EX-4.1 3 dex41.htm UMBRELLA DEED- HOSPITALS Umbrella Deed- Hospitals

Exhibit 1

 

CLAYTON UTZ

 

Umbrella Deed - Hospitals

 

Mayne Group Limited ABN 56 004 073 410

MGL

 

Mayne Healthcare Holdings Pty Limited ABN 16 078 954 631

MHH

 

Australian Newco Holdings Pty Limited

Buyer

 

and

 

Others

 

If you have any questions about the details of this document

please contact Rod Halstead on + 61 2 9353 4000

 

Clayton Utz Lawyers

Levels 22-35 No. 1 O’Connell Street Sydney NSW 2000 Australia

PO Box H3 Australia Square Sydney NSW 1215

T + 61 2 9353 4000 F + 61 2 8220 6700

 

www.claytonutz.com

 

Our reference Rod Halstead/Jonathan Algar/21724491

 

Liability limited by the Solicitors Scheme, approved under the Professional Standards Act 1994 (NSW) and by our Terms of Engagement


Table of Contents

 

1.

   Definitions and interpretation    2
    

1.1

  

Definitions

   2
    

1.2

  

Interpretation

   15
    

1.3

  

Governing law

   16
    

1.4

  

Enforcement on behalf of the Seller Group

   16
    

1.5

  

Procurement by MGL

   16
    

1.6

  

Procurement by the Buyer

   16
    

1.7

  

Other Indemnifying Parties

   17

2.

   Umbrella Pre-Adjustment Purchase Price; Determination and payment of Adjustment Amounts    17
    

2.1

  

Umbrella Pre-Adjustment Purchase Price

   17
    

2.2

  

Intercompany Debt Estimate and repayment of Intercompany Debt

   17
    

2.3

  

Preparation of Umbrella Completion Statements

   17
    

2.4

  

Audit of Umbrella Completion Statements

   18
    

2.5

  

Determination of the Umbrella Completion Amounts

   18
    

2.6

  

Disputes

   19
    

2.7

  

Limitation on disputes

   20
    

2.8

  

Final payment and Escrow arrangements

   20
    

2.9

  

Divestment Business

   21
    

2.10

  

Escrow

   21

3.

   Apportionment of Umbrella Purchase Price    21
    

3.1

  

Apportionment of Umbrella Pre-Adjustment Purchase Price

   21
    

3.2

  

Apportionment of Umbrella Completion Amounts

   22

4.

   Conditions Precedent    23
    

4.1

  

Condition

   23
    

4.2

  

Best endeavours

   23
    

4.3

  

Notification

   23
    

4.4

  

Non-satisfaction of Conditions

   23
    

4.5

  

Termination

   23
    

4.6

  

Waiver of Conditions

   23
    

4.7

  

Schedule 13

   23

5.

   Seller’s obligations and consultancy arrangements    24
    

5.1

  

Conduct of business and consultancy arrangements

   24
    

5.2

  

Restricted actions - Non C&P Hospital Business

   24
    

5.3

  

Restricted actions - C&P Hospital Business

   25
    

5.4

  

Integration

   26
    

5.5

  

Access to Excluded Business Records

   26
    

5.6

  

Conduct between 30 November 2003 and Umbrella Completion

   27

6.

   Buyer’s obligations    27
    

6.1

  

Supply of references

   27
    

6.2

  

Consents to act - Non-C&P Hospital Business

   27
    

6.3

  

Access to Business Records

   28
    

6.4

  

Trade mark licence

   28
    

6.5

  

Cessation of use of Reserved Name

   31
    

6.6

  

Infringement

   31
    

6.7

  

Indemnity in relation to Trade Marks - Excluded

   32

7.

   Warranties and indemnities    32
    

7.1

  

Seller’s Warranties and acknowledgment

   32

 

i


    

7.2

  

Exceptions for disclosures and public records

   33
    

7.3

  

Breach of Warranties

   33
    

7.4

  

Acknowledgments

   34
    

7.5

  

Buyer’s Warranty

   34

8.

   Limitation of liability    35
    

8.1

  

No reliance on and no liability for matters outside this Deed

   35
    

8.2

  

Limitations of liability

   35
    

8.3

  

Maximum liability for claims

   38
    

8.4

  

Reimbursement for amounts recovered

   38
    

8.5

  

Third party claims

   38
    

8.6

  

Adjustment to Umbrella Purchase Price

   39
    

8.7

  

Directors and Employees of the Group

   39
    

8.8

  

Insurance

   39
    

8.9

  

Contamination or Pollution

   39
    

8.10

  

Group reorganisation

   40
    

8.11

  

Litigation

   40

9.

   Work-related claims    41
    

9.1

  

Buyer’s indemnity for work-related claims

   41
    

9.2

  

States assuming management of claims

   41
    

9.3

  

Administration of workers’ compensation liabilities

   41

10.

   GST    41
    

10.1

  

Interpretation

   41
    

10.2

  

Reimbursements and similar payments

   42
    

10.3

  

GST payable

   42
    

10.4

  

Variation

   42
    

10.5

  

No merger

   42

11.

   Litigation    42
    

11.1

  

Acknowledgment

   43
    

11.2

  

Management and Responsibility for Litigation

   43
    

11.3

  

Procedure in relation to Joint Litigation

   44
    

11.4

  

Notice of New or Unidentified Current Litigation

   44
    

11.5

  

Allocation of responsibility

   45
    

11.6

   Procedure in event of Joint Litigation by or against a Seller Group Member where MGL is not primarily responsible for the conduct of the Claims    45
    

11.7

   Procedure in event of Joint Litigation by or against the Buyer where the Buyer Group is not primarily responsible for the conduct of the claims    46
    

11.8

  

Excluded Litigation

   48
    

11.9

  

Assignment of Litigation

   48

12.

   Restrictive covenant    49
    

12.1

  

Covenants

   49
    

12.2

  

Duration of covenants

   49
    

12.3

  

Geographic application of covenants

   49
    

12.4

  

Interpretation

   49
    

12.5

  

Exceptions

   49
    

12.6

  

Acknowledgments

   50

13.

   General    50
    

13.1

  

Termination

   50
    

13.2

  

Further acts

   50
    

13.3

  

Notices

   50

 

ii


    

13.4

  

Expenses

   51
    

13.5

  

Stamp duties

   51
    

13.6

  

Jurisdiction

   52
    

13.7

  

Amendments

   52
    

13.8

  

Assignment

   52
    

13.9

  

Waiver

   53
    

13.10

  

Counterparts

   53
    

13.11

  

Indemnities

   53
    

13.12

  

Entire agreement

   54
    

13.13

  

Confidentiality and public announcements

   54
    

13.14

  

Privacy

   55
    

13.15

  

Survival of certain provisions; no merger

   56

14.

  

Insurance Recovery in relation to medical malpractice

   56
    

14.1

  

Insurance Recovery

   56

Schedule 1 Last Accounts

    

Schedule 2 Last Accounts Adjusted Net Trading Assets Statement

    

Schedule 3 Umbrella Completion Accounts

    

Schedule 4 Umbrella Completion Adjusted Net Trading Assets Statement

    

Schedule 5 Umbrella Balancing Statement

    

Schedule 6 Warranties

    

Schedule 7 Buyer Warranties

    

Schedule 8 Obligations relating to Workers’ Compensation Liability

    

Schedule 9 Insurance

    

Schedule 10 Trusts and Beneficiaries

    

Schedule 11 Current Litigation

    

Schedule 12 - Conditions Precedent

    

Schedule 13 Facilities Agreement Conditions Precedent

    

Schedule 14 Variation to principles of Last Accounts

    

Schedule 15 Senior Management

    

Annexure A Data Room Index

    

Annexure B Disclosure Letter

    

Annexure C Financial Statements as at 30 June 2002

    

Annexure D Commitment Letters

    

Annexure E Newco Group Structure

    

Annexure F Top 100 Providers of Goods and Services

    

Annexure G Escrow Agreement

    

Annexure H Consultancy Letter

    

 

iii


Deed dated 21 OCTOBER 2003

 

Parties    Mayne Group Limited ABN 56 004 073 410 of Level 21, 390 St Kilda Road, Melbourne, Victoria 3004, Australia (“MGL”)
     Mayne Healthcare Holdings Pty Limited ABN 16 078 954 631 of Level 21, 390 St Kilda Road, Melbourne, Victoria 3004, Australia (“MHH”)
     Australian Newco Holdings Pty Limited ACN 106 722 347 of c/- Minter Ellison, 88 Phillip Street, Sydney, New South Wales 2000, Australia (“Buyer”)
    

 

and

 

     Joondalup Hospital Pty Limited ACN 106 723 193 of c/- Minter Ellison, 88 Phillip Street, Sydney, New South Wales 2000, Australia;
     Port Macquarie Hospital Pty Limited ACN 106 723 399 of c/- Minter Ellison, 88 Phillip Street, Sydney, New South Wales 2000, Australia;
     Logan Hospital Pty Limited ACN 106 723 406 of c/- Minter Ellison, 88 Phillip Street, Sydney, New South Wales 2000, Australia;
     Melbourne Hospital Pty Limited ACN 106 723 415 of c/o Minter Ellison, 88 Phillip Street, Sydney, New South Wales 2000, Australia;
     Noosa Privatised Hospital Pty Limited ACN 106 723 380 of c/- Minter Ellison, 88 Phillip Street, Sydney, New South Wales 2000, Australia;
     Caboolture Hospital Pty Limited ACN 106 723 219 of c/- Minter Ellison, 88 Phillip Street, Sydney, New South Wales 2000, Australia;
     Frances Perry Hospital Pty Limited ACN 106 723 228 of c/- Minter Ellison, 88 Phillip Street, Sydney, New South Wales 2000, Australia;
     Armidale Hospital Pty Limited ACN 106 723 200 of c/- Minter Ellison, 88 Phillip Street, Sydney, New South Wales 2000, Australia; and
     P.O.W. Hospital Pty Limited ACN 106 723 871 of c/- Minter Ellison, 88 Phillip Street, Sydney, New South Wales 2000, Australia
     (collectively with the Buyer, the “Newco Group” and each a “Newco Group Member”)

 

Recitals

 

A. MGL and the Seller Group wishes to sell, and the Buyer wishes to buy, all (and not some or part) of the assets, property and businesses comprising the Australian Hospital Business.

 

B. On or about the date of this Deed, the parties entered into the Share and Asset Sale Deed, and the parties other than MHH entered into the nine Asset Sale Deeds and the Indonesian Share Sale Agreement, under which agreements the Buyer has agreed to acquire the Australian Hospital Business and the Indonesian Hospital Business conducted by the Seller Group.

 

C. The parties other than MHH have agreed to, pursuant to the Share and Asset Sale Deed, enter into an agreement entitled “Shared Services Agreement” on Umbrella Completion under which the Buyer has agreed to provide certain services to the Seller Group after Umbrella Completion which are currently provided as between MGL and its Related Bodies Corporate.

 

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D. The nine Asset Sale Deeds have no force and effect until such time as the relevant Governmental Authority has consented to the transfers contemplated in those agreements. In view of Recital A and in consideration for MGL agreeing to sell its Non-C&P Hospital Business prior to such consents being obtained, the Buyer has agreed to pay the Umbrella Purchase Price for the Australian Hospital Business under this Deed.

 

E. The parties would like to record their agreement in relation to the payment of the Umbrella Pre-Adjustment Purchase Price and its adjustment to ascertain the Umbrella Purchase Price on the terms of this Deed.

 

This deed provides

 

1. Definitions and interpretation

 

1.1 Definitions

 

In this document unless the context requires otherwise:

 

“Adjustment Items” means the adjustments to the net trading assets described in the Last Accounts Adjusted Net Trading Assets Statement and the Umbrella Completion Adjusted Net Trading Assets Statement in Schedules 2 and 4.

 

“Adjusted Net Trading Assets as at 30 November 2003” means the net trading assets of the Australian Hospital Business as at 30 November 2003 determined in accordance with clause 2, and as set out in the Umbrella Completion Adjusted Net Trading Assets Statement.

 

“Adjusted Net Trading Assets as at the Last Accounts Balance Date” means the net trading assets of the Australian Hospital Business as set out in the Last Accounts Adjusted Net Trading Assets Statement in the form set out in Schedule 2.

 

“Asset Sale Deeds” means each of the 9 sale and purchase deeds entered into on or about the date of this Deed between MGL, the relevant Newco Group Member providing for the transfer to the Buyer of the assets and liabilities in relation to each of the Collocated and Privatised Hospitals.

 

“Australian Hospital Business” means the Non C&P Hospital Business and each C&P Hospital Business.

 

“Beneficiaries” means the beneficiaries under the Trusts listed in Schedule 10.

 

“Business Day” means a day, not being a Saturday, Sunday or public holiday, on which banks are generally open for business in the State and New South Wales.

 

“Business Records” means “Business Records” as defined in the Share and Asset Sale Deed and the Asset Sale Deed.

 

“Buyer Group” means the Buyer, Newco Group and each of Buyer’s other Related Bodies Corporate and, on and from Umbrella Completion, includes the Group and where the context requires or allows, “Buyer Group Member” means any one or more of them.

 

“Buyer Litigation” means:

 

  (a) Current Litigation that is against or by a Group Member to which a Seller Group Member is not a party;

 

  (b) any Claim which has been commenced or made on or after the Umbrella Completion Date that relates to the Non C&P Hospital Business, and is against or by a Buyer Group Member and to which a Seller Group Member is not a party; and

 

2


  (c) any Claim which has been commenced or made on or after the C&P Completion Date that relates to the C&P Hospital Business and is against or by a Buyer Group Member and to which a Seller Group Member is not a party,

 

excluding Joint Litigation.

 

“C&P Assets” means Assets - Seller Group as defined under the relevant Asset Sale Deed.

 

“C&P Completion” means in relation to a C&P Hospital Business, “C&P Completion” or “Unit Sale Completion” (as the case may be) as defined under the relevant Asset Sale Deed.

 

“C&P Completion Date” means in relation to a C&P Hospital Business, “C&P Completion Date” or “Unit Sale Completion Date” as defined under the relevant Asset Sale Deed.

 

“C&P Deemed Employee” means any person, other than a C&P Employee, who is defined as a worker under any statute relating to workers’ compensation, or is otherwise deemed to be entitled to workers’ compensation payments in accordance with any statute relating to workers’ compensation, in respect of any Seller Group Member provided that such person was engaged exclusively in relation to the C&P Hospital Business.

 

“C&P Employees” means “Employees - Seller Group” as defined under the relevant Asset Sale Deed.

 

“C&P Former Employee” means any person who was or becomes, at any time before C&P Completion:

 

  (a) an employee of any Seller Group Member provided that such person was engaged exclusively in relation to the relevant C&P Hospital Business; or

 

  (b) a C&P Deemed Employee.

 

“C&P Hospital Business” means a “Hospital Business” as defined under the relevant Asset Sale Deed.

 

“C&P Termination” means termination or expiry of the relevant Asset Sale Deed.

 

“C&P Premises” means the “Premises” as defined under the relevant Asset Sale Deed.

 

“C&P Warranty” has the meaning given in clause 7.1(c).

 

“Claims” for the purposes of clause 11 and the definitions used therein, means any allegations, claims, demands, causes of action, litigation, proceedings declarations or orders (whether based in contract, tort, statute, equity or otherwise) of any nature made or existing:

 

  (a) before or on the date of this Deed, but not resolved before or on the date of this Deed; or

 

  (b) after the date of this Deed,

 

including by a Governmental Authority.

 

“Claims or Actions” means any claims, demands or causes of action (whether based in contract, tort or statute, or otherwise arising):

 

  (a) in respect of the Transaction Agreements, or any part of them;

 

3


  (b) relating to any transaction or matter contemplated by the Transaction Agreements or in relation to the Non C&P Hospital Business, each C&P Hospital Business, the Sale Shares and the assets, real property and liabilities in relation to those businesses or their sale under the Transaction Agreements; or

 

  (c) relating to any aspect of the affairs of any Group Member or Seller Group Member.

 

“Collocated and Privatised Hospitals” means the following hospitals:

 

  (a) Armidale Private Hospital, Armidale;

 

  (b) Caboolture Private Hospital, Caboolture;

 

  (c) Frances Perry Private Hospital, Carlton;

 

  (d) Joondalup Health Campus, Joondalup;

 

  (e) Logan Private Hospital, Meadowbrook;

 

  (f) The Melbourne Private Hospital, Parkville;

 

  (g) Noosa Hospital, Noosaville;

 

  (h) Port Macquarie Base Hospital, Port Macquarie; and

 

  (i) Prince of Wales Private Hospital, Randwick.

