EXHIBIT 99.3
[▇▇▇▇▇▇▇▇ CHANCE LOGO] LIMITED LIABILITY PARTNERSHIP
ADVOCATEN BELASTINGADVISEURS SOLICITORS
FORM OF SHARE PURCHASE AGREEMENT
dated as of 28 February 2003
among
RELIANT ENERGY EUROPE INC.,
as Seller No. 1,
RELIANT ENERGY WHOLESALE (Europe) HOLDINGS B.V.,
as Seller No. 2,
n.v. NUON,
as Purchaser
and
RELIANT RESOURCES, INC.,
as Sellers' Guarantor
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SALE AND PURCHASE OF SHARES IN
RELIANT ENERGY EUROPE B.V.
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CONTENTS
ARTICLE PAGE
1. Definitions And Interpretation................................................................. 4
2. Sale, Purchase And Purchase Price.............................................................. 15
3. Representations And Warranties Regarding The Companies......................................... 22
4. Representations And Warranties Regarding The Sellers And The Sellers' Guarantor................ 34
5. Representations And Warranties Regarding The Purchaser......................................... 36
6. Specific Indemnities Of The Sellers............................................................ 37
7. Due Diligence Investigation.................................................................... 38
8. Covenants Of The Purchaser..................................................................... 38
9. Covenants Of The Sellers....................................................................... 39
10. Covenants Of All Parties....................................................................... 46
11. Obligations Of The Sellers' Guarantor.......................................................... 47
12. Pre-Closing Termination And Abandonment........................................................ 47
13. Conditions Precedent To Closing................................................................ 49
14. Closing........................................................................................ 50
15. Remedies Pre-Closing Breaches.................................................................. 53
16. Sellers' Warranties Indemnification............................................................ 54
17. Limitation Of Sellers' Liability............................................................... 54
18. Claim Procedures............................................................................... 56
19. Indemnity By The Purchaser..................................................................... 58
20. Conduct Of Tax Affairs......................................................................... 59
21. Notices........................................................................................ 61
22. Governing Law And Dispute Resolution........................................................... 63
23. No Rescission.................................................................................. 64
24. Miscellaneous.................................................................................. 64
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THIS SHARE PURCHASE AGREEMENT (this "AGREEMENT") is made on this 28th day of
February 2003
AMONG:
1. RELIANT ENERGY EUROPE INC., a company incorporated under the laws of
the State of Delaware, United States of America and having its
principal place of business at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America (the "SELLER NO. 1");
2. RELIANT ENERGY WHOLESALE (EUROPE) HOLDINGS B.V., a private company with
limited liability (besloten vennootschap met beperkte
aansprakelijkheid) registered and incorporated under the laws of The
Netherlands and having its seat (statutaire zetel) in Utrecht, The
Netherlands and its principal place of business at ▇▇▇▇▇ ▇▇▇▇▇▇ ▇, ▇▇▇▇
▇▇ ▇▇▇▇▇▇▇▇-▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ and registered with the Commercial
Register at Amsterdam, The Netherlands, under file number 34116644 (the
"SELLER NO. 2");
3. N.V. NUON, a public company with limited liability (naamloze
vennootschap) registered and incorporated under the laws of The
Netherlands and having its seat (statutaire zetel) in Amsterdam, The
Netherlands and its principal place of business at ▇▇▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ and registered with the Commercial Register
at Amsterdam, The Netherlands, under file number 34108286 (the
"PURCHASER"); and
4. RELIANT RESOURCES, INC., a company incorporated under the laws of the
State of Delaware, the United States of America and having its
principal place of business at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America (the "SELLERS' GUARANTOR").
Seller No. 1 and Seller No. 2 are hereinafter jointly referred to as the
"SELLERS". The Sellers, the Purchaser and the Sellers' Guarantor are hereinafter
jointly referred to as the "PARTIES" and each individually as a "PARTY".
WHEREAS:
(A) On the date of this Agreement and on the Closing Date, Seller No. 1
holds ninety nine point five percent (99.5%) and Seller No. 2 holds
zero point five percent (0.5%) of all outstanding shares of Reliant
Energy Europe B.V., a private company with limited liability (besloten
vennootschap met beperkte aansprakelijkheid) registered and
incorporated under the laws of The Netherlands having its seat
(statutaire zetel) in Utrecht, The Netherlands and having its principal
place of business at ▇▇▇▇▇ ▇▇▇▇▇▇ ▇-▇▇, ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇-▇▇▇▇, ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇ and registered with the Commercial Register at Amsterdam,
The Netherlands, under file number 34129971 (the "COMPANY");
(B) On the date of this Agreement and on the Closing Date, the Company
holds all outstanding shares of Reliant Energy Power Generation Benelux
B.V., formerly known as N.V. Energieproduktiebedrijf UNA, a private
company with limited liability (besloten vennootschap met beperkte
aansprakelijkheid) registered and incorporated under the laws of The
Netherlands and having its seat (statutaire zetel) in Utrecht, The
Netherlands and its principal place of business at ▇▇▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇
▇▇ ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
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and registered with the Commercial Register at Utrecht, The
Netherlands, under file number 30084656 ("REPGB");
(C) On the date of this Agreement and on the Closing Date, REPGB holds all
outstanding shares of Reliant Energy Trading & Marketing B.V., a
private company with limited liability (besloten vennootschap met
beperkte aansprakelijkheid) registered and incorporated under the laws
of The Netherlands and having its seat (statutaire zetel) in Amsterdam,
The Netherlands and its principal place of business at ▇▇▇▇▇ ▇▇▇▇▇▇
▇-▇▇, ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇-▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇, and registered with the
Commercial Register at Amsterdam, The Netherlands under file number
30141690 ("RETM");
(D) REPGB jointly with RETM and with its other Subsidiaries conducts the
European electricity generation and power, gas and fuel products
marketing, trading and structured products businesses of the Sellers'
Guarantor (such businesses being referred to as "RELIANT ENERGY
EUROPE");
(E) The Sellers wish to sell and the Purchaser wishes to purchase Reliant
Energy Europe in a single and indivisible transaction by means of a
sale and purchase of all the issued and outstanding shares in the
capital of the Company (the "SHARES"); and
(F) The notification and consultation procedures pursuant to the Dutch
Merger Code (SER-besluit Fusiegedragsregels 2000) and the Works Council
Act (Wet op de ondernemingsraden) with respect to the transactions
contemplated in this Agreement have been complied with and all relevant
Works Councils have rendered advice with respect to the transactions
contemplated in this Agreement.
NOW IT IS HEREBY AGREED AS FOLLOWS:
1. DEFINITIONS AND INTERPRETATION
1.1 DEFINITIONS
For the purposes of this Agreement, the following words and phrases
shall have the following meanings, except as the context may otherwise
require:
"ACCOUNTING STANDARDS" means the accounting policies, principles and
practices (and their particular application) adopted and consistently
applied by the Companies in the preparation of the consolidated annual
accounts of the two (2) financial years preceding the financial year
for which the Audited Accounts are prepared and furthermore in
accordance with Dutch GAAP and Title 9 of Book 2 of the Dutch Civil
Code;
"ACTION" means any material claim, action, suit or proceeding, whether
before any court, arbitrator, arbitration panel or Governmental Entity
and any investigation relating to the same;
"ADVISORS" has the meaning ascribed to it in Article 7.1;
"AFFILIATE" means in relation to a company, a legal entity that is
(directly or indirectly): (i) a subsidiary of that company, (ii) a
parent of that company or (iii) a subsidiary of a parent, which is also
a parent of that company;
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"AGREEMENT" means this agreement regarding the sale and purchase of the
Shares, including the content of the Annexes to this Agreement and the
content of the Appendices to the Annexes to this Agreement;
"APPLICABLE LAW" means in relation to a person any Judgment or any
statute, law, ordinance (verordening), rule (beleidsregel) or
regulation of a Governmental Entity applicable to that person;
"ASSETS" means the assets owned by any of the Companies each
individually representing a value of at least five million Euro ((euro)
5,000,000);
"AUDITED ACCOUNTS" means the audited consolidated financial statements
of REPGB for the financial year ended at the Last Accounting Date,
attached as Annex 1 to this Agreement, consisting of a consolidated
balance sheet as at the Last Accounting Date and a consolidated profit
and loss account for the year ended at the Last Accounting Date, as
well as all notes thereto, all prepared in accordance with the
Accounting Standards;
"AUDITOR'S STATEMENT" has the meaning ascribed to it in Article 2.3.4;
"BROKER" has the meaning ascribed to it in Article 3.20;
"BUSINESS DAY" means a day, other than (i) a Saturday, Sunday or
official public holiday in any of Amsterdam, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or Houston, Texas, United States of America or (ii) a
day on which commercial banking institutions in Amsterdam, London or
Houston are authorised or obligated to be closed;
"BUSINESS PREMISES" has the meaning ascribed to it in Article 3.8.2;
"CASH PAYMENT" means the cash payment to be determined on the basis of
the table as set forth in ANNEX 2 to this Agreement, which cash payment
amount will have been reduced by the Preliminary Net Cash Reduction;
"CLAIM NOTICE" has the meaning ascribed to it in Article 18.1.1;
"CLOSING" means the finalisation of the sale, purchase and transfer of
the Shares as contemplated in Article 14;
"CLOSING DATE" has the meaning ascribed to it in Article 14.1;
"COMPANY" has the meaning ascribed to it in Recital (A);
"COMPANIES" means the Company and all Subsidiaries;
"CONFIDENTIALITY AGREEMENTS" means the Purchaser's Confidentiality
Agreement and the Sellers' Confidentiality Agreement jointly;
"CONSENT" means consent, approval or authorisation of any Governmental
Entity under any Applicable Law;
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"CONTINGENT PURCHASE PRICE" means ninety per cent (90%) of the NEA
Proceeds in excess of one hundred ten million Euro ((euro) 110,000,000)
(it being understood that the Contingent Purchase Price can never be
less than zero);
"CONTRACT" means a contract, agreement, lease or license providing for
obligations of the Companies in an aggregate amount of ten million Euro
((euro)10,000,000) for individual trading and fuel supply contacts and
in an aggregate amount of two million Euro ((euro) 2,000,000) for each
other contract;
"CROSS BORDER LEASES" means all US and German cross border lease
agreements to which any of the Companies is a party, a list of which is
attached as Annex 3 to this Agreement;
"DEED OF TRANSFER OF SHARES" means the notarial deed, substantially in
the form as attached as Annex 4 to this Agreement;
"DERIVATIVE TRANSACTIONS" means any derivative transactions, including
rate swap transaction, basis swap, forward rate transaction, commodity
swap, commodity forward transaction, foreign exchange transaction,
currency swap transaction, cross-currency rate swap transaction,
credit-linked transaction, equity-linked transaction, any combination
of these transactions and any option with respect to these
transactions, except those entered into in the ordinary course of the
business of the Companies, including those associated with the purchase
and sale of any energy related commodity, commodity transmission,
currency rate management, in connection with or arising out of green
power certificates; contracts related to emissions, weather or stranded
cost contracts; whether physical, cash or financial and whether option,
exchange, swap or future;
"DIVIDEND NOTES" means:
(i) the interest bearing promissory demand note dated 30 December
2002 issued by the Company to the Seller No. 1 and
representing a distribution of share premium in the original
principal amount of five hundred eighty nine million forty
thousand Euro ((euro)589,040,000) to the Seller No. 1; and
(ii) the interest bearing promissory demand note dated 30 December
2002 issued by the Company to the Seller No. 2 and
representing a distribution of share premium in the original
principal amount of two million nine hundred sixty thousand
Euro ((euro)2,960,000) to the Seller No. 2,
which both have been assigned by each of the Sellers to RECE on 31
December 2002;
"DRAFT AUDITOR'S STATEMENT" has the meaning ascribed to it in Article
2.3.2;
"DUE DILIGENCE INFORMATION" means all information relating to the
Companies and to the Participations or their respective businesses
obtained by or made available to the Purchaser's Group by the Sellers
or their Affiliates or their advisors either in writing or orally and
whether directly or indirectly from, or pursuant to discussions leading
to this Agreement;
"DUE DILIGENCE INVESTIGATION" has the meaning ascribed to it in Article
7.1;
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"DUTCH COMPETITION AUTHORITY" means Nederlandse Mededingingsautoriteit
(NMa);
"DUTCH GAAP" means generally accepted Dutch accounting principles;
"ENCUMBRANCES" means any mortgages (rechten van hypotheek), pledges
(pandrechten), attachments (beslagen), entitlements of beneficial
ownership (including rights of usufruct (rechten van vruchtgebruik)),
deposits or assignments by way of security, options and rights of
pre-emption (voorkeursrechten);
"ENVIRONMENT" means the air (including air inside buildings and other
natural and man-made structures above or below ground), water
(including surface water and ground water), land (including soil and
river beds under any water, surface land and subsurface land), flora
and fauna;
"ENVIRONMENTAL LAWS" means any European Union, national, provincial or
local applicable law, regulations, and directives in force on the date
of this Agreement and having direct effect (directe ▇▇▇▇▇▇▇),
concerning (i) the pollution or protection of the Environment or (ii)
harm to or the protection of flora and fauna;
"ESTIMATED NET CASH" has the meaning ascribed to it in Article 2.3.2;
"FINAL DISTRIBUTION DATE" has the meaning ascribed to it in Article
2.4.3 (ii);
"GOVERNMENTAL ENTITY" means any international, European Union,
national, federal, state, provincial or local governmental body or
authority exercising executive, legislative, judicial, regulatory,
administrative or other governmental function with jurisdiction over a
Party, including the Dutch Competition Authority, the European
Commission and the Ministry of Economic Affairs of The Netherlands;
"GUARANTEED OBLIGATIONS" has the meaning ascribed to it in Article
11.1;
"INDEMNIFIED PARTY" has the meaning ascribed to it in Article 2.5.2;
"INITIAL PURCHASE PRICE" means
(i) the Cash Payment; and
(ii) the amounts outstanding as of the Closing Date under the
Dividend Notes as provided for in Article 14.2.10 and 14.3;
"INTELLECTUAL PROPERTY RIGHTS" means all industrial and intellectual
property rights, excluding any rights in the Marks, but including
patents, copyrights in computer software and in any other works
protected by copyright, design rights, sui generis database rights,
rights in confidential know-how and other rights of a similar nature
subsisting anywhere in the world, in each case whether registered or
unregistered and including all applications for the registration of the
same;
"INTER-COMPANY PAYABLES" means the aggregate amount of accounts and
notes payable by any of the Companies to any member of the Sellers'
Group other than the Companies, excluding the total amount due under
the Dividend Notes;
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"INTER-COMPANY RECEIVABLES" means the aggregate amount of accounts and
notes receivables of any of the Companies from any member of the
Sellers' Group other than the Companies, excluding the total amount due
under the Note;
"INTEREST RATE" means a rate of four point five per cent (4.5 % ) per
annum;
"JUDGMENT" means any judgment, order, decree or injunction of any
court, Governmental Entity or arbitration panel;
"KEY EMPLOYEES" means the employees of the Sellers, the Sellers'
Guarantor, the Company, REPGB and RETM set forth in Annex 5 to this
Agreement;
"LAST ACCOUNTING DATE" means 31 December 2002;
"LC FACILITY" means the U$ four hundred and twenty million
($420,000,000) letter of credit facility dated 17 July 2000 between
REPGB (as borrower) with ABN AMRO Bank N.V. and Barclays Capital as
arranger and ABN AMRO Bank N.V. as agent;
"MARKS" means the trade names, registered and unregistered trademarks,
domain names and e-mail addresses comprising or including the terms
"Reliant" or "Resources", or any terms of a confusingly similar nature;
"MATERIAL" or "MATERIALLY," when used with respect to any of the
Companies means material to the Companies taken as a whole;
"MATERIAL ADVERSE EFFECT" means any change, circumstance, event or
effect that individually is materially adverse to the business, Assets,
condition, or results of operations of one or more of the Companies and
their businesses resulting in a loss at one or more of the Companies
equal to or in excess of one hundred million Euro ((euro)100,000,000),
except for those resulting from:
(i) changes that affect the industry taken as a whole in which the
Companies operate, including changes in:
wholesale or retail markets for electric power, district
heating or fuel or related products including those due to
actions by competitors; or
electric transmission or distribution systems;
(ii) changes in financial or securities markets or the economy in
general;
(iii) effects of weather or meteorological events;
(iv) changes in Applicable Law; or
(v) changes in the political climate generally (including but not
limited to (an announcement of) war);
"MATERIAL PURCHASER'S PRE-CLOSING BREACH" means a Purchaser's
Pre-Closing Breach that shall have a material adverse effect on any
members of the Sellers' Group, on any of the Companies or on the
transactions contemplated under this Agreement (for the
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purpose of this definition "material adverse effect" does not have the
meaning ascribed to it in the definition of Material Adverse Effect);
"MATERIAL SELLERS' GUARANTOR PRE-CLOSING BREACH" means a Sellers'
Guarantor Pre-Closing Breach that is deemed to have a Material Adverse
Effect;
"MATERIAL SELLERS' PRE-CLOSING BREACH" means a Sellers' Pre-Closing
Breach that is deemed to have a Material Adverse Effect;
"MEDIUM TERM NOTE FACILITY" means the thirty two million six hundred
seventy two thousand and one hundred seventy six Euro
((euro)32,672,176) Domestic Medium Term Note Programme of REPGB, dated
26 November 1991;
"NEA" means B.V. Nederlands Elektriciteits Administratiekantoor and any
of its successors;
"NEA PROCEEDS" means any cash payments (dividend or liquidation
proceeds) to be made after the date of this Agreement by or on behalf
of NEA to any of the Companies or to any of their Affiliates or to any
other person designated by them;
"NEA REFUND REQUEST" has the meaning ascribed to it in Article 2.4.3
(i);
"NET CASH" as of the applicable date of determination means in
aggregate:
(i) with regard to REPGB and its Subsidiaries the cash at hand
(including (a) cash in bank balances, cash on deposit in money
market funds, or cash on deposits in broker or on margin
accounts, (b) cash pledged as collateral for letters of
credit, guaranties, margin agreements to secure obligations
with commercial counterparties, (c) bonds, (d) funds available
in the escrow account established for the settlement of
