financial Debt of the
Seller other than any Assumed Business Debt;

 

Excluded Contracts means the contracts and
commitments of the Seller relating to its Business described in Part C of
Schedule 1;

 

Excluded Liabilities means the Liabilities described in
Part D of Schedule 1;

 

Exhibits means exhibits 1 to 6 to this
Agreement, and Exhibit
shall be construed accordingly;

 

Existing Business Properties shall take its meaning from
Schedule 8;

 

Final Business Price has the meaning given in clause
2.3;

 

Final Share Price has the meaning given in clause
2.2;

 

Financial Adjustments means any adjustment(s) required
in accordance with Part C of Schedule 9;

 

Financial Debt means borrowings and indebtedness
in the nature of borrowing (including by way of acceptance credits, discounting
or similar facilities, loan stocks, bonds, debentures, notes, overdrafts or any
other similar arrangements the purpose of which is to raise money) owed to any
banking, financial, acceptance credit, lending or other similar institution or
organisation, or to any member of the Seller Group;

 

Freephone/Lo-call Numbers means the following telephone
numbers:

RM UK – 08457 21 21 77

GB UK – 0800 55 44 77

ISA – ROI – 1800 DOCBOX (1800 362269);

 

Governmental Entity means any supra-national,
national, state, municipal or local government (including any subdivision,
court, administrative agency or commission or other authority thereof) or any
quasi-governmental or private body exercising any regulatory, taxing, importing
or other governmental or quasi-governmental authority, including the European
Union;

 

94

 

Initial Business Price has the meaning given in clause
2.3;

 

Initial Cash Price means the cash price payable on
Closing under clause 2.4;

 

Initial Share Price has the meaning given in clause
2.2;

 

Intellectual Property Rights or IPR means patents, trade marks, service
marks, logos, get-up, trade names, internet domain names, rights in designs,
copyright (including rights in computer software) and moral rights, database
rights, semi-conductor topography rights, utility models, rights in know-how
and other intellectual property rights, in each case whether registered or
unregistered and all rights or forms of protection having equivalent or similar
effect anywhere in the world and registered includes registrations and
applications for registration;

 

Interest Amount has the meaning given in
Schedule 6;

 

Interest Rate means LIBOR plus 2 per cent;

 

Inter-Company Non-Trading Debt means Inter-Company Non-Trading
Payables and Inter-Company Non-Trading Receivables;

 

Inter-Company Non-Trading Payables means any amounts owed by the
Target Company to any member of the Seller Group (which are neither Inter-Company
Trading Debt nor amounts in respect of tax or amounts in respect of group
relief), together with accrued interest, if any, on the terms of the applicable
debt;

 

Inter-Company Non-Trading
Receivables means any amounts owed to the Target Company by any member of the
Seller Group (which are neither Inter-Company Trading Debt nor amounts in
respect of tax or amounts in respect of group relief), together with accrued
interest, if any, on the terms of the applicable debt;

 

Inter-Company Trading Debt means all amounts owed,
outstanding or accrued in the ordinary course of trading, including any VAT
arising on such amounts, as between (i) any member of the Seller Group and the
Target Company or (ii) the Seller and any member of the Seller Group (in
the case of (ii), only to the extent that the relevant amount relates to the
Businesses of the Seller) in respect of inter-company trading activity and the
provision of services, facilities and benefits between them; for the avoidance
of doubt, Inter-Company Trading Debt:

 

(a)           includes, where applicable,
amounts owed in respect of salaries or other employee benefits (including
payroll taxes thereon but excluding any bonuses and related taxes), insurance
(including health and motor insurance), pension and retirement benefit
payments, management training and car rental payments paid or management
services provided between them; but

 

(b)           excludes amounts due in respect of
matters which would in the ordinary course of the Target Enterprise remain
outstanding or otherwise have the characteristics of an intra-group loan and
also excludes any amounts in respect of tax or amounts in respect of group
relief);

 

Irish Security Archives Limited
(Northern Ireland) means the dormant entity incorporated in Northern Ireland with company
number NI002620 and named Irish Security Archive Limited;

 

IT Systems means the information and
communications technologies materially used by the Target Company and, in
relation to the Target Enterprise, the Seller;

 

95

 

Key Managers means those employees of the
Target Enterprise or the Target Company whose names are set out in
Exhibit 6;

 

Last Accounts means, in relation to the Target
Company, the Accounts of that entity in respect of its financial year ended on
the Last Accounts Date;

 

Last Accounts Date means 25 December 2004;

 

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 or
ascertained or unascertained and whether owed or incurred severally or jointly
or as principal or surety;

 