 

“Condition Precedent” means the conditions set out in Schedule 12.

 

“Consequential Loss” means any loss or damage which is indirect or consequential; or which results from some special circumstance or supervening event; or which is by way of loss of revenue, loss of profits, loss of goodwill or credit, loss of business reputation future reputation or publicity, loss of use, loss of interest, damage to credit rating, loss or denial of opportunity, or increased overhead costs; or which relates to expenses incurred as a consequence of the direct loss or outgoings rendered futile as a consequence of the direct loss; or which is not an immediate result of the act, omission or event which gives rise to the direct loss.

 

“Constitution” means as the case requires the Constitution of any of the Hospital Companies and of each Subsidiary in the form in which they are in at the date of this Agreement.

 

“Consultancy Agreement” means the consultancy agreement to be entered into between MGL and the Buyer at Umbrella Completion in the form annexed at Annexure H.

 

“Contamination” means the presence on, in, or under land (including surface water, ground water and other waters) of a substance at a concentration above the concentration at which the substance is normally present on, in or under (as the case may be) other land in the same locality and gives rise to a risk of harm to human health or the Environment.

 

“Corporations Act” means the Corporations Act 2001 (Commonwealth).

 

“Current Litigation” means, as the case may be:

 

  (a) from the Umbrella Completion Date, such of the matters listed in Part A of Schedule 11 and any other Claim which has been commenced or made but not resolved prior to Umbrella Completion in respect of:

 

  (i) the Non C&P Hospital Business; and

 

4


  (ii) the Retained Business or the Divestment Businesses,

 

by or against a Seller Group Member and/or a Group Member; or

 

  (b) from the relevant C&P Completion Date, such of the matters listed in Part B of Schedule 11 and any other Claim which has been commenced or made but not resolved prior to C&P Completion in respect of the C&P Hospital Business.

 

“Costs” means external legal costs and expenses, on a full indemnity basis, penalties, fines and other like costs directly associated with a matter.

 

“Data Room Index” means the index of written material disclosed by MGL or its advisors to the Buyer which is annexed to this Agreement as Annexure A.

 

“Day Surgery” means a facility which predominantly provides surgery in respect of which patients are not required to remain in the facility overnight and by medical practitioners who are not general practitioners and, for the avoidance of doubt, does not include any facility from which the Seller Group provides medical services which are predominantly conducted by general practitioners or medical services in the nature of pathology or diagnostic imaging.

 

“Disclosure Letter” means the disclosure letter provided by MGL to the Buyer which is annexed to this Agreement as Annexure B.

 

“Disclosure Material” means:

 

  (a) the written material disclosed by MGL or its advisors to the Buyer and referred to in the Data Room Index;

 

  (b) the Disclosure Letter; and

 

  (c) all information contained in the Transaction Agreements.

 

“Divestment Businesses” means the businesses of operating the following hospitals previously conducted by the Group Members:

 

  (a) Hobart Private Hospital;

 

  (b) St Helens Private Hospital;

 

  (c) Mosman Private Hospital;

 

  (d) Sunbury Private Hospital;

 

  (e) Northpark Private Hospital;

 

  (f) Allamanda Private Hospital;

 

  (g) Mitcham Private Hospital;

 

  (h) South Eastern Private Hospital;

 

  (i) Geelong Private Hospital;

 

  (j) National Capital Private Hospital;

 

  (k) Mersey Community Hospital;

 

  (l) Liverpool Private Hospital;

 

5


  (m) Jamieson Private Hospital; and

 

  (n) Lilydale Private Hospital.

 

“Drawdown” means receipt of funds.

 

“Drawdown Default Event” means non-satisfaction or non-waiver of the conditions precedent in Schedule 13.

 

“Employee” means, as the case may be:

 

  (a) any Non C&P Employee, Non C&P Deemed Employee and Non C&P Former Employee; or

 

  (b) any C&P Employee, C&P Deemed Employee and C&P Former Employee.

 

“Encumbrance” means any mortgage, charge, pledge, lien, encumbrance, assignment, hypothecation, security interest, preferential right, trust arrangement, contractual right of set-off or any other security agreement or arrangement in favour of any person.

 

“Environment” means the physical factors of the surroundings of human beings including land, waters, atmosphere, climate, sound, odours, tastes, the biological factors of animals and plants and the social factor of aesthetics.

 

“Environmental Laws” means any Law relating to the Environment including Law relating to:

 

  (a) the discharge or emission of substances (whether solid, liquid or gaseous) to air, water or land;

 

  (b) pollution or contamination of air, water or land;

 

  (c) the production, use, handling, storage, disposal or transport of waste, hazardous substances or dangerous goods;

 

  (d) the presence of asbestos; or

 

  (e) threatened or endangered flora or fauna,

 

or any other aspect of protection of the Environment or the enforcement or administration of any such Law.

 

“Environmental Permit” means any permit, licence, authority, approval, consent or authorisation required by Environmental Law.

 

“Escrow Account” means the account into which the Escrow Agent deposits the Escrow Amount pursuant to the Escrow Agreement.

 

“Escrow Agent” means the party so named in the Escrow Agreement.

 

“Escrow Agreement” means the agreement to be entered into between MGL, the Buyer and the Escrow Agent at Umbrella Completion substantially in the form which is annexed to this Agreement as Annexure G.

 

“Escrow Amount” has the meaning given in the Escrow Agreement.

 

“Excluded Business Records” has the meaning defined in the Share and Asset Sale Deed or the relevant Asset Sale Deed, as the case may be.

 

6


“Excluded Litigation” means each of the matters set out in clause 11.8.

 

“Facilities Agreement” means the Bridge Facility and the Senior Facilities to be entered into by the Buyer (as defined in the two letters from Credit Suisse First Boston as annexed at Annexure D).

 

“Final Payment Date” means the date which is 5 Business Days after the date upon which the Umbrella Completion Amount is finally agreed or determined pursuant to clause 2 or some other date as the parties may agree in writing.

 

“Financiers” has the meaning given in clause 13.8(b).

 

“Freehold Premises” has the meaning defined in the Share and Asset Sale Deed.

 

“Fundamental Warranty Breach” means a material breach of or material inaccuracy of Warranty 1 (share capital), Warranty 2 (capacity and authority), Warranty 3 (Assets), Warranty 5 (Accounts), Warranty 10(e) (Litigation), Warranties 12 (a-g) (Subsidiaries) or Warranty 19 (Unit Trusts).

 

“Governmental Authority” means any governmental, semi-governmental, administrative, fiscal, judicial or quasi-judicial body, or tribunal, department, commission, authority, agency, statutory entity or statutory authority or person vested with functions under any law.

 

“Group” means the Hospital Companies and the Subsidiaries and where the context requires or allows “Group Member” meaning one or more of them.

 

“Hospital Companies” has the meaning given in the Share and Asset Sale Deed.

 

“Independent Contractors” means “Independent Contractors” as defined in the Share and Asset Sale Deed or Independent Contractors - Seller Group as defined in the relevant Asset Sale Deed (as the case may be).

 

“Indemnified Litigation” means the litigation referred to in clause 8.11(a).

 

“Indonesian Hospitals” means RS International Bintaro, Jakarta, RS Mitra International, Jakarta and Surabaya International Hospital, Surabaya.

 

“Indonesian Hospital Business” means the business of operating the Indonesian Hospitals carried on by the Seller Group.

 

“Intercompany Debt” means the aggregate of:

 

  (a) all amounts owing by any Group Member to any Seller Group Member; less

 

  (b) all amounts owing by any Seller Group Member to any Group Member,

 

and as accounted for under the Umbrella Completion Accounting Principles.

 

“Intercompany Debt Balance” means the Intercompany Debt as at 30 November 2003 shown in the Umbrella Completion Accounts less the Intercompany Debt Estimate.

 

“Intercompany Debt Estimate” means all amounts owed by the Group to the Seller Group as at the Last Accounts Balance Date as described in the Last Accounts in the line entitled “Intercompany Funding” being a total amount of $402,774,820.

 

“Joint Litigation” means, as the case may be, any Claim in respect of:

 

  (a) from the Umbrella Completion Date, the assets or businesses of the Seller Group after the Umbrella Completion Date against a Buyer Group Member; or

 

7


  (b) from the Umbrella Completion Date, the Retained Business or the Divestment Businesses against a Buyer Group Member; or

 

  (c) from the Umbrella Completion Date, the Non C&P Hospital Business against a Seller Group Member; or

 

  (d) the Non C&P Hospital Business and either:

 

  (i) the assets or businesses of the Seller Group after the Umbrella Completion Date; or

 

  (ii) the Retained Business or the Divestment Businesses;

 

  (e) from the C&P Completion Date, the C&P Hospital Business against a Seller Group Member; or

 

  (f) from the C&P Completion Date, the C&P Hospital Business and the assets or businesses of the Seller Group after the C&P Completion Date,

 

whether the Claim was commenced or made but not resolved prior to the Umbrella Completion Date or the C&P Completion Date or on or after the Umbrella Completion Date or the C&P Completion Date (as the case may be).

 

“Last Accounts” means the aggregated accounts as at 30 June 2003 in relation to the Australian Hospital Business, a copy of which are included in Part A of Schedule 1.

 

“Last Accounts Balance Date” means 30 June 2003.

 

“Last Accounts Adjusted Net Trading Assets Statement” means the Last Accounts adjusted for the Adjustment Items in the form set out in Schedule 2.

 

“Law” includes all statutes, regulations, by-laws, ordinances and other delegated legislation and any rule of common law or equity from time to time and “lawfully” means in compliance with all such Laws and the provision of any relevant contract.

 

“Leases” means “Leases - Seller Group” as defined in both the Share and Asset Sale Deed and the Asset Sale Deed.

 

“Liability” means:

 

  (a) any debt or other monetary liability or penalty, fine or payment or any damage, harm, loss, cost, charge or expense on any account and in any capacity, irrespective of whether the debt, liability, penalty, fine, payment, damage, harm, loss, cost, charge or expense is:

 

  (i) present or future, matured or unmatured;

 

  (ii) actual, prospective or contingent or in respect of acts, events or things which have or have not yet occurred;

 

  (iii) a contractual, tortious, legal, equitable or statutory obligation;

 

  (iv) ascertained or unascertained at any time;

 

  (v) against any person, property or thing;

 

8


  (vi) owed, incurred or imposed by or on account of any person alone or severally or jointly with another person;

 

  (vii) owed, incurred or imposed to or for the account of any person alone or severally or jointly with another person;

 

  (viii) owed, incurred or imposed as a principal obligation or by way of surety or indemnity;

 

  (ix) owed, incurred or imposed as interest, fees, charges, taxes, duties or other imposts;

 

  (x) owed, incurred or imposed as compensation or damages, whether for breach of contact or tort or on any other basis, or as losses, costs or expenses or on any other account; or

 

  (xi) any combination of any of the foregoing paragraphs; or

 

  (b) any contractual, tortious, statutory, legal equitable or other obligation or liability to do or perform any act or to refrain from doing or performing any act,

 

including any Consequential Loss.

 

“Litigation” means Current Litigation, New Litigation and Joint Litigation but excludes any matters which are the subject of clause 9 and Schedule 8 of this Deed.

 

“Management Accounts” means the management accounts for the Australian Hospital Business provided by MGL to the Buyer for each completed month prior to Umbrella Completion from the Last Accounts Balance Date.

 

“Mayne Prosecutions” means a prosecution against a Seller Group Member in connection with:

 

  (a) from Umbrella Completion, the Non C&P Hospital Business; and

 

  (b) from C&P Completion, the C&P Hospital Business,

 

under any Law.

 

“Newco Group” means

 

  1. Buyer;

 

  2. Joondalup Hospital Pty Limited ACN 106 723 193;

 

  3. Port Macquarie Hospital Pty Limited ACN 106 723 399;

 

  4. Logan Hospital Pty Limited ACN 106 723 406;

 

  5. Melbourne Hospital Pty Limited ACN 106 723 415;

 

  6. Noosa Privatised Hospital Pty Limited ACN 106 723 380;

 

  7. Caboolture Hospital Pty Limited ACN 106 723 219;

 

  8. Frances Perry Hospital Pty Limited ACN 106 723 228;

 

  9. Armidale Hospital Pty Limited ACN 106 723 200; and

 

9


  10. P.O.W. Hospital Pty Limited ACN 106 723 871,

 

and Newco Group Member means any one or more of them.

 

“MFL” means Mayne Finance Limited.

 

“New Litigation” means, as the case may be:

 

  (a) from the Umbrella Completion Date, any Claim which has been commenced or made in relation to the Non C&P Hospital Business by or against a Seller Group Member and/or a Buyer Group Member; or

 

  (b) from the Umbrella Completion Date, any Claim which has been commenced or made in relation to the Retained Business or the Divestment Businesses by or against a Seller Group Member and/or a Buyer Group Member; or from the Umbrella Completion Date, any Claim which has been commenced or made by or against a Buyer Group Member other than as described above; or

 

  (c) from the C&P Completion Date, any Claim which has been commenced or made in relation to the relevant C&P Hospital Business by or against any Seller Group Member and/or Buyer Group Member,

 

on or after the Umbrella Completion Date or the C&P Completion Date, as the case may be.

 

“Non C&P Assets” means “Assets” as that term is defined in the Share and Asset Sale Deed.

 

“Non C&P Deemed Employee” means any person, other than a Non C&P Employee, who is defined as a worker under any statute relating to workers’ compensation, or is otherwise deemed to be entitled to workers’ compensation payments in accordance with any statute relating to workers’ compensation, in respect of:

 

  (a) any Group Member excluding any person engaged in relation to the Retained Business or the Divestment Businesses; or

 

  (b) any Seller Group Member,

 

provided that such person was engaged exclusively in relation to the Non C&P Hospital Business.

 

“Non C&P Employees” means “Employees” as defined under the Share and Asset Sale Deed.

 

“Non C&P Former Employee” means any person who was, at any time before Umbrella Completion, an employee of:

 

  (a) any Group Member; or

 

  (b) any Seller Group Member,

 

provided that such person was engaged exclusively in relation to the Non C&P Hospital Business.

 

“Non C&P Hospital Business” means the “Hospital Business” as defined under the Share and Asset Sale Deed.

 

“Non C&P Premises” means the “Premises” as defined under the Share and Asset Sale Deed.

 

“Non C&P Warranty” has the meaning given in clause 7.1(b).

 

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“Personal Information” has the same meaning given in the Privacy Act.

 

“Pollution” means the discharge, release or emission of any substance (whether solid, liquid or gaseous) from any Non C&P Premises or C&P Premises (as the case may be) other than in accordance with an Environmental Permit or Environmental Law.

 

“Pre-Completion Workers’ Compensation Claims” means the workers’ compensation claims which are the subject of the indemnity given by the Buyer in clause 9.1.

 

“Principal Premises” has the meaning defined in the relevant Asset Sale Deed.

 

“Privacy Act” means the Privacy Act 1988 (Commonwealth) as amended.

 

“Privacy Laws” means:

 

  (a) the Privacy Act;

 

  (b) the National Privacy Principles contained in Schedule 3 to the Privacy Act or any approved privacy code that applies to any of the parties to this Agreement; and

 

  (c) all other applicable Laws which require a person to observe privacy or confidentiality obligations in respect of Personal Information or other information.

 

“Project Agreements” means in relation to each Collocated and Privatised Hospital the agreements identified as “Government Contracts” in the Asset Sale Deed for that Collocated and Privatised Hospital.

 

“Public Register Information” means all information which is available on the Public Registers seven days before the date of this Deed.

 

“Public Registers” means:

 

  (a) the registers maintained by the Australian Securities and Investments Commission in respect of companies;

 

  (b) the registers and public records maintained by State health departments;

 

  (c) the registers and public records maintained by the titles office, Governmental Authorities and other statutory authorities and local government in relation to property in each place where any Group Member or Seller Group Member in respect of the Non C&P Hospital Business or C&P Hospital Business has a property interest;

 

  (d) searches of the following courts:

 

  (i) the Supreme Courts of Victoria, New South Wales, Australian Capital Territory, Queensland (Brisbane, Cairns, Rockhampton and Townsville), Western Australia, South Australia, Tasmania and the Northern Territory;

 

  (ii) the County Court of Victoria;

 

  (iii) the District Courts of Sydney, Queensland (Brisbane, Cairns, Rockhampton and Townsville), South Australia and Western Australia; and

 

  (iv) the Federal Court of Australia.