Stranded Costs by the former shareholders, (e) cash on deposit
with exchanges and grid operators;
plus
(ii) marketable securities;
plus
(iii) any amount of any dividends paid by REPGB after the Last
Accounting Date, if and to the extent paid at the moment of
calculating the Net Cash in accordance with Article 14.2.2;
minus
(iv) moneys actually borrowed or drawn down as of the Closing Date
under REPGB's (euro) 32,672,176 Medium Term Note Program or
REPGB's outstanding credit agreements but excluding amounts
relating to (a) issued and outstanding letters of credit, (b)
Cross Border Leases, (c) the Inter-Company Payables and
Inter-Company Receivables (it being understood that such
receivables and payables will have been fully settled in
accordance with Article 9.9 prior to
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Closing), (d) derivative transactions, (e) forward purchase
agreements and (f) indemnity obligations, guaranties, etc.;
minus
(v) any cash received between the Last Accounting Date and the
Closing Date from:
(a) the settlement agreement with the former
shareholders;
(b) the ongoing arbitration proceeding with Corus;
(c) in connection to the arbitration proceedings related
to Rijks Energie Belastingen (net of any related
payments to the Ministry of Economic Affairs);
(d) dividends, or similar distributions received from
NEA,
all of the above to be determined in accordance with the Accounting
Standards used in preparing the Audited Accounts;
"NET CASH ADJUSTMENT" has the meaning ascribed to it in Article 2.3.7;
"NET CASH AMOUNT" means Net Cash as of the date prior to the Closing;
"NORNED AGREEMENTS" means (i) the Power Exchange Agreement, (ii) the
Cable Co-operation Agreement between NEA and Statnett SF, dated 18 July
1994, (iii) the Co-ordination Agreement between NEA, Statkraft SF and
Statnett SF, dated 18 July 1994, (iv) the DC-Link Transmission
Agreement between NEA, Statkraft SF and Statnett SF, dated 18 July
1994, (v) the Supplemental Agreement to the Cable Co-Coperation
Agreement, and (vi) any relevant ancilliary documentation related to
the foregoing agreements;
"NORNED CABLE PROJECT" means the construction of a high voltage sub-sea
cable between Norway and The Netherlands for the delivery and power
exchange between NEA and Statkraft SF;
"NOTARY" has the meaning ascribed to it in Article 14.2.5;
"NOTE" means the interest bearing promissory demand note dated 7
October 1999, as amended, in the original amount of three hundred and
ninety-seven million seven hundred thousand seven hundred and
sixty-three Euro and seventy Euro cents ((euro) 397,700,763.70), which
is outstanding as of the date of this Agreement, by and between Reliant
Energy Power Generation, Inc. (as debtor) in favour of REPGB (as
beneficiary), the obligations of which will be assumed by the Purchaser
on the Closing Date pursuant to section 14.2.3 (ii), a copy of which is
attached as Annex 6 to this Agreement;
"ORIGINAL ACQUISITION DATE" means 1 March 2000, the date on which the
final tranche of shares in the capital of REPGB was transferred to the
Sellers' Group;
"PARENT" of a company means a legal entity of which such company is a
subsidiary;
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"PARTICIPATION SHARES" means the shares of any of the Companies in a
Participation;
"PARTICIPATIONS" means the entities, other than the Subsidiaries, in
which the Companies directly or indirectly have a minority equity or
other minority ownership interest or minority investment, a list of
which is attached as Annex 9 to this Agreement;
"PARTIES" has the meaning ascribed to it in the heading of this
Agreement;
"PAYMENT DATE" has the meaning ascribed to it in Article 2.4.4 (c);
"PEA CLAIM NOTICE" has the meaning ascribed to it in Article 2.4.6;
"PEA STRANDED COSTS" has the meaning ascribed to it in Article 2.4.6
(ii);
"PERMITS" means all licenses, permits, consents and approvals,
including those required under applicable Environmental Laws, necessary
to conduct the operations of the Companies as conducted at the date of
this Agreement the absence of which would materially impair the
operations of the Companies as conducted at the date of this Agreement
or at the Closing Date;
"PERMITTED ENCUMBRANCES" means:
(i) any (cross) netting or (cross) set-off arrangement entered
into by any of the Companies in the ordinary course of their
banking or trading arrangements for the purpose of netting
debit and credit balances of any of the Companies;
(ii) any title transfer or retention of title arrangement entered
into by or arising in respect of assets of any of the
Companies in the ordinary course on the counter party's
standard or usual terms;
(iii) any Encumbrance arising solely by operation of law and in the
ordinary course of business of the Companies provided that
such Encumbrance is discharged within thirty (30) Business
Days of arising; and
(iv) any of the Cross Border Leases;
"PERSON" or "PERSON" means an individual, corporation, company, firm,
partnership, joint venture, association, unincorporated organisation,
limited liability company, or Governmental Entity;
"POWER EXCHANGE AGREEMENT" means the power exchange agreement between
NEA and Statkraft SF dated 31 January 1994 as amended by No. 1 dated 18
July 1994;
"PREMISES" has the meaning ascribed to it in Article 3.8.2;
"PRELIMINARY NET CASH REDUCTION" has the meaning ascribed to it in
Article 2.3.3;
"PURCHASE PRICE" means the purchase price to be paid by the Purchaser
to the Sellers for the Shares as determined in Article 2.2;
"PURCHASER" has the meaning ascribed to it in the heading of this
Agreement;
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"PURCHASER'S CONFIDENTIALITY AGREEMENT" means the confidentiality
agreement between the Purchaser and ▇▇▇▇▇▇▇ ▇▇▇▇▇ International, as
agent for and on behalf of Reliant Resources, Inc., executed in
connection with the potential sale of Reliant Energy Europe, dated 7
January 2003;
"PURCHASER'S GROUP" has the meaning ascribed to it in Article 9.1.1;
"PURCHASER'S DISCLOSURE LETTER" has the meaning ascribed to it in
Article 5.1;
"PURCHASER'S PRE-CLOSING BREACH" means a breach by the Purchaser
occurring prior to Closing of any of (i) its obligations pursuant to
this Agreement or (ii) the Purchaser's Warranties;
"PURCHASER'S WARRANTIES" means any and all express representations and
warranties given by the Purchaser pursuant to Article 5;
"REAL PROPERTY" has the meaning ascribed to it in Article 3.8.1;
"RECE" means Reliant Energy Capital (Europe), Inc. a company
incorporated under the laws of the State of Delaware, United States of
America;
"RELEVANT PERIODS" means any period ending on or prior to Closing in
respect of which any of the Companies is required to make a return or a
payment to a tax authority;
"RELIANT ENERGY EUROPE" has the meaning ascribed to it in Recital (D);
"RELIEF" means loss, allowance, credit, relief, deduction or set-off or
any right to a repayment of Taxes;
"REPGB" has the meaning ascribed to it in Recital (B);
"RESIGNING PERSON" has the meaning ascribed to it in Article 14.2.7;
"REVOLVING CREDIT FACILITY" means the two hundred fifty million Euro
((euro)250,000,000 (currently reduced to one hundred eigthy four
million seven hundred forty nine thousand Euro ((euro)184,749,000))
multicurrency revolving credit facility agreement dated 17 July 2000,
as amended on 16 July 2001 and 10 July 2002 between REPGB as borrower
with ABN AMRO Bank N.V. and Barclays Capital as arrangers and ABN AMRO
Bank N.V. as agent;
"RETM" has the meaning ascribed to it in Recital (C);
"SELLER NO. 1" has the meaning ascribed to in the heading of this
Agreement;
"SELLER NO. 2" has the meaning ascribed to in the heading of this
Agreement;
"SELLERS" has the meaning ascribed to it in the heading of this
Agreement;
"SELLERS' CONFIDENTIALITY AGREEMENT" means the confidentiality
agreement between the Purchaser and the Sellers' Guarantor on behalf of
the Sellers' Group in connection with the possible sale of Reliant
Energy Europe, dated 15 January 2003;
"SELLERS' DISCLOSURE LETTER" has the meaning ascribed to it in Article
3.1.1;
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"SELLERS' GROUP" means each of the Sellers and any of their Affiliates;
"SELLERS' GUARANTOR" has the meaning ascribed to it in the heading of
this Agreement;
"SELLERS' GUARANTOR PRE-CLOSING BREACH" means a breach by the Sellers'
Guarantor occurring prior to Closing of any of (i) its obligations
pursuant to this Agreement, (ii) the representations and warranties on
its part given in Article 4 or (iii) the Guaranteed Obligations;
"SELLERS' GUARANTOR WARRANTIES" means any and all express
representations and warranties given by the Sellers' Guarantor pursuant
to this Agreement;
"SELLERS' MAXIMUM REFUND OBLIGATION " has the meaning ascribed to it in
Article 2.4.3 (ii);
"SELLERS' PRE-CLOSING BREACH" means a breach by the Sellers occurring
prior to Closing of any of (i) their obligations pursuant to this
Agreement or (ii) the Sellers' Warranties;
"SELLERS' REFUND OBLIGATION" has the meaning ascribed to it in Article
2.4.4 (b);
"SELLERS' WARRANTIES" means any and all express representations and
warranties given by the Sellers on the part of themselves or the
Companies pursuant to Articles 3 and 4, as well as the Sellers'
Guarantor Warranties;
"SHARES" has the meaning ascribed to it in Recital (E);
"STRANDED COSTS" means the obligations and liabilities referred to in
Article 2(2) of the Transitional Act of 21 December 2000 (Overgangswet
elektriciteitsproductiesector);
"SUBSIDIARIES" means all the companies as set forth in Annex 9 to this
Agreement;
"SUBSIDIARY SHARES" means all the issued and outstanding share capital
in each of the Subsidiaries;
"TAX" or "TAXES" means all forms of taxation, duties, levies, imposts
and social security charges, including, without limitation, corporate
income tax, wage withholding tax, national social security
contributions and employee social security contributions, value added
tax, customs and excise duties, capital tax and other legal transaction
taxes, dividend withholding tax, surtax, (municipal) real estate taxes,
real estate transfer tax, other municipal taxes and duties,
environmental taxes and duties and any other type of taxes or duties in
any relevant jurisdiction; together with any interest, penalties,
surcharges or fines relating thereto, due, payable, levied, imposed
upon or claimed to be owed in The Netherlands, the United States and
any other relevant jurisdiction;
"TAX RETURNS" means returns, reports or similar statements (including
any attached schedules) required to be filed with respect to any Taxes,
including any information return, claim for refund, amended return or
declaration of estimated Taxes;
"TERMINATED LEASES" means (i) the US cross border lease agreement with
respect to Diemen 31/32, (ii) the Austrian cross border lease agreement
with respect to a turbine at
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Lage ▇▇▇▇▇ 05, (iii) the German cross border lease agreement with
respect to a gas turbine at Diemen 33 and (iv) the German cross border
lease agreement with respect to a steam turbine at Diemen 33, that all
have been entered into by REPGB in the past;
"TERMINATED OBLIGATIONS" means the guaranties as set forth in Annex 7
to this Agreement;
"TERMINATION NOTICE" has the meaning ascribed to it in Article 12.1;
"TRANSITIONAL ACT" means the Dutch Act of 21 December 2000
(Overgangswet elektriciteitsproductiesector) setting out transitional
arrangements for the electricity sector as amended from time to time;
and
"WORKS COUNCIL" means the works council (ondernemingsraad) of (i) REPGB
or (ii) of the Purchaser or any of its Affiliates, as the case may be.
1.2 INTERPRETATION
1.2.1 Where any Sellers' Warranty or any disclosure in the Sellers'
Disclosure Letter is qualified or phrased by the expression
"TO THE SELLERS' BEST KNOWLEDGE" or any similar expression or
statement, that expression or statement shall refer to, after
due enquiry, the actual knowledge of - and what reasonably
should be known by - any and all of the Key Employees.
1.2.2 An action taken by a person will be deemed to have been taken
in the "ORDINARY COURSE OF BUSINESS" only if such action (i)
is consistent with the prudent past practices of such person,
(ii) is taken in the ordinary course of the normal day-to-day
operations of such person and (iii) does not require prior
approval of the supervisory board (raad van commissarissen) of
REPGB or other relevant company.
1.2.3 Where any obligation is qualified or phrased by reference to
"USE BEST EFFORTS" or any similar expression, that expression
means the efforts that a person desirous of achieving a result
would use in similar circumstances to ensure that such result
is achieved as expeditiously as possible and taking into
account, among other factors, (i) the price, financial
interest and other terms of the obligation, (ii) the degree of
risk normally involved in fulfilling such obligation and (iii)
the ability of an unrelated person to influence the
performance of the obligation.
1.2.4 All Annexes to this Agreement and all Appendices to the
Annexes to this Agreement shall form an integral part of this
Agreement and any reference to this Agreement includes such
Annexes and Appendices. In this Agreement, references to
Articles, Recitals, Annexes and Appendices are references to
Articles, Recitals and Annexes to this Agreement and to
Appendices to Annexes to this Agreement.
1.2.5 Captions are inserted for convenience only and shall not
affect the interpretation of this Agreement.
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1.2.6 Unless the context otherwise requires, in this Agreement:
(i) defined terms, nouns, pronouns and verbs of the
singular number shall be deemed to include the
plural, and vice versa, and pronouns of the masculine
gender shall be deemed to include the feminine and
neuter, and vice versa, all as the context may
require;
(ii) the words "include", "includes" and "including" shall
be deemed to be followed by the phrase "without
limitation";
(iii) whenever used in this Agreement the words "herein"
and similar words shall be construed as references to
this Agreement as a whole and not limited to the
particular Article or subsection in which the
reference appears;
(iv) a statutory provision includes a reference to the
statutory provision as modified or re-enacted (or
both) before the date of this Agreement and any
subordinate legislation made and brought into effect
under such legislation before the date of this
Agreement;
(v) any reference to "or" shall mean "and/or"; and
(vi) Dutch words and expressions defined in Book 2 of the
Dutch Civil Code shall bear the same meaning as in
that Code.
1.2.7 If there is a discrepancy between an English language word and
a Dutch language word used to clarify the same, and then only
to the extent of the conflict, the meaning of the Dutch
language word shall prevail.
2. SALE, PURCHASE AND PURCHASE PRICE
2.1 SALE AND PURCHASE
Upon the terms and subject to the conditions of this Agreement:
2.1.1 the Sellers hereby sell to the Purchaser and the Purchaser
hereby purchases from the Sellers the Shares; and
2.1.2 the Sellers undertake to transfer to the Purchaser and the
Purchaser undertakes to accept from the Sellers the Shares on
the Closing Date.
2.2 PURCHASE PRICE
The purchase price for the Shares shall be equal to the sum of (i) the
Initial Purchase Price as adjusted, if required, pursuant to the Net
Cash Adjustment plus (ii) the Contingent Purchase Price.
2.3 NET CASH ADJUSTMENT
2.3.1 As of the date of this Agreement, within five (5) Business
Days after the end of each calendar month the Sellers shall
report to the Purchaser in writing on the amount of Net Cash
as at the last Business Day of each calendar month.
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2.3.2 On the Closing Date the Sellers shall:
(i) prepare and get its external auditors (or if the
external auditor appointed by the Sellers cannot
guarantee its ability to timely provide the Draft
Auditor's Statement on the Closing Date, the Sellers
will at least 5 days prior to Closing give the
Purchaser the opportunity to appoint an auditor for
this purpose) to audit and certify the Net Cash
Amount ("ESTIMATED NET CASH") in an auditors
statement (the "DRAFT AUDITOR'S STATEMENT"). However,
in the event that the Draft Auditor's Statement is
prepared by the auditors of the Purchaser, the
Sellers shall procure that the external auditor
appointed by Sellers shall in any event additionally
deliver to the Sellers and to the Purchaser an
auditors statement of the Net Cash per Closing two
(2) Business Days after Closing; and
(ii) deliver to the Purchaser a copy of the Draft
Auditor's Statement.
2.3.3 If the Estimated Net Cash is less than one hundred fifteen
million Euro ((euro) 115,000,000) the difference shall be
deducted by the Purchaser from the Cash Payment as a
preliminary Net Cash reduction, such reduction of the Initial
Purchase Price hereinafter referred to as the "PRELIMINARY NET
CASH REDUCTION".
2.3.4 If the Sellers or the Purchaser have objections to the Draft
Auditors' Statement and the Estimated Net Cash the Sellers or
the Purchaser, as the case may be, must, not later than five
(5) Business Days of receipt of the Draft Auditors' Statement
under Article 2.3.2, send a written notice to the other Party,
setting out those objections in a reasonable level of detail,
failing which the Draft Auditors' Statement shall be the final
and binding audited statement (the "AUDITOR'S STATEMENT"), and
the Estimated Net Cash shall be the Net Cash Amount. The
Audited Statement and the Net Cash Amount shall be deemed to
be final, approved by and binding upon the Parties.
2.3.5 If the Sellers or the Purchaser send a written objection
according to Article 2.3.4, the Sellers and the Purchaser must
use their best efforts to approve, in writing, to agree to the
Auditors' Statement and agree to the Net Cash Amount.
2.3.6 If within ten (10) Business Days of the submission to the
Purchaser of the Draft Auditors' Statement according to
Article 2.3.2, it has not been approved by the Parties, the
unresolved matter(s) must be referred to an independent
registered accountant of at least fifteen (15) years relevant
experience agreeable to the Parties, or failing that agreement
a person with that experience and those qualifications
appointed by the chairperson for the time being of the
Nederlands Instituut voor Register Accountants (NIVRA) for
final determination (bindend advies). The Parties will
instruct the independent accountant to determine the Auditor's
Statement and the Net Cash Amount within ten (10) Business
Days of the referral to him. The Parties must provide him with
all the information as he may request for the purposes of
making his determination. The Parties must pay on demand the
costs of the independent accountant in equal shares.
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2.3.7 The Sellers and the Purchaser shall settle the difference
between the Estimated Net Cash and the Net Cash Amount (the
"NET CASH ADJUSTMENT") and shall make the required
(re)payments, each as the case may be, not later than five (5)
Business Days after the Net Cash Amount has been finally
determined. If the Net Cash Adjustment is in favour of the
Sellers the Net Cash Adjustment will be deemed to be limited
to the amount of the Preliminary Net Cash Reduction.
2.4 CONTINGENT PURCHASE PRICE
2.4.1 As from the Closing Date until the liquidation (ontbinding) of
NEA becoming effective the Purchaser shall inform and shall
cause REPGB to inform the Sellers:
(i) on a quarterly basis (and without any delay on any
earlier date as appropriate) of the financial
position of NEA;
(ii) on a monthly basis (and without any delay on any
earlier date as appropriate) of any (advance) cash
payments (or of equivalents thereof) made by NEA to
the Companies or any of its Affiliates, including of
any intentions to make such payments; and
(iii) subject to the Sellers or Sellers' Guarantor's
execution of a confidentiality agreement and provided
that Purchaser is not prevented from doing so
pursuant to contractual or legal obligations, any
other information relevant to the position of the
Sellers in respect of the NEA Proceeds, including
excerpts of agenda's, minutes and resolutions
relevant to the foregoing.
2.4.2 The Purchaser shall procure that REPGB shall pay the
Contingent Purchase Price to the Sellers, or to any other
person designated by them, no later than five (5) Business
Days after receipt of any of the NEA Proceeds by any of the
Companies or by any of their Affiliates (or by any of their
successors) or by any other person designated by them, in cash
by wire transfer in immediately available funds and free of
bank charges, deductions or set-off from any course of action
in any way arising, into the account as designated by the
Sellers.