LIBOR means the display rate per annum
of the offered quotation for deposits in sterling for a period of one month
which appears on the appropriate page of the Reuters Screen (or such other page
as the parties may agree) at or about 11.00a.m. London time on the date on
which payment of the sum under this Agreement was due but not paid;

 

Licence Agreement means the licence agreement to be
entered into at Closing between the Seller and the Purchaser in relation to
certain IPR in the Agreed Form;

 

Material Adverse Change means a change occurring after
the date of this Agreement that is materially adverse to the value of the
Target Enterprise taken as a whole.  The
term Material Adverse Change shall be deemed to exclude the impact of (i)
changes in UK GAAP, (ii) any public announcement of the transactions
contemplated by this Agreement, (iii) the termination or failure to be
consummated or completed of any acquisition, joint venture, development
project, customer or supplier relationship or other transaction which was not
consummated or completed prior to the execution of this Agreement, (iv) changes
in general economic conditions, interest rates or conditions affecting the
industry of the Target Enterprise and the Target Enterprise generally, (v) any
failure by the Target Enterprise to meet projections or forecasts or revenue or
earnings predictions, (vi) national or international political or social
conditions, including the engagement by the United Kingdom in hostilities,
whether or not pursuant to the declaration of a national emergency or war, or
the occurrence of any military or terrorist attack upon the United Kingdom, or
any of its territories, possessions, or diplomatic or consular offices or upon
any military installation, equipment or personnel of the United Kingdom, (vii)
financial, banking, or securities markets (including any disruption thereof and
any decline in the price of any security or any market index), (viii) changes
in law, rules, regulations, orders, or other binding directives issued by any
governmental body, or (ix) any event, occurrence, or circumstance with respect
to which the Purchaser has actual knowledge, as of the date hereof;

 

Net Cashflow Statement has the meaning given to it in
Clause 19.3;

 

New Business Property shall take its meaning from
Schedule 8;

 

Non-Exclusive Information means information in the
possession of members of the Seller Group which does not relate exclusively to
the Target Enterprise;

 

Non-Tax Claim means a Claim other than a Tax
Claim;

 

Non-TOGC Properties shall take its meaning from
Schedule 8;

 

96

 

Owned IP means the registered Intellectual
Property Rights owned by the Target Company and the registered Intellectual
Property Rights owned by the Seller and materially used in relation to the
Target Enterprise;

 

parent company means any company which holds a
majority of the voting rights in another company, or which is a member of
another company and has the right to appoint or remove a majority of its board
of directors, or which is a member of another company and controls a majority
of the voting rights in it under an agreement with other members, in each case
whether directly or indirectly through one or more companies;

 

Permitted Encumbrances means security interests arising
in the ordinary course of business or by operation of law including security
interests for taxation and other governmental charges;

 

Pre-Closing Net Cashflow Amount has the meaning given to it in
Clause 19.3;

 

Properties means the land and buildings used
by the Target Enterprise at the locations set out in Part I of Schedule 8;

 

Proposed Transactions means the transactions
contemplated by the Transaction Documents;

 

Purchaser Group means the Purchaser and its
Affiliates from time to time (for the avoidance of doubt, including the Target
Company from Closing);

 

Purchaser Obligation means any representation, warranty
or undertaking to indemnify given by the Purchaser to the Seller under this
Agreement;

 

Purchaser’s Bank Account means the Purchaser’s bank
account, details of which shall be given to the Seller by the Purchaser in
writing.

 

Records has the meaning given in clause 17.1;

 

RM Business means the Seller’s records
management business in the United Kingdom operated from the Existing Business
Properties;

 

Representatives has the meaning given in clause
23.1;

 

Retirement Benefits means any pension, lump sum,
gratuity or other like benefit given or to be given on retirement or on death,
or in anticipation of retirement, or, in connection with past service, after
retirement or death, or to be given on or in anticipation of or in connection
with any change in the nature of the service of the employee in question,
except that it does not include any benefit which is to be afforded solely by
reason of disablement by accident of a person occurring during his service or
of his death by accident or occurring and for no other reason;

 

Retirement Benefit Warranties means the warranties set out in
Part F of Schedule 2;

 

Seller’s Bank Account means such bank account as the
Seller may designate in writing from time to time (the Seller shall, for the
purposes of Closing, notify the Purchaser by no later than the Business Day
immediately prior to the Closing Date, of the details of a US Dollar bank
account with the Hong Kong branch of a recognised bank in the name of the
Seller and such payment as is to be made to the Seller at Closing shall be made
to that account);

 

97

 

Seller Employee Benefit Plan means, in any jurisdiction, any
Seller plan, scheme, fund, arrangement, plan or agreement (whether funded or
unfunded) under which the Seller or any member of the Seller Group or any
Target Company provides, is liable to provide or has agreed to provide (or to
which the Seller or any member of the Seller Group or any Target Company
contributes, is liable to contribute or has agreed to contribute to the
provision of) any Retirement Benefits for or in respect of any Employee; and