 

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“Related Body Corporate” has the meaning given in section 9 of the Corporations Act

 

“Release Event” means:

 

  (a) the termination of the relevant Asset Sale Deed in accordance with its terms for Seller Default, Buyer Default pursuant to clause 17 of the Asset Sale Deeds for Joondalup and Frances Perry House and Part 4 of the other Asset Sale Deeds; or

 

  (b) the expiry of the Asset Sale Expiry Date.

 

“Relevant Escrow Amount” means the Escrow Amount apportioned to a C&P Hospital Business pursuant to the Transaction Agreements.

 

“Relevant Seller Group Member” has the meaning given to it in the Share and Asset Sale Deed or the relevant Asset Sale Deed (as the case may be).

 

“Remediation” means the cleanup, removal, remediation, abatement, treatment, control, containment or encapsulation of Contamination or Pollution or the investigation, monitoring or management thereof.

 

“Representative” of a party includes an adviser, agent, director, employee, joint venturer, officer, partner, or sub-contractor of that party.

 

“Reserved Names” means “Mayne”, and any name containing the word “Mayne” and any name substantially similar to or reasonably capable of confusion with the word “Mayne”.

 

“Retained Business” has the meaning given in the Share and Asset Sale Deed.

 

“Retained Companies” has the meaning given in the Share and Asset Sale Deed.

 

“Revenue Authority” means any Federal, State, Territory or local governmental authority or instrumentality in respect of Tax.

 

“Sale Shares” means all of the “Sale Shares” as defined in the Share and Asset Sale Deed.

 

“Scheduled Insurances” means the insurance listed in Schedule 9

 

“Scheduled Intellectual Property” means the intellectual property rights listed in Schedule 7 of the Share and Asset Sale Deed or Schedule 6 of the relevant Asset Sale Deed, as the case may be.

 

“Scheduled Premises” means the premises listed in Schedule 8 of the Share and Asset Sale Deed or Schedule 9 of the relevant Asset Sale Deed, as the case may be.

 

“Seller Group” means MGL and each of its Related Bodies Corporate (but excluding all Group Members) and where the context requires or allows “Seller Group Member” means any one or more of them.

 

“Senior Management” means the persons listed in Schedule 15.

 

“Share and Asset Sale Deed” means the share and asset sale deed entered into on or about the date of this Deed between MGL, MHH and the Buyer providing for the transfer to the Buyer of the shares in Australian Medical Enterprises Ltd and HCoA Hospital Holdings (Australia) Pty Ltd and certain assets and liabilities in relation to the hospital business carried on by those companies and their respective subsidiaries.

 

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“Shared Assets” means assets used by the Seller Group both for purposes:

 

  (a) of the Australian Hospital Business; and

 

  (b) other than the Australian Hospital Business,

 

excluding the assets which are the subject of the Shared Services Agreement.

 

“Shared Services Agreement” means the agreement described in Recital C.

 

“State” means the state of Victoria.

 

“Subsidiaries” has the meaning given in the Share and Asset Sale Deed.

 

“Superannuation Commitment” means any legal liability (whether arising pursuant to an industrial award, employment agreement, the governing rules of a superannuation fund, legislation or otherwise) or voluntary commitment to make contributions to any superannuation fund, pension scheme or other arrangement which will provide directors or employees of any Seller Group Member or Group Member or their respective dependants with pensions, annuities, lump sum or any other payments upon retirement or earlier death or otherwise.

 

“Tax” has the meaning given in the Share and Asset Sale Deed.

 

“Tax Indemnity” means the tax indemnity contained in clause 14 of the Share and Asset Sale Deed.

 

“Third Party Environmental Claims” means any action, claim, demand, suit, proceeding or litigation, whether at law, in equity or under statute by any person who is not a party to this Agreement against any Seller Group Member or Group Member in respect of any Contamination or Pollution arising out of:

 

  (a) operation of the Non C&P Hospital Business or the occupation of any of the Non C&P Premises before Umbrella Completion; or

 

  (b) operation of the C&P Hospital Business (as the case may be) or the occupation of any of the C&P Premises before C&P Completion.

 

“Trade Marks - Excluded” means Trade Marks - Excluded as defined in the Share and Asset Sale Deed.

 

“Transaction Agreements” means this Deed, the Share and Asset Sale Deed, the Asset Sale Deeds and the Shared Services Agreement.

 

“Trusts” means the trusts listed in Schedule 10.

 

“Umbrella Balancing Statement” means the statement of the Umbrella Completion Amount - AHB, Umbrella Completion Amount - Non C&P and Umbrella Completion Amount - C&P, which is prepared in accordance with clause 2 in the form set out in Schedule 5.

 

“Umbrella Completion” means “Completion” as defined in the Share and Asset Sale Deed.

 

“Umbrella Completion Accounting Principles” means the accounting principles to be used for the purpose of preparing the Umbrella Completion Statements, being, unless MGL and the Buyer otherwise agree in writing:

 

  (a) the principles set out in the Seller Group accounting principles as described in the financial statements of MGL for the period to 30 June 2003;

 

  (b) to the extent not inconsistent with paragraph (a), the accounting standards from time to time approved under the Corporations Act;

 

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  (c) to the extent not inconsistent with paragraph (a) or (b) the requirements of the Corporations Act in relation to the preparation and content of the accounts; and

 

  (d) if and to the extent that any matter is not covered by the accounting standards or other requirements referred to in paragraphs (a), (b) or (c), other relevant accounting standards, mandatory professional requirements (including consensus views of the Urgent Issues Group) and generally accepted accounting principles applied from time to time in Australia for a business similar to the Australian Hospital Business, unless inconsistent with the standards or requirements referred to in paragraph (a), (b) or (c),

 

applied on a consistent basis with the Last Accounts varied in accordance with the principles described in Schedule 14.

 

“Umbrella Completion Accounts” means the aggregated accounts as at 30 November 2003 in relation to the Australian Hospital Business prepared in accordance with the Umbrella Completion Accounting Principles in the form set out in Schedule 3.

 

“Umbrella Completion Adjusted Net Trading Assets Statement” means the Umbrella Completion Accounts adjusted for the Adjustment Items, in the form set out in Schedule 4.

 

“Umbrella Completion Amount - AHB” means the Adjusted Net Trading Assets as at 30 November 2003 minus the Adjusted Net Trading Assets as at the Last Accounts Balance Date, attributable to the Australian Hospital Business and which may be a positive or negative amount.

 

“Umbrella Completion Amounts - C&P” means the Adjusted Net Trading Assets as at 30 November 2003 minus the Adjusted Net Trading Assets as at the Last Accounts Balance Date, attributable to each C&P Hospital Business and which each may be a positive or negative amount.

 

“Umbrella Completion Amount - Non C&P” means the Adjusted Net Trading Assets as at 30 November 2003 minus the Adjusted Net Trading Assets as at the Last Accounts Balance Date, attributable to the Non-C&P Hospital Business and which may be a positive or negative amount.

 

“Umbrella Completion Audit Report” has the meaning given in clause 2.4.

 

“Umbrella Completion Date” means “Completion Date” as defined in the Share and Asset Sale Deed.

 

“Umbrella Completion Statements” means the Umbrella Completion Accounts, the Umbrella Completion Adjusted Net Trading Assets Statement and the Umbrella Balancing Statement.

 

“Umbrella Pre-Adjustment Purchase Price” means the amount specified in clause 2.1.

 

“Umbrella Purchase Price” means the Umbrella Pre-Adjustment Purchase Price as adjusted under clause 2.8.

 

“Unit Sale Completion” has the meaning defined in each Asset Sale Deed.

 

“Warranties” means the Non C&P Warranties and the C&P Warranties given by MGL under clause 7.

 

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1.2 Interpretation

 

In the Transaction Agreements:

 

  (a) headings are for convenience only and do not affect interpretation;

 

and unless the context indicates a contrary intention:

 

  (b) an obligation or liability assumed by, or a right conferred on, 2 or more parties binds or benefits all of them jointly and each of them severally;

 

  (c) the expression “person” includes an individual, the estate of an individual, a corporation, an authority, an association or a joint venture (whether incorporated or unincorporated), a partnership and a trust;

 

  (d) a reference to any party includes that party’s executors, administrators, successors and permitted assigns, including any person taking by way of novation;

 

  (e) a reference to any document (including any Transaction Agreement) is to that document as varied, novated, ratified or replaced from time to time;

 

  (f) a reference to any statute or to any statutory provision includes any statutory modification or re-enactment of it or any statutory provision substituted for it, and all ordinances, by-laws, regulations, rules and statutory instruments (however described) issued under it;

 

  (g) words importing the singular include the plural (and vice versa), and words indicating a gender include every other gender;

 

  (h) references to parties, clauses, schedules, exhibits or annexures are references to parties, clauses, schedules, exhibits and annexures to or of the relevant Transaction Agreement, and a reference to a Transaction Agreement includes any schedule, exhibit or annexure to that agreement;

 

  (i) where a word or phrase is given a defined meaning, any other part of speech or grammatical form of that word or phrase has a corresponding meaning;

 

  (j) the word “includes” or “including” in any form is not a word of limitation;

 

  (k) if any day appointed or specified by any Transaction Agreement for the payment of any money or doing of any thing falls on a day which is not a Business Day, the day so appointed or specified shall be deemed to be the next Business Day;

 

  (l) if a period of time dates from a given day or date, or the day or date of an event or an act, it is to be calculated inclusive of that day or date;

 

  (m) a reference to “$” or “dollar” is to Australian currency;

 

  (n) references to payments to any party to any Transaction Agreement will be construed to include payments to another person upon the written and duly authorised direction of such party;

 

  (o) references to “indemnify” or “indemnifying” (and other grammatical forms of that word) any person against any circumstance or occurrence will be construed to include indemnifying and keeping indemnified that person and holding that person harmless to the fullest extent permitted by law from and against all demands, claims, actions, suits, proceedings, judgments, orders and decrees from time to time made or taken against or affecting that person and all Liabilities, whatsoever and howsoever made, suffered or incurred by that person as a consequence of or which would not have arisen but for that circumstances or occurrence;

 

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  (p) references to concepts of materiality in this Deed means material in the context of the Australian Hospital Business as a whole;

 

  (q) all payments to be made under any Transaction Agreement will be made by electronic funds transfer of immediately available funds;

 

  (r) any statement expressed to be qualified by the phrase “as far as MGL is aware” or otherwise qualified by reference to the actual knowledge or awareness of MGL or any Seller Group Member is deemed to be qualified by reference only to the knowledge, belief or awareness of the following persons after appropriate enquiry by them: Stuart James (Group Managing Director and Chief Executive Officer), Peter Jenkins (Chief Development Officer), Neil Rodaway (General Manager, Asset Management), Paul Binfield (Chief Financial Officer), Jeff Pearce (Group General Manager, Personnel), Campbell Richards (Group Tax Manager), Peter Kopanidis (Group Treasurer), Robert Cooke (Group General Manager, Hospitals), John Hickey (General Manager, Finance, Hospitals), Robert Wise (National Operations Manager, Hospitals) Peter Fleming (Chief Information Officer), Fiona French (National Business Support Manager, Hospitals), Peter Kahn (Manager, Research, Development & Health Funds, Hospitals);

 

  (s) any statement expressed to be qualified by reference to the actual knowledge or awareness of the Buyer is deemed to be qualified by reference only to the actual knowledge, belief and awareness of the following persons: Andrew Cummins, Adrian MacKenzie, Adrian Warner, Neil Broekhuizen and Tom Tucker; and

 

  (t) references to “contractor” include references to sub-contractor and other indirect contractors.

 

1.3 Governing law

 

This Deed and each of the other Transaction Agreements is governed by and will be construed according to the laws of the State.

 

1.4 Enforcement on behalf of the Seller Group

 

MGL enters into this Deed and each of the other Transaction Agreements for itself and each other Relevant Seller Group Member and accordingly accepts the full benefit of this document on behalf of those persons. The parties agree that MGL may enforce this provision on behalf of those other persons. To the extent that a matter giving rise to any Liability results, directly or indirectly, in any Liability being incurred or suffered by those other persons, that Liability is deemed to be incurred or suffered directly by MGL.

 

1.5 Procurement by MGL

 

MGL agrees that where the performance of any obligation of MGL under this Deed and each of the other Transaction Agreements requires any action by a Seller Group Member, MGL will procure that action to be taken by the Relevant Seller Group Member.

 

1.6 Procurement by the Buyer

 

The Buyer agrees that where the performance of any obligation of the Buyer under this Deed and each of the other Transaction Agreements requires any action by a Buyer Group Member, the Buyer will procure that action to be taken by the relevant Buyer Group Member.

 

16


1.7 Other indemnifying Parties

 

  (a) In consideration for the MGL and MHH entering into this Deed with the Buyer, each indemnity granted by the Buyer pursuant to this Deed is hereby also granted by each of the other Newco Group Members.

 

  (b) Without limiting the Buyer’s obligations under this Deed, every reference in this Deed to the “Buyer” relating to an indemnity shall be read as if it is a reference to the “Buyer” and each of the other Newco Group Members.

 

  (c) The obligations and liabilities assumed by, and rights conferred on, the Buyer and each of the other Newco Group Members pursuant to the provisions referred to in clause 1.7(b) binds and benefits them jointly and severally.

 

  (d) A reference in this Deed to a “party” or “the parties” does not include any of the other Newco Group Members, except to the extent necessary to give effect to this clause 1.7.

 

2. Umbrella Pre-Adjustment Purchase Price; Determination and payment of Adjustment Amounts

 

2.1 Umbrella Pre-Adjustment Purchase Price

 

The Umbrella Pre-Adjustment Purchase Price is [*] which must be paid on Umbrella Completion by the Buyer as follows:

 

  (a) the Buyer must pay [*] to MGL or as MGL may direct; and

 

  (b) the Buyer must pay [*] to the Escrow Agent to be held in accordance with the terms of the Escrow Agreement.

 

2.2 Intercompany Debt Estimate and repayment of Intercompany Debt

 

  (a) On Umbrella Completion, the Buyer must procure the Group pay the Intercompany Debt Estimate to the Seller Group or as MGL may direct.

 

  (b) The payment of the Intercompany Debt Estimate as part of the Umbrella Pre-Adjustment Purchase Price and the operation of the Umbrella Completion adjustment process described in clause 2 will operate to satisfy fully and completely and discharge the relevant Group Members from all liability to repay the debts aggregated to determine the Intercompany Debt as at 30 November 2003.

 

2.3 Preparation of Umbrella Completion Statements

 

  (a) The Group must:

 

  (i) following Umbrella Completion, prepare Umbrella Completion Statements in accordance with Umbrella Completion Accounting Principles and this clause 2; and

 

  (ii) use all reasonable endeavours to ensure that, as soon as practicable following Umbrella Completion (but in any event no later than 20 Business Days after that date), such Umbrella Completion Statements are delivered to MGL.

 

  (b) Within 10 Business Days of the receipt of the Umbrella Completion Statements under clause 2.3(a)(ii), MGL will review in consultation with the Chief Financial

 


[*] Certain confidential portions of these exhibits have been omitted pursuant to a request for confidential treatment and filed separately with the Commission.

 

17


 

Officer of the Buyer the Umbrella Completion Statements then deliver to KPMG Umbrella Completion Statements prepared in accordance with the Umbrella Completion Accounting Principles.

 

  (c) The Buyer must, and must procure the Group to, provide MGL such access to all its employees, accounts, records and such other documentation, and all such assistance, which MGL requires to comply with its obligations under this clause, at no cost to MGL.

 

2.4 Audit of Umbrella Completion Statements

 

As soon as the Umbrella Completion Statements (“Statements”) have been delivered by MGL in accordance with clause 2.3, the following procedure will apply:

 

  (a) MGL and the Buyer must jointly instruct KPMG to undertake a completion audit of the Statements and, within 20 Business Days of being provided with the Statements, to prepare an audit report thereon together with a certificate addressed to both MGL and the Buyer confirming the accuracy of the Statements, any adjustments that should be made to the Statements (including the resulting Umbrella Completion Amount - AHB, Umbrella Completion Amount - Non C&P and Umbrella Completion Amounts - C&P for the purposes of this Deed) (“Umbrella Completion Audit Report”);

 

  (b) the terms of engagement of KPMG must be agreed in writing by MGL and the Buyer and will include a requirement that KPMG, in conducting their audit, will adopt a materiality level of $1,000,000, meaning that under Generally Accepted Auditing Standards, KPMG must design their audit review procedures so that they detect adjustments that individually and cumulatively exceed this amount;

 

  (c) KPMG must be instructed to conduct their audit and prepare their Umbrella Completion Audit Report in accordance with Australian Auditing Standards for audits, as modified expressly by their terms of engagement and the Umbrella Completion Accounting Principles;

 

  (d) KPMG must be instructed to provide reasonable access to both the Buyer and MGL and their respective accounting and other professional advisers to KPMG’s audit work papers and all files relevant to preparing its Umbrella Completion Audit Report;

 

  (e) KPMG must be provided with full and free access to all books, records, accounts and documents of the Seller Group, the Group and the Buyer Group that are within the possession, or under the control, of any Seller Group Member or any Group Member to enable KPMG to conduct its audit review and prepare its Umbrella Completion Audit Report; and

 

  (f) the Buyer and MGL must each bear half of KPMG’s costs of conducting its audit review and preparing its Umbrella Completion Audit Report.