2.4.3 For purposes of this Article 2.4:
(i) the term "NEA REFUND REQUEST" means an obligation of
REPGB pursuant to the Transitional Act to make to NEA
a cash payment necessary to allow NEA to pay all
costs and liabilities that NEA is otherwise unable to
pay using its own capital resources or other assets,
whether based upon a written request of NEA or not;
and
(ii) the term "FINAL DISTRIBUTION DATE" means the date on
which NEA makes the final distribution to its
shareholders comprising of substantially all, being
at least ninety five per cent. (95%), of its
remaining assets; and
(iii) the term "SELLERS' MAXIMUM REFUND OBLIGATION" means
the amount equal to the Contingent Purchase Price
actually received by Sellers,
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which Sellers will remit to the Purchaser as a result
of a certification of any NEA Refund Request and a
PEA Stranded Costs Claim.
2.4.4 CERTIFICATION OF NEA REFUND REQUEST. In the event of a NEA
Refund Request prior to the Final Distribution Date, the
Purchaser shall transmit to the Sellers as soon as possible,
but in no event later than two (2) Business Days after receipt
of such request, a certificate signed by a managing director
(bestuurder) of Purchaser attesting to the following:
(a) a true and correct copy of any documents in relation
to the NEA Refund Request;
(b) the certification that the amount of Sellers' refund
obligation ("SELLERS' REFUND OBLIGATION") is not more
than ninety per cent (90%) of NEA's Refund Request;
(c) confirmation of the date on which REPGB paid or will
pay the NEA Refund Request (the "PAYMENT DATE");
(d) the bank account of REPGB in The Netherlands into
which Sellers are requested to deposit by wire
transfer the Refund Amount; and
(e) any other information relevant to the NEA Refund
Request, including information (and documents
relating to) any settlement agreements entered into
by NEA and REPGB (or its Affiliates) with respect to
the matters underlying the NEA Refund Request and
with respect to the Final Distribution Date as
Sellers may reasonably request.
2.4.5 PAYMENT OF NEA REFUND REQUEST. No later than five (5) Business
Days after receipt of the certificate, the Sellers shall
transmit by wire transfer in immediately available funds,
without deductions or set off and free of bank charges, the
Sellers' Refund Obligation to REPGB; provided, however, that
under no circumstances shall the aggregate amount of Sellers'
Refund Obligation exceed Sellers' Maximum Refund Obligation.
2.4.6 PEA STRANDED COST. Notwithstanding the above, the Sellers
shall also reimburse the Purchaser for out of market costs
incurred by the Companies and its Affiliates relating to the
("POWER EXCHANGE AGREEMENT") for the ("NORNED CABLE PROJECT"),
provided, however, that under no circumstances shall the
aggregate amount of Sellers' Refund Obligation exceed Sellers'
Maximum Refund Obligation. For the purpose of this Article
2.4.6 "out of market costs' or "out of market losses" shall be
calculated by discounting the cash flows with the Purchaser's
weighted average cost of capital as of the date of such
valuation, on an after-tax basis.
(i) PRE-CONDITIONS TO PEA CLAIM NOTICE. To be eligible
for reimbursement of the out of market costs relating
to the Power Exchange Agreement ("PEA STRANDED
COSTS"), the following conditions must be satisfied:
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(a) NEA shall have assigned to REPGB its
percentage share of the contractual rights
and obligations of NEA under the Power
Exchange Agreement; and
(b) the NorNed cable shall have been constructed
and shall be operational, provided, however,
that this condition that the NorNed cable
shall have been constructed and shall be
operational shall also be fulfilled in the
event that (i) in respect of the NorNed
cable the construction has commenced and
(ii) the Final Distribution Date is after
the construction of the NorNed cable has
been commenced but prior to the NorNed cable
becoming operational. Notwithstanding any
other provision of this Agreement, after the
date on which the construction of the NorNed
cable has commenced, the Purchaser can
set-off any NEA Proceeds against any PEA
Stranded Costs .
(ii) CERTIFICATION OF PEA STRANDED COSTS CLAIM. If the
preceding conditions are satisfied, and the Purchaser
believes that it or any of the Companies or its
Affiliates has incurred or shall incur a liability
for PEA Stranded Costs, the Purchaser shall submit to
the Sellers a certificate ("PEA CLAIM NOTICE") signed
by a managing director of Purchaser attesting to the
following:
(a) the satisfaction of the conditions specified
in subparagraphs (i)(a) and (i)(b) above;
(b) a detailed calculation, together with
supporting explanation and documents, of the
amount of out of market costs and losses
incurred or to be incurred by REPGB and its
Affiliates with respect to electricity
imports and exports under the Power Exchange
Agreement as calculated by reference to (i)
the difference between the contract price
and market price for such electricity over
the total period of the contract, (ii)
Purchaser's weighted average cost of capital
as of the date of such valuation on an
after-tax basis, and (iii) other related
costs; and
(c) any other information relevant to the NEA
Refund Request, including information (and
documents relating to) any settlement
agreements entered into by NEA and REPGB (or
its Affiliates) with respect to the matters
underlying the NEA Refund Request for PEA
Stranded Costs.
(iii) SELLERS' RESPONSE TO PEA CLAIM NOTICE. Within thirty
(30) Business Days of receipt of the PEA Claim
Notice, the Sellers will notify the Purchaser as to
whether they agree with, or wish to contest, the
calculation of the PEA Stranded Costs.
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(a) AGREEMENT AS TO CALCULATION OF PEA STRANDED
COST LIABILITIES. If the Sellers agree with
the calculation of PEA Stranded Costs, they
shall transmit, no later than five (5)
Business Days after receipt of the PEA Claim
Notice, payment of Sellers' Refund
Obligation by wire transfer in immediately
available funds, without deductions or set
off and free of bank charges, the amount
specified in the PEA Claim Notice; provided,
however, under no circumstances shall the
aggregate amount of Sellers' Refund
Obligation exceed the Sellers' Maximum
Refund Obligation.
(b) DISAGREEMENT AS TO CALCULATION OF PEA
STRANDED COSTS. If the Sellers disagree with
the calculation of PEA Stranded Costs, they
shall within fifteen (15) Business Days
after receiving a PEA Refund Request
transmit to the Purchaser a certificate
signed by an executive board member of
Seller's Guarantor setting forth a detailed
re-calculation, together with supporting
explanation and documentation, of the amount
of PEA Stranded Costs with respect to
electricity imports and exports under the
Power Exchange Agreement calculated by (i)
reference to the difference between the
contract price and market price for such
electricity over the total period of the
contract, (ii) Purchaser's weighted average
cost of capital as of the date of such
valuation on an after-tax basis and (iii)
any other related costs.
(iv) MEETING TO RECONCILE DIFFERENCES IN CALCULATIONS.
Within ten (10) Business Days of receipt of Sellers
objection to the calculation of the PEA Stranded
Costs, the Sellers and the Purchaser shall meet to
negotiate in good faith a reconciliation of their
different calculations of the PEA Stranded Costs.
(v) DETERMINATION OF THIRD PARTY EXPERT. If within ten
(10) Business Days of receipt of Sellers objection to
the calculation of the PEA Stranded Costs, the
Parties are unable to agree upon the calculation of
the PEA Stranded Costs, they shall submit their
respective calculations to an independent expert
jointly appointed by the Parties or, if the Parties
are unable to agree on the independent expert, an
expert jointly appointed by the respective
independent experts designated by the Parties. The
independent expert so selected shall determine by way
of "binding advice" (bindend advies) the amount of
Sellers' Refund Obligation attributable to the PEA
Stranded Costs; provided, however, that under no
circumstances shall the aggregate amount of Sellers'
Refund Obligation exceed the Sellers' Maximum Refund
Obligation.
(vi) Upon determination of the amount of Sellers' Refund
Obligation attributable to the PEA Stranded Costs,
the Sellers shall transmit, no later than five (5)
Business Days after receipt of the PEA Claim Notice,
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payment of Sellers' Refund Obligation by wire
transfer in immediately available funds, without
deductions or set off and free of bank charges, the
amount specified in the PEA Claim Notice; provided,
however, under no circumstances shall the aggregate
amount of Sellers' Refund Obligation exceed the
Sellers' Maximum Refund Obligation.
2.4.7 The calculation of Sellers' Refund Obligation shall be subject
to the limitations and other provisions regarding damage
payments as set forth in Article 17.5 (Recourse) and in
Article 18.2.2 (Consent to Settlement).
2.4.8 The Purchaser shall not and shall procure that REPGB shall
not, in any way whatsoever, agree to any sale or transfer of
any shares in NEA, nor shall the Purchaser allow and shall
procure that REPGB shall not allow, in any way whatsoever, to
make any shares in NEA held by REPGB subject of any pledge
(pandrechten), attachments (beslagen), entitlements of
beneficial ownership (including rights of usufruct (rechten
van vruchtgebruik)), deposits or assignments by way of
security, options and rights of pre-emption
(voorkeursrechten), without the prior written consent of the
Sellers.
2.4.9 The Purchaser shall procure that REPGB shall use its best
efforts to cause NEA to maximise the NEA Proceeds and to cause
that any distributions of NEA are made in cash.
2.5 TERMINATED OBLIGATIONS
2.5.1 On the Closing Date, the Purchaser shall assume the Terminated
Obligations in a form and substance reasonably satisfactory to
the beneficiary of each such Terminated Obligation and shall
use its best efforts to deliver to the Sellers and the
Sellers' Guarantor written releases with respect to all
Terminated Obligations on the Closing Date or as soon as
reasonably practicable prior to the Closing Date.
2.5.2 If the Purchaser is unable to effect any such substitution or
release on or prior to the Closing Date due to a breach by the
Purchaser, the Purchaser shall indemnify and hold harmless the
Sellers, the Sellers' Guarantor and their Affiliates and any
of their respective officers and directors (each an
"INDEMNIFIED PARTY") from and against any liabilities, claims,
demands, Judgments, losses, costs, damages or expenses from
and after the Closing Date that any such Indemnified Party may
sustain, suffer or incur and that directly result from or
directly arise out of or directly relate to a Terminated
Obligation until such time as substitutions of all such
Terminated Obligations are effected and written releases
thereto have been obtained by the Purchaser. The Purchaser
hereby agrees to provide copies of such written releases to
the Sellers and the Sellers' Guarantor promptly upon receipt
by the Purchaser. The obligation of Purchaser to indemnify
Sellers and Sellers' Guarantor is subject to the Companies not
being in breach of any Terminated Obligation on the Closing
Date.
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2.5.3 The Purchaser shall continue to use its best efforts to effect
such substitution or release with respect to the Terminated
Obligations at all times after the Closing Date until such
time when the substitution or release of all Terminated
Obligations has been effected. Each Indemnified Party shall
co-operate with the Purchaser in procuring any such
substitutions or releases; provided that the failure of an
Indemnified Party to perform its obligations under this
Article 2.5 shall not constitute an event that would, by
itself, give rise to any claim by the Purchaser or right of
the Purchaser to terminate this Agreement. For the avoidance
of doubt, this Article 2.5 should not be interpreted to
constitute a waiver (afstand ▇▇▇ ▇▇▇▇▇) of the right of the
Sellers and their Affiliates to terminate any Terminated
Obligation in accordance with the terms thereof, provided this
is in accordance with Article 9 of this Agreement.
3. REPRESENTATIONS AND WARRANTIES REGARDING THE COMPANIES
3.1.1 The Sellers hereby jointly and severally represent and warrant
(garanderen) to the Purchaser, except as set forth in the
disclosure letter delivered by the Sellers to the Purchaser
and attached as Annex 8 to this Agreement (the "SELLERS'
DISCLOSURE LETTER"), each of the statements set out in
Articles 3.2 to 3.22 (inclusive) is on the date of this
Agreement or on such earlier or later date as expressly
indicated, true and accurate in accordance with its terms.
3.1.2 Each of the Sellers' Warranties is separate and independent
and is not limited:
(i) by reference to any other paragraph of Article 3 or
Article 4; or
(ii) by anything in this Agreement; or
(iii) without prejudice to Article 5.7, by any knowledge
resulting from the Due Diligence Investigation
carried out by or on behalf of the Purchaser or the
Due Diligence Information.
Without prejudice to Article 5.7, each of the Sellers hereby
waives (doet afstand van) its rights to use the Due Diligence
Information and the Due Diligence Investigation in the event
that there is a breach of any of the Sellers' Warranties,
except for the Sellers' Disclosure Letter.
3.1.3 The Sellers' Warranties allocate between the Sellers on the
one hand and the Purchaser on the other hand the risk and
costs relating to any facts or circumstances which may cause
any of the Sellers' Warranties to be untrue or inaccurate. The
Purchaser's Group has relied on its own independent Due
Diligence Investigation and has not relied on any information,
representations or warranties furnished or made by the
Sellers, by any Advisor of the Sellers, by any member of the
Sellers' Group or by any other person in determining to (i)
enter into this Agreement and (ii) pay the Purchase Price as
set out in this Agreement, other than on the Sellers'
Warranties.
3.1.4 The Purchaser acknowledges and agrees that, except as
otherwise expressly provided in this Agreement, the Sellers
and the Sellers' Guarantor expressly
- 22 -
disclaim any representations or warranties of any kind or
nature, express or implied.
3.1.5 After Closing, any payment made by the Sellers and the
Sellers' Guarantor in respect of a breach of the Sellers'
Warranties shall for Dutch tax purposes only be deemed to be a
reduction of the Purchase Price.
3.1.6 The liability of the Sellers in connection with the Sellers'
Warranties shall be subject to the limitations contained in
this Agreement, including Articles 12 and 15, and any claim in
connection with the Sellers' Warranties shall be subject to
the provisions of this Agreement, including Articles 12 and 15
to 18 (inclusive).
3.2 ORGANISATION AND AUTHORITY
3.2.1 Each of the Companies is duly organised and validly existing
under the laws of The Netherlands or of Germany, as the case
may be. Each of the Companies has the requisite corporate
power and authority to own its property and to carry on its
business as currently conducted.
3.2.2 Neither of the Companies has stopped or suspended payment of
its debts, become unable to pay its debts, been declared
bankrupt (in staat van faillissement verklaard), nor have any
of the Companies been dissolved by a competent court. No order
has been made, or action or request is pending in any
jurisdiction, to declare any of the Companies insolvent and
neither has any of the Companies petitioned for or been
granted a suspension of payments (surseance van betaling) or
similar procedure or action in The Netherlands or in Germany.
3.2.3 The Companies are not a party to a pending legal merger or a
pending legal demerger, each within the meaning of Book 2 of
the Dutch Civil Code, or any similar procedure in The
Netherlands or in Germany.
3.2.4 To the Sellers' best knowledge, there are no material
transactions entered into by the Companies capable of being
set aside, stayed, reversed, avoided, or affected in whole or
in part by any bankruptcy proceedings affecting the Companies
or any of the Assets or any of the Companies' undertakings
(whether or not such proceedings have been commenced) whether
as transactions at undervalue, in fraud of or against the
interests of creditors, preferences or paulian actions or
similar concepts or legal principles.
3.3 NO DIVIDENDS
3.3.1 Since the Last Accounting Date, the Companies have not made
any resolution or taken any action to distribute dividends, to
repay capital or to make any other distribution of reserves or
capital, other than in relation to the distribution of
dividends in accordance with Article 14.2.2.
3.3.2 Since the Last Accounting Date, the Companies have not issued
any profit sharing bonds or otherwise attributed rights to
third parties to share in its past, present or future income
or profit, reserves or liquidation surpluses.
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3.4 SHARES
3.4.1 Details of the Shares, the Subsidiary Shares and of the
Participation Shares are set forth in Annex 9 to this
Agreement. The Sellers are the sole legal and beneficial owner
of the Shares. The Company is, directly or indirectly, the
sole legal and beneficial owner of the Subsidiary Shares. The
Sellers have full power, right and authority to transfer the
Shares. The Companies have no material direct or indirect
shareholdings or participating interests in any person other
than the Subsidiary Shares and the Participation Shares.
3.4.2 The Shares and the Subsidiary Shares are duly authorised,
validly issued and are fully paid up. No repayment of capital
by any of the Companies has taken place since the Last
Accounting Date. None of the Companies owns shares in its own
outstanding share capital. The Shares, the Subsidiary Shares
and the Participation Shares are free and clear of any
Encumbrances and there are no commitments to give or create
any Encumbrances.
3.4.3 There are no outstanding rights to subscribe for shares in the
capital of any of the Companies. In particular there are no
share options or warrants to purchase shares in or convertible
debentures convertible into shares of any of the Companies.
3.4.4 There are no outstanding depository receipts (certificaten) in
relation to the Shares and Subsidiary Shares.
3.5 AUDITED ACCOUNTS
3.5.1 The Audited Accounts have been prepared in accordance with the
Accounting Standards, applied on a consistent basis (except as
may be indicated in the Audited Accounts or in the notes to
the Audited Accounts). The Audited Accounts give a true and
fair view of the financial position and the results of the
Companies as at the Last Accounting Date and provide such a
view as enables a sound judgement to be formed of the
Companies' assets and liabilities and their results and of
their solvency and liquidity. The balance sheet and the notes
thereon included in the Audited Accounts reflect in an
accurate, clear and systematic manner the net assets and the
composition thereof as at the Last Accounting Date. The
Companies have no other off balance liabilities than set forth
in (the notes to) the Audited Accounts. The profit and loss
statement and the notes thereon included in the Audited
Accounts reflects in an accurate, clear and systematic manner
the results for the financial year 2002 of the Companies and
the items of income and expenditure on which they are based.
Provided, however, that the Purchaser in order to make a claim
under this Article 3.5 has to establish that the Audited
Accounts do not give a true and fair view of the financial
position and the results of the Companies taken as a whole as
at the Last Accounting Date.
3.5.2 Each of the Companies has materially complied with the
provisions of the Dutch Civil Code concerning the recording of
financial information and
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bookkeeping requirements as well as the publication and filing
of its annual accounts for the previous two (2) financial
years, including for the financial year ending on the Last
Accounting Date.
3.6 ASSETS
3.6.1 The Companies own all the Assets included in the Audited
Accounts per the Last Accounting Date, other than (i) those
Assets disposed of in the ordinary course of business of the
Companies or those Assets disposed of as obsolete or surplus
Assets, (ii) those Assets disposed of in connection with the
replacement of Assets or properties, or property losses
covered by insurance, or (iii) those Assets disposed of in
accordance with a Contract.
3.6.2 As per the Closing Date, none of the Assets are subject to any
Encumbrance (save Permitted Encumbrances) or any Contract to
give or create any Encumbrance, except for (i) a retention of
title in the ordinary course of business of the Companies or
(ii) as part of a Cross Border Lease.
3.7 INTER-COMPANY RECEIVABLES AND INTER-COMPANY PAYABLES / SUBSIDIES
3.7.1 Except as provided for in the Audited Accounts, the Note and
as otherwise specified in Annex 26 none of the Companies had
as of the Last Accounting Date any outstanding receivables
with respect to any member of the Sellers' Group excluding the
Companies, including but not limited to the Inter-Company
Receivables.