 

Seller Group means the Seller and its
Affiliates from time to time but excluding the Target Company;

 

Seller Group Company means a company within the Seller
Group;

 

Seller Obligation means any representation,
warranty or undertaking to indemnify given by the Seller to the Purchaser under
this Agreement;

 

Seller’s Bank Account means such bank account as the
Seller may designate in writing from time to time (the Seller shall, for the
purpose of Closing, notify the Purchaser of the details of a US Dollar bank
account with the Hong Kong branch of a recognised bank in the name of the
Seller and such payment as is to be made to the Seller at Closing shall be made
to that account);

 

Seller’s Solicitors means Freshfields Bruckhaus
Deringer of 65 Fleet Street, London EC4Y 1HS, UK;

 

Service Mark means the service mark “RM
FastTrack” used for the client web access portal to the records management
database of the RM Business and any applications for registration of this
service mark;

 

Shares means 76,000 shares of EUR 1.25
each in the capital of the Target Company;

 

Site Facility Agreements means all contracts, engagements
and commitments entered into by or on behalf of, or the benefit of which is
held on trust for or has been assigned to, the Seller prior to Closing to the
extent that they relate to estate management and maintenance activities in
respect of any of the Properties and of any other part of an Assignment Consent
Property;

 

Stock means all the stocks of the Seller
relating to the Businesses;

 

subsidiary and subsidiaries means any company in
relation to which another company is its parent company;

 

Target Company means Irish Security Archives
Limited, details of which are set out in Exhibit 3;

 

Target Company Properties means the freehold and leasehold
interests of the Target Company brief particulars of which are set out in Part
I of Schedule 8;

 

Target Enterprise means the RM Business, the CH
Business and the entire business as at the date of this Agreement of the Target
Company;

 

Target Working Capital has the meaning given in
Part C of Schedule 9;

 

tax or taxation means (a) taxes on income,
profits and gains, and (b) all other taxes, levies, duties, imposts, charges
and withholdings in the nature of taxation, including any excise, property,
value added, sales, transfer, franchise and payroll taxes and any national
insurance

 

98

 

or social security contributions, together with all penalties, charges
and interest relating to any of the foregoing or to any late or incorrect
return in respect of any of them (save insofar as attributable to the delay or
default after Closing of the Target Company or the Purchaser);

 

tax authority means any taxing or other
authority (whether within or outside the United Kingdom) competent to impose
any tax liability;

 

Tax Claim means a claim for a breach of any
of the Tax Warranties or under clause 20;

 

Tax Warranties means the warranties set out in
Part G of Schedule 2;

 

Third Party Assurances means all guarantees, indemnities,
counter-indemnities and letters of comfort of any nature given (i) to a third
party by the Target Company in respect of any obligation of a member of the
Seller Group; and/or (as the context may require) (ii) to a third party by a
member of the Seller Group in respect of any obligation of the Target Company
or in respect of any Business Contract;

 

Third Party Consent has the meaning given in clause
10.5;

 

Third Party Right means any interest or equity of
any person (including any right to acquire, option or right of pre-emption or
conversion) or any mortgage, charge, pledge, lien, assignment, hypothecation,
security interest, title retention or any other security agreement or
arrangement, or any agreement to create any of the above;

 

TOGC Properties shall take its meaning from
Schedule 8;

 

Trade Creditors means amounts payable in respect
of trade creditors by the Target Company or, in relation to a Businesses, by
the Seller (including, in each case, any Inter-Company Trading Debt, customers’
prepayments and trade bills payable) and Capital Creditors;

 

Trade Debtors means amounts receivable in
respect of trade debtors by the Target Company or, in relation to a Business,
by the Seller in connection with that Business (including, in each case, any
Inter-Company Trading Debt, amounts recoverable, payments in advance, trade
bills recoverable, prepayments and accrued income);

 

Trade Name means the trade name “GB
Nationwide Crate Hire” under which the Seller trades in relation to its crate
hire business in the United Kingdom;

 

Transaction Documents means this Agreement, the
Disclosure Letter, the Licence Agreement, the Crate Hire Agreement, the
Transitional Services Agreement, the Assignment of Intellectual Property and
any other documents in Agreed Form (including, for the avoidance of doubt, the
agreements referred to in Schedule 8) and any other documents to be entered
into pursuant to this Agreement;

 

Transactions Foundations Databook
Appendix
means the financial information and related descriptions of policies and
methods of preparation supplied by the Seller to Ernst & Young, as set out
in the section of the Vendor due diligence report prepared by Ernst & Young
entitled ‘Databook’ and contained in Exhibit 5;