 

2.5 Determination of the Umbrella Completion Amounts

 

  (a) Following delivery of the Umbrella Completion Audit Report in accordance with clause 2.4(a), MGL and the Buyer must confer and use all reasonable endeavours to agree on the Umbrella Completion Amount - AHB, Umbrella Completion Amount - Non C&P and Umbrella Completion Amounts -C&P within 10 Business Days.

 

  (b) If the Umbrella Completion Amount - AHB, Umbrella Completion Amount - Non C&P and Umbrella Completion Amounts - C&P:

 

  (i) are so agreed, that amount so agreed will be final and binding on the parties; or

 

18


  (ii) are not so agreed within the period specified in clause 2.5(a) and no election to a referral is made in accordance with clause 2.6 within the period referred to in clause 2.6(a), the amount for the Umbrella Completion Amount - AHB, Umbrella Completion Amount - Non C&P and Umbrella Completion Amounts -C&P set out in the Umbrella Completion Audit Report will be final and binding on all parties.

 

2.6 Disputes

 

  (a) Subject to clause 2.7, if either the Buyer or MGL disputes that the Umbrella Completion Statements or any item contained in them have been prepared in accordance with this Deed they shall notify the other in writing, setting out a detailed explanation of why the amount is disputed with a supporting alternative calculation of that amount within the 10 Business Day period referred to in clause 2.5(a). If MGL and the Buyer do not resolve the matters in dispute within a further 5 Business Days, either MGL or the Buyer may by notice in writing to the other at any time within 5 Business Days after the end of that period require that the difference of opinion or dispute be referred to an expert for determination in accordance with the principles in clause 2.6(c). Such expert (“Expert”) must be an auditor with relevant industry expertise agreed in writing by MGL and the Buyer or in the event that MGL and the Buyer are not able to agree upon such an expert within 5 Business Days of either MGL or the Buyer giving notice that it requires that the difference of opinion or dispute be resolved by an expert, the expert will be appointed by the President for the time being of the Institute of Chartered Accountants in Australia or his or her nominee.

 

  (b) Each of MGL and the Buyer is entitled to:

 

  (i) make a written submission to the Expert within 5 Business Days of the date of appointment of the Expert;

 

  (ii) provide a response to the Expert in respect of the other’s submission within 5 Business Days of receipt of that submission,

 

that in each case must not exceed 15 pages in aggregate (including all annexures) and which they must each provide to the other.

 

  (c) The Expert must:

 

  (i) act as an expert and not as an arbitrator and his or her written determination will be final and binding on MGL and the Buyer in the absence of manifest error;

 

  (ii) determine the difference of opinion or dispute within 20 Business Days of the date of appointment of the Expert; and

 

  (iii) have the right to review all relevant working papers of MGL, the Group and KPMG and to interview the Representatives of the parties and their audit partners.

 

  (d) The costs of the Expert are to be borne in the manner determined by the Expert.

 

  (e) The Umbrella Completion Statements delivered to KPMG and the Buyer pursuant to clause 2.3 will be deemed to be varied to reflect any alteration agreed to by the Buyer and MGL or which the Expert determines be made pursuant to this clause.

 

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2.7 Limitation on disputes

 

  (a) The parties may not:

 

  (i) dispute the Umbrella Completion Statements unless the aggregate amount disputed exceeds $3,000,000 (but then, for the avoidance of doubt, may dispute the entire amount and not just the excess); or

 

  (ii) dispute any individual line item in the Umbrella Completion Statements unless the amount in dispute exceeds $200,000.

 

  (b) The parties may not dispute or purport to disagree on any amount contained in the Umbrella Completion Statements once they have been settled pursuant to this clause 2.

 

  (c) The parties may not at any stage dispute or purport to disagree on any amount contained in the Last Accounts or the Last Accounts Adjusted Net Trading Assets Statement except in respect of a potential or actual breach of a Warranty. Any fundamental error in the Last Accounts or the Last Accounts Adjusted Net Trading Assets Statement having a material adverse effect may be rectified by agreement between the parties.

 

2.8 Final payment and Escrow arrangements

 

  (a) The Umbrella Pre-Adjustment Purchase Price will be adjusted upwards or downwards (as the case may be) by the Umbrella Completion Amount - AHB.

 

  (b) The Umbrella Pre-Adjustment Purchase Price attributable to the Non C&P Hospital Business will be adjusted upwards or downwards (as the case may be) by the Umbrella Completion Amount - Non C&P.

 

  (c) The Umbrella Pre-Adjustment Purchase Price attributable to each C&P Hospital Businesses will be adjusted upwards or downwards (as the case may be) by the respective Umbrella Completion Amounts - C&P.

 

  (d) If the Umbrella Completion Amount - Non C&P:

 

  (i) is a positive number, then on the Final Payment Date, the Buyer must pay that amount to MGL by way of an addition to the Umbrella Pre-Adjustment Purchase Price attributable to the Non-C&P Hospital Business;

 

  (ii) is a negative number, then on the Final Payment Date, MGL must pay that amount to the Buyer by way of a reduction to the Umbrella Pre-Adjustment Purchase Price attributable to the Non-C&P Hospital Business;

 

  (iii) is zero, the Umbrella Pre-Adjustment Purchase Price attributable to the Non-C&P Hospital Business will not be adjusted.

 

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  (e) If any of the Umbrella Completion Amounts - C&P:

 

  (i) is a positive number, then on the Final Payment Date, the Buyer must pay that amount (by way of an addition to the Umbrella Pre-Adjustment Purchase Price attributable to the relevant C&P Hospital Business) to:

 

  A. the Escrow Agent; or

 

  B. MGL if the Relevant Escrow Amount has been paid to MGL;

 

  (ii) is a negative number, then on the Final Payment Date, MGL must (by way of a reduction to the Umbrella Pre-Adjustment Purchase Price attributable to the relevant C&P Hospital Business):

 

  A. give notice in writing to the Escrow Agent, directing the Escrow Agent to release and (or another Newco Group Member as the Buyer may direct) pay that amount from the Escrow Account to the Buyer; or

 

  B. pay that amount to the Buyer (or another Newco Group Member as the Buyer may direct) if a Release Event has occurred under the relevant Asset Sale Deed;

 

  (iii) is zero, the Umbrella Pre-Adjustment Purchase Price attributable to the relevant C&P Hospital Business will not be adjusted.

 

2.9 Divestment Business

 

Upon payment to, or on behalf of, any Buyer Group Member or Buyer’s Representative, of any of the proceeds from the sale of the Divestment Businesses, the Buyer must within 5 Business Days thereafter, pay to MGL an amount equivalent to such proceeds subject to any deductions required by Law (including any Tax).

 

2.10 Escrow

 

  (a) The parties will on Umbrella Completion enter into an agreement with the Escrow Agent substantially in the form annexed at Annexure G with such changes as are required by the Escrow Agent provided that the changes are acceptable to both parties acting reasonably.

 

  (b) If any Transaction Agreement provides that MGL or the Buyer may or will give a direction to the Escrow Agent:

 

  (i) the direction must be in the form prescribed in the Escrow Agreement;

 

  (ii) the direction must not require the Escrow Agent to pay any amount out of the Escrow Account sooner than 3 Business Days after the Escrow Agent’s receipt of the direction; and

 

  (iii) the party giving the direction must deliver a copy of the direction to the other party at least 3 Business Days before the payment specified in the direction is to be made.

 

3. Apportionment of Umbrella Purchase Price

 

3.1 Apportionment of Umbrella Pre-Adjustment Purchase Price

 

The parties agree that the Umbrella Pre-Adjustment Purchase Price will be apportioned as follows:

 

  (a) [*] for the shares in Australian Medical Enterprises Ltd;

 

  (b) [*] for the shares in HCoA Hospital Holdings (Australia) Pty Ltd;

 


[*] Certain confidential portions of these exhibits have been omitted pursuant to a request for confidential treatment and filed separately with the Commission.

 

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  (c) in relation to that part of the Non-C&P Hospital Business which is not conducted by the Group (adopting the definitions in the Share and Asset Sale Deed):

 

  (i) for the Fixed Assets - Seller Group, their tax written down value as at the Last Accounts Balance Date;

 

  (ii) for the Stock - Seller Group, the value of the Stock - Seller Group as set out in the Last Accounts;

 

  (iii) for the Trade Debts - Seller Group, the value of the Trade Debts - Seller Group as set out in the Last Accounts;

 

  (iv) the Prepayments - Seller Group as set out in the Last Accounts;

 

  (v) $1.00 for the Seller Group’s right, title and interest in the Equipment Leases - Seller Group;

 

  (vi) $1.00 for the Seller Group’s right, title and interest in the Leases - Seller Group; and

 

  (vii) the balance for the Goodwill - Seller Group, for the Seller Group’s right, title and interest in the Hospital Business Contracts - Seller Group, the Intellectual Property Rights - Seller Group, the Business Records - Seller Group, and for any other asset transferred under the Share and Asset Sale Deed; and

 

  (d) in relation to each C&P Hospital Business, subject to the necessary consents to transfer having been obtained, the apportionment as shown in each Asset Sale Deed.

 

3.2 Apportionment of Umbrella Completion Amounts

 

  (a) For the purposes of allocation of the Umbrella Pre-Adjustment Purchase Price in relation to the Non C&P Hospital Business, the Umbrella Completion Amount - Non C&P if positive shall be added to, and if negative shall be subtracted from, the amount allocated in clause 3.1(a), 3.1(b) and 3.1(c) as follows:

 

  (i) to the extent that the Umbrella Completion Amount - Non C&P is directly attributable to an individual asset, the addition or subtraction will be made to that part of the Umbrella Pre-Adjustment Purchase Price attributed to that asset; and

 

  (ii) in all other circumstances, the addition or subtraction will be made to that part of the Umbrella Pre-Adjustment Purchase Price attributed to the Sale Shares or the Sale Shares in a particular company if the Umbrella Completion Amount - Non C&P is directly attributable to that company.

 

  (b) For the purposes of allocation of the Umbrella Pre-Adjustment Purchase Price in relation to each C&P Hospital Business (adopting the definitions used in each such agreement), if the Umbrella Completion Amount - C&P is directly attributable to any particular C&P Hospital Business asset:

 

  (i) if positive shall be added to, and if negative shall be subtracted from, the amount allocated in clause 3.l(d) and that part of the Umbrella Pre-Adjustment Purchase Price attributed to that asset.;

 

  (ii) the Umbrella Pre-Adjustment Purchase Price attributed to that asset shall be adjusted under clause 2.8(e).

 

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4. Conditions Precedent

 

4.1 Condition

 

Umbrella Completion is conditional upon satisfaction (or waiver pursuant to clause 4.6) of all of the Conditions Precedent.

 

4.2 Best endeavours

 

The Buyer must use its best endeavours to obtain the satisfaction or waiver of the Conditions Precedent by 30 November 2003. If the Buyer has not satisfied or waived the Conditions Precedent by this date, it must use its best endeavours to obtain the satisfaction or waiver of the Conditions Precedent by 31 January 2004.

 

4.3 Notification

 

Upon a party becoming aware that any of the Conditions Precedent has been satisfied or of circumstances which may result in any of the conditions not being or having become incapable of being satisfied, that party must promptly notify the other party in writing of the same.

 

4.4 Non-satisfaction of Conditions

 

If any of the Conditions Precedent has not been satisfied on or by 31 January 2004 or such other later date as agreed in writing between the parties, MGL or the Buyer may, at their discretion, terminate the Transaction Agreements and the Indonesian Share Sale Agreement by giving the other party written notice to that effect.

 

4.5 Termination

 

If this Deed is terminated under clause 4.4, then, in addition to any other rights, powers or remedies provided by law:

 

  (a) each party is released from its obligations to further perform this Deed and this Deed will have no further effect, other than in relation to clauses 1, 10 and 13;

 

  (b) each party retains the rights it has against the other party in respect of any past breach or any claim that has arisen before termination.

 

4.6 Waiver of Conditions

 

The Conditions Precedent may only be waived by the Buyer, at its sole discretion, giving written notice to MGL specifying the Condition Precedent to be waived.

 

4.7 Schedule 13

 

Capitalised terms used in Schedule 13 will have the meaning defined (if any) in the Facilities Agreement. As between the parties, the term “Leases” in Part II (e) means Principal Premises as defined in each Asset Sale Deed.

 

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5. Seller’s obligations and consultancy arrangements

 

5.1 Conduct of business and consultancy arrangements

 

  (a) From the date of this Deed until:

 

  (i) Umbrella Completion, MGL must, and must procure that each Group Member and each Relevant Seller Group Member, carries on the Non C&P Hospital Business in the ordinary course; and

 

  (ii) C&P Completion, MGL must, and must procure that each Relevant Seller Group Member, carries on each C&P Hospital Business, in the ordinary course.

 

  (b) On Umbrella Completion, the Buyer and MGL will execute the Consultancy Deed.

 

  (c) Newco Group agrees to indemnify MGL and each of the Seller Group Members against any Liability suffered or incurred by MGL resulting from:

 

  (i) any wilful or negligent act or omission or misfeasance of the Buyer, or any other servant, agent or contractor of the Buyer, incidental or preparatory to the Consultancy Arrangement; and

 

  (ii) all injury, loss or damage sustained by any of the officers, servants, agents or contractors of the Buyer incurred as a result of attending to performance of the Buyer’s duties under the Consultancy Arrangement including a breach of the Project Agreements (but, for the avoidance of doubt, this will not include any breach pursuant to the performance by the Buyer of its other obligations under the Transaction Agreements), unless the injury, loss or damage was caused by any wilful or negligent act or omission of MGL or any officer, servant or agent of MGL.

 

5.2 Restricted actions - Non C&P Hospital Business

 

Without limiting clause 5.1, from the date of this Deed until Umbrella Completion, MGL must, and must procure, that unless contemplated by the Transaction Agreements or the Buyer otherwise consents in writing (such consent not to be unreasonably withheld or delayed):

 

  (a) no Group Member will increase, decrease or otherwise alter its share capital or issue or grant any securities or agree to do so;

 

  (b) no Group Member will, and no Relevant Seller Group Member will in respect of the Non C&P Hospital Business, create or grant any Encumbrance over the assets of the Group Member or the Non C&P Assets or incur any indebtedness or liability in the nature of borrowings or agree to do so, other than in the ordinary course of business;

 

  (c) no Group Member will, and no Relevant Seller Group Member will in respect of the Non C&P Hospital Business acquire, transfer or dispose of any Non C&P Asset with a written down book value in excess of $1,000,000 other than in the ordinary course of the Non C&P Hospital Business;

 

  (d) no Group Member will amend its Constitution;

 

  (e) no Group Member will, and no Relevant Seller Group Member will in respect of the Non C&P Hospital Business, enter into, terminate or materially vary any agreement, arrangement or understanding which involves the incurring of a total liability over the life of the agreement, arrangement or understanding in excess of $1,000,000 other than in the ordinary course of the Non C&P Hospital Business in procuring or replenishing stock;

 

  (f) no Group Member will, and no Relevant Seller Group Member will in respect of the Non C&P Hospital Business, make any material change to its practice as to payment of creditors and collection of trade debtors;

 

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  (g) no Group Member will, and no Relevant Seller Group Member will in respect of the Non C&P Hospital Business, enter into, terminate or increase annual remuneration by more than 10% under, any agreement, arrangement or understanding concerning a Non C&P Employee where the annual gross salary or gross wages payable to such Non C&P Employee will exceed $100,000. However, this clause (g) will not exclude a Group Member or a Relevant Seller Group Member from terminating any agreement, arrangement or understanding concerning a Non C&P Employee in circumstances where, in the reasonable opinion of a Group Member or a Seller Group Member, the Non C&P Employee concerned has:

 

  (i) engaged in conduct justifying summary dismissal at common law or under an applicable policy of the Group or the Seller Group; or

 

  (ii) engaged in repeated poor performance justifying termination under an applicable policy of the Group or the Seller Group;

 

  (h) no Group Member will acquire shares or other securities in any body corporate other than any other Group Member or agree to do so;

 

  (i) no Relevant Seller Group Member or Group Member will initiate any proceedings for the winding up, liquidation or other external administration of that Group Member or Relevant Seller Group Member; and

 

  (j) no Group Member will merge or consolidate with any other body corporate,

 

unless any of the foregoing is contemplated by the Transaction Agreements or the Law or is, in MGL’s reasonable opinion, required to give effect to the terms of any of the Transaction Agreements or the Law.