3.7.2 Except as provided for in the Audited Accounts, the Dividend
Notes and as otherwise specified in Annex 26, none of the
Companies has any outstanding payables with respect to any
member of the Sellers' Group excluding the Companies,
including but not limited to the Inter-Company Payables.
3.7.3 As per the Closing, none of the Companies has any outstanding
receivables, including but not limited to the Inter-Company
Receivables with respect to any members of the Sellers' Group,
excluding the Companies.
3.7.4 As per the Closing, none of the Companies has any outstanding
payables, including but not limited to the Inter-Company
Payables with respect to any member of the Sellers' Group,
excluding the Companies.
3.7.5 The Companies are not subject to any arrangement for receipt
or repayment of any grant, subsidy or financial assistance
from any governmental department or other similar entity.
3.8 BUSINESS PREMISES
3.8.1 To the Sellers best knowledge, Annex 10 to this Agreement
contains a complete list of the real property that is owned by
the Companies (the "REAL PROPERTY").
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3.8.2 All material leases entitling the Companies to use, occupy or
hold the premises upon which each of the Companies, as the
case may be, conducts its business in effect on the date of
this Agreement are set forth in Annex 11 to this Agreement
(the "PREMISES" and jointly with the Real Property, referred
to as the "BUSINESS PREMISES").
3.9 TAXES
3.9.1 Each of the Companies has duly paid all Taxes on time, or, in
so far as Taxes are reasonably estimated to be due by any of
the Companies, but have not yet been paid, full provision for
such Taxes has been made in the Audited Accounts.
3.9.2 Each of the Companies has, to the extent material, duly filed
its respective Tax Returns on time (taking into account any
applicable extensions) and has furnished all other documents
required under Applicable Law.
3.9.3 Except as set forth in Annex 12, there are no audits,
investigations, claims, assessments or disputes pending
against any of the Companies with respect to any Taxes due
from the Companies for, or as a result of which any of the
Companies may have a liability. Neither of the Companies has
any outstanding agreement, waiver or arrangement extending any
statute of limitations with respect to Taxes due from any of
the Companies for any taxable period as from the Original
Acquisition Date for which any of the Companies may be liable.
3.9.4 All records which each of the Companies have required to keep
for Taxation purposes which would be needed to substantiate
any claim made or position taken in relation to taxation by
the relevant Subsidiary, have been duly kept and are available
for inspection at the premises of the relevant Subsidiary.
3.9.5 All amounts due for payment to the relevant authorities in
respect of VAT on goods sold or services rendered since the
Original Acquisition Date and prior to the Closing Date, wage
taxes to be withheld since the Original Acquisition Date and
prior to the Closing Date and social security contributions
(both for employers and employees) due in respect of any of
the Companies prior to the Closing Date has been or will be
duly paid or withheld prior to the Closing Date.
3.9.6 No Taxes are due or will become due by any of the Companies as
a result of the transactions contemplated by this Agreement.
3.9.7 None of the Companies is currently liable nor will be held
liable for the liability of other companies for taxes in
respect of any period prior to the Closing Date, other than
pursuant to an applicable fiscal unity.
3.9.8 None of the Companies is subject to any special Tax regime,
except for the applicable fiscal unity for corporate income
tax purposes and for VAT purposes that is applicable to the
Companies.
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3.10 CONDUCT OF BUSINESS SINCE THE LAST ACCOUNTING DATE
3.10.1 Since the Last Accounting Date, none of the Companies has
disposed of any Assets other than (i) in the ordinary course
of business, (ii) dispositions of obsolete or surplus Assets,
(iii) dispositions in connection with the replacement of
Assets or properties, or property losses covered by insurance
or (iv) dispositions made in accordance with a Contract or
Encumbrance. Since the Last Accounting Date, neither of the
Companies has become subject to any material commitment (i.e.
a commitment that obligates the Companies to assume
liabilities or make payments in excess of ten million Euro
((euro) 10,000,000) other than in the ordinary course of
business or in accordance with Article 9.2).
3.10.2 In the period between the Last Accounting Date and the date of
this Agreement (a) there has been no change in the business
position and the financial position of the Companies, which
constitutes a material adverse effect and (b) there are no
other debt facilities than (i) the LC Facility; (ii) the
Revolving Facility; (iii) the Medium Term Note Facility, (iv)
the Dividend Notes, and (v) certain arrangements with third
parties whereby REPGB or RETM deposit cash in blocked bank
accounts to secure the issuance of letters of credit, which
existing as per the date of this Agreement letters of credit
will be terminable upon the Purchaser becoming the credit
support provider under the terms of the relevant master
agreements. For the purpose of this Article, "material adverse
effect" means any change, circumstance, event or effect that
individually is materially adverse to the business, Assets,
condition, or results of operations of the Companies and their
businesses taken as a whole resulting in a loss, except for
those resulting from:
(i) changes in the ordinary course of business of any of
the Companies, including changes in borrowings under
the debt facilities listed above as such facilities
may be extended in accordance with Article 9.2.2(iv),
issuance of letters of credit and posting of
collateral in accordance with the Company's
obligations under existing Contracts, fluctuations in
the ▇▇▇▇-to-market value of the Companies' contract
portfolio and similar changes;
(ii) changes that affect the industry taken as a whole in
which the Companies operate, including changes in:
(a) wholesale or retail markets for electric
power, district heating or fuel or related
products including those due to actions by
competitors; or
(b) electric transmission or distribution
systems;
(iii) changes in financial or securities markets or the
economy in general;
(iv) effects of weather or meteorological events;
(v) changes in Applicable Law; or
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(vi) changes in the political climate generally (including
but not limited to (an announcement of) war), or
3.10.3 To the Sellers best knowledge, since the Last Accounting Date:
(i) the Companies have paid their respective material
creditors within the times agreed with them and in
particular, and without limiting the foregoing, no
material debt owed by the Companies has been
outstanding for more than ninety (90) days from the
date of invoice;
(ii) none of the Companies has entered into any Derivative
Transactions outside of the ordinary course of the
business of the Companies in connection with
purchases of fuel, sales of power generated by the
REPGB generation plants or hedging activities
relating thereto; and
(iii) none of the Companies has made any payment or
incurred any liability except in the ordinary course
of business.
3.11 EMPLOYEES
3.11.1 Set forth in Annex 13 to this Agreement is a list of all
pension and voluntary early retirement plans applicable to the
Companies. Since the Original Acquisition Date and to the
Sellers' best knowledge, in respect of the period prior to the
Original Acquisition Date, all contributions due with respect
to these pension and voluntary early retirement plans have
been (i) fully paid or have been adequately provided for in
the Audited Accounts and (ii) have been made in accordance
with Applicable Law. There exist no back-service obligations
as per the date of this Agreement.
3.11.2 Set forth in Annex 14 to this Agreement is a list of all
deferred compensation, profit sharing and all material bonus
and other employee welfare benefit or fringe benefit plans
established or maintained by the Companies.
3.11.3 None of the Companies has any outstanding liability to pay
compensation for loss of office or employment or redundancy
payment to any present or former employee or to make any
payment for breach of any employment agreement and no such
sums have been paid (whether pursuant to a legal obligation or
ex gratia) since the Last Accounting Date.
3.11.4 There is no term of employment contract for any key managers
or any term of engagement of any key contractor of any of the
Companies which provides that a direct or indirect change of
control of any of the Companies shall entitle the manager to
treat the change of control as amounting to a breach of
contract or entitling him/her to any payment or benefit
whatsoever or entitling him/her to treat him/herself as
redundant or otherwise dismissed or released from any
obligation.
3.12 CONTRACTS
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3.12.1 Each Contract to which any of the Companies is a party has
been disclosed, or made available to the Purchaser.
3.12.2 To the Sellers' best knowledge:
(i) none of the Companies is in default with respect to
the performance of their obligations under any
Contract to which it is a party;
(ii) each other party to any Contract to which any of the
Companies is a party, has complied with their
obligations under such Contract;
(iii) each Contract to which any of the Companies is a
party, is in full force and effect and binding on the
parties to such Contract in accordance with its
terms;
(iv) the execution of this Agreement and the consummation
of the transactions contemplated by this Agreement do
not and shall not cause any existing Contract to
which any of the Companies is a party, to be varied
in any material respect or terminated or give rise to
an event of default, termination event, default, the
right to vary in any material respect or terminate
any of such Contract and shall not affect any
material contractual right, claim or obligation of
any of the Companies;
(v) none of the Companies has any obligation to assume
liabilities or make payments in an amount in excess
of two million Euro ((euro) 2,000,000) or more under
any leasing (other than in relation to land), hire
purchase, credit sale or conditional sale contract in
respect of goods;
(vi) none of the Companies has any obligation or liability
under any sale and purchase agreement in respect of
any sale of shares or a former part of the business,
including representations and warranties or
indemnities given by any of the Companies; and
(vii) each of the Companies has observed and performed all
the terms and conditions required on its part to be
observed and performed by it under its trading
Contracts.
3.13 LITIGATION
3.13.1 The Companies are not (i) a party to or, to the Sellers' best
knowledge, under threat of, any Action or (ii) subject to an
investigation by any Governmental Entity of The Netherlands or
by the European Commission or (iii) to the Sellers' best
knowledge, subject to investigations under any other
Applicable Law.
3.13.2 To the Sellers' best knowledge, none of the Companies has done
or omitted to do anything, which is in contravention of any
Applicable Law giving rise to any fine, penalty, other
liability or sanction on the part of any of the Companies.
3.13.3 To the Sellers' best knowledge, none of the Companies is the
subject of any investigation, inquiry or enforcement
proceedings or process by any governmental, administrative or
regulatory body in any jurisdiction.
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3.13.4 There are no past or current, pending or to the Seller's best
knowledge, threatened, criminal Actions (excluding driving
offences) concerning the current members of the supervisory
board (raad van commissarissen) and of the management board
(bestuur) of the Companies in any jurisdiction in which the
Companies conducts its operations.
3.14 INSURANCE
3.14.1 The Companies maintain the insurance policies set forth in
Annex 15 to this Agreement on their properties, operations,
personnel and businesses and each such policy is in effect as
of the date of this Agreement. If and to the extent that
Annex 15 to this Agreement sets forth insurance policies
maintained by any member of the Sellers' Group other than the
Companies, these insurance policies are in effect as of the
date of this Agreement but shall terminate on the Closing
Date.
3.14.2 The Companies maintain all such insurance policies as required
under the Cross Border Leases.
3.14.3 None of the Companies has received any written notice from any
insurer or agent of such insurer that (i) capital improvements
or other expenditures will have to be made in order to
continue such insurance or (ii) its insurance policies are
being terminated or materially modified effective after the
date of this Agreement due to acts of terrorism or war.
3.14.4 Annex 16 to this Agreement sets forth all pending material
claims under the insurance policies of the Companies.
3.14.5 No notice of cancellation or termination has been received by
any of the Companies or any member of the Sellers' Group in
respect of any material insurance policy, each of which is in
full force and effect.
3.14.6 None of the Companies has any outstanding obligation with
respect to the payment of insurance premiums under any
insurance policy, the non- or untimely fulfilled of which can
have material consequences for any and all of the Companies.
3.14.7 To the Sellers' best knowledge, nothing has been done or
omitted to be done which could make any insurance policy void
or voidable and there is no claim outstanding under any such
policy. None of the Companies is required to pay any
additional premiums other than those set out in the insurance
policies.
3.15 ENVIRONMENTAL MATTERS
3.15.1 To the Sellers' best knowledge, (i) each of the Companies has
since the Original Acquisition Date conducted and currently
conduct its operations and businesses materially in compliance
with all Environmental Laws and (ii) none of the Companies has
received any notice, report or other communication claiming,
stating or alleging a material violation or material
non-compliance with any such Environmental Laws.
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3.15.2 Except for (i) the coal covenant regarding the reduction of
CO2 for electricity generation companies (convenant
kolencentrales CO2 reductie), dated 24 April 2002 and (ii) the
bench ▇▇▇▇ covenant for energy efficiency, none of the
Companies is a party to or otherwise required to comply with
any material environmental agreement or "convenant"
(milieuconvenant, milieubeleidsovereenkomst).
3.15.3 In connection with or as a result of the operations or conduct
of business of any and all of the Companies, none of the
Companies shall become liable for any and all claims, damages,
liabilities, costs, and expenses in connection with alleged or
actual damage to, or impairment of, human health in connection
with exposure to asbestos, of (former) employees of the
Sellers, the Companies and their Affiliates relating to the
period before the Closing Date.
3.16 PERMITS
To the Sellers' best knowledge:
3.16.1 each of the Companies has obtained all Permits required by
Applicable Law;
3.16.2 Annex 27 to this Agreement sets forth a list of all material
permits. Each Permit is in full force and effect and is not
subject to any administrative or judicial review other than
ordinary reviews undertaken as provided for in such Permit;
3.16.3 since the Original Acquisition Date, the Companies have
conducted their operations and businesses in compliance with
the Permits and their terms and conditions;
3.16.4 there are no circumstances likely to give rise to any material
modification, suspension or revocation, or prejudice the
renewal of an environmental Permit;
3.16.5 the validity of environmental Permits will not be affected by
the proposed acquisition of the Shares by the Purchaser; and
3.16.6 none of the Companies has received any notice or written
complaints from which it appears that it is or may be in
violation of any Environmental Laws or environmental licence
or that any further environmental licence may be required.
3.17 INTELLECTUAL PROPERTY RIGHTS, COMPUTER SYSTEMS, DATA AND RECORDS
3.17.1 Annex 17 to this Agreement contains details of all
Intellectual Property Rights owned or used by the Companies
and no other Intellectual Property Rights are currently used
by the Companies. To the Sellers best knowledge, each of the
Companies holds the Intellectual Property Rights described in
Annex 17 to this Agreement and may freely use and dispose of
such Intellectual Property Rights.
3.17.2 All the records and systems (including but not limited to
computer systems) and all data and information of the
Companies are recorded, stored, maintained or
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operated or otherwise held exclusively by one of the Companies
and are not wholly or partly dependent on any facilities or
means (including any electronic, mechanical or photographic
process, computerised or otherwise) which are not under the
exclusive ownership and control of any of the Companies.
3.17.3 To Seller's best knowledge, each of the Companies holds, or is
licensed to use, such Intellectual Property Rights as are
currently in use in their businesses; provided, however, it is
understood that this representation does not apply to
intellectual property rights owned by EnergieNed. For
avoidance of doubt, Seller makes no representation regarding
the suitability or adequacy or suitability of software systems
owned by third parties such as grid operators, power and
commodity exchanges, etc.
3.17.4 To the extent applicable and to the Sellers' best knowledge,
the Companies have complied with the Dutch Data Protection Act
(Wet Persoonsregistratie).
3.18 COMPETITION
3.18.1 To the Sellers' best knowledge, none of the Companies has
since the Original Acquisition Date:
(viii) been subject to any investigation, complaint or
warning from any Governmental Entity in relation to
any anti-competitive practice under any Applicable
Law;
(ix) been a party to any arrangement or practice involving
breaches of competition or anti-trust legislation
under any Applicable Law; and
(x) has given any undertaking and no order has been made
against or in relation to any of the Companies
pursuant to any anti-trust or similar legislation
under any Applicable Law.
3.18.2 Since the Original Acquisition Date, no investigation, request
for information, or statement of objections or similar matter
has been carried out or, as the case may be, received from any
court, tribunal, governmental, national or supra-national
authority in respect of any of the Companies.
3.18.3 To the Seller's best knowledge, since the Original Acquisition
Date, none of the Companies has been a party to any
arrangement, which is void or voidable or may render any of
the Companies liable in relation to any anti-competitive
practice under any Applicable Law.
3.19 NOTE AND DIVIDEND NOTES
3.19.1 As at the date of this Agreement, the principal amount
outstanding under the terms of the Note is three hundred and
ninety-seven million seven hundred thousand seven hundred and
sixty-three Euro and seventy Euro cents ((euro)
397,700,763.70).
3.19.2 As at the date of this Agreement, there does not exist, nor
shall the execution of this Agreement and the consummation of
the transactions contemplated by this
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Agreement or the transfer of the Shares cause with respect to
the Note any event of default, or any other similar event.
3.19.3 As from the Last Accounting Date, all interest required to be
paid shall have been accrued in accordance with its terms and
no prepayments have been made by the obligor under the Note;
it is, however, understood that neither the Purchaser nor
REPGB will be entitled to interest payment reimbursement from
any of the Sellers.
3.19.4 The terms and conditions applicable to the Dividend Notes
allow for early payment of all amounts outstanding under the
Dividend Notes, on or after the Closing, without any penalties
being incurred under the Dividend Notes in connection to such
early payment.
3.19.5 The Dividend Notes only accrue interest. No interest has been
paid in relation to the Dividend Notes after the Last
Accounting Date until the Closing Date (inclusive).
3.20 BROKERS
None of the Companies has any contract, arrangement or understanding
with any investment banking firm, broker, finder or similar agent (each
a "BROKER") with respect to the transactions contemplated by this
Agreement.
3.21 CROSS BORDER LEASES
3.21.1 All Cross Border Leases have been included in the Due
Diligence Information. To the extent any of the Cross Border
Leases have been amended such amendments have also been
included in the Due Diligence Information.
3.21.2 At the date hereof (and as at the Closing) there does not
exist, nor shall the execution of this Agreement and the
consummation of the transactions contemplated thereby, nor
shall the Closing or the transfer of the Shares and/or the
Subsidiary Shares in connection thereto cause with respect to
the Cross Border Leases:
(i) an "Event of Default", as defined in the respective
Cross Border Leases;
(ii) an "Event of Loss" as defined in the respective Cross
Border Leases;
(iii) an event or circumstance that due to the expiration
of a certain term and/or after being served notice
upon or an equivalent thereof and/or any other
condition (or a combination of the foregoing) shall
at a certain time constitute an "Event of Default" or
an "Event of Loss" as defined in the respective Cross
Border Leases; or
(iv) any other event pursuant to which any third party
would be entitled to early termination of any of the
Cross Border Leases.
3.21.3 Each of the Companies that is a party to one or more Cross
Border Leases is in full compliance with any of its respective
obligations under the Cross Border
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Leases and has in the past always been in compliance with all
of its obligations under the Cross Border Leases.
3.21.4 None of the Companies has on the date hereof and per the
Closing Date exercised any option to early termination of any
of the Cross Border Leases.
3.21.5 The US cross border lease agreement with respect to Diemen
31/32, the Austrian cross border lease agreement with respect
to a turbine at Lage ▇▇▇▇▇ 05, the German cross border lease
agreement with respect to a gas turbine at Diemen 33 and the
German cross border lease agreement with respect to a steam
turbine at Diemen 33, that all have been entered into by one
or more of the Companies in the past (the "Terminated
Leases"), have been terminated and none of the Companies has
any obligations in this respect. There are no third parties
who, based on the Terminated Leases, can claim any of the
assets of any of the Companies that were the subject of the
Terminated Leases. Each of the Companies that has been a party
to one or more Terminated Leases has in the past always
fulfilled all of its obligations under the Terminated Leases.