 

Transitional Services Agreement means the transitional services
agreement to be entered into at Closing between the Seller and the Purchaser in
the Agreed Form;

 

99

 

UK GAAP means all Statements of Standard
Accounting Practice, Financial Reporting Standards and Urgent Issues Taskforce
Abstracts issued or adopted by the Accounting Standards Board and extant;

 

Unconditional Date has the meaning given to it in
clause 4.2;

 

VAT means value added tax and any
similar sales or turnover tax;

 

VATA means the Value Added Tax Act
1994;

 

Warranties means the warranties given
pursuant to clause 6 and set out in Schedule 2 and the Tax Warranties;

 

Working Capital has the meaning given in
Part A of Schedule 9; and

 

Working Hours means 9.30am to 5.30pm in the
relevant location on a Business Day.

 

2.             Interpretation. In this Agreement, unless the
context otherwise requires:

 

(a)           references to a person include any
individual, firm, body corporate (wherever incorporated), government, state or
agency of a state or any joint venture, association, partnership, works council
or employee representative body (whether or not having separate legal
personality);

 

(b)           headings do not affect the
interpretation of this Agreement; the singular shall include the plural and
vice versa; and references to one gender include all genders;

 

(c)           references to any English legal
term or concept 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;

 

(d)           references to sterling or pounds
sterling or £ are references to the lawful currency from time to time of
England;

 

(e)           for the purposes of applying a
reference to a monetary sum expressed in sterling, an amount in a different
currency shall be deemed to be an amount in sterling translated at the Exchange
Rate at the relevant date (which in relation to a Claim, shall be the date of
the receipt of notice of that Claim under Schedule 3);

 

(f)            any phrase introduced by the terms
including,
include, in particular or any
similar expression shall be construed as illustrative and shall not limit the
sense of the words preceding those terms; and

 

(g)           any statement in this Agreement
qualified by the expression so far as the Seller is aware or to the best of the Seller’s
knowledge  or any similar expression shall be deemed only
to be made on the basis of the actual knowledge, at the date of this Agreement,
of the following persons, in each case in respect only of the Warranties
identified below against their respective names, and shall carry no further or
other implication nor impose any requirement on such persons to make enquiries
of any other person, party, body or authority.

 

100

 

	
  Name

  	
   

  	
  Warranties

  
	
  Mr Dave Farkas

  	
   

  	
  Schedule 2, Part A

  
	
   

  	
   

  	
   

  
	
  Mr Frank Hopping

  	
   

  	
  Schedule 2, Part A

  
	
   

  	
   

  	
   

  
	
  Mr Brad McCarthy

  	
   

  	
  Schedule 2, Part A

  
	
   

  	
   

  	
   

  
	
  Mr Gary Greasby

  	
   

  	
  Schedule 2, Part A, Part G

  
	
   

  	
   

  	
   

  
	
  Ms Joyce Weekes

  	
   

  	
  Schedule 2, Part B

  
	
   

  	
   

  	
   

  
	
  Mr Kevin Sey

  	
   

  	
  Schedule 2, Part C

  
	
   

  	
   

  	
   

  
	
  Mr Peter Gower

  	
   

  	
  Schedule 2, Part D

  
	
   

  	
   

  	
   

  
	
  Mr Mike Allen

  	
   

  	
  Schedule 2, Part E, Part F

  

 

3.       Enactments. Except as otherwise expressly provided in
this Agreement, any express reference to an enactment (which includes any
legislation in any jurisdiction) includes references to (i) that enactment as
amended, consolidated or re-enacted by or under any other enactment before or
after the date of this Agreement; (ii) any enactment which that enactment re-enacts
(with or without modification); and (iii) any subordinate legislation
(including regulations) made (before or after the date of this Agreement) under
that enactment, as amended, consolidated or re-enacted as described in (i) or
(ii) above, except to the extent that any of the matters referred to in (i) to
(iii) occurs after the date of this Agreement and increases or alters the
liability of the Seller or the Purchaser (or any person on whose behalf it is
acting as agent pursuant to this Agreement) under this Agreement.

 

4.       Schedules and Exhibits. The Schedules and Exhibits
comprise schedules and exhibits to this Agreement and form part of this
Agreement.

 

5.       Inconsistencies. Where there is any inconsistency between the
definitions set out in this Schedule and the definitions set out in any clause
or any other Schedule, then, for the purposes of construing such clause or
Schedule, the definitions set out in such clause or Schedule shall prevail.