 

5.3 Restricted actions - C&P Hospital Business

 

Without limiting clause 5.1, from the date of satisfaction or waiver of the relevant Condition Precedent until the relevant C&P Completion or C&P Termination, MGL must, and must procure, that unless contemplated by the Transaction Agreements or the Buyer otherwise consents in writing (such consent not to be unreasonably withheld or delayed), no Relevant Seller Group Member will in respect of each C&P Hospital Business:

 

  (a) create or grant any Encumbrance over the C&P Assets or agree to do so, other than in the ordinary course of business;

 

  (b) acquire, transfer or dispose of any C&P Asset with a written down book value of in excess of $1,000,000 other than in the ordinary course of each C&P Hospital Business;

 

  (c) enter into, terminate or materially vary any agreement, arrangement or understanding which involves the incurring of a total liability over the life of the agreement, arrangement or understanding in excess of $1,000,000 other than in the ordinary course of each C&P Hospital Business in procuring or replenishing stock;

 

  (d) make any material change to its practice as to payment of creditors and collection of trade debtors;

 

  (e) enter into, terminate or increase annual remuneration by more than 10% under any agreement, arrangement or understanding concerning a C&P Employee where the annual remuneration payable to such C&P Employee will exceed $100,000.

 

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However, this will not exclude a Seller Group Member from terminating any agreement, arrangement or understanding concerning a C&P Employee in circumstances where, in the reasonable opinion of a Relevant Seller Group Member, the C&P Employee concerned has:

 

  (i) engaged in conduct justifying summary dismissal at common law or under an applicable policy of the Seller Group; or

 

  (ii) engaged in repeated poor performance justifying termination under an applicable policy of the Seller Group; and

 

  (f) initiate any proceedings for the winding up, liquidation or other external administration of that Seller Group Member,

 

unless any of the foregoing is contemplated by the Transaction Agreements or the Law or the relevant Project Agreements or is, in MGL’s opinion, required to give effect to the terms of any of the Transaction Agreements or Law or the relevant Project Agreements.

 

5.4 Integration

 

  (a) From the date of this Deed until Umbrella Completion, MGL will make relevant senior executives available to meet with the Buyer at any time reasonably required by the Buyer and on reasonable notice from the Buyer, being not less than 48 hours and during normal business hours at 390 St Kilda Road, Melbourne, Victoria to assist the Buyer in preparing for integration with the Non C&P Hospital Business. The duration of such meetings will be at the sole discretion of MGL.

 

  (b) From the date of Umbrella Completion until C&P Completion or C&P Termination, subject to complying with its obligations of confidentiality, other contractual obligations and the Law, MGL will make available for review by the Buyer all such information in relation to the operation of each C&P Hospital Business:

 

  (i) which is reasonably required by the Buyer;

 

  (ii) which is relevant to the day to day operations of those businesses;

 

  (iii) which relates to the accounts payable and receivable in relation to those businesses;

 

  (iv) which is relevant to the matters warranted under the Asset Sale Deeds; and

 

  (v) which it from time to time otherwise sees fit to make available to the Buyer,

 

on such terms and condition as MGL, in its discretion determines.

 

5.5 Access to Excluded Business Records

 

  (a) After Umbrella Completion and C&P Completion (as the case may be), MGL and the relevant Seller Group Members must keep the Excluded Business Records relevant to that acquisition for five years from that date or such longer period as any applicable law requires that such records must be maintained.

 

  (b) During the period referred to in clause 5.5(a), MGL and the relevant Seller Group Members must provide the Buyer reasonable access to such Excluded Business Records and assistance (including providing copies of relevant documents) as reasonably requested by the Buyer, including such access as reasonably required to permit the Buyer and the Group to complete tax returns.

 

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5.6 Conduct between 30 November 2003 and Umbrella Completion

 

Between 30 November 2003 and Umbrella Completion, unless otherwise agreed by the Buyer:

 

  (a) MGL will consult with Robert Cooke in the conduct of the Non C&P Hospital Business;

 

  (b) MGL will procure that no Group Member will declare or distribute any dividend;

 

  (c) neither MGL nor any Seller Group Member will loan monies to any Group Member;

 

  (d) no Group Member will loan monies to any Seller Group Member; and

 

  (e) no Group Member will enter into any loan arrangement with any third party.

 

6. Buyer’s obligations

 

6.1 Supply of references

 

  (a) Newco Group must promptly supply such references or information (including financial information and, where reasonable, relevant or appropriate, business plans and do anything else reasonably required (excluding paying money or providing other valuable consideration to or for the benefit of any person (except where the Transaction Agreements expressly provide otherwise)):

 

  (i) on and from the date of this Deed, by any lessor named in the “Leases - Seller Group” as defined in the Share and Asset Sale Deed;

 

  (ii) on and from the date of this Deed, by any third party including financiers named in the “Hospital Business Contracts - Seller Group” and “Equipment Leases - Seller Group” as defined in the Share and Asset Sale Deed;

 

  (iii) on and from C&P Completion, by any lessor named in the “Leases - Seller Group” as defined in the Asset Sale Deeds; and

 

  (iv) on and from C&P Completion, by any third party including financiers named in the “Hospital Business Contracts - Seller Group” and “Equipment Leases - Seller Group” as defined in the Asset Sale Deeds.

 

6.2 Consents to act - Non-C&P Hospital Business

 

At least 5 Business Days prior to Umbrella Completion, the Buyer must deliver to MGL:

 

  (a) written notice of the persons whom the Buyer nominates to act as directors and secretaries of the Hospital Companies and the Subsidiaries; and

 

  (b) in respect of any persons not already acting in a position to which he or she has been nominated to act by the Buyer, a consent to act signed by such persons consenting to act in the position to which they have been nominated to act by the Buyer.

 

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6.3 Access to Business Records

 

  (a) After Umbrella Completion and C&P Completion (as the case may be), the Buyer must, and, where relevant, must procure that each Group Member, keep the Business Records (as defined in the Share and Asset Sale Deed or relevant Asset Sale Deed, as the case may be) relevant to that acquisition which were delivered to the Buyer for 5 years from that date or such longer period as any applicable law requires that such records must be maintained.

 

  (b) During the period referred to in clause 6.3(a), the Buyer must, and, where relevant, must procure that each Group Member, provide any Seller Group Member with reasonable access to such Business Records and assistance (including copies of relevant documents) as reasonably requested by any Seller Group Member, including such access as reasonably required to permit any relevant Seller Group Member to complete tax returns.

 

6.4 Trade mark licence

 

  (a) In this clause 6.4, “Territory” means:

 

  (i) in relation to the Non-C&P Hospital Business, Australia; and

 

  (ii) in relation to the Indonesian Hospital Business, Indonesia.

 

  (b) Grant of licence

 

  (i) MGL grants to the Buyer and each Group Member a non-exclusive royalty free licence to use the Trade Marks - Excluded in the Territory for the term set out in clause 6.4(b)(ii) and only as permitted by the terms and conditions set out in this clause 6.4. The Buyer acknowledges that this licence is granted for transitional purposes only.

 

  (ii) The Buyer and each Group Member may only exercise its rights under the licence granted pursuant to clause 6.4(b)(i):

 

  A. in Australia, in relation to those of the Trade Marks - Excluded being used by MGL (or any Seller Group Member or any Group Member), and only to the extent that MGL (or any Seller Group Member or any Group Member) used those Trade Marks - Excluded in relation to the Non-C&P Hospital Business immediately prior to the Umbrella Completion Date;

 

  B. in Indonesia, in relation to those of the Trade Marks - Excluded being used by MGL (or any Seller Group Member or any Group Member), and only to the extent that MGL (or any Seller Group Member or any Group Member) used those Trade Marks - Excluded, in relation to the Indonesian Hospital Business immediately prior to the Umbrella Completion Date; and:

 

  C. in either country, for as long as reasonably necessary but in any event not after the date which is six months from the Umbrella Completion Date, unless MGL has given its prior written consent to the continued use of any of the Trade Marks - Excluded beyond that date.

 

  (iii) For the purposes of (ii)(C) MGL consents to using the Trade Marks - Excluded for the uniforms and minor incidental goods currently used exclusively in the Hospital Business, until the date on which those uniforms or goods cease to be so used.

 

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  (c) Terms of use

 

  (i) The Buyer and each Group Member may only use the Trade Marks - Excluded in the Territory and in accordance with the guidelines and standards of the Seller Group and advised to the Buyer from time to time (the “Guidelines”).

 

  (ii) In the event of any conflict between this Deed and the Guidelines, this Deed will prevail.

 

  (iii) The Buyer and each Group Member must not use the Trade Marks - Excluded in a manner which the Buyer or Group Member ought reasonably to know is, or which is prejudicial to:

 

  A. any Seller Group Member; or

 

  B. the validity or distinctiveness of any of the Trade Marks - Excluded.

 

  (iv) The Buyer acknowledges that each of the Trade Marks - Excluded is of particular importance and value to MGL and that the Trade Marks - Excluded are the sole and exclusive property of MGL.

 

  (v) If, in its discretion, MGL decides that any use of any of the Trade Marks - Excluded by the Buyer or any Group Member is in any way prejudicial to the maintenance of any registration of or any other rights of MGL in any of the Trade Marks - Excluded, MGL may direct the Buyer or such Group Member to change, at the Buyer’s reasonable expense its manner of use of any of the Trade Marks - Excluded within a reasonable time specified by MGL, having regard to the steps and costs that the Buyer or such Group Member would need to undertake to comply with that direction.

 

  (vi) If MGL directs the Buyer to change its manner of use pursuant to clause 6.4(c)(v), the Buyer must take all actions reasonably necessary to ensure that its manner of use of the Trade Marks - Excluded is changed in the manner directed by MGL and that all other use of the Trade Marks - Excluded ceases within the time specified by MGL.

 

  (d) Buyer Acknowledgments

 

Except as expressly provided in this Deed, the Buyer acknowledges that:

 

  (i) all right, title and interest in and to each of the Trade Marks - Excluded is and remains vested absolutely in MGL;

 

  (ii) MGL has the right to apply to register each of the Trade Marks - Excluded for such goods and/or services as MGL sees fit;

 

  (iii) except for the licence and permission granted to it by this Deed, the Buyer and the Group Members have no right, title or interest in or to any of the Trade Marks - Excluded; and

 

  (iv) all goodwill and any other right, title and interest arising from the use of any of the Trade Marks - Excluded by the Buyer and the Group Members will enure solely for the benefit of MGL.

 

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  (e) Undertakings

 

Except as expressly provided in this Deed, the Buyer undertakes to MGL that:

 

  (i) the Buyer will not itself or assist any third party to challenge or in any way impugn the registration, validity of or ownership of any of the Trade Marks - Excluded;

 

  (ii) the Buyer and the Group Members will not at any time use any of the Trade Marks - Excluded in a manner likely to prejudice the distinctiveness or reputation of any of the Trade Marks - Excluded or the validity of any registration for any of the Trade Marks - Excluded. In particular, without limiting the generality of the foregoing, the Buyer and the Group Members will not, without MGL’s prior written consent, use in its business or seek to register anywhere in or outside the Territory any other trade mark which is substantially identical with or deceptively similar to any of the Trade Marks - Excluded or so nearly resembling any of the Trade Marks - Excluded as to be likely to deceive or cause confusion;

 

  (iii) the Buyer and the Group Members will not use any of the Trade Marks - Excluded in juxtaposition to any other Trade Marks - Excluded, embellishment or device without the prior written consent of MGL;

 

  (iv) the Buyer and the Group Members will not either within or outside the Territory seek to register any of the Trade Marks - Excluded for any goods or services in respect of which any of the Trade Marks - Excluded are registered or used or for any similar or closely related goods or services; and

 

  (v) the Buyer and the Group Members will, from time to time at the request of MGL, execute and provide to MGL (or as MGL may direct) any consents, authorisations or other documents required to secure or perfect MGL’s rights, titles and interests in and to any of the Trade Marks - Excluded.

 

  (f) Where any of the Trade Marks - Excluded is used in a document issued by or on behalf of the Buyer or a Group Member, or where any goods and services bear or are advertised, promoted, offered for sale or sold under or by reference to any of the Trade Marks - Excluded, the Buyer or the relevant Group Member must, unless otherwise authorised by MGL, include in that document or on or in relation to those goods and services the text:

 

[insert details of trade mark being used] is a trade mark/are trade marks [delete whichever is not applicable] used under licence from Mayne Group Limited by [insert name of Buyer/Group Member]”,

 

positioned as a footnote as close as practicable to where the Trade Marks - Excluded first appear in that document or on or in relation to those goods and services.

 

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6.5 Cessation of use of Reserved Name

 

  (a) The Buyer acknowledges that prior to Umbrella Completion, MGL may:

 

  (i) change the name of each Group Member which uses a Reserved Name to a name not including that Reserved Name, and if it does so, MGL will provide the Buyer with proof that the appropriate documentation has been lodged with the Australian Securities and Investments Commission by Umbrella Completion;

 

  (ii) lodge completed Notices of Cessation of Business Name (or equivalent documents) for any business names used by the Group Members, the Non C&P Hospital Business or each C&P Hospital Business which incorporate a Reserved Name; and

 

  (iii) cancel any domain names used by the Group Members or the Non C&P Hospital Business or each C&P Hospital Business which incorporate a Reserved Name.

 

  (b) If MGL does not, prior to Umbrella Completion, change the name of each Group Member which uses a Reserved Name to a name not including that Reserved Name, then the Buyer must do so as soon as practicable after Umbrella Completion and in any event no later than three months after Umbrella Completion, and provide MGL with proof that the appropriate documentation has been lodged with the Australian Securities and Investments Commission.

 

  (c) If MGL does not, prior to Umbrella Completion, lodge completed Notices of Cessation of Business Name (or equivalent documents) for each business name which incorporates a Reserved Name and is registered in the name of any of the Group Members, then the Buyer must do so as soon as practicable after Umbrella Completion and in any event no later than three months after Umbrella Completion, and provide MGL with proof that the appropriate documentation has been lodged with the appropriate authorities.

 

  (d) If MGL does not, prior to Umbrella Completion, cancel any domain name which is registered in the name of any of the Group Members and incorporates a Reserved Name, then the Buyer must do so as soon as practicable after Umbrella Completion and in any event no later than three months after Umbrella Completion, and provide MGL with proof that the appropriate documentation has been lodged with the relevant domain name authorities.

 

6.6 Infringement

 

  (a) If the Buyer receives notice, or otherwise becomes aware, of any infringement of, misuse of, unauthorised use of, act inconsistent with, challenge to or claim, demand or suit against or related to any of the Trade Marks - Excluded (an “Infringement”), the Buyer must notify MGL as soon as possible giving such detailed particulars of the Infringement as it reasonably can.

 

  (b) MGL may consult with the Buyer about the appropriate action to take in relation to any Infringement notified by the Buyer to MGL pursuant to clause 6.6(a).

 

  (c) MGL may in its sole discretion:

 

  (i) take such action as it deems necessary or desirable (including issuing, conducting or settling legal or administrative proceedings) to bring the Infringement to an end;

 

  (ii) require the Buyer at MGL’s reasonable expense to take such action as MGL deems necessary or desirable (including issuing, conducting or settling legal or administrative proceedings) to bring the Infringement to an end; or

 

31


  (iii) elect to take no action at all, in which case no action will be taken in respect of that Infringement;

 

  (d) MGL may in any action in accordance with clause 6.6(a) require the Buyer at MGL’s reasonable expense to assist MGL in any action taken to bring the Infringement to an end.

 

6.7 Indemnity in relation to Trade Marks - Excluded

 

Newco Group must indemnify each Seller Group Member against all Liabilities incurred or suffered by any Seller Group Member after Umbrella Completion as a result of, or arising out of a failure of the Buyer or any Group Member to comply with clauses 6.4, 6.5 or 6.6.