3.21.6 At the date of this Agreement there exists no soil
contamination pursuant to which any additional letters of
credit should have been issued under the Cross Border Leases.
3.21.7 There are on the date hereof and per the Closing Date no facts
or circumstances, which reasonably could give, rise to any tax
liabilities or indemnity obligations of any of the Companies
in respect of the Cross Border Leases.
3.22 FULL DISCLOSURE
The Sellers have disclosed or made available to the Purchaser all
material financial information relating to the Contracts and the
overall trading position of the Companies during the Due Diligence
Investigation.
4. REPRESENTATIONS AND WARRANTIES REGARDING THE SELLERS AND THE SELLERS'
GUARANTOR
4.1 Each of the Sellers and the Sellers' Guarantor, as the case
may be, hereby represent and warrant to the Purchaser that on
the date of this Agreement, except as set forth in the
Sellers' Disclosure Letter, each of the statements set out in
Articles 4.2 to 4.8 (inclusive) is true and accurate in
accordance with its terms.
4.2 ORGANISATION AND AUTHORITY
4.2.1 The Seller No. 1 is duly incorporated and validly existing
under the laws of the State of Delaware, United States of
America and has the requisite corporate power and authority to
own its property and to carry on its business as conducted on
the date of this Agreement.
4.2.2 The Seller No. 2 is duly incorporated and validly existing
under the laws of The Netherlands and has the requisite
corporate power and authority to own its property and to carry
on its business as conducted on the date of this Agreement.
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4.2.3 The Sellers' Guarantor is duly incorporated and validly
existing under the laws of the State of Delaware, the United
States of America, and has the requisite corporate power and
authority to own its property and to carry on its business as
conducted on the date of this Agreement.
4.2.4 The Sellers, their material Affiliates, other than the
Companies and the Sellers' Guarantor have not stopped or
suspended payment of their debts, become unable to pay their
debts, been declared bankrupt (in staat van faillissement
verklaard) under any Applicable Law, nor have the Sellers,
their material Affiliates and the Sellers' Guarantor been
dissolved by a competent court. No order has been made or
Action or request is pending under any Applicable Law to
declare the Sellers, their material Affiliates or the Sellers'
Guarantor insolvent and neither have the Sellers, their
material Affiliates or the Sellers' Guarantor petitioned for
or have been granted a suspension of payments (surseance van
betaling) or similar procedure or action under any Applicable
Law.
4.3 AUTHORISATION AND LEGAL AND BINDING OBLIGATION
4.3.1 The execution, performance and delivery (if and to the extent
this concept is applicable) of this Agreement by each of the
Sellers and the Sellers' Guarantor has been duly authorised by
all requisite corporate action on the part of each of the
Sellers and the Sellers' Guarantor.
4.3.2 This Agreement has been duly executed by each of the Sellers
and the Sellers' Guarantor and, assuming the due execution of
this Agreement by the Purchaser, constitutes valid and binding
obligations of each of the Sellers and the Sellers' Guarantor,
enforceable against each of the Sellers and the Sellers'
Guarantor in accordance with the terms of this Agreement.
4.4 NO CONFLICT
The execution and performance by the Sellers and the Sellers' Guarantor
of this Agreement and the consummation of the transactions contemplated
by this Agreement do not:
4.4.1 violate the provisions of Applicable Law, the applicable
articles of association, deeds or certificates of
incorporation or by-laws or other similar documents of the
Sellers and the Sellers' Guarantor, or any resolutions of the
management board or of any other corporate governing body or
the shareholders of the Sellers and the Sellers' Guarantor; or
4.4.2 conflict with or result in the breach or termination of any
material term or provision of, or constitute a default under,
or cause any acceleration under, any Contract by which the
Sellers or the Sellers' Guarantor are or may be bound except
as would not have, individually or in the aggregate, a
material adverse effect on the ability of the Sellers or the
Sellers' Guarantor to consummate the transactions contemplated
by this Agreement.
4.5 OWNERSHIP OF THE SHARES AND OF THE SUBSIDIARY SHARES
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4.5.1 The Sellers are jointly the sole owners of the Shares and have
full power, right and authority to transfer the Shares to the
Purchaser in accordance with the terms of this Agreement. The
Shares constitute the total issued share capital of the
Company.
4.5.2 The Company is the sole owner (indirectly or directly) of the
Subsidiary Shares. The Subsidiary Shares constitute the whole
of the issued and outstanding share capital of the respective
Subsidiaries.
4.6 CONSENTS
No consent, approval, order or authorisation, or registration,
declaration or filing with, any Person is or will be necessary for the
valid execution and performance by the Sellers or the Sellers'
Guarantor of this Agreement and the consummation of the transactions
contemplated by this Agreement, except (i) the consents or approvals
specified in Article 13.1, (ii) such consents or approvals that relate
to the business or circumstances of the Purchaser or its Affiliates or
(iii) as would not have, individually or in the aggregate, a material
adverse effect on the ability of the Sellers or the Sellers' Guarantor
to consummate the transactions contemplated by this Agreement.
4.7 BROKERS
Neither of the Sellers nor the Sellers' Guarantor nor any of their
Affiliates has any contract, arrangement or understanding with any
Broker with respect to the transactions contemplated by this Agreement,
except for Brokers whose fees shall be borne by the Sellers' Guarantor.
4.8 SELLERS' COVENANTS
On the Closing Date, to the Sellers' best knowledge and except as set
forth in the Sellers' Disclosure Letter, neither of the Sellers, nor
the Sellers' Guarantor, nor any of the Companies has breached any of
the covenants of the Sellers as set forth in Article 9.
5. REPRESENTATIONS AND WARRANTIES REGARDING THE PURCHASER
5.1 The Purchaser hereby represents and warrants to each of the Sellers and
the Sellers' Guarantor that on the date of this Agreement, except as
set forth in the disclosure letter, delivered by the Purchaser to the
Sellers and the Sellers' Guarantor, as attached as Annex 18 to this
Agreement (the "PURCHASER'S DISCLOSURE LETTER") that each of the
statements set out in Article 5.2 to 5.7 (inclusive) is true and
accurate in accordance with its terms.
5.2 ORGANISATION AND AUTHORITY
The Purchaser is duly incorporated and validly existing under the laws
of The Netherlands and has the requisite corporate power and authority
to own its property and to carry on its business as conducted on the
date of this Agreement.
5.3 AUTHORISATION AND LEGAL AND BINDING OBLIGATION
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5.3.1 The execution and performance of this Agreement by the
Purchaser has been duly authorised by all requisite corporate
action on the part of the Purchaser.
5.3.2 This Agreement has been duly executed by the Purchaser and,
assuming the due execution of this Agreement by the Sellers
and the Sellers' Guarantor, constitutes valid and binding
obligations of the Purchaser, enforceable against the
Purchaser in accordance with the terms of this Agreement.
5.4 NO CONFLICT
The execution and performance by the Purchaser of this Agreement and
the consummation of the transactions contemplated by this Agreement do
not:
5.4.1 violate the provisions of Applicable Law, its articles of
association, deed of incorporation or other similar documents,
or any resolutions of the supervisory board, the management
board or of any other corporate governing body or of
shareholders of the Purchaser; or
5.4.2 conflict with or result in the breach or termination of any
material term or provision of, or constitute a default under,
or cause any acceleration under, any Contract by which the
Purchaser is or may be bound except as it would not have
individually or in the aggregate a material adverse effect on
the Purchaser's ability to consummate the transactions
contemplated by this Agreement.
5.5 CONSENTS
No consent, approval, order or authorisation, or registration,
declaration or filing with, any person is or will be necessary for the
valid execution and performance by the Purchaser of this Agreement and
the consummation of the transactions contemplated by this Agreement,
except (i) the consents or approvals specified in Article 13.1, (ii)
such consents or approvals that relate to the business or circumstances
of the Companies, the Sellers, the Sellers' Guarantor or their
Affiliates or (iii) as would not have, individually or in the
aggregate, a material adverse effect on the Purchaser's ability to
consummate the transactions contemplated by this Agreement.
5.6 AVAILABILITY OF FUNDS
At Closing, the Purchaser shall have sufficient cash resources and
means to make the Cash Payment and to satisfy the Dividend Notes.
5.7 NO KNOWLEDGE OF BREACH
As of the date of the Agreement and as of the Closing Date (except as
otherwise disclosed in the certificate to be delivered pursuant to
Article 15.1.2) the Purchaser is not aware, after giving effect to the
Due Diligence Investigation, of any breach of any of the Sellers'
Warranties or of any of the obligations of the Sellers or of the
Sellers' Guarantor under this Agreement.
6. SPECIFIC INDEMNITIES OF THE SELLERS
6.1 THE COMPANY
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Each of the Sellers shall fully indemnify the Purchaser and the
Companies and shall hold the Purchaser and the Companies harmless
against any liability (including taxes) of the Company relating to the
period prior to the Closing Date (a) that results from the Closing
steps set out in Article 14 or (b) that results from or is connected to
the Company having any assets or liabilities at Closing other than (i)
the shares of REPGB and (ii) the principal and accrued interest under
the Dividend Notes (after giving effect to the partial payment of such
Notes).
6.2 NO LIMITATIONS
For the avoidance of doubt, the liability of the Sellers under Article
6.1 shall not be limited or qualified in any respect by any limitations
that may apply to the Sellers' Warranties, nor by any statements
contained in the Sellers' Disclosure Letter.
7. DUE DILIGENCE INVESTIGATION
7.1 ACKNOWLEDGEMENT DUE DILIGENCE INVESTIGATION
The Purchaser acknowledges that it has performed, with the assistance
of professional legal, accountancy, financial, technical and tax
advisors (its "ADVISORS"), a due diligence investigation of the
Companies, including financial, tax, legal, operational and commercial
areas with respect to the Companies and their respective businesses
(the "DUE DILIGENCE INVESTIGATION").
7.2 FURTHER ACKNOWLEDGEMENTS
Furthermore the Purchaser acknowledges that:
7.2.1 the Purchaser's Group has conducted a very extensive review of
the Due Diligence Information made available to the
Purchaser's Group by the Sellers' Group or their Advisors; and
7.2.2 the Purchaser's Group has had the opportunity to raise with
the Sellers specific issues through (i) written question and
answer sessions and (ii) management presentations.
8. COVENANTS OF THE PURCHASER
8.1 THE MARKS
8.1.1 The Purchaser acknowledges and agrees that (i) the Marks shall
not be deemed to be hereby acquired and (ii) the license under
which the Companies use the Marks will be terminated sixty
(60) calendar days after the Closing Date. The Sellers shall
be permitted (but shall not be required), after due
consultation with the Purchaser, on or prior to Closing, to
cause each of the Companies to change its name such that the
name "Reliant" or "Resources" is not used in any such entity's
name. In doing so, the Sellers will take into account the
reasonable wishes of the Purchaser in this regard. No later
than sixty (60) calendar days after the Closing Date, the
Purchaser shall cause any Companies the name of which includes
the name "Reliant" or "Resources" to change its name to
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exclude the name "Reliant" or "Resources". Thereafter, the
Purchaser shall cause the Companies to cease and discontinue
all use of the Marks.
8.1.2 During the period of use, as set forth in Article 8.1.1, by
the Companies of the Marks, the Purchaser shall, and shall
procure that the Companies shall, comply with the obligations
of licensees under the trademark license agreement covering
the Marks and shall retain and conform to Reliant Energy
Europe's established quality standards.
8.2 NO DIVIDENDS
The Purchaser shall procure that none of the Companies adopts any
resolution or takes any action to distribute dividends, to repay
capital or to make any other distributions of reserves or capital on
the Closing Date.
8.3 MITIGATION OF DAMAGES
Except as expressly provided for in this Agreement, the Purchaser shall
and shall procure that any of its Affiliates shall carry out any
reasonable voluntary act, omission, transaction, or arrangement after
the Closing Date to avoid or mitigate any claim or matter which would
give rise to a claim under the Sellers' Warranties.
9. COVENANTS OF THE SELLERS
9.1 ACCESS
9.1.1 To the extent permitted pursuant to Applicable Law, the
Sellers agree that from the date of this Agreement until
Closing upon reasonable notice from the Purchaser, the Sellers
shall, and shall cause the Companies to, as soon as
practicable, provide to the Purchaser and its respective
Advisors and representatives (collectively, the "PURCHASER'S
GROUP") reasonable access, at reasonable times during normal
business hours, to the books and records of the Companies and
to members of their management designated by the Sellers, and
to furnish to the Purchaser's Group such information
concerning the businesses, property and personnel of the
Companies as the Purchaser's Group may reasonably request.
9.1.2 From the date of this Agreement until Closing, REPGB and RETM
shall grant access to an independent third party adviser of
the Purchaser on at least [three (3)] Business Days per week
for the purpose of monitoring that the commercial procedures
of the Companies are conducted in accordance with Article 9.
The Purchaser shall procure that such third party advisor
enter into a confidentiality agreement prior to providing such
access. It is agreed that such third party advisor shall not
provide Purchaser with any specific commercially sensistive
information.
In addition, from the date of this Agreement until Closing, to
the extent permitted by Applicable Law, the Chief Operating
Officer of the Companies and members of his staff will meet at
least once a month with representatives of the Purchaser to
review the topics.
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9.1.3 In the event that the Sellers suffer any damage clearly the
result of a breach by the independent third party adviser of
the Purchaser disclosing information to the Purchaser in
breach of the terms set forth in this Agreement, the Purchaser
shall fully indemnify the Sellers for such damages.
9.1.4 The provisions of Articles 9.1.1 to 9.1.3 (inclusive) are
subject to the following limitations:
(i) Access shall be afforded to the Purchaser's Group
only in such manner so as not to unreasonably disturb
or interfere with the normal operations of each of
the Companies;
(ii) The Purchaser's Group shall fully comply with
Applicable Law and with any applicable security,
health and safety requirements;
(iii) Nothing in this Article 9.1 shall be construed to
require any of the Sellers, the Sellers' Guarantor or
any of the Companies to supply to the Purchaser's
Group any information that any of the Sellers, the
Sellers' Guarantor or any of the Companies reasonably
believe:
(a) it may not provide to the a member of the
Purchaser's Group by reason of any
Applicable Law and APX rules;
(b) would constitute information protected by
attorney-client privilege; or
(c) that any of the Sellers, the Sellers'
Guarantor or any of the Companies is
required to keep confidential by reason of a
contractual obligation, an understanding
with third parties, or pursuant to
Applicable Law;
(iv) All information furnished by or on behalf of the
Sellers, the Sellers' Guarantor or the Companies or
any of their Affiliates under this Agreement to a
member of the Purchaser's Group shall be subject to
the terms of the Sellers' Confidentiality Agreement;
(v) The Purchaser shall not have the right to perform or
conduct any environmental sampling or testing at, in,
on or underneath the Business Premises; and
(vi) The Purchaser shall have no rights pursuant to this
Article 9.1 during the continuation of a Material
Purchaser's Pre-Closing Breach.
9.2 CONDUCT OF BUSINESS BETWEEN THE DATE OF THIS AGREEMENT AND CLOSING
9.2.1 From the date of this Agreement until Closing, the Sellers
shall procure that the Companies shall:
(i) conduct their respective businesses and operations in
the usual, regular and ordinary course in
substantially the same manner as conducted since the
Original Acquisition Date;
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(ii) preserve their respective businesses and operations
substantially in the same condition as they exist on
the date of this Agreement; and
(iii) preserve the relationships of the respective
Companies with customers, suppliers, licensors,
licensees, distributors and other counter parties
with whom the Companies deal.
9.2.2 Notwithstanding the foregoing, and except as otherwise
specifically contemplated in this Agreement, the Sellers shall
procure that the Companies shall not, without the prior
written consent of the Purchaser, which will not be
unreasonably withheld, from the date of this Agreement until
Closing:
(i) enter into any capital expenditure commitment above
an amount of one million Euro ((euro)1,000,000),
which in total with other capital expenditure
commitments entered into after the date of this
Agreement exceeds the sum of five million Euro
((euro)5,000,000), with the exception only of normal
payments of wages, social security charges, office
leases, insurance premiums and Taxes;
(ii) dispose of or grant an option to purchase or a right
of pre-emption in respect of any part of the Assets
and part of the operations of the Companies;
(iii) borrow any money or guarantee any indebtedness,
except for borrowings under the terms and conditions
of existing facilities, as such facilities, as
described in subparagraph (iv) of the definition of
'Net Cash' (i.e. for the avoidance of any doubt: the
LC Facility, the Revolving Credit Facility and any of
REPGB's current outstanding credit agreements) may be
extended from time to time, subject to the terms and
conditions being the same as the existing facilities
(save the term thereof),
(iv) guarantee any indebtedness, issue, amend or extend
letters of credit, bonds or other forms of
collateral, except required pursuant to the terms and
conditions of existing or new F/X, fuel supply or
trading contracts, that require or may require
entering into any (new) credit support documentation
with (existing or new) commercial counterparties, all
of the foregoing in accordance with and on terms and
conditions in accordance with past practice,
provided, however, that effective as of the date of
this Agreement, the Companies will not enter into new
master or general fuel supply or trading contracts
unless such contracts provide for the automatic
release of letters of credit upon meeting investment
grade status and provided further that with regard to
existing agreements as of the date of this Agreement,
such letters of credit are terminable upon Purchaser
becoming the credit support provider under the
relevant master agreement.