 

101

 

	
  SIGNED

  	
  )

  	
  Name: DAVID A. FARKAS

  
	
  for and on behalf of

  	
  )

  	
   

  
	
  SIRVA UK LIMITED

  	
  )

  	
  Signature:

  	
  /s/ David A. Farkas

  	
   

  
	
   

  	
   

  	
   

  
	
  SIGNED

  	
  )

  	
  Name: DAVID
  MUIR

  
	
  for and on behalf of

  	
  )

  	
   

  
	
  CROWN RELOCATION

  	
  )

  	
   

  
	
  SERVICES LIMITED

  	
  )

  	
  Signature:

  	
  /s/ David Muir

  	
   

  
	
   

  	
   

  	
   

  
	
  SIGNED

  	
  )

  	
  Name: KEN
  MADRID

  
	
  for and on behalf of

  	
  )

  	
   

  
	
  CROWN WORLDWIDE

  	
  )

  	
   

  
	
  HOLDINGS LIMITED

  	
  )

  	
  Signature:

  	
  /s/ Ken Madrid

  	
   

  
							

 

102EXHIBIT 10.1

 

FIRST AMENDMENT TO CREDIT AND
SECURITY AGREEMENT AND WAIVER

 

THIS FIRST AMENDMENT TO CREDIT AND SECURITY AGREEMENT
AND WAIVER (this “Amendment”), dated as of March 15, 2006, is
entered into between WELLS FARGO BANK, NATIONAL ASSOCIATION, acting through its
Wells Fargo Business Credit operating division, as successor by merger to Wells
Fargo Business Credit, Inc. (“Lender”), on the one hand, and
GARDENBURGER, INC., an Oregon corporation (“Borrower”), on the
other.

 

RECITALS

 

A.                                   The
Borrower and the Lender are parties to a Credit and Security Agreement dated as
of November 22, 2005 (as amended, supplemented, restated and modified from
time to time, the “Credit Agreement”). Capitalized terms used in these
recitals have the meanings given to them in the Credit Agreement unless
otherwise specified.

 

B.                                     The
following Events of Default have occurred and are continuing under the Credit
Agreement:  (a) an Event of Default
due to the resignation of James W. Linford from the position of Chief Operating
Officer of the Borrower, which resignation constitutes a Change of Control
under the Credit Agreement in violation of Section 7.1(d) thereof,
and (b) an Event of Default due to the Borrower’s failure to achieve, when
measured for the test period beginning December 31, 2005 through February 24,
2006, the minimum Net Cash Flow required by Section 6.2(b) of the
Credit Agreement in violation of Section 7.1(b) thereof
(collectively, the “Known Existing Defaults”).

 

C.                                     The
Borrower has requested that the Lender waive the Known Existing Defaults and
amend the Credit Agreement on the terms and conditions set forth herein.

 

D.                                    The
Borrower is entering into this Amendment with the understanding and agreement
that, except as specifically provided herein, none of the Lender’s rights or
remedies as set forth in the Credit Agreement is being waived or modified by
the terms of this Amendment.

 

AMENDMENT

 

NOW, THEREFORE, in consideration of the
foregoing and the mutual covenants herein contained, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:

 

1.                                       Defined
Terms. Capitalized terms used in this Amendment which are defined in the
Credit Agreement shall have the same meanings as defined therein, unless
otherwise defined herein.

 

2.                                       Amendment
to Credit Agreement.

 

(a)                                  Section 6.2(b) of
the Credit Agreement is hereby amended and restated in its entirety to read as
follows:

 

 

“(b)                           Minimum Net Cash Flow. The Borrower
will achieve, for the test periods set forth below, Net Cash Flow in an amount
not less than the amount set forth below:

 

	
  Test Period

  	
   

  	
  Minimum Net Cash Flow

  	
   

  
	
  10/01/05 through 12/02/05

  	
   

  	
  $

  	
  (900,000

  	
  )

  
	
  10/29/05 through 12/30/05

  	
   

  	
  $

  	
  (600,000

  	
  )

  
	
  12/03/05 through 01/27/06

  	
   

  	
  $

  	
  (1,800,000

  	
  )

  
	
  12/31/05 through 02/24/06

  	
   

  	
  $

  	
  200,000

  	
   

  
	
  01/28/06 through 03/31/06

  	
   

  	
  $

  	
  (742,000

  	
  )

  
	
  02/25/06 through 04/28/06

  	
   

  	
  $

  	
  (1,356,000

  	
  )

  
	
  04/01/06 through 06/02/06

  	
   

  	
  $

  	
  (524,000

  	
  )

  
	
  04/29/06 through 06/30/06

  	
   

  	
  $

  	
  (408,000

  	
  )

  
	
  06/03/06 through 07/28/06

  	
   

  	
  $

  	
  65,000”

  	
   

  

 