 

7. Warranties and indemnities

 

7.1 Seller’s Warranties and acknowledgment

 

  (a) As part of the terms of the sale of the Australian Hospital Business but subject to clauses 7.2, 7.3, 7.4 and 8, MGL warrants to:

 

  (i) the Buyer that, subject to clause 7.1(b), each of the Non C&P Warranties is accurate as at the date of this Deed and as at Umbrella Completion; and

 

  (ii) each Newco Group Member that, subject to clause 7.1(c), each of the C&P Warranties is accurate as at the date of this Deed and as at Umbrella Completion.

 

  (b) For the purposes of this Deed, “Non C&P Warranty” means, in relation to the Share and Asset Sale Deed, each warranty set out in paragraphs 1 to 18 inclusive of Schedule 6 as if each word or term used in those paragraphs had the meaning where defined in the Share and Asset Sale Deed.

 

  (c) For the purposes of this Deed, “C&P Warranty” means, in relation to each Asset Sale Deed, each warranty set out in the following paragraphs of Schedule 6 as if each word or term used in those paragraphs had the meaning where defined in the relevant Asset Sale Deed:

 

  (i) paragraph 1 (Share Capital), to the extent that the warranty relates to AMNL, MFL or MPPL (as defined in the relevant Asset Sale Deed);

 

  (ii) paragraph 2 (Capacity and Authority), to the extent the warranty relates to MGL but not MHH;

 

  (iii) paragraphs 5 (Last Accounts and management accounts), 8 (Superannuation), 16 (Disclosure Material), 17 (Insurance);

 

  (iv) paragraphs 3 (Assets), 4 (Conduct of Hospital Business), 6 (Period Since Last Accounts Balance Date), 7 (Commitments and Contracts), 10 (Litigation), 11 (Intellectual Property), 13 (Premises), 14 (Environment), 15 (Records), 18 (Employees) to the extent that the warranty relates to a Seller Group Member but not a Group Member,

 

and for the avoidance of doubt “C&P Warranty” does not include the warranties in paragraphs 9 (Tax), 12 (Subsidiaries) or 19 (Unit Trusts).

 

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  (d) MGL acknowledges that the Buyer has entered into:

 

  (i) the Share and Asset Sale Deed in reliance on the Non C&P Warranties; and

 

  (ii) each of the Asset Sale Deeds in reliance on the C&P Warranties applicable to each such agreement.

 

  (e) Each Warranty is separate and independent and not limited by any other Warranty or any other provision of this Deed except to the extent expressly provided to the contrary in this Deed.

 

7.2 Exceptions for disclosures and public records

 

The Warranties are given subject to disclosures or matters recorded in this Deed or disclosed in the Disclosure Material or in the Public Register Information, and no Newco Group Member can claim that any fact, matter or circumstance causes:

 

  (a) any damage or loss to the Buyer or a Group Member;

 

  (b) the Warranties to be false or misleading; or

 

  (c) the Warranties to be breached,

 

if the fact, matter or circumstance is fairly disclosed in the Disclosure Material or in the Public Register Information.

 

7.3 Breach of Warranties

 

  (a) If any Newco Group Member becomes aware of any material breach or inaccuracy of any of:

 

  (i) the Non C&P Warranties, on or before Umbrella Completion; or

 

  (ii) the C&P Warranties, on or before C&P Completion,

 

(including, as applicable, a Fundamental Warranty Breach) the Newco Group Member must forthwith give notice to MGL of such breach or inaccuracy (“Breach Notice”).

 

  (b) Upon receipt of a Breach Notice under clause 7.3(a)(i):

 

  (i) MGL may remedy the breach specified in the Breach Notice by the earlier of:

 

  A. 10 Business Days after receiving the Breach Notice; or

 

  B. the Umbrella Completion Date; or

 

  (ii) if there is:

 

  A. a Fundamental Warranty Breach;

 

  B. a breach of warranty (i) of the Buyer’s warranties in Schedule 7; or

 

  C. a breach of a Warranty which will result in a loss or cost to the Buyer in excess of $50 million,

 

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then MGL may terminate the Transaction Agreements by notice in writing to the Buyer at any time before Umbrella Completion but without prejudice to any Claim or Action by the Buyer for any antecedent breach; or

 

  (iii) if MGL fails to remedy a Fundamental Warranty Breach in accordance with paragraph (i), the Buyer may terminate the Transaction Agreements by notice in writing to MGL at any time before Umbrella Completion but without prejudice to any Claim or Action by the Buyer for any antecedent breach.

 

  (c) Upon receipt of a Breach Notice under clause 7.3(a)(ii):

 

  (i) MGL may remedy the breach specified in the Breach Notice by the earlier of:

 

  A. 10 Business Days after receiving the Breach Notice; or

 

  B. the date for C&P Completion; or

 

  (ii) if there is a Fundamental Warranty Breach, or a material Warranty breach, then MGL may terminate the relevant Asset Sale Deed at any time before Umbrella Completion; or

 

  (iii) if MGL fails to remedy a Fundamental Warranty Breach in accordance with paragraph (i), the Buyer may terminate the relevant Asset Sale Deed by notice in writing to MGL at any time before Umbrella Completion but without prejudice to any Claim or Action by the Buyer for any antecedent breach.

 

  (d) Each Newco Group Member acknowledges and agrees that it is not entitled to rescind or terminate any of the Transaction Agreements for a breach of Warranty other than for a Fundamental Warranty Breach.

 

7.4 Acknowledgments

 

The parties acknowledge and agree that the Warranties do not apply to any forward looking statements, financial forecasts, projections, opinions of future performance or statements relating to prospects of the Group, the Non C&P Hospital Business or each C&P Hospital Business that have been provided by a Seller Group Member or Group Member or any of their representatives. No warranty is given or representation made that any such financial forecast, projection, opinion or statement will be met or achieved. Any such information that has been provided to the Buyer was provided for information purposes only.

 

7.5 Buyer’s Warranty

 

As part of the terms of this Deed Newco Group warrants to MGL in the terms set out in Schedule 7 as at the date of this Deed and separately as at a time immediately before Umbrella Completion.

 

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8. Limitation of liability

 

8.1 No reliance on and no liability for matters outside this Deed

 

  (a) Newco Group acknowledges and warrants that:

 

  (i) no Seller Group Member or Group Member (nor any person acting on its behalf) has made any representation, warranty or other inducement to it to enter into this Deed, except for representations, warranties or inducements expressly set out in the Transaction Agreements; and

 

  (ii) it does not enter into the Transaction Agreements in reliance on any representation, warranty or other inducement by or on behalf of any other person, except for any representation, warranty or inducement expressly set out in the Transaction Agreements respectively.

 

  (b) Newco Group acknowledges and warrants that:

 

  (i) the Buyer has undertaken a due diligence investigation in relation to the Non C&P Hospital Business, each C&P Hospital Business, the Group Members, the Sale Shares and the assets, real property and liabilities in relation to those businesses and in accordance with a process designed and implemented by the Buyer and its Representatives; and

 

  (ii) it has not relied and does not rely on any statement, disclosure, representation or warranty, whether express or implied, made by or on behalf of a Seller Group Member (and, if Umbrella Completion does not occur, a Group Member) which is not set out in this Deed, whether in relation to the Group Members or the sale of the Non C&P Hospital Business, each C&P Hospital Business, the Sale Shares and the assets, real property and liabilities in relation to those businesses,

 

  (c) No Newco Group Member will bring any Claim or Action against any Seller Group Member (and, if Umbrella Completion does not occur, any Group Member) unless it is based solely on and limited to the regime contemplated by this Deed.

 

  (d) Except for the parties’ obligations under the express provisions of the Transaction Agreements, by this Deed the Buyer releases each Seller Group Member (and, if Umbrella Completion does not occur, each Group Member) and their Representatives, from all claims, demands, obligations or liabilities whether in tort (including negligence), statute, contract, or otherwise which it has or may have after the date of this Deed which arise out of the negotiations for and subject matter of the Transaction Agreements, or agreements entered into by the Seller Group and the Buyer Group (including the Group) under or pursuant to the Transaction Agreements.

 

8.2 Limitations of liability

 

Notwithstanding anything to the contrary contained in the Transaction Agreements no Seller Group Member (and, if Umbrella Completion does not occur, no Group Member) will be Liable for any Claims or Actions:

 

  (a) (Buyer insured): to the extent that the Claim or Action arises or is in respect of matters against which any Buyer Group Member is insured for loss or damage suffered by it (but only to the extent that such loss or damage is recovered under any insurance policy held by any Buyer Group Member);

 

  (b) (Buyer insured): if any Buyer Group Member fails to do all things reasonably necessary to recover under any insurance relevant to the Claim or Action on a timely basis;

 

  (c) (Buyer’s awareness): where the Buyer is actually aware of the matter giving rise to the Claim or Action under the Warranties, before the date of this Deed.

 

35


For this purpose, the Buyer will be deemed to have knowledge of those matters disclosed in the Disclosure Material on or before the date of this Deed and the Public Register Information on the date which is seven days before the date of this Deed;

 

  (d) (Buyer’s own actions): if, but only to the extent that, the Claim or Action is as a direct result or consequence of any voluntary act, omission, transaction or arrangement of or on behalf of any Buyer Group Member other than in the ordinary course of the Australian Hospital Business as carried on before Umbrella Completion or as required by Law;

 

  (e) (Loss only compensated once): if, but only to the extent that the Buyer or any Buyer Group Member has recovered the same loss under any other provision of the Transaction Agreements or any other document referred to in the Transaction Agreements or the Disclosure Material;

 

  (f) (Buyer otherwise compensated): if, but only to the extent that the subject of the Claim or Action has been or is made good or is otherwise compensated for without cost to the Buyer or a Buyer Group Member;

 

  (g) (Last Accounts or Umbrella Completion Statement): if, but only to the extent that the matter in respect of which the Claim or Action is made is accrued or provided for or otherwise reflected in the Last Accounts, or the Umbrella Completion Statements;

 

  (h) (No indirect or consequential loss): to the extent that the Claim or Action relates to any exemplary, special, indirect, incidental or Consequential Loss suffered by the Buyer or a Buyer Group Member;

 

  (i) (Legislation): to the extent that the Claim or Action is as a result of or in respect of, or where the Claim or Action arises from any act, matter, omission, transaction or circumstance which would not have occurred but for any legislation not in force at the date of this Deed or any change of any Law or administrative practice of any governmental agency after the date of this Deed, including any such legislation or change which takes effect retrospectively or any increase in the rates of Tax liable to be paid or any imposition of Tax not in effect at the date of this Deed;

 

  (j) (Buyer’s actions in relation to Tax): to the extent that the circumstances giving rise to the Claim or Action result in a savings in Tax to the Buyer or any Group Member or would have so resulted had the Buyer or the relevant Group Member availed itself of proper credits, deductions, allowances and other savings in respect of Tax (for the avoidance of doubt, a savings in tax will include where the Buyer or any Buyer Group Member is entitled to a tax loss in respect of the amount);

 

  (k) (Labour disputes): to the extent that any labour dispute, strike or work stoppage arises from or is connected with the sale or proposed sale of the Non C&P Hospital Business, or each C&P Hospital Business or the Buyer not offering employment or engagement (as required by the Transaction Agreements) or terminating the employment or engagement of one or more Employees;

 

  (l) (Announcement of sale) to the extent that the Claim or Action relates to Warranty 6 (Period Since Last Accounts Balance Date) and arises directly as a result of the announcement of the sale or proposed sale of the Australian Hospital Business or the Indonesian Hospital Business;

 

36


  (m) (Notice): unless the Buyer has:

 

  (i) given MGL notice in writing of each fact or circumstance which gives or may give rise to a Claim or Action by the Buyer under this Deed as soon as reasonably practicable but in any event within 2 weeks of the fact or circumstance coming to the attention of senior management of the Buyer; and

 

  (ii) given MGL access to all relevant business records together with all other records, correspondence and information as MGL may reasonably request;

 

  (n) (Time limits - Non-C&P): unless the Buyer has given written notice to MGL setting out details of any Claim or Action under the Share and Asset Sale Deed or in relation to the Non C&P Warranties within:

 

  (i) 7 years after the Umbrella Completion Date in respect of any such Claim or Action relating to Tax fraud;

 

  (ii) 6 years after the Umbrella Completion Date in respect of any such Claim or Action relating to Tax avoidance or Tax evasion;

 

  (iii) 3 years after the Umbrella Completion Date in respect of any such Claim or Action relating to the Environment (including any Claim or Action under clause 8.9 and any Warranty 14);

 

  (iv) 4 years after the Umbrella Completion Date in respect of any such Claim or Action relating to Tax other than those subject to paragraphs (i) and (ii); and

 

  (v) 18 months after the Umbrella Completion Date in respect of all other Claims or Actions,

 

and within 6 months of MGL receiving that notice, such Claim or Action has been:

 

  (vi) admitted or satisfied by MGL; or

 

  (vii) settled between MGL and the Buyer; or

 

  (viii) referred to a Court of competent jurisdiction by the Buyer instituting and serving legal proceedings against MGL in relation to the Claim or Action;

 

  (o) (Time limits - C&P): in relation to the Asset Sale Deed or any of the C&P Warranties, unless the Buyer has given written notice to MGL within:

 

  (i) 3 years after the Umbrella Completion Date in respect of any such Claim or Action relating to the Environment (including any Claim or Action under clause 8.9 and any Warranties relating to the Environment, Contamination and Environmental Law); and

 

  (ii) 18 months after the Umbrella Completion Date in respect of all other Claims or Actions,

 

and within 6 months of the later of written notice or the relevant C&P Completion, such Claim or Action has been:

 

  (iii) admitted or satisfied by MGL; or

 

  (iv) settled between MGL and the Buyer; or

 

37


  (v) referred to a Court of competent jurisdiction by the Buyer instituting and serving legal proceedings against MGL in relation to the Claim or Action;

 

  (p) (Lower dollar limits): (except in respect of any Claim or Action arising out of the Tax Indemnity, in relation to which this paragraph (p) will not apply) unless:

 

  (i) the amount finally awarded or agreed as being payable in respect of the Claim or Action in question is not less than $1,000,000; and

 

  (ii) the aggregate amount finally awarded or agreed as being payable in respect of all Claims and Actions is not less than $8,000,000,

 

in which case, MGL will be liable for the whole amount (not just the excess);

 

  (q) (Worker’s compensation claim): where the Claim or Action relates to any workers’ compensation claim or fees in relation thereto whether under statute, common law or otherwise and whether made before or after Umbrella Completion by any Employee, Deemed Employee or Former Employee whether attributable to their employment or engagement by MGL, any Seller Group Member or any Group Member before Umbrella Completion or by any Buyer Group Member on and from Umbrella Completion.

 

  (r) (Environment): other than in respect of a breach of Warranty 14, or as provided for in clause 8.9, where the Claim or Action relates to any environmental matter or circumstance, including in relation to any Contamination, or any breach of any Environmental Law.

 

8.3 Maximum liability for claims

 

The maximum aggregate amount recoverable by the Buyer from MGL in respect of all Claims and Actions is the Umbrella Purchase Price as finally determined pursuant to clause 2.

 

8.4 Reimbursement for amounts recovered

 

The Buyer will reimburse MGL for amounts paid by MGL to the Buyer or any Buyer Group Member in respect of any Claim or Action to the extent to which the same is recovered by the Buyer or any Buyer Group Member from any third party, including suppliers, manufacturers or insurers. If the Buyer or any Buyer Group Member is at any time entitled to recover from some other person any sum in respect of which it makes or brings a Claim or Action, it must take, and must procure that the relevant Group Member takes, all reasonable steps to enforce such recovery from the third party.

 

8.5 Third party claims

 

  (a) If any claims, demands, actions or proceedings are made or instituted against any Buyer Group Member (“Relevant Member”) in respect of which the Buyer may seek to make any Claim or Action (any such claims, demands, actions or proceedings being hereinafter called a “Third Party Claim”), the following procedure applies:

 

  (i) the Buyer will give prompt written notice of the Third Party Claim to MGL and will ensure that it consults with MGL concerning such claim;

 

  (ii)

the Buyer will not itself, nor allow the Relevant Member to admit, compromise, settle or pay any such Third Party Claim or take any other steps which may in any way prejudice the defence or challenge thereof

 

38


 

without the prior written consent of MGL (such consent not to be unreasonably withheld or delayed) except as may be reasonably required in order to prevent any judgment against the Relevant Member;

 

  (iii) the Buyer will procure that the Relevant Member will permit MGL at MGL’s expense to take such reasonable action in the name of the Relevant Member to defend or otherwise settle the Third Party Claim as MGL may reasonably require;

 

  (iv) the Buyer will ensure that MGL and their representatives are given reasonable access to such officers and employees, and the documents and records of the Buyer or any Group Member as may be reasonably required by MGL in relation to any action taken or proposed to be taken by MGL under clause 8.5(a)(iii); and

 

  (v) the Buyer will ensure that neither it nor any Group Member does or causes to be done anything in relation to the Third Party Claim which compromises or prejudices MGL’s rights under this clause 8.5(a).