(v) commit to make or make any loan except to the
Companies;
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(vi) distribute any dividends or make distributions out of
any of the Companies;
(vii) make any changes in accounting methods (other than
changes in accounting methods required under Dutch
GAAP, as applicable, to be implemented prior to or on
the Closing Date);
(viii) (a) enter into, modify, amend, terminate or renew any
Contract (specifically including any and all Cross
Border Leases, agreements related to Stranded Costs,
the Note and the Dividend Notes (except in respect of
the Dividend Notes as specifically agreed to in this
Agreement) or (b) waive, release or assign any
material right or material claim;
(ix) enter into agreements or amendments related to the
Stranded Costs, except for the exercise of REPGB's
corporate governance rights as a shareholder in NEA,
agreements required to implement the terms and
conditions of governmental regulations, court orders,
etc., maintenance, service level and other
ministerial agreements entered into in the ordinary
course of business and consistent with the day to day
operation of REPGBs district heating operations (it
being understood that Sellers and the Companies will
not, however, enter into any amendments of the
district heating contracts without the consent of the
Purchaser);
(x) create, extend, grant, issue or permit to subsist, or
agree to create, extend or issue any new Encumbrances
in excess of one million Euro ((euro) 1,000,000) on
any of the Assets, Shares or any of the Subsidiary
Shares;
(xi) make any increase, or agree to make any increase, in
the remuneration of any of their directors, managers
or employees or make any change in the terms and
conditions of employment of any of their directors,
managers or employees or employ or terminate (except
for good cause) the employment of any person earning
a total annual remuneration in excess of sixty five
thousand Euro ((euro) 65,000), in each case except
for such increases or changes as are in the ordinary
course of business and consistent with past practice;
(xii) acquire or commit to acquire any assets or property
in excess of one million Euro ((euro)1,000,000) per
transaction or related transactions;
(xiii) make, or announce to any person any proposal to make,
any change or addition to any benefit (including but
not limited to retirement, death or disability
benefit) in respect of any of their directors,
managers or employees or former directors, managers
or employees (or any dependant of any such person) or
to any existing social plan or arrangements following
from a previous social plan (other than any change
required by Applicable Law) or grant or create any
additional benefit or, without limiting the
foregoing, take any action or allow any action to be
taken in relation to the applicable arrangements as a
result of any social plan other than in the ordinary
course of administering any social plan or omit to
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take any action necessary or prudent for the ordinary
proper operation of any social plan;
(xiv) enter into any agreement or arrangement with the
Works Council of REPGB or any trade union with
respect to any applicable social plan;
(xv) permit any of their material insurance to lapse
(vervallen) or do any thing which would make any
policy of a material insurance void or voidable, it
being understood that any insurance required pursuant
to the terms of any of the Cross Border Leases shall
be deemed material for the purpose hereof;
(xvi) create, issue, purchase or redeem any shares;
(xvii) settle any existing or initiate any new litigation;
(xviii) agree to give any option in respect of the Shares or
the Subsidiary Shares;
(xix) create, extend, grant, issue or agree to any
guarantees or similar arrangements on behalf of the
Sellers or any direct or indirect parent of the
Sellers;
(xx) enter into any arrangements or agreements with any
member of the Sellers' Group except the Companies; or
(xxi) agree, conditionally or otherwise, to do any of the
foregoing.
9.2.3 Notwithstanding the foregoing, the Sellers and the Companies
shall be permitted to do the following:
(i) actions expressly permitted under the other sections
of this Agreement;
(ii) actions in connection with necessary repairs due to
breakdown or casualty, environmental emergencies,
business emergency or other unforeseen operational
matters;
(iii) actions required by Applicable Law or any Judgement;
(iv) actions required by any Contract;or
(v) as set forth in Capital Expenditures schedule,
attached as Annex 19 to this Agreement;
provided that the Sellers shall keep the third party adviser
set forth in Article 9.1.2 informed of such action.
9.3 COMMERCIAL TERMS
9.3.1 As from the date of this Agreement until Closing, the Sellers
shall procure that, to the extent permitted pursuant to
Applicable Law the Companies shall:
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(i) conduct their business in the ordinary course of
business and in accordance with reasonable prudent
practice compared to a company operating under
similar circumstances; and
(ii) with regard to those subjects specifically set forth
in Annex 23 to this Agreement (hereafter the
"COMMERCIAL TERMS") operate in accordance with the
terms set forth in Annex 23.
9.3.2 For the purpose of determining whether there is a Material
Seller's Pre-Closing Breach or Material Seller's Guarantor
Pre-Closing Breach, the consequences of all breaches of
obligations of the Companies pursuant to the Commercial Terms
as specified in Annex 23 to this Agreement will be aggregated
(giving effect to the netting of the impacts).
9.3.3 The Commercial Terms set out in Annex 23 to this Agreement
are for the period up to the earlier of (i) Closing and (ii)
the date on which any of the Parties terminate this Agreement
in accordance with the terms of this Agreement.
9.4 LICENCE AGREEMENT
As from Closing, the Sellers' Group, excluding the Companies, shall
grant to the Purchaser and the Companies a non-exclusive, fully
paid-up, licence-fee free, perpetual, transferable license to any
Intellectual Property Rights that are held by the Sellers' Group,
excluding the Companies and are necessary for the conduct of the
business of the Companies as conducted on the date of this Agreement,
including (but not limited to) the PCI and E-Midas systems and
software, to be effectuated by one or more license agreements
substantially in the form attached as Annex 20 to this Agreement.
9.5 INSURANCE
9.5.1 Until the Closing Date, the Sellers shall maintain insurance
policies covering the Assets, the properties, operations,
personnel and business of the Companies in substantially the
same manner as maintained since the Original Acquisition Date
and in accordance with the terms of the Cross Border Leases.
9.5.2 With respect to any claim arising prior to the Last Accounting
Date for loss or damage experienced by any of the Companies
that is covered by one or more of the insurance policies held
by the Sellers or by any member of the Sellers' Group other
than any of the Companies, covering the Assets, the
properties, operations, personnel and businesses of the
Companies, any and all insurance proceeds received by any of
the Companies for such claims prior to or after the Closing
Date shall be notified without delay to the Sellers and shall
be transferred to the Sellers, or to any other person
designated by the Sellers, into a bank account to be
designated by the Sellers within five (5) Business Days after
receipt of such proceeds by the respective Company.
9.6 LIQUIDATION SELLER NO. 2
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In the event, after the Closing Date, Seller No. 1, in its capacity as
sole shareholder of Seller No. 2, would resolve to merge Seller No. 2
into Seller No. 1 or an Affiliate or liquidate (ontbinden) Seller No.
2, the Purchaser hereby irrevocably and unconditionally (i) grants its
approval for such merger or the liquidation, (ii) agrees to fully
co-operate to the extent necessary to effect such merger or liquidation
and (iii) waives any rights it may have to oppose to (verzetten) or
prevent such merger or liquidation, provided that, Seller No. 1, prior
to or as part of the liquidation, takes over and assumes all rights and
obligations of Seller No. 2 under this Agreement.
9.7 CROSS BORDER LEASES
9.7.1 During the period prior to the Closing Date, the Sellers and
REPGB will meet periodically to discuss possible mechanisms
for the Purchaser to eliminate or reduce the obligation of
REPGB to post letters of credit under its Cross Border Leases,
including the possibility of seeking consents, waivers or
amendments to the terms of the Cross Border Leases.
9.7.2 The Sellers will cooperate, to the extent reasonable, in
arranging for the Purchaser to contact investors under the
Cross Border Leases for this purpose; provided, however, that
(i) the Purchaser will reimburse the Sellers for any
reasonable costs and reasonable expenses incurred by the
Sellers directly pursuant to a request of the Purchaser in
connection with this undertaking, (ii) none of the Sellers are
under any obligation to enter into any agreement or undertake
any other action that Sellers could reasonably impose upon
REPGB a risk of liability and (iii) Sellers are not under any
obligation to assume any liability regarding the Cross Border
Leases after the Closing Date as part of this undertaking
(except as otherwise provided expressly under this Agreement).
9.8 ABB MORTGAGE
At Closing either (i) the Sellers shall procure that REPGB shall have
been granted a first right of mortgage (recht van eerste hypotheek) in
order to secure the performance of Asea ▇▇▇▇▇ Boveri AG & Co Leasing KG
pursuant to the equipment lease agreement dated October 14, 1994, and,
if applicable, the related documents in connection to this Cross Border
Lease or (ii) the Sellers shall provide the Purchaser with a legal
opinion of a Swiss lawyer reasonably satisfactory to the Purchaser
opining that in the event of a bankruptcy of the Swiss subsidiary of
Asea ▇▇▇▇▇ Boveri AG & Co Leasing KG which holds the purchase option
under the equipment lease agreement dated October 14, 1994, REPGB can
cause a transfer of ownership to itself of the GT13E2 Gas turbine,
located in the Lage ▇▇▇▇▇ Facility in Utrecht, The Netherlands against
a release of the deposit amount under the equipment lease agreement
dated October 14, 1994 to Asea ▇▇▇▇▇ Boveri AG & Co Leasing KG.
9.9 SETTLEMENT
The Sellers' Group and the Companies shall not engage in any
intercompany transactions that result in the creation of Inter-Company
Payables and Inter-Company Receivables that are not in the ordinary
course of business consistent with past practice. Prior to the last day
immediately prior to the Closing, the Sellers' Group, not including the
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Companies, on the one hand and the Companies on the other hand shall
have fully settled between them all outstanding receivables, including
but not limited to the Intercompany Receivables, but excluding the
Note, as well as all outstanding payables, including but not limited to
the Intercompany Payables, but excluding the Dividend Note.
10. COVENANTS OF ALL PARTIES
10.1 CONFIDENTIALITY
10.1.1 Nothing in this Agreement shall be construed as impairing or
otherwise limiting the obligations assumed pursuant to the
Confidentiality Agreements by the parties thereto.
10.1.2 In addition to the obligations of each Party set forth in
Article 10.1.1, each Party, from Closing, with respect to
itself and to its Affiliates, agrees and covenants with the
other Parties that it will keep confidential, and cause their
and their Affiliates' respective officers, directors,
employees and advisors to keep confidential, all information
relating to the businesses and operations of Reliant Energy
Europe; provided, that after Closing, the Purchaser shall be
entitled to disclose material information about the
pre-Closing businesses and operations of Reliant Energy Europe
only if the Purchaser consults in good faith with the Sellers
before publicly disclosing such material information and only
if such material information is not material specific
competitive customer information except, in each case, as
required by Applicable Law or administrative process (to the
extent so required) (in which case the legally obligated Party
shall promptly notify the other Parties and give the other
Parties an opportunity to oppose such disclosure) and except
for information that is available to the public on the Closing
Date, or thereafter becomes available to the public other than
as a result of a breach of this Article 10.1. The covenants
set forth in this Article 10.1 shall be effective as of the
Closing Date and shall terminate two (2) years after the
Closing Date.
10.2 FURTHER ASSURANCES
As and when requested by a Party after the date of this Agreement and
subject to the terms of this Agreement, the other Parties shall take or
procure the taking of all actions by their Affiliates (or refrain and
procure that their Affiliates refrain from taking any actions) and
execute or procure the execution of all such further documents, forms,
assignments, transfers, assurances and other things as such other Party
may reasonably consider necessary or appropriate to give full effect to
the transactions contemplated by this Agreement.
10.3 INSURANCE CLAIMS
10.3.1 As from Closing, each Party shall use its best efforts to
assist the other Party and their Affiliates in filing and
pursuing claims arising prior to the Last Accounting Date
under any insurance policy covering the Assets, properties,
operations, personnel and businesses of the Companies.
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10.3.2 In connection with the preparation or pursuit of an insurance
claim, each Party shall co-operate and provide the other
Party, its Affiliates and their Advisors with reasonable
access during normal business hours to all relevant premises,
assets, personnel, documents and records within its or its
Affiliates' possession or control and each Party will
reasonably allow the other Parties to take photographs or copy
documents, in each case as reasonably deemed necessary by such
other Party, its Affiliates or their Advisors for the
preparation or pursuit of such insurance claim.
11. OBLIGATIONS OF THE SELLERS' GUARANTOR
11.1 PERFORMANCE AND PAYMENT GUARANTEE
The Sellers' Guarantor, by way of its own independent obligation and
not as surety (borg), hereby irrevocably and unconditionally and
absolutely guarantees to the Purchaser and irrevocably and
unconditionally and absolutely promises to cause the prompt, due and
punctual observance and performance of all the obligations, terms,
conditions and covenants on the part of each of the Sellers under and
pursuant to this Agreement, including the payment from time to time as
guarantor of any and every sum of money, which each of the Sellers are
at any time liable to pay or reimburse to the Purchaser or the
Companies under or pursuant to this Agreement (the "GUARANTEED
OBLIGATIONS"):
11.1.1 by virtue of a Judgment rendered against the Sellers or each
of them by a competent court of law in accordance with this
Agreement; or
11.1.2 by virtue of an amicable settlement between the Parties.
11.2 NO EFFECT
Except as described in Article 11.1, no invalidity, irregularity or
unenforceability of all or any part of the Guaranteed Obligations shall
affect, impair or be a defence to the foregoing guarantee nor shall any
other circumstances that may otherwise constitute a defence available
to, or discharge of, the Sellers or the Sellers' Guarantor in respect
of the Guaranteed Obligations, or in respect of the foregoing guarantee
affect, impair or be a defence to the guarantee under Article 11.1.
11.3 WAIVER OF DEFENCES
The Seller Guarantor hereby waives all defences, counterclaims and,
where relevant, all suretyship, jointly and severally liable debtor or
other defences or otherwise.
12. PRE-CLOSING TERMINATION AND ABANDONMENT
12.1 PRE-CLOSING TERMINATION AND ABANDONMENT
This Agreement may be terminated (ontbonden) and the transactions
contemplated hereby may be abandoned by notice to the other Parties (a
"TERMINATION NOTICE") at any time before the Closing:
12.1.1 by mutual written consent of the Parties;
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12.1.2 by each of the Parties if there has been a Material Sellers'
Pre-Closing Breach or a Material Sellers' Guarantor
Pre-Closing Breach, provided, however, that
(i) the Purchaser shall have no right pursuant to this
Article 12.1.2 if there is a Material Purchaser's
Pre-Closing Breach; and
(ii) neither of the Sellers, nor the Sellers' Guarantor
shall have a right to terminate this Agreement
pursuant to this Article 12.1.2 if such Material
Sellers' Pre-Closing Breach or Material Sellers'
Guarantor Breach, as the case may be, results from a
wilful act, wilful omission or intentional breach of
either of the Sellers or the Sellers' Guarantor; and
(iii) neither of the Sellers nor the Sellers' Guarantor
shall have a right to terminate this Agreement
pursuant to this Article 12.1.2 if such Material
Sellers' Pre-Closing Breach or Material Sellers'
Guarantor Breach, as the case may be, results from
(a) the creditors of the Sellers' Group have acquired
direct or indirect control of the voting power of a
majority of the capital stock of the Company or any
of its parent companies through the exercise of their
rights as pledge holders of the capital stock of such
entities or (b) the Sellers' or the Sellers'
Guarantor's bankruptcy;
12.1.3 by the Sellers together with the Sellers' Guarantor if there
has been a Material Purchaser's Pre-Closing Breach, provided
that there is not also a Material Sellers' Pre-Closing Breach
or a Material Sellers' Guarantor Pre-Closing Breach
continuing;
12.1.4 by each of the Parties if at any time on or after the date
that is nine (9) months after the date of this Agreement any
of the conditions precedent provided for in Article 13 have
not been satisfied or waived in writing by the Party or
Parties permitted to waive such conditions precedent.
12.2 CONSEQUENCES OF PRE-CLOSING TERMINATION
Upon receipt of a Termination Notice:
12.2.1 all Information (as defined in the Purchaser's Confidentiality
Agreement) will be returned to the Sellers or destroyed in
accordance with the terms of the Purchaser's Confidentiality
Agreement;
12.2.2 all Information (as defined in the Sellers' Confidentiality
Agreement) will be returned to the Purchaser or destroyed in
accordance with the terms of the Sellers' Confidentiality
Agreement; and
12.2.3 no Party shall have any liability or further obligation to any
other Party except:
(i) with respect to the Confidentiality Agreements, in
accordance with their respective terms;
(ii) for such rights, remedies and liabilities in
connection to a breach of this Agreement as are
explicitly provided for this Agreement; and
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(iii) any liability or further obligation pursuant to the
following Articles: Article 11 (Obligations of the
Sellers' Guarantor), this Article 12 (Pre-Closing
Termination and Abandonment), Article 21 (Notices),
Article 22 (Governing Law and Dispute Resolution
Procedures), Article 24.1 (Entire Agreement) and
Article 24.3 (Expenses), which shall all survive the
termination of this Agreement.
13. CONDITIONS PRECEDENT TO CLOSING
13.1 CONDITION PRECEDENT TO THE OBLIGATIONS OF EACH PARTY
The respective obligations of each of the Parties to consummate the
transactions contemplated by this Agreement are conditional upon on or
before the Closing Date (or being waived by all Parties):
13.1.1 the Dutch Competition Authority (Nederlandse
Mededingingsautoriteit):
(a) having issued a decision stating that no licence is
required for the transactions contemplated by this
Agreement or any matter arising from these
transactions; or
(b) not taking a decision upon notification within the
respective time limits set by the Dutch Competition
Act; or
(c) in the event that the Dutch Competition Authority
issues a decision that a license is necessary for the
transactions contemplated by this Agreement or any
matter arising from these transactions, the Dutch
Competition Authority, following a request for such
license, has granted such license or has not taken a
decision upon request for a license within the
respective time limits set by the Dutch Competition
Act; and
13.1.2 if the relevant jurisdictional thresholds are met, the Federal
Cartel Office (Bundes Kartel Amt), following a first or second
phase investigation (or the relevant national equivalents),
having issued a decision notifying the Purchaser and the
Sellers that it grants approval under the Act Against
Restraints of Competition in relation to the purchase of the
Shares by the Purchaser or any matter arising from it, or not
taking a decision upon notification within the respective time
limits set by the Act Against Restraints of Competition.
13.2 CONDITIONS PRECEDENT TO OBLIGATIONS OF THE PURCHASER
The obligations of the Purchaser to consummate the transactions
contemplated by this Agreement are further conditional upon each of the
following conditions precedent (opschortende voorwaarden) being
fulfilled on or before the Closing Date (or being waived by the
Purchaser):
13.2.1 MATERIAL ADVERSE CHANGE. No events or circumstances having
occurred prior to Closing that have a Material Adverse Effect
and that were unknown to the Purchaser on the date of this
Agreement or have not been disclosed as part of the Sellers'
Disclosure Letter;
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13.2.2 REPRESENTATION AND WARRANTIES. The Sellers' Warranties and
Sellers' Guarantor's Warranties shall be true and correct as
at the Closing Date, except to the extent such warranties
expressly relate to an earlier date (in which case as of such
earlier date), and except for failures of Sellers' Warranties
and Sellers' Guarantor's Warranties referred to in this
Article to be true and correct in accordance with their terms
and do not have, individually or in the aggregate, (i) a
material adverse effect (not being a Material Adverse Effect)
on the Sellers and the Sellers' Guarantor's ability to
consummate the transactions contemplated by this Agreement or
(ii) a Material Adverse Effect;
13.2.3 CERTIFICATE. The Purchaser shall have received a certificate
signed on behalf of the Sellers by (one or more) executive
officer(s) of the Sellers and a certificate signed on behalf
of the Sellers' Guarantor by an executive officer of the
Sellers' Guarantor, in each case indicating that the
conditions precedent provided in Articles 13.2.1 and 13.2.2
have been satisfied to the extent that they have not been
waived; and
13.2.4 OPINIONS. Purchaser shall have received a legal opinion dated
the Closing Date of (i) US counsel to Seller No. 1 and the
Sellers' Guarantor and (ii) the Sellers' In-House counsel to
Seller No. 1 and the Sellers' Guarantor, all substantially in
the form as attached as Annex 21 to this Agreement.