(b)                                 Section 6.2(c) of
the Credit Agreement is hereby amended and restated in its entirety to read as
follows:

 

“(c)                            Minimum Gross Sales. The Borrower
will achieve, for each period described below, gross sales of not less than the
amount set forth for each such period:

 

	
  Period

  	
   

  	
  Minimum Gross Sales

  	
   

  
	
  10/01/05 through 10/31/05

  	
   

  	
  $

  	
  3,600,000

  	
   

  
	
  11/01/05 through 11/30/05

  	
   

  	
  $

  	
  3,000,000

  	
   

  
	
  12/01/05 through 12/31/05

  	
   

  	
  $

  	
  3,600,000

  	
   

  
	
  01/01/06 through 01/31/06

  	
   

  	
  $

  	
  4,300,000

  	
   

  
	
  02/01/06 through 02/28/06

  	
   

  	
  $

  	
  3,900,000

  	
   

  
	
  03/01/06 through 03/31/06

  	
   

  	
  $

  	
  4,300,000

  	
   

  
	
  04/01/06 through 04/30/06

  	
   

  	
  $

  	
  4,350,000

  	
   

  
	
  05/01/06 through 05/31/06

  	
   

  	
  $

  	
  5,650,000

  	
   

  
	
  06/01/06 through 06/30/06

  	
   

  	
  $

  	
  5,100,000

  	
   

  
	
  07/01/06 through 07/31/06

  	
   

  	
  $

  	
  5,100,000”

  	
   

  

 

(c)                                  Section 6.2(d) of
the Credit Agreement is hereby amended and restated in its entirety to read as
follows:

 

“(d)                           Minimum Net Sales. In the event that
the Borrower fails to achieve the minimum gross sales required by Section 6.2(c) for
any period set forth above, the Borrower will achieve, for the period set forth
below ending on the same end date as the period for which the Borrower failed
such minimum gross sales covenant, cumulative Net Sales of not less than the
amount set forth for the period ending on such date set forth below:

 

	
  Period

  	
   

  	
  Minimum Net Sales

  	
   

  
	
  10/01/05 through 10/31/05

  	
   

  	
  $

  	
  3,100,000

  	
   

  
	
  10/01/05 through 11/30/05

  	
   

  	
  $

  	
  5,700,000

  	
   

  
	
  10/01/05 through 12/31/05

  	
   

  	
  $

  	
  8,600,000

  	
   

  
	
  10/01/05 through 01/31/06

  	
   

  	
  $

  	
  12,100,000

  	
   

  
	
  10/01/05 through 02/28/06

  	
   

  	
  $

  	
  15,500,000

  	
   

  
	
  10/01/05 through 03/31/06

  	
   

  	
  $

  	
  18,200,000

  	
   

  
	
  10/01/05 through 04/30/06

  	
   

  	
  $

  	
  21,500,000

  	
   

  
	
  10/01/05 through 05/31/06

  	
   

  	
  $

  	
  25,800,000

  	
   

  
	
  10/01/05 through 06/30/06

  	
   

  	
  $

  	
  29,900,000

  	
   

  
	
  10/01/05 through 07/31/06

  	
   

  	
  $

  	
  34,400,000”

  	
   

  

 

2

 

3.                                       Waiver
of Known Existing Defaults. The Lender hereby waives enforcement of its
rights against the Borrower arising from the Known Existing Defaults. This
waiver shall be effective only for the specific defaults comprising the Known
Existing Defaults, and in no event shall this waiver be deemed to be a waiver
of enforcement of the Lender’s rights with respect to any other Defaults or
Events of Default now existing or hereafter arising. Nothing contained in this
Amendment nor any communications between the Borrower and the Lender shall be a
waiver of any rights or remedies the Lender has or may have against the
Borrower, except as specifically provided herein. Except as specifically
provided herein, the Lender hereby reserves and preserves all of its rights and
remedies against the Borrower under the Credit Agreement and the other Loan
Documents.

 

4.                                       Release; Covenant Not to Sue.

 

(a)                                                          The Borrower hereby absolutely and
unconditionally releases and forever discharges the Lender, and any and all
participants, parent corporations, subsidiary corporations, affiliated
corporations, insurers, indemnitors, successors and assigns thereof, together
with all of the present and former directors, officers, agents and employees of
any of the foregoing (each a “Released Party”), from any and all claims,
demands or causes of action of any kind, nature or description, whether arising
in law or equity or upon contract or tort or under any state or federal law or
otherwise, which the Borrower has had, now has or has made claim to have
against any such person for or by reason of any act, omission, matter, cause or
thing whatsoever arising from the beginning of time to and including the date
of this Amendment, whether such claims, demands and causes of action are
matured or unmatured or known or unknown. It is the intention of the Borrower
in providing this release that the same shall be effective as a bar to each and
every claim, demand and cause of action specified, and in furtherance of this
intention it waives and relinquishes all rights and benefits under Section 1542
of the Civil Code of the State of California, which provides:

 

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES
NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE,
WHICH IF KNOWN BY HIM MIGHT HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE
DEBTOR.”