 

  (b) MGL will not be liable to the Buyer for any Claim or Action arising from a Third Party Claim to the extent to which the Buyer does not comply with clause 8.5(a) in all material respects.

 

8.6 Adjustment to Umbrella Purchase Price

 

If any amount is payable or paid by MGL to the Buyer or any Buyer Group Member in respect of a Claim or Action, such amount will be deemed to be a reduction in the Umbrella Purchase Price of:

 

  (a) to the extent that the Claim or Action is directly attributable to certain assets or property, those assets or that property; and

 

  (b) in all other circumstances, the Sale Shares.

 

8.7 Directors and Employees of the Group

 

To the extent permitted by law, the Buyer will not, and will procure that each current and future Related Body Corporate of the Buyer does not, bring or make any claim, demand, suit, proceeding, action or cause of action against any Representative of any Seller Group Member (and if Umbrella Completion does not occur, any Representative of any Group Member) in respect of any matter arising out of the sale of the Non C&P Hospital Business, each C&P Hospital Business, the Sale Shares and the assets, real property and liabilities in relation to those businesses by MGL to the Buyer or relating to any financial or other information approved or provided by the director or employee before Umbrella Completion.

 

8.8 Insurance

 

From the Umbrella Completion Date until MGL ceases to have any Liability for any Claims or Actions under this Deed, the Buyer must ensure that the Buyer Group maintains in respect of the Non C&P Hospital Business, each C&P Hospital Business, the Sale Shares and the assets, real property and liabilities in relation to those businesses, prudent levels of insurance taking into account the nature of the assets and liabilities of the Buyer Group.

 

8.9 Contamination or Pollution

 

  (a)

Subject to clause 8.9(b), MGL indemnifies the Buyer for and on behalf of each Buyer Group Member against all Liabilities incurred or suffered by any Buyer

 

39


 

Group Member in respect of any Contamination at or migrating to or from any Freehold Premises or Principal Premises or the emission of any Pollution from those premises, occurring before Umbrella Completion.

 

  (b) This clause 8.9 shall:

 

  (i) not apply to the extent that any such Liability arises from a change in the use of the Freehold Premises by any Buyer Group Member after Umbrella Completion;

 

  (ii) not apply to the extent that any such Liability arises from a change in the use of the Principal Premises by any Buyer Group Member after C&P Completion;

 

  (iii) apply from until Umbrella Completion, in relation to Liabilities incurred or suffered by any Buyer Group Member in respect of any Contamination at or migrating to or from any Freehold Premises;

 

  (iv) apply from until C&P Completion, in relation to Liabilities incurred or suffered by any Buyer Group Member in respect of any Contamination at or migrating to or from the relevant Principal Premises;

 

  (v) unless the aggregate of such Liabilities exceeds $10,000,000, in which case, MGL will only be liable for the amount in excess of $1 million.

 

  (c) Clause 8.2(p) shall not apply to this clause 8.9.

 

8.10 Group reorganisation

 

  (a) MGL indemnifies each Buyer Group Member against all Liabilities incurred or suffered by any Buyer Group Member in connection with any of the Divestment Businesses, any Retained Businesses or any Retained Companies (whether or not as a result of any transaction the subject of the Transaction Agreements or otherwise).

 

  (b) The limitations of liability in the Transaction Agreements (including in this clause 8) shall not apply to this clause 8.10.

 

8.11 Litigation

 

  (a) Subject to clauses 8.11(b), but notwithstanding any other provision in the Transaction Agreements, from the Umbrella Completion Date, MGL indemnifies each Buyer Group Member against all Liabilities incurred or suffered by any Buyer Group Member in connection with:

 

  (i) any dispute as at the date of Umbrella Completion with [*] regarding the [*] (“[*]”); and

 

  (ii) any dispute as at the date of Umbrella Completion regarding the [*] to the [*] (“[*]”); and

 

  (iii) any dispute as at the date of Umbrella Completion [*] regarding the [*] to the [*] (“[*]”).

 

  (iv) any dispute as at the date of Umbrella Completion with [*] regarding the [*] under a [*] (“[*]”).

 


[*] Certain confidential portions of these exhibits have been omitted pursuant to a request for confidential treatment and filed separately with the Commission.

 

40


  (b) In relation to any such Liability (including all related Claims and Costs referred to in clause 11.2(b)) incurred or suffered by any Buyer Group Member in connection with:

 

  (i) the [*], the Buyer will be Liable for [*] of the amount of such Liability up to a cap of [*];

 

  (ii) the [*], the Buyer will be Liable for [*] of the amount of such Liability up to a cap of [*];

 

  (iii) the [*], the Buyer will be Liable for [*] of the amount of such Liability up to a cap of [*]; and

 

  (iv) the [*], the Buyer will be Liable for the total amount of such Liability up to a cap of [*],

 

and the Buyer will not be entitled to any indemnity from MGL in relation to these amounts referred to in paragraphs (i), (ii) and (iii).

 

  (c) Clauses 8.2 and 8.3 do not apply to the Indemnified Litigation

 

9. Work-related claims

 

9.1 Buyer’s indemnity for work-related claims

 

The Buyer indemnifies MGL and each other Seller Group Member against any Liability it suffers or incurs in relation to any workers’ compensation claim or fees in relation thereto whether under statute, common law or otherwise:

 

  (a) from Umbrella Completion, by any Non C&P Employee, Non C&P Deemed Employee and Non C&P Former Employee; and

 

  (b) from C&P Completion, by any C&P Employee, C&P Deemed Employee and C&P Former Employee,

 

whether attributable to their employment or engagement before, or on and from Umbrella Completion.

 

9.2 States assuming management of claims

 

The Buyer indemnifies MGL against any Liability it may incur in the event that any Governmental Authority assumes responsibility for any Pre-Completion Workers’ Compensation Claims.

 

9.3 Administration of workers’ compensation liabilities

 

In respect of any Liability referred to in clause 9.1, the parties agree that they will promptly perform and comply with their obligations set out in Schedule 8.

 

10. GST

 

10.1 Interpretation

 

Except where this Deed provides otherwise, terms used in this clause have the meanings given to those terms by the GST Act.

 


[*] Certain confidential portions of these exhibits have been omitted pursuant to a request for confidential treatment and filed separately with the Commission.

 

41


10.2 Reimbursements and similar payments

 

Any payment or reimbursement required under the Transaction Agreements that is calculated by reference to a cost, expense, or other amount paid or incurred by a party will be limited to the total cost, expense or amount less the amount of any input tax credit to which an entity is entitled for the acquisition to which that cost, expense or other amount relates.

 

10.3 GST payable

 

If GST becomes payable by a party to the Transaction Agreements (“Supplier”) in relation to any supply that it makes under or in connection with the Transaction Agreements, the parties agree that:

 

  (a) any amount provided for that supply under the Transaction Agreements other than under this clause 10.3 (as reduced in accordance with clause 10.2 if applicable) or any value deemed for GST purposes in relation to that supply (“Agreed Amount”) is exclusive of GST;

 

  (b) an additional amount will be payable by the party receiving the supply (“Recipient”) equal to the amount of GST payable by the Supplier in relation to that supply and the additional amount is payable at the same time as any part of the Agreed Amount is to be first provided for that supply; and

 

  (c) the Supplier will provide a tax invoice to the Recipient in respect of that supply, no later than the time at which the additional amount in respect of that taxable supply is payable pursuant to clause 10.3(b).

 

To the extent, if any, that an amount payable for a supply is specified in the Transaction Agreements to be inclusive of GST, that amount shall be excluded from the Agreed Amount for the purposes of this clause 10.3.

 

10.4 Variation

 

If the GST payable in relation to a supply made by the Supplier under or in connection with the Transaction Agreements varies from the additional amount paid by the Recipient under clause 10.3 such that:

 

  (a) further GST is payable in relation to the supply; or

 

  (b) a refund or credit of GST is received in relation to the supply,

 

then the Supplier will issue an Adjustment Note and provide a corresponding refund or credit to, or will be entitled to receive the amount of that variation from, the Recipient. Any payment, credit or refund under this clause is deemed to be a payment, credit or refund of the additional amount payable under clause 10.3.

 

10.5 No merger

 

This clause shall not merge on Umbrella Completion or C&P Completion (as the case may be).

 

11. Litigation

 

This clause 11 will apply to the litigation referred to in clauses 8.9 and 8.11 and in the event of any inconsistency clauses 8.9 and 8.11 will prevail.

 

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11.1 Acknowledgment

 

The parties must use their best endeavours to assist each other in relation to:

 

  (a) the ongoing management and resolution of Current Litigation;

 

  (b) notification of any Current Litigation not listed in Part A or Part B of Schedule 12, as the case may be;

 

  (c) the ongoing management and resolution of New Litigation;

 

  (d) the ongoing management and resolution of Excluded Litigation; and

 

  (e) the notification of any underwriters which may be liable to indemnify the Seller Group or the Buyer Group in respect of any such Claims, and the involvement of those underwriters in the management and resolution thereof.

 

11.2 Management and Responsibility for Litigation

 

The parties agree that from the Umbrella Completion Date or the C&P Completion Date (as the case may be):

 

  (a) Buyer Litigation, Current Litigation and New Litigation, other than Joint Litigation and the matters referred to in paragraph (a)(ii) of the definition of Current Litigation and paragraph (b) of the definition of New Litigation relating to the Retained Business or the Divestment Businesses, will be the responsibility of and managed by the Buyer at its Cost;

 

  (b) Joint Litigation will be managed jointly by the Buyer and MGL in accordance with the provisions of clauses 11.3, 11.4, 11.5, 11.6, 11.7 and 11.8 as follows:

 

  (i) to the extent that the relevant Joint Litigation is in respect of:

 

  A. the assets or businesses owned by the Seller Group after the Umbrella Completion Date or the C&P Completion Date (as the case may be) and is a Claim by or against a Buyer Group Member;

 

  B. the Retained Business or the Divestment Businesses and is a Claim by or against a Buyer Group Member; or

 

  C. the Indemnified Litigation,

 

MGL will:

 

  D. bear the Cost and be entitled to the proceeds of the Joint Litigation;

 

  E. have responsibility for the conduct of the Joint Litigation; and

 

  F. indemnify the Buyer against all Claims, Costs and Liabilities in respect of the Joint Litigation subject to clause 8.11.

 

43


  (ii) to the extent that the relevant Joint Litigation is in respect of the Non C&P Hospital Business or C&P Hospital Business (as the case may be) and is a Claim by or against a Seller Group Member, the Buyer Group will:

 

  A. bear the Cost and be entitled to the proceeds of the Joint Litigation; and

 

  B. have responsibility for the conduct of the Joint Litigation; and

 

  C. indemnify the Seller Group against all Claims, Costs and Liabilities in respect of the Joint Litigation.

 

  (iii) if the relevant Joint Litigation is a Claim in respect of which both a Seller Group Member and a Buyer Group Member have an interest (regardless of whether or not a Seller Group Member and/or a Buyer Group Member is a party to the proceeding), MGL and the Buyer will:

 

  A. agree who is to have primary responsibility for the conduct of the litigation; and

 

  B. share the Costs and the proceeds of the litigation in proportion to their respective interests in the litigation.

 

  (c) Current Litigation and New Litigation described in paragraph (a)(ii) of the definition of Current Litigation and paragraph (b) of the definition of New Litigation relating to the Retained Business or Divestment Business will be the responsibility of and managed by MGL at its Cost.

 

11.3 Procedure in relation to Joint Litigation

 

MGL and the Buyer agree that the party with the primary responsibility for the conduct of Joint Litigation from the Umbrella Completion Date will:

 

  (a) keep the other party fully informed of all matters relating to Joint Litigation including the retainer of solicitors and counsel, the preparation and calling of evidence, the making of submissions and the provision of documents;

 

  (b) as soon as practicable copy every notice, correspondence, demand or other document in relation to Joint Litigation to the other party;

 

  (c) promptly consult with the other party as to the appropriate response to any notice, correspondence, demand or other document relating to Joint Litigation;

 

  (d) take all such reasonable action (including the making of objections and appeals) necessary to avoid, resist, compromise or defend any claim made in relation to Joint Litigation; and

 

  (e) ensure that it pursues any and all of the steps set out in this clause unless it reasonably considers, in consultation with the other party that such step would be injurious to the name or reputation of the other party.

 

To the extent that there is any disagreement between MGL and the Buyer in relation to any aspect of the conduct or management of Joint Litigation the reasonable requirements of the party with primary responsibility will prevail.

 

11.4 Notice of New or Unidentified Current Litigation

 

If, after the Umbrella Completion Date, a Seller Group Member or a Buyer Group Member becomes aware of:

 

  (a) Current Litigation that is not specified in Part A or Part B of Schedule 11 (as applicable); or

 

44


  (b) a new Claim which is or could give rise to Joint Litigation which is made or threatened against a Seller Group Member; or

 

  (c) any fact or matter which could reasonably be expected to give rise to such a Claim; or

 

  (d) New Litigation,

 

that Seller Group Member or Buyer Group Member must as soon as it is practical to do so advise MGL or the Buyer (as the case may be) in writing of the same.

 

11.5 Allocation of responsibility

 

On receipt of a notice issued under clause 11.4, MGL and the Buyer must:

 

  (a) assign the responsibility for the conduct, and allocate the Cost of, the matter in accordance with clause 11.2; and

 

  (b) conduct the matter in accordance with clause 11.3 if the matter is or is determined likely to be Joint Litigation.

 

11.6 Procedure in event of Joint Litigation by or against a Seller Group Member where MGL is not primarily responsible for the conduct of the Claims

 

Where MGL or another Seller Group Member does not have primary responsibility for the conduct of any Joint Litigation which is by or against a Seller Group Member, that Joint Litigation will be managed in accordance with clauses 11.1, 11.2, and 11.3 and MGL will, subject to clause 11.8, comply with the following procedure in respect of any relevant Claim or anticipated Claim the subject of such Joint Litigation:

 

  (a) if after the Umbrella Completion Date or the C&P Completion Date (as the case may be), any Claim is made or threatened against a Seller Group Member, or if MGL becomes aware of any fact or matter which could reasonably be expected to give rise to such a Claim against a Seller Group Member in relation to the Non C&P Hospital Business or the C&P Hospital Business (as the case may be), MGL must as soon as reasonably practicable give to the Buyer or the relevant Buyer Group Member, written notice of the Claim containing reasonable details of the circumstances of the Claim, and MGL must fully consult with the Buyer or the relevant Buyer Group Member concerning the management of the Claim by the Buyer;

 

  (b) if a Claim involves a Mayne Prosecution, MGL may, at its discretion, decide whether:

 

  (i) it will manage the conduct of the Mayne Prosecution and if it so decides, MGL will be liable for all Costs and Liabilities in respect of such Mayne Prosecution incurred by a Buyer Group Member; or

 

  (ii) the Buyer will manage the conduct of the Mayne Prosecution and if MGL so decides, the Buyer will be liable for all Costs and Liabilities in respect of such Mayne Prosecution incurred by a Buyer Group Member,

 

  (c)

in either case both MGL and the Buyer agree to conduct such Mayne Prosecution in accordance with this clause 11.6, if relevant; MGL must not itself, nor must it allow

 

45


 

any of its Representatives or any Seller Group Member, to admit, compromise, settle or pay a Claim, or to take any other steps which may in any way prejudice the defence or challenge thereof, including without limitation, the discontinuation of any proceeding or appeal instituted or defended by the relevant Buyer Group Member in the name of MGL or the relevant Seller Group Member under this clause, without the prior written consent of the relevant Buyer Group Member, which consent cannot be unreasonably withheld;

 

  (d) Subject to the Buyer obtaining MGL’s prior written consent, which consent will not be unreasonably withheld, the Seller Group will permit the Buyer Group (at the relevant Buyer Group Member’s Cost) to take any action in the name of MGL or the relevant Seller Group Member to commence, prosecute, resist, defend, dispute, avoid, counterclaim, set-off, settle, compromise or appeal a Claim;

 

  (e) the relevant Buyer Group Member will consult with MGL in relation to the form, procedure and substance of any action to be taken (including in relation to the solicitors and counsel to be instructed) and any negotiations, appeal or further actions in respect thereof;

 

  (f) MGL must ensure that the relevant Buyer Group Member and their Representatives are given full access to, and are permitted to take copies of, all relevant documentation in the possession, custody or control of a Seller Group Member for the purposes of assessing any Claim or in relation to any action taken or proposed to be taken under this clause;

 

  (g) MGL must ensure that the Buyer or the relevant Buyer Group Member and its Representatives are given reasonable access to any Representatives of the relevant Seller Group Member for the purposes of assessing any Claim or in relation to any action taken or proposed to be taken under this clause, including without limitation by procuring that:

 

  (i) such persons attend interviews at the premises of MGL;

 

  (ii) give evidence in Court at the request of the Buyer; or

 

  (iii) provide all other reasonable assistance in relation to any Claim,

 

provided that the Buyer or the relevant Buyer Group Member must take reasonable steps to minimise any disruption caused to the business of MGL or the relevant Mayne Group Member; and

 

  (h) MGL must ensure that neither it nor any other Seller Group Member nor their respective officers, employees or agents do or cause to be done anything in relation to a Claim which is likely to compromise or prejudice the Buyer’s or the relevant Buyer Group Member’s rights under this clause.