13.3 CONDITIONS PRECEDENT TO THE OBLIGATIONS OF THE SELLERS AND THE SELLERS'
GUARANTOR
The obligations of the Sellers and of the Sellers' Guarantor to
consummate the transactions contemplated by this Agreement are further
conditional upon each of the following conditions precedent
(opschortende voorwaarden) being fulfilled on or before the Closing
Date (or being waived by the Sellers and by the Sellers' Guarantor):
13.3.1 REPRESENTATIONS AND WARRANTIES. The Purchaser's Warranties
shall be true and correct as of the Closing Date, except for
failures of the representations and warranties referred to in
this Article to be true and correct as do not have,
individually or in the aggregate, a material adverse effect on
the Purchaser's ability to consummate the transactions
contemplated by this Agreement; and
13.3.2 CERTIFICATES. The Sellers and of the Sellers' Guarantor shall
have received a certificate signed on behalf of the Purchaser
by an executive officer of the Purchaser indicating that the
condition precedent provided in Article 13.3.1 has been
satisfied to the extent that it has not been waived.
14. CLOSING
14.1 CLOSING DATE
The Closing shall take place at 10:00 a.m. (Amsterdam time) on the
sixth (6th) Business Day after the written notification by a Party to
the other Parties (which is not objected to within two (2) Business
Days) of the satisfaction or waiver of the conditions precedent set
forth in Article 13 (other than those conditions to be satisfied at
Closing), or at such other time, date or place agreed to in writing by
the Parties, at the offices of ▇▇▇▇▇ & ▇▇▇▇▇ in Amsterdam, The
Netherlands, provided, however, that if the sixth (6th)
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Business Day after such notification is in the period of the twelfth
(12th) through the twentieth (20th) calendar day of the month, the
Closing will be on the first Business Day after the twentieth (20th)
calendar day of the month. The date on which Closing occurs is referred
to in this Agreement as the "CLOSING DATE".
14.2 TRANSACTIONS TO BE EFFECTED AT CLOSING
The following shall take place (or, to the extent that any of the
documents referred to below shall have been executed before Closing,
shall be deemed to have taken place) at Closing simultaneously, save
for Article 14.2.10 that shall be deemed to have taken place directly
thereafter:
14.2.1 CERTIFICATES. The Purchaser, the Sellers and the Sellers'
Guarantor shall deliver to each other the certificates
described in Article 13.2.3 and Article 13.3.2.
14.2.2 DIVIDEND. The Sellers shall procure that prior to or at
Closing REPGB declares and pays an amount of dividend equal to
ninety million Euro ((euro) 90,000,000) in favour of the
Company and that the Company will subsequently as partial
repayment of the Dividend Notes pay such amount to RECE.
14.2.3 PAYMENT / ASSUMPTION. The Purchaser shall:
(i) pay the Cash Payment in cash by wire transfer in
immediately available funds and free of bank charges,
deductions or set-off from any course of action in
any way arising into the third party bank account of
the Notary at the ABN AMRO Bank (account number:
▇▇.▇▇.▇▇.▇▇▇). The Notary shall thereafter hold the
amount for and on behalf of the Purchaser;
Sellers hereby instruct the Notary to transfer the
Cash Payment in cash by wire transfer in immediately
available funds and free of bank charges, deductions
or set-off from any course of action in any way
arising by the Notary to the Sellers into the account
of [-] at the [-] bank (account number [-])
immediately upon the execution of the Deed of
Transfer of Shares;
(ii) assume the liability of Reliant Energy Power
Generation Inc. (or any of its assignees) vis-a-vis
REPGB pursuant to the terms of the Note and granting
Reliant Energy Power Generation Inc. full discharge
from its payment obligations of the outstanding
balance under the Note and any other liability under
the Note by execution of the deed of assignment
substantially in the form as attached as Annex 22
to this Agreement.
14.2.4 TERMINATED OBLIGATIONS; RELEASES. Upon the terms and subject
to the conditions set forth in this Agreement the Purchaser
shall deliver to the Sellers (with a copy to the relevant
Companies) sufficient evidence that it has assumed the
Terminated Obligations and the Sellers and its Affiliates
(except for the Companies) shall be released from such
Terminated Obligations.
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14.2.5 TRANSFER OF THE SHARES. The Sellers shall transfer the Shares
to the Purchaser by execution of the Deed of Transfer of
Shares before Mr Gerbrand W. Ch.▇▇▇▇▇▇, civil law notary
(notaris) in Amsterdam, or his replacement (the "NOTARY").
14.2.6 SHAREHOLDERS' REGISTER. The Sellers shall cause the Company to
deliver to the Purchaser the Company's shareholders' register
in which the transfer of the Shares shall have been registered
by the Notary.
14.2.7 RESIGNATIONS. The Sellers shall deliver to the Purchaser
resignation letters signed by each of the members of the
management board and of the supervisory board of the Companies
as set forth in Annex 23 to this Agreement (each a "RESIGNING
PERSON"), in each case acknowledging that such Resigning
Person has no claim against any of the Companies from which
he/she is resigning, whether for loss of office or otherwise.
14.2.8 RESOLUTIONS. The Sellers shall deliver to the Purchaser copies
of the necessary corporate resolutions in which it shall be
resolved that the Resigning Persons shall be removed with
granting full discharge (decharge) of their office duties as
managing directors or supervisory board directors, as the case
may be, and the managing directors and supervisory directors
nominated by the Purchaser shall be appointed, with effect
from the time of execution of the Deed of Transfer of Shares.
14.2.9 LICENCES. The relevant Parties shall execute and cause the
relevant Parties' Affiliates to execute the licence agreements
contemplated by Article 9.4.
14.2.10 DIVIDEND NOTES. After the payments have been made in
accordance with Article 14.2.2, and after the transfer of the
Share has been completed in accordance with Article 14.2.5,
the Companies shall and the Purchaser shall procure that the
Company pays the remaining outstanding amounts (unpaid
principal amount and interest) under the Dividend Notes, by
wire transfer in immediately available funds and free of bank
charges, deductions or set-off from any course of action in
any way arising to the third party bank account of th Notary
at ABN AMRO Bank (account number ▇▇.▇▇.▇▇.▇▇▇). The Notary
shall thereafter hold the amount for and on behalf of the
Sellers, provided however, that the Notary shall not be
entitled to release such amount without prior joint
instructions of the Sellers and the Purchaser and only in
accordance with Article 14.3.
14.3 DIVIDEND NOTES
On the first Business Day after the Closing Date, the Notary shall,
after receiving the joint instruction of the Sellers and the Purchaser,
as set forth in Article 14.2.10, transfer the amounts held pursuant to
Article 14.2.10 by wire transfer in immediately available funds and
free of bank charges, deductions or set-off from any course of action
in any way arising, to RECE into the account of [-] at the [-] bank
(account number [-]) as full and final settlement of the Dividend
Notes.
14.4 ADDITIONAL DOCUMENTS
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Each Party shall deliver or execute such other documents as any other
Party may reasonably request to demonstrate satisfaction of the
conditions precedent and covenants set forth herein; provided, however,
that such request must be received by a Party no later than two (2)
Business Days prior to the Closing.
15. REMEDIES PRE-CLOSING BREACHES
15.1 SELLERS' PRE-CLOSING BREACH AND SELLERS' GUARANTOR'S PRE-CLOSING BREACH
In the event of a Sellers' Pre-Closing Breach or a Sellers' Guarantor's
Pre-Closing Breach (other than a Material Sellers' Pre-Closing Breach
or Material Sellers' Guarantor Pre-Closing Breach):
15.1.1 none of the Parties is entitled to terminate this Agreement;
and
15.1.2 the Purchaser shall be entitled after the Closing Date to
submit a claim for damages only, provided that such claim is
accompanied by a certificate to the effect that it (i) had
disclosed the existence of such Sellers' Pre-Closing Breach or
Sellers' Guarantor's Pre-Closing Breach on the Closing Date
pursuant to Article 5.7 or (ii) it had no knowledge of such
Sellers' Pre-Closing Breach or Sellers' Guarantor's
Pre-Closing Breach on the Closing Date.
15.2 MATERIAL SELLERS' PRE-CLOSING BREACH AND MATERIAL SELLERS' GUARANTOR
PRE-CLOSING BREACH
In the event of a Material Sellers' Pre-Closing Breach or a Material
Sellers' Guarantor Pre-Closing Breach:
15.2.1 each Party can terminate this Agreement in accordance with
Article 12;
15.2.2 if the Agreement is not terminated, after Closing, the
Purchaser can claim damages provided that it has complied with
Article 5.7; and
15.2.3 if a Party elects to terminate the Agreement pursuant to
Article 12, the Purchaser shall be entitled to claim damages
only if the Material Sellers' Pre-Closing Breach or the
Material Sellers' Guarantor Pre-Closing Breach is the result
of a wilful act or omission or intentional breach of the
Sellers or Sellers' Guarantor, it being understood that the
circumstances referred to in Article 12.1.2 (iii) will for the
purpose of this Agreement not be deemed as resulting from a
wilful act or omission or intentional breach of the Sellers or
the Sellers' Guarantor.
15.3 PURCHASER'S PRE-CLOSING BREACH
In the event of a Purchaser's Pre-Closing Breach (other than a Material
Purchaser's Pre-Closing Breach):
15.3.1 none of the Parties is entitled to terminate this Agreement;
and
15.3.2 the Sellers and the Sellers' Guarantor shall be entitled after
the Closing Date to submit a claim for damages it suffered,
provided that such claim is accompanied by a certificate to
the effect that it (i) had disclosed the existence of such
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Purchaser's Pre-Closing Breach on the Closing Date or (ii) it
had no knowledge of such Purchaser's Pre-Closing Breach prior
to the Closing Date.
15.4 MATERIAL PURCHASER'S PRE-CLOSING BREACH
In the event of a Material Purchaser's Pre-Closing Breach:
15.4.1 the Sellers and the Sellers' Guarantor shall be entitled to
terminate the Agreement as set forth in Article 12; and
15.4.2 if the Agreement is not terminated, the Sellers and the
Sellers' Guarantor shall be entitled to claim damages suffered
as a result of such Material Purchaser's Pre-Closing Breach
provided that such claim is accompanied by a certificate to
the effect that Sellers and Sellers' Guarantor (i) had
disclosed the existence of such Material Purchaser's
Pre-Closing Breach on the Closing Date or (ii) had no
knowledge of such breach prior to the Closing Date.
16. SELLERS' WARRANTIES INDEMNIFICATION
16.1 SELLERS' LIABILITY FOR DAMAGES
Subject to the terms of this Agreement, including Articles 15 to 18
(inclusive), the Sellers shall indemnify and hold harmless (vrijwaren)
the Purchaser from any costs, expenses and damages directly resulting
from:
16.1.1 a Material Sellers' Pre-Closing Breach, a Material Sellers'
Guarantor Pre-Closing Breach, a Sellers' Pre-Closing Breach or
a Sellers' Guarantor Pre-Closing Breach; and
16.1.2 a breach of the Sellers' Warranties and the Sellers' Guarantor
Warranties.
16.2 COSTS
For the avoidance of doubt, any amounts payable by the Sellers or the
Sellers' Guarantor for any breach of a Sellers' Warranty and a Sellers'
Guarantor Warranty will include an amount for all reasonable costs
incurred by the Purchaser in connection with the determination,
prevention or limitation of any loss or damage resulting from or
arising as a result of any breach of any Sellers' Warranty and a
Sellers' Guarantor Warranty and in particular, but without limitation,
will include all reasonable legal costs as determined by a Judgment
pursuant to Article 22.2.6.
16.3 INTEREST
Interest against the Interest Rate on the amount of each claim
resulting from any breach of any Sellers' Warranties and any Sellers'
Guarantor Warranties shall be payable by the Sellers to the Purchaser,
or at the discretion of the Purchaser to any of the Companies notified
by the Purchaser to each of the Sellers, from the date a Claim Notice
is sent pursuant to Article 18.
17. LIMITATION OF SELLERS' LIABILITY
17.1 LIMITATIONS AS TO AMOUNT
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The Sellers are not liable for a breach of any of the Sellers'
Warranties:
17.1.1 until the amount of each claim involving or relating to a
breach of the Sellers' Warranties exceeds one million Euro
((euro)1,000,000), except for the Sellers' Warranties provided
for in Articles 3.2, 3.3, 3.4, 3.9 and 3.15.3, to which no
such threshold apply;
17.1.2 until the amount of such claims (each claim exceeding the
amount set forth in Article 17.1.1) exceeds the total sum of
ten million Euro ((euro) 10,000,000), in which case the
Sellers are liable for the full amount claimed, except for the
Sellers' Warranties provided for in Articles 3.2, 3.3, 3.4 and
3.9, to which no such basket apply; and
17.1.3 to the extent the total amount payable by the Sellers in
respect of (i) all such claims under the Sellers' Warranties,
except those in Articles 3.2, 3.3 and 3.4, exceeds the amount
of two hundred fifty million Euro ((euro) 250,000,000) and
(ii) a breach of the Sellers' Warranties provided for in
Articles 3.2, 3.3 and 3.4, exceeds the amount equal to the
Purchase Price,
it being understood that the minimum thresholds stipulated in Article
17.1.1 and 17.1.2 must be determined exclusive of any penalties,
interest and expenses and the maximum thresholds stipulated in Article
17.1.3 must be determined inclusive any penalties, interest and
expenses.
17.2 LIMITATIONS AS TO TIME
The Sellers are not liable for a breach of the Sellers' Warranties,
unless a Claim Notice (stating in reasonable detail the nature of the
claim and, if practicable, the amount claimed) has been sent by the
Purchaser to the Sellers:
17.2.1 in respect of claims involving or relating to Articles 3.4
before the date of the expiry of the period determined by the
relevant statute of limitations under Applicable Law;
17.2.2 in respect of claims involving or relating to Articles 3.9
before the date being five (5) years and two (2) months after
the Closing Date;
17.2.3 in respect of claims involving or relating to in Article
3.15.3 before the date being five (5) after the Closing Date;
or
17.2.4 in respect of any other Sellers' Warranties before the date
which is one (1) year after the Closing Date.
17.3 SPECIFIC LIMITATIONS
The Purchaser cannot file any claims against the Sellers on the basis
of the Sellers' Warranties if and to the extent that such claim is
directly attributable to:
17.3.1 any voluntary act, omission, transaction, or arrangement
carried out before the Closing Date at the express written
request or with the prior written consent of the Purchaser; or
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17.3.2 any change in Applicable Law effective after the date of this
Agreement.
17.4 LIMITATIONS ON CALCULATION OF DAMAGES
In calculating the liability of the Sellers for any claim for breach of
the Sellers' Warranties, that liability must be reduced:
17.4.1 by any amount actually recovered by the Purchaser or its
Affiliates by any of the Companies under any insurance policy
in respect of such claim;
17.4.2 by the value of any payment actually received or any actual
reduction of an amount due and payable under any Applicable
Tax Law by the Purchaser or its Affiliates or by any of the
Companies;
17.4.3 to the extent that the matter giving rise to the claim under
the Sellers' Warranties was provided for in the Audited
Accounts; and
17.4.4 to the extent that a breach of the Sellers or of the Sellers'
Guarantor reduced the Net Cash Amount limited by the sum of
the Preliminary Net Cash Reduction and the Net Cash
Adjustment.
17.5 RECOURSE
Where the Sellers are liable in respect of any claim under the Sellers'
Warranties and make payment of that claim to the Purchaser in full and
the Purchaser has a right of reimbursement (in whole or in part)
against any person, the Purchaser must, to the extent lawful, assign to
the Sellers the benefit of that right for no further consideration.
Where the third party's consent to that assignment is required the
Purchaser must use its best efforts to obtain it.
17.6 INDIRECT OR CONSEQUENTIAL LOSS
The Purchaser is not entitled to recover under this Agreement any loss
of profit by the Purchaser or any of the Companies as a result of or in
connection with any breach of the Sellers' Warranties.
18. CLAIM PROCEDURES
18.1 CLAIM NOTICE
If the Purchaser becomes aware of any fact, matter, event or
circumstance that in the reasonable opinion of the Purchaser is likely
to result in the liability of the Sellers under the Sellers'
Warranties, the Purchaser must:
18.1.1 inform the Sellers and the Sellers' Guarantor by written
notice of the potential breach of the Sellers' Warranties as
soon as possible after becoming aware thereof, with a summary
of the facts relating to such breach at that time readily
available to the Purchaser (the "CLAIM NOTICE");
18.1.2 after sending a Claim Notice to the Sellers and the Sellers'
Guarantor, to the extent reasonably possible or available,
give the Sellers and the Sellers' Guarantor any further
particulars the Sellers and the Sellers' Guarantor
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reasonably requests in writing concerning the claim so that
the Sellers and the Sellers' Guarantor can investigate the
claim and form an opinion as to whether the claim is
justified;
18.1.3 take any steps that the Sellers and the Sellers' Guarantor may
reasonably request in writing to avoid, dispute or mitigate
any claim or matter which would give rise to a claim under the
Sellers' Warranties;
18.1.4 take any reasonable action that is required to avoid or
dismiss an adverse effect on the financial position or the
business of the Companies, provided that such action must be
taken in consultation with the Sellers and the Sellers'
Guarantor and taking the interests of the Sellers and the
Sellers' Guarantor into account; and
18.1.5 where a time limit applies to a claim giving rise to a
liability or a potential liability under the Sellers'
Warranties, the Purchaser must use all reasonable efforts to
ensure that the time limit is complied with (unless otherwise
instructed by the Sellers and the Sellers' Guarantor).
18.2 DEFENCE
18.2.1 After sending a Claim Notice to the Sellers and the Sellers'
Guarantor, any of the Sellers or the Sellers' Guarantor may at
any time take over the defence of such claim (either in whole
or in part), provided that it (i) seeks the assistance of a
legal advisor who has the relevant expertise, (ii) assumes the
liability for such claim subject to the terms and conditions
of this Agreement, including but not limited to Articles 16
and 17. If any of the Sellers or the Sellers' Guarantor takes
over the defence (either in whole or in part), the Purchaser
and each of the Companies shall:
(i) leave the defence against the claim entirely to the
Sellers and the Sellers' Guarantor, provided that
they shall conduct the defence to the best of their
abilities, having reasonable regard to the
Purchaser's and each of the Companies' interests and
keep the Purchaser informed of the status of the
matter; and
(ii) lend the Sellers and the Sellers' Guarantor any
co-operation that they may require reasonably for the
defence, including the granting of powers of attorney
and the provision of information and documents or
copies thereof.
18.2.2 To the extent that the Purchaser or any of the Companies
conducts the defence against such a claim, it shall do so to
the best of its abilities, taking into account not only its
own interests but also the interests of the Sellers and of the
Sellers' Guarantor. The Purchaser and each of the Companies
shall keep the Sellers and the Sellers' Guarantor informed of
all material developments and provide copies of all relevant
documentation. The Purchaser and each of the Companies shall
not without the prior written consent of the Sellers and of
the Sellers' Guarantor, acknowledge any claim, waive any
defence or enter into any settlement with
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regard to a claim. The Sellers and the Sellers' Guarantor
shall not withhold their consent on unreasonable grounds.