 

(b)                                                         The
Borrower acknowledges that it may hereafter discover facts different from
or in addition to those now known or believed to be true with respect to such claims, demands,
or causes of action and agree that this instrument shall be and remain
effective in all respects notwithstanding any such differences or additional
facts. The Borrower understands, acknowledges and agrees that the release set
forth above may be pleaded as a full and complete defense and may be
used as a basis for an injunction against any action, suit or other proceeding
which may be instituted, prosecuted or attempted in breach of the
provisions of such release.

 

3

 

(c)                                                          The
Borrower, on behalf of itself and its successors, assigns, and other legal
representatives, hereby absolutely, unconditionally and irrevocably, covenants
and agrees with and in favor of each Released Party above that it will not sue
(at law, in equity, in any regulatory proceeding or otherwise) any Released
Party on the basis of any claim released, remised and discharged by Borrower
pursuant to the above release. If the Borrower or any of its successors,
assigns or other legal representations violates the foregoing covenant, the
Borrower, for itself and its successors, assigns and legal representatives,
agrees to pay, in addition to such other damages as any Released Party may sustain
as a result of such violation, all attorneys’ fees and costs incurred by such
Released Party as a result of such violation.

 

(d)                                                         Notwithstanding the foregoing, the
Lender agrees that this Amendment does not release or otherwise affect any of
the Lender’s obligations or commitments under the Exit Financing Commitment
Letter attached to the Credit Agreement as Exhibit E.

 

5.                                       No
Other Changes. Except as explicitly amended by this Amendment, all of the
terms and conditions of the Credit Agreement shall remain in full force and
effect and shall apply to any Advance or Letter of Credit thereunder.

 

6.                                       Effectiveness
of this Amendment. The Lender must have received the following items, in form and
content acceptable to the Lender, before this Amendment is effective and before
the Lender is required to extend any credit to the Borrower as provided for by
this Amendment:

 

(a)                                  Amendment.
This Amendment fully executed in a sufficient number of counterparts for
distribution to the Lender and the Borrower.

 

(b)                                 Waiver
Fee. A non-refundable waiver fee in the amount of Ten Thousand Dollars ($10,000),
which fee is fully earned as of and due and payable on the date hereof.

 

(c)                                  Court
Approval. Evidence, in form and substance satisfactory to the Lender,
that this Amendment has been approved by the Bankruptcy Court.

 

(d)                                 Representations
and Warranties. The representations and warranties set forth herein and in
the Credit Agreement must be true and correct.

 

(e)                                  Other
Required Documentation. All other documents and legal matters in connection
with the transaction contemplated by this Amendment shall have been delivered
or executed or recorded and shall be in form and substance satisfactory to
Lender.

 

7.                                       Representations
and Warranties. The Borrower represents and warrants as follows:

 

(a)                                  Authority.
The Borrower has the requisite corporate power and authority to execute and
deliver this Amendment, and to perform its obligations hereunder and under
the Loan Documents (as amended or modified hereby) to which it is a party. The
execution, delivery and performance by the Borrower of this Amendment have been
duly approved by all necessary corporate action, have received all necessary
governmental

 

4

 

approval, if any, and do
not contravene any law or any contractual restrictions binding on Borrower. No
other corporate proceedings are necessary to consummate such transactions.

 

(b)                                 Enforceability.
This Amendment has been duly executed and delivered by Borrower. This Amendment
and each Loan Document (as amended or modified hereby) is the legal, valid and
binding obligation of Borrower, enforceable against Borrower in accordance with
its terms, and is in full force and effect.

 

(c)                                  Representations
and Warranties. The representations and warranties contained in each Loan
Document (other than any such representations or warranties that, by their
terms, are specifically made as of a date other than the date hereof) are
correct on and as of the date hereof as though made on and as of the date
hereof.

 

(d)                                 No
Default. After giving effect to this Amendment, no event has occurred and
is continuing that constitutes an Event of Default, and by entering into this
Amendment, other than as expressly set forth herein, Lender is not waiving and
shall not be deemed to have waived any Event of Default that may exist.

 

8.                                       Choice
of Law. The validity of this Amendment, its construction, interpretation
and enforcement, and the rights of the parties hereunder, shall be determined
under, governed by, and construed in accordance with the internal laws of the
State of California governing contracts entered into and wholly performed in
that State.