 

11.7 Procedure in event of Joint Litigation by or against the Buyer where the Buyer Group is not primarily responsible for the conduct of the claims

 

Where the Buyer or another Buyer Group Member does not have primary responsibility for the conduct of any Joint Litigation which is by or against a Buyer Group Member, that Joint Litigation will be managed in accordance with clauses 11.1, 11.2 and 11.3 and the Buyer will, subject to clause 11.8, comply with the following procedure in respect of any relevant Claim or anticipated Claim the subject of such Joint Litigation:

 

  (a)

if after the Umbrella Completion Date or the C&P Completion Date (as the case may be), any Claim is made or threatened against a Buyer Group Member, or if the

 

46


 

Buyer becomes aware of any fact or matter which could reasonably be expected to give rise to such a Claim against a Buyer Group Member in relation to the assets or businesses owned by the Seller Group after the Umbrella Completion Date or the C&P Completion Date (as the case may be), the Retained Business, the Divestment Business or the Indemnified Litigation, the Buyer or the relevant Buyer Group Member must, as soon as reasonably practicable, give to MGL written notice of the Claim containing reasonable details of the circumstances of the Claim and must fully consult with MGL concerning the management of the Claim by MGL;

 

  (b) the Buyer or the relevant Buyer Group Member must not itself, nor must it allow any of its Representatives, to admit, compromise, settle or pay a Claim, or to take any other steps which may in any way prejudice the defence or challenge thereof, including without limitation, the discontinuation of any proceeding or appeal instituted or defended by MGL in the name of the Buyer or the relevant Buyer Group Member under this clause, without the prior written consent of MGL, which consent cannot be unreasonably withheld;

 

  (c) Subject to MGL obtaining the Buyer’ prior written consent, which consent will not be unreasonably withheld, the Buyer and the Buyer Group Members will permit a Seller Group Member (at the relevant Seller Group Member’s Cost) to take any action in the name of the Buyer or the relevant Buyer Group Member to commence, prosecute, resist, defend, dispute, avoid, counterclaim, set-off, settle, compromise or appeal a Claim;

 

  (d) MGL will consult with the Buyer over the form, procedure and substance of any action to be taken (including in relation to the solicitors and counsel to be instructed) and any negotiations, appeal or further actions in respect thereof;

 

  (e) the Buyer or the relevant Buyer Group Member must ensure that MGL and its Representatives are given full access to, and are permitted to take copies of, all relevant documentation in the possession, custody or control of the Buyer or the relevant member of the Buyer Group Member for the purposes of assessing any Claim or in relation to any action taken or proposed to be taken under this clause;

 

  (f) the Buyer or the relevant Buyer Group Member must ensure that MGL and its Representatives are given reasonable access to any Representatives of the Buyer or the relevant member of the Buyer Group Member for the purposes of assessing any Claim or in relation to any action taken or proposed to be taken under this clause, including without limitation by procuring that:

 

  (i) such persons attend interviews at the premises of the Buyer or the relevant Buyer Group Member;

 

  (ii) give evidence in Court at the request of MGL; or

 

  (iii) provide all other reasonable assistance in relation to any Claim,

 

provided that MGL must take reasonable steps to minimise any disruption caused to the business of the Buyer or the relevant Buyer Group Member; and

 

  (g) the Buyer and the relevant Buyer Group Member must ensure that neither they nor their respective officers, employees or agents do or cause to be done anything in relation to a Claim which is likely to compromise or prejudice Mayne’s rights under this clause.

 

47


11.8 Excluded Litigation

 

Subject to clause 11.8(a)(vii), the following matters are excluded from the operation of clauses 11.2, 11.3, 11.5, 11.6 and 11.7 and will be conducted by the relevant party as set out in this clause.

 

  (a) Where:

 

  (i) any allegation of fraud is made against either:

 

  A. a Seller Group Member; or

 

  B. a Buyer Group Member;

 

  (ii) any Claim is made which, in the opinion of MGL, acting reasonably, would or would be likely to be injurious to the name or reputation of Seller Group Member or materially or adversely affect the business, markets or operations of a Seller Group Member;

 

  (iii) any criminal prosecution is brought against a Seller Group Member (and not against a Buyer Group Member); and

 

  (iv) any Claim is made which, in the opinion of the Buyer, acting reasonably, would or would be likely to be injurious to the name or reputation of a Buyer Group Member or materially adversely affect the businesses, markets or operations of a Buyer Group Member;

 

  (v) any criminal prosecution is brought against a Buyer Group Member (and not against a Seller Group Member),

 

the party against which the allegation or Claim is made, or the prosecution is brought may, at its discretion, decide whether:

 

  (vi) it will manage the defence of the allegation, Claim or prosecution and if it so decides, it will be liable for all Liability and Costs in respect of such allegation, Claim or prosecution whether incurred by a Seller Group Member or a Buyer Group Member; or

 

  (vii) the responsibility for and the defence of the allegation, Claim or prosecution will be determined in accordance with the provisions of clauses 11.2 to 11.7 of this Deed.

 

If the party against which the allegation or Claim is made, or the prosecution is brought, decides that the responsibility for and the defence of the allegation, Claim or prosecution will be determined in accordance with the provisions of clauses 11.2 to 11.7 of this deed, in addition to any other obligations it may have, the party with primary responsibility for the conduct of that defence will consider all reasonable requests made to it in relation to the conduct of the defence by the other party.

 

  (b) This clause 11 does not apply to any Claim to the extent that it is between one or more members of the Seller Group on the one hand and one or more members of the Buyer Group on the other.

 

11.9 Assignment of Litigation

 

MGL and the Buyer will, acting reasonably, either:

 

  (a) assign to the Buyer or a Buyer Group Member the proceeds of any Buyer Litigation; or

 

48


  (b) if legally able to do so, assign any Buyer Litigation to the Buyer or a Buyer Group Member.

 

12. Restrictive covenant

 

12.1 Covenants

 

MGL undertakes to the Buyer, and agrees to procure, that neither MGL nor any Seller Group Member at any time (each a “Prohibited Person”) will:

 

  (a) carry on or engage directly or indirectly in a business in Australia which is a Day Surgery or requires such Seller Group Member to hold an overnight private hospital bed licence (“Restricted Business”);

 

  (b) induce or assist in the inducement of any Senior Management to leave the employment of any Buyer Group Member,

 

12.2 Duration of covenants

 

The undertakings in this clause 12 are given for a period commencing on the Umbrella Completion Date and ending on:

 

  (a) the fifth anniversary of the Umbrella Completion Date, in relation to clause 12.l(a); and

 

  (b) the second anniversary of the Umbrella Completion Date, in relation to clause 12.l(b).

 

12.3 Geographic application of covenants

 

The undertakings given in this clause 12 apply to an activity restrained by this clause 12 only if it occurs within Australia.

 

12.4 Interpretation

 

  (a) If any of the provisions in this clause 12 is invalid or otherwise unenforceable for any reason, the provision shall be read down or otherwise amended to the extent necessary so that it is valid and enforceable.

 

  (b) The invalidity or unenforceability of any provision in this clause 12 shall not affect the validity or enforceability of any of the other provisions in this clause 12.

 

12.5 Exceptions

 

Nothing in clause 12 restricts:

 

  (a) the activities of a Prohibited Person carried out pursuant to the Transaction Agreements;

 

  (b) a Prohibited Person holding not more than 5% of the shares of a listed company;

 

  (c) the acquisition by a Prohibited Person of a business or any interest in a business where less than 20% of its revenue is generated by a Restricted Business; or

 

  (d) recruitment of any person as a response to a newspaper, web page or other public employment advertisement.

 

49


12.6 Acknowledgments

 

MGL acknowledges that:

 

  (a) all the prohibitions and restrictions contained in this clause 12 are reasonable in the circumstances and necessary to protect the goodwill of the companies and businesses to be transferred pursuant to the Transaction Agreements;

 

  (b) damages may not be an adequate remedy if there is a breach or a potential breach by a Prohibited Person of its obligations under clause 12; and

 

  (c) if a breach by a Prohibited Person of its obligations under clause 12 occurs, is threatened or in the opinion of the Buyer is likely, the Buyer is immediately entitled to apply for injunctive relief.

 

13. General

 

13.1 Termination

 

This Deed other than clauses 1, 10, and this clause 13 (to the extent applicable) will automatically terminate (except in respect of any antecedent breach):

 

  (a) if Umbrella Completion does not occur under the Share and Asset Sale Deed by 31 January 2004 or such other date as MGL and the Buyer may agree in writing; or

 

  (b) upon the termination of the Share and Asset Sale Deed.

 

13.2 Further acts

 

Each party will promptly do and perform all further acts and execute and deliver all further documents (in form and content reasonably satisfactory to that party) required by law or reasonably requested by any other party to give effect to the Transaction Agreements.

 

13.3 Notices

 

Any communication under or in connection with the Transaction Agreements:

 

  (a) must be in writing;

 

  (b) must be addressed as shown below:

 

Name:

  

Mayne Group Limited

Address:

  

Level 21, 390 St Kilda Road, Melbourne, Victoria, 3004

Fax no:

  

03 9868 0757

For the attention of:

  

Company Secretary

Name:

  

Australian Newco Holdings Pty Limited

Address:

  

c/- Minter Ellison, 88 Phillip Street, Sydney NSW 2000

Fax no:

  

+61 2 9921 8123

For the attention of:

  

Philip Kapp

 

(or as otherwise notified by that party to the other party from time to time);

 

  (c) must be signed by the party making the communication or (on its behalf) by the solicitor for, or by any attorney, director, secretary, or authorised agent of, that party;

 

50


  (d) must be delivered or posted by prepaid post to the address, or sent by fax to the number, of the addressee, in accordance with clause 13.3(b); and

 

  (e) unless there is evidence to the contrary, will be deemed to be received by the addressee:

 

  (i) (in the case of prepaid post) on the third business day after the date of posting to an address within Australia, and on the fifth business day after the date of posting to an address outside Australia;

 

  (ii) (in the case of fax) at the local time (in the place of receipt of that fax) which then equates to the time at which that fax is sent as shown on the transmission report which is produced by the machine from which that fax is sent and which confirms transmission of that fax in its entirety, unless that local time is a non business day, or is after 5.00 pm on a business day, when that communication will be deemed to be received at 9.00 am on the next business day; and

 

  (iii) (in the case of delivery by hand) on delivery at the address of the addressee as provided in clause 13.3(b), unless that delivery is made on a non business day, or after 5.00 pm on a business day, when that communication will be deemed to be received at 9.00 am on the next business day,

 

and where “business day” means a day which is not a Saturday, Sunday or public holiday in the place of receipt of that communication.

 

13.4 Expenses

 

Except as otherwise provided in the Transaction Agreements, each party will pay its own costs and expenses in connection with the negotiation, preparation, execution, and performance of the Transaction Agreements.

 

13.5 Stamp duties

 

  (a) Subject to clause 13.5(c) the Buyer will:

 

  (i) pay all stamp duties (apart from financial institutions duties or bank account debit taxes which will lie between the parties as they fall) and any related fines and penalties in respect of the Transaction Agreements, the performance of the Transaction Agreements and each transaction effected by or made under or pursuant to the Transaction Agreements (other than in respect of the Divestment Businesses, the Retained Businesses and the Retained Companies);

 

  (ii) pay 50% of all stamp duties and any related fines and penalties in relation to the termination of the Trust (as defined in the relevant Asset Sale Deed) as a consequence of the distribution or sale or transfer of its capital assets; and

 

  (iii) indemnify each other party against any liability arising from the Buyer’s failure to comply with clause 13.5(a)(i).

 

  (b) The Buyer is authorised to make any application for and retain the proceeds of any refund due in respect of any stamp duty paid as contemplated under this clause 13.5.

 

51


  (c) MGL will:

 

  (i) pay all stamp duties and any related fines and penalties in relation to the sell down of the Retained Business and Divestment Businesses;

 

  (ii) pay:

 

  A. all stamp duties and any related fines and penalties in relation to the transfer of the Capital Units (as defined in the relevant Asset Sale Deed) in accordance with any of the Asset Sale Deeds; and

 

  B. 50% of all stamp duties and any related fines and penalties in relation to the termination of the Trust (as defined in the relevant Asset Sale Deed) as a consequence of the distribution or sale or transfer of its capital assets,

 

provided that the Buyer has not done or omitted to do anything which gives rise to such duties, fines and penalties except as required under the Transaction Agreements or by Law; and

 

  (iii) indemnify each other party against any liability arising from MGL’s failure to comply with clause 13.5(c)(i).

 

13.6 Jurisdiction

 

  (a) Each party irrevocably submits to the non-exclusive jurisdiction of the courts of the State, and the courts competent to determine appeals from those courts, with respect to any proceedings which may be brought at any time relating in any way to the Transaction Agreements.

 

  (b) Each party irrevocably waives any objection it may now or in the future have to the venue of any proceedings, and any claim it may now or in the future have that any proceedings have been brought in an inconvenient forum, where that venue falls within paragraph (a) of this clause.

 

13.7 Amendments

 

  (a) This Deed may only be varied by a document signed by or on behalf of each of the parties.

 

13.8 Assignment

 

  (a) Subject to clause 13.8(b), a party cannot assign, novate or otherwise transfer any of its rights or obligations under the Transaction Agreements without the prior written consent of each other party.

 

  (b) The Buyer and each Newco Member (as the case may be) may assign the benefit of any of its rights under the Transaction Agreements to:

 

  (i) Credit Suisse First Boston (Financier) (for itself and as agent/trustee for the Financiers (who agree to underwrite the acquisition facilities and/or to take a participation in them) and any other financier providing working capital and/or revolving credit facilities, in each case, referred to or contemplated by or in connection with the commitment letters (and the Senior Facility and the Bridge Facility referred to therein) from the Financier dated on or about the date of this Deed and any hedge counterparty in relation to any hedging agreement in respect of the finance facilities); or

 

52


  (ii) any person or persons as trustee and agent for the Financier and/or any other funding institution,

 

by way of security for facilities made available to the Buyer for the purposes of the financing or refinancing of the amounts payable under the Transaction Agreements, and the Buyer or any Newco Group Member or the Financier or such trustee or agent may also, in the event of enforcement of such security, assign the benefit of the rights hereunder to any purchaser or assignee from the Financier or such trustee or agent (or any receiver appointed by any of them) who acquires any one or more of the Group (or all or any part of the businesses thereof) provided that such person executes a deed in a form acceptable to MGL to be bound by the terms of the Transaction Agreements.

 

Any purported transfer, assignment, novation or other dealing of an interest in this Agreement in breach of this provision shall be void.

 

13.9 Waiver

 

  (a) Failure to exercise or enforce or a delay in exercising or enforcing or the partial exercise or enforcement of any right, power or remedy provided by law or under the Transaction Agreements by any party will not in any way preclude, or operate as a waiver of, any exercise or enforcement, or further exercise or enforcement of that or any other right, power or remedy provided by law or under the Transaction Agreements.

 

  (b) Any waiver or consent given by any party under the Transaction Agreements will only be effective and binding on that party if it is given or confirmed in writing by that party.

 

  (c) No waiver of a breach of any term of the Transaction Agreements will operate as a waiver of another breach of that term or of a breach of any other term of the Transaction Agreements.