18.2.3 The Party conducting the defence against a claim shall at all
times keep the other Parties informed of any development in
the dispute and of its intentions as to how to proceed.
18.3 COMPLIANCE BY THE COMPANIES
After the Closing Date, the Purchaser shall procure that the Companies
shall comply with Articles 18.1 and 18.2. Prior to and on the Closing
Date, the Sellers shall procure that the Companies shall comply with
Articles 18.1 and 18.2.
18.4 THIRD PARTY CLAIMS
If the Purchaser or any of the Companies become aware of any right it
may have to claim any amount from any third party in respect of any
matter which has previously been the subject of a payment by the
Sellers or by the Sellers' Guarantor under this Agreement, the
Purchaser will promptly notify the Sellers and the conduct provisions
of this Article shall apply to such right mutatis mutandis, and the
lesser of the amount recovered by or on behalf of the Purchaser or any
of the Companies from such third party and the amount originally paid
by the Sellers or by the Sellers' Guarantor, shall be paid to the
Sellers or to the Sellers' Guarantor.
18.5 WAIVER ARTICLE 7:23(1) OF THE DUTCH CIVIL CODE
The Parties specifically agree that the arrangement provided for in
Articles 16 and 17 shall apply between the Parties instead of the
provisions set out in Article 7:23(1) of the Dutch Civil Code and that
the Sellers and the Sellers' Guarantor shall not have the right to
invoke any rights that it would otherwise have pursuant to Article
7:23(1) of the Dutch Civil Code.
19. INDEMNITY BY THE PURCHASER
19.1 PURCHASER'S LIABILITY
In the event of a breach of the Purchaser's Warranties or in the event
of any non-fulfilment of any obligation of the Purchaser under this
Agreement that has adverse consequences for the Sellers and the
Sellers' Guarantor, the Purchaser shall indemnify and hold harmless
(vrijwaren) the Sellers and the Sellers' Guarantor from any costs,
expenses, damages, and legal fees and expenses directly resulting from
any breach of the Purchaser's Warranties or any non-fulfilment of any
obligation of the Purchaser under this Agreement.
19.2 COSTS
For the avoidance of doubt, any amounts payable by the Purchaser for
any breach of a Purchaser's Warranty will include an amount for all
reasonable costs incurred by the Sellers and the Sellers' Guarantor in
connection with the determination, prevention or limitation of any loss
or damage resulting from or arising as a result of any breach of any
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Purchaser's Warranty and in particular, but without limitation, will
include all reasonable legal costs as determined by a Judgment pursuant
to Article 22.2.6.
19.3 INTEREST
Interest against the Interest Rate on the amount of each claim
resulting from any breach of a Purchaser's Warranties shall be payable
by the Purchaser to the Sellers and the Sellers' Guarantor, or at the
discretion of the Sellers or the Sellers' Guarantor to any member of
the Sellers' Group, from the date a claim notice is sent to the
Purchaser.
20. CONDUCT OF TAX AFFAIRS
20.1 CONDUCT OF TAX AFFAIRS FOR THE RELEVANT PERIODS
The Purchaser and the Sellers agree that, subject to the following
provisions of this Article 20 and of Article 18.2.1(ii) (including
assuming liability), the Sellers shall at their own expense have the
conduct of the tax affairs of the Companies for the Relevant Periods.
20.2 CONDUCT OF TAX AFFAIRS - PURCHASER'S COVENANTS
20.2.1 Notwithstanding any provision of this Agreement, the Sellers
shall not prepare or submit any tax return or have any contact
with the Tax authorities in The Netherlands on the Note and
the provisions, without instructions and approval of the
Purchaser
20.2.2 The Purchaser shall procure that:
(i) the Sellers (or such professional advisers as the
Sellers may elect) shall have the conduct of the
preparation, submission to the relevant authority,
negotiation, and agreement of the Taxes Returns of
the Companies for the Relevant Periods which have not
been prepared and agreed with the relevant authority
prior to Closing;
(ii) the Sellers and their advisers shall be provided on a
timely basis with such information and assistance
(including reasonable assistance from employees of
the Purchaser and the Companies) and reasonable
access to such documents and records relating to the
Companies as may reasonably be required in connection
with the agreement of the Tax Returns of the
Companies for the Relevant Periods;
(iii) the Companies, at the written request of the Sellers
or their advisers, shall make those claims and
elections in respect of the Relevant Periods that are
reflected in a provision in the audited accounts; and
(iv) the Companies shall authorise, sign and submit any
Tax Returns and other ancillary information,
accounts, statements and reports relating to the
Relevant Periods which have been provided to them by
the Sellers and are required by the relevant
authority (incorporating such amendment as the
Purchaser may in writing request) provided that no
Company shall be
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obliged to sign any Tax Return which it considers not
to be full, true and accurate in all material
respects.
20.2.3 The Purchaser's Group and any of Purchaser's Affiliates shall
not take (or cause or permit any of the Companies to take) any
action which could increase the liability of any member of the
Sellers' Group for Taxes (including any liability any member
of the Sellers' Group to indemnify the Purchaser or the
Companies for Taxes pursuant to this Agreement) including, for
example, any action which could result in, or change the
character of, any income or gain (including any Subpart F
income) that any member of the Sellers' Group must report on
any Tax Return (e.g. the declaration of any dividend by any of
the Companies on the Closing Date, the declaration of any
repayment of capital by any of the Companies, or the
declaration of any share premium by any of the Companies).
20.3 CONDUCT OF TAX AFFAIRS - SELLERS' COVENANTS
The Sellers shall procure that in relation to the tax affairs of any of
the Companies for the Relevant Periods:
20.3.1 they will provide to the Purchaser copies of all
correspondence and other documents to be submitted to the
relevant authority in relation to Tax Returns for the Relevant
Periods (together with such other information as may be
necessary to enable the Purchaser to consider the
correspondence and other documents in light of all material
facts) in sufficient time before submission to the relevant
authority to enable the Purchaser to comment on such
correspondence or documents;
20.3.2 any Tax Returns are agreed with the relevant authority as
quickly as reasonably possible;
20.3.3 the Purchaser is kept fully informed about the status of any
negotiations relating to the tax affairs of the Companies for
the Relevant Periods and is consulted on any matters relating
to the tax affairs of the Companies for the Relevant Periods
which the Purchaser may specify in writing to the Sellers; and
20.3.4 all reasonable comments of the Purchaser' Group received by
the Sellers or their advisers are incorporated in the
documents to be submitted to the relevant authority.
20.4 CONDUCT OF TAX AFFAIRS - PURCHASER TAKING OVER TAX AFFAIRS
20.4.1 If the Purchaser considers in its reasonable opinion that the
Sellers are not complying with their obligations under Article
20.3 in relation to any Relevant Period it shall notify the
Sellers and the Sellers' Guarantor of that fact in writing,
with a summary of the facts at that time readily available to
the Purchaser. The Purchaser shall, to the extent reasonably
possible or available, give the Sellers and the Sellers'
Guarantor any further particulars the Sellers and the Sellers'
Guarantor reasonably requests in writing concerning the
subject of the notice so that the Sellers and the Sellers'
Guarantor can investigate the
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subject of the notice and form an opinion as to whether the
Purchaser's notification is justified.
20.4.2 If within fifteen (15) days of receiving the written notice
under Article 20.4.1 the Sellers fail to provide an
explanation which is satisfactory to the Purchaser in its
reasonable discretion, the Purchaser shall, provided that a
detailed explanation as to the basis of their objection and,
following good faith consultation, be entitled, at the expense
of the Sellers, to take over the tax affairs of the relevant
Company for the Relevant Period(s) specified in the
Purchaser's notice, provided, however, that:
(i) the Purchaser shall do so to the best of its
abilities, taking into account not only its own
interests and that of the Companies, but also the
interests of the Sellers' Group;
(ii) the Purchaser and each of the Companies shall keep
the Sellers and the Sellers' Guarantor informed of
all material developments and provide copies of all
relevant documentation;
(iii) the Purchaser and each of the Companies shall not
without the prior written consent of the Sellers and
of the Sellers' Guarantor, acknowledge any
obligation, waive any defence or enter into any
settlement; the Sellers and the Sellers' Guarantor
shall not withhold their consent on unreasonable
grounds;
(iv) any Advisor engaged in that respect shall be
appointed by mutual consent of all Parties; and
(v) the Purchaser shall at all times keep the Sellers and
the Sellers' Guarantor informed of any development
and of its intentions as to how to proceed.
20.5 CONDUCT OF TAX AFFAIRS - ALLOWED DISCLOSURES
Notwithstanding anything to the contrary contained in this Agreement,
the Confidentiality Agreements, or any other express or implied
agreement, arrangement or understanding, the Parties and their
Affiliates, employees, representatives and other agents may disclose to
any and all persons the structure and any of the tax aspects of the
transactions contemplated by this Agreement, which are necessary to
describe or support any United States federal income tax benefits that
may result therefrom or any materials relating thereto, except where
confidentiality is reasonably necessary to comply with United States
federal or state securities laws. The Parties or their representatives
may be required to maintain a list of participants and other related
information with respect to the transactions contemplated by this
Agreement pursuant to section 6112 of the United States Internal
Revenue Code of 1986, as amended. This list, if required, will be
available for inspection upon request by the United States Internal
Revenue Service.
21. NOTICES
21.1 DELIVERY OF NOTICES
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All notices, requests, demands, waivers and other communications
required or permitted to be given under this Agreement shall be in
writing and may be given by any of the following methods: (a) personal
delivery, (b) facsimile transmission, (c) registered or certified mail,
postage prepaid, return receipt requested or (d) courier service.
Notices shall be sent to the appropriate Party at its address or
facsimile number given below (or at such other address or facsimile
number for such Party as shall be specified by notice given hereunder).
If to the Sellers, to:
The Sellers
c/o Reliant Energy Europe Inc.
▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America
Attn: ▇▇▇ ▇. ▇▇▇▇▇▇
Telefax: ▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇
with a copy, which shall not constitute notice under this Agreement,
to:
▇▇▇▇▇▇▇▇ Chance Limited Liability Partnership
▇▇▇▇▇▇▇▇ ▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Attn: ▇▇▇ de Waard
Telefax: ▇▇▇ (▇) ▇▇ ▇▇▇ ▇▇▇▇
If to the Sellers' Guarantor, to:
Reliant Resources Inc.
▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America
Attn: ▇▇▇ ▇. ▇▇▇▇▇▇
Telefax: ▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇
with a copy, which shall not constitute notice under this Agreement,
to:
▇▇▇▇▇▇▇▇ Chance Limited Liability Partnership
▇▇▇▇▇▇▇▇ ▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Attn: ▇▇▇ de Waard
Telefax: ▇▇▇ (▇) ▇▇ ▇▇▇ ▇▇▇▇
If to the Purchaser, to:
The Purchaser
n.v. Nuon
Spaklerweg 20
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▇.▇.▇▇▇ 41920
1009 DC Amsterdam
Attn: ▇▇ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Telefax: ▇▇▇ (▇) ▇▇ ▇▇▇ ▇▇ ▇▇
with a copy, which shall not constitute notice under this Agreement,
to:
▇▇▇▇▇ & Overy
▇▇▇▇▇▇▇▇▇▇ ▇▇
▇▇▇▇ ▇▇ Amsterdam
Attn: Jan ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Telefax: ▇▇▇ (▇) ▇▇ ▇▇▇ ▇▇▇▇
Notwithstanding any other provision of this Agreement, for the purpose
of serving any document (including notices and writs of summons)
relating to or in connection with this Agreement, each of the Sellers
hereby choose as their place of domicile the address of ▇▇▇▇▇▇▇▇ Chance
Limited Liability Partnership in Amsterdam, The Netherlands (attn.: Mr.
T. de Waard) and appoints such as their Service Agent (domicilie
keuze).
21.2 RECEIPT OF NOTICES
All such notices, requests, demands, waivers and other communications
shall be deemed received upon (i) actual receipt thereof by the
addressee, (ii) actual delivery thereof to the appropriate address or
(iii) in the case of a facsimile transmission, transmission thereof by
the sender and issuance by the transmitting machine of a confirmation
slip that the number of pages constituting the notice have been
transmitted without error. In the case of notices sent by facsimile
transmission, the sender shall contemporaneously mail a copy of the
notice to the addressee at the address provided for above by first
class mail or by an overnight courier service, postage prepaid.
However, such mailing shall in no way alter the time at which the
facsimile notice is deemed received.
22. GOVERNING LAW AND DISPUTE RESOLUTION
22.1 GOVERNING LAW
This Agreement (including the Annexes and the Appendices to the
Annexes, unless specifically stated otherwise therein) is governed by
and shall be construed in accordance with the laws of The Netherlands.
22.2 DISPUTE RESOLUTION PROCEDURES
22.2.1 Save as otherwise set out in this Agreement, any dispute
arising out of or in connection with this Agreement (including
questions in respect of the authority of the arbitrators) will
be finally settled by arbitration in accordance with the rules
of the Netherlands Arbitration Institute (Nederlands Arbitrage
Instituut).
22.2.2 The arbitral tribunal will be composed of three arbitrators
appointed in accordance with those rules. Parties agree that
one of the arbitrators shall have the nationality of the
United States of America and one of the arbitrators shall have
the nationality of The Netherlands. The third arbitrator,
being also the
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chairman, shall have neither the nationality of The
Netherlands, nor of the United States of America.
22.2.3 The arbitrators will decide according to the rules of law.
22.2.4 The place of arbitration shall be Amsterdam, The Netherlands.
22.2.5 The arbitration proceedings shall be conducted in the English
language and shall be governed by the laws of The Netherlands.
22.2.6 The costs of arbitration shall in principle be borne by the
unsuccessful Party. However, the arbitrators may apportion
each of such costs between the Parties if they determine that
apportionment is reasonable, taking into account the
circumstances of the case.
22.2.7 The award of the arbitral tribunal will be final and binding
on the Parties and may be presented by any of the Parties for
enforcement in any jurisdiction and the Parties hereby consent
to the jurisdiction of such court solely for purposes of
enforcement of this Agreement to arbitrate and any award
rendered under this Agreement. In any such enforcement action,
irrespective of where it is brought, none of the Parties will
seek to invalidate or modify the decision of the arbitral
tribunal or otherwise to invalidate or circumvent the
procedure set forth in this Article 22.2.
23. NO RESCISSION
Without prejudice to Articles 12, 13 and 15 the Parties hereby waive
their rights, if any, under Sections 6:228, 6:230.2, 6:258 and 6:265 of
the Dutch Civil Code to rescind, annul, dissolve or amend this
Agreement (including gehele ▇▇▇ wel partiele vernietiging ▇▇▇ wel
ontbinding) or to claim damages in lieu of annulment, and the other
Parties hereby accept such waiver.
24. MISCELLANEOUS
24.1 ENTIRE AGREEMENT
This Agreement together with Confidentiality Agreements constitutes the
entire agreement, and replaces and extinguishes all prior agreements,
undertakings, arrangements, understandings or statements of any nature
made by the Parties or any of them whether oral or written (and, if
written, whether or not in draft form) with respect to such subject
matter.
24.2 WAIVER
The Purchaser for itself as well as for each of its Affiliates hereby
agrees with the Sellers that any and all claims relating to the Sellers
shall be governed by this Agreement and the Confidentiality Agreements.
If and to the extent the laws of any jurisdiction provide for more
protection to the Purchaser or any of its Affiliates than is provided
to the Purchaser in this Agreement and pursuant to the Confidentiality
Agreements, the Purchaser (on behalf of itself as well as for each of
its Affiliates) hereby excludes or (if incapable of exclusion)
irrevocably waives (afstand ▇▇▇ ▇▇▇▇▇) its rights to any such
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rights and implied representations or warranties and the other Parties
hereby accept such waiver.
24.3 EXPENSES
24.3.1 Save as otherwise provided in this Agreement, each Party will
bear its own expenses incurred in connection with the
preparation of this Agreement and the transactions
contemplated by this Agreement, including legal and auditing
fees and expenses and costs.
24.3.2 The notarial costs of the Deed of Transfer of Shares shall be
borne by the Purchaser.
24.4 PRESS ANNOUNCEMENTS
The Parties shall not make any press release or public announcement
relating to this Agreement or the transactions contemplated by this
Agreement without the prior written consent of the other Parties prior
to making such release or announcement. The foregoing shall not
prohibit any disclosure as may be required by Applicable Law or by the
rules of any recognised stock exchange, or upon request of any of the
rating agencies; provided, however, that such disclosure may not
violate the terms of the Confidentiality Agreement and that the
disclosing Party shall consult with the other Parties in advance of
such disclosure.
24.5 ASSIGNMENT OF RIGHTS AND OBLIGATIONS
No Party may assign any of its rights or transfer any of the
obligations under this Agreement without prior written consent of the
other Parties, save that the Purchaser's rights under this Agreement
may be assigned by the Purchaser to any of its Affiliates and by such
Affiliate to any of its Affiliates; provided that in each such case,
the Purchaser prior to such assignment irrevocably guarantees vis-a-vis
the Sellers and the Sellers' Guarantor any and all obligations of such
Affiliate under this Agreement.
24.6 VARIATION
This Agreement may not be amended, supplemented or changed, nor may any
provision hereof be waived, except by written instrument making
specific reference to this Agreement signed by each of the Parties.
24.7 COUNTERPARTS
This Agreement may be executed in one or more counterparts, each of
which shall constitute an original, and all of which when taken
together shall constitute one and the same original document. All
signatures need not be on the same counterpart.
24.8 SEVERABILITY
In the event that any provision of this Agreement shall be finally
determined to be unenforceable, such provision shall, so long as the
economic and legal substance of the transactions contemplated by this
Agreement is not affected in any materially adverse
- 65 -
manner as to any Party, be deemed severed from this Agreement and every
other provision of this Agreement shall remain in full force and
effect.
24.9 LANGUAGE
Subject to Article 1.2.7, any documentation and oral or written
communications by one Party to any other Party shall be in the English
language, unless otherwise agreed between such Parties.
24.10 JOINT LIABILITY
Without prejudice to Article 9.6, with regard to all obligations,
representations, warranties, covenants and other undertakings that are
expressed to be made, undertaken or given by the Sellers to the
Purchaser or any of the Companies, the Sellers shall be jointly and
severally liable in respect thereof.
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IN WITNESS WHEREOF this Agreement has been executed by the Parties hereto on the
date set out on page one.
For and on behalf of:
RELIANT ENERGY EUROPE INC., as Seller No. 1,
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------------
By: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President
For and on behalf of:
RELIANT ENERGY WHOLESALE (EUROPE) HOLDINGS B.V., as Seller No. 2,
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------------
By: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Managing Director
For and on behalf of:
N.V. NUON, as Purchaser,
/s/ Ludo ▇. ▇. van Halderen
------------------------------------
By: Ludo ▇. ▇. van Halderen
Title: Statutory Director
For and on behalf of:
RELIANT RESOURCES, INC., as Sellers' Guarantor,
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
------------------------------------
By: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Title: Power-of-Attorney
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