 

9.                                       Counterparts.
This Amendment may be executed in any number of counterparts and by
different parties and separate counterparts, each of which when so executed and
delivered, shall be deemed an original, and all of which, when taken together,
shall constitute one and the same instrument. Delivery of an executed counterpart of
a signature page to this Amendment by telefacsimile shall be effective as
delivery of a manually executed counterpart of this Amendment.

 

10.                                 Reference
to and Effect on the Loan Documents.

 

(a)                                  Upon
and after the effectiveness of this Amendment, each reference in the Credit
Agreement to “this Agreement”, “hereunder”, “hereof” or words of like import
referring to the Credit Agreement, and each reference in the other Loan
Documents to “the Credit Agreement”, “thereof” or words of like import
referring to the Credit Agreement, shall mean and be a reference to the Credit
Agreement as modified and amended hereby.

 

(b)                                 Except
as specifically amended above, the Credit Agreement and all other Loan
Documents, remain unchanged, each is and shall continue to be in full force and
effect, and each is hereby in all respects ratified and confirmed and
constitutes the legal, valid, binding and enforceable obligations of Borrower
to Lender without defense, offset, claim or contribution.

 

(c)                                  Except
as provided herein, the execution, delivery and effectiveness of this Amendment
shall not operate as a waiver of any right, power or remedy of Lender under any
of the Loan Documents or constitute a waiver of any provision of any of the
Loan

 

5

 

Documents.

 

(d)                                 To
the extent that any terms and conditions in any of the Loan Documents shall
contradict or be in conflict with any terms or conditions of the Credit
Agreement after giving effect to this Amendment, such terms and conditions are
hereby deemed modified or amended accordingly to reflect the terms and
conditions of the Credit Agreement as modified or amended hereby.

 

11.                                 No
Waiver. Except as expressly provided herein, the execution of this
Amendment and acceptance of any documents related hereto shall not be deemed to
be a waiver of any under the Credit Agreement or breach, default or event of
default under any Security Document or other document held by the Lender,
whether or not known to the Lender and whether or not existing on the date of
this Amendment.

 

12.                                 Ratification.
Borrower hereby restates, ratifies and reaffirms each and every term and
condition set forth in the Credit Agreement as amended hereby and in the Loan
Documents effective as of the date hereof.

 

13.                                 Estoppel.
To induce Lender to enter into this Amendment and to continue to make advances
to Borrower under the Credit Agreement, Borrower hereby acknowledges and agrees
that, after giving effect to this Amendment, as of the date hereof, there
exists no Event of Default and no right of offset, defense, counterclaim or
objection in favor of Borrower as against Lender with respect to the Obligations.

 

14.                                 Costs
and Expenses. The Borrower hereby reaffirms its agreement under the Credit
Agreement to pay or reimburse the Lender on demand for all costs and expenses
incurred by the Lender in connection with the Credit Agreement, the Loan
Documents and all other documents contemplated thereby, including without
limitation all reasonable fees and disbursements of legal counsel. Without
limiting the generality of the foregoing, the Borrower specifically agrees to
pay all reasonable fees and disbursements of counsel to the Lender for the
services performed by such counsel in connection with the preparation of this
Amendment and the documents and instruments incidental hereto. The Borrower
hereby agrees that the Lender may, at any time or from time to time in its sole
discretion and without further authorization by the Borrower, make a loan to
the Borrower under the Credit Agreement, or apply the proceeds of any loan, for
the purpose of paying any such fees, disbursements, costs and expenses.

 

[Remainder of page intentionally blank.]

 

6

 

IN WITNESS WHEREOF, the parties have entered into this
Amendment as of the date first above written.

 

	
  “BORROWER”

  	
  “LENDER”

  
	
   

  	
   

  
	
  GARDENBURGER, INC.,

  	
  WELLS FARGO BANK,
  NATIONAL

  
	
  an Oregon corporation

  	
  ASSOCIATION, acting
  through its Wells

  
	
   

  	
  Fargo Business Credit
  operating division

  
	
  By:

  	
  /s/ Scott C. Wallace

  	
   

  	
   

  
	
  Name: Scott C. Wallace

  	
  By:

  	
  /s/ Harry L. Joe

  	
   

  
	
  Title: President and CEO

  	
  Name: Harry L. Joe

  
	
   

  	
  Title: Vice President

  
						

 

 

Acknowledged and consented to as of the date first written above.

 

	
  GB RETAIL FUNDING, LLC, as the Term
  Facility

  
	
  Lender under the Intercreditor Agreement

  
	
   

  
	
   

  
	
  By:

  	
  /s/ Lawrence E. Klaff

  	
   

  
	
  Name: Lawrence E. Klaff

  
	
  Title: Principal and Managing Director

  

 

7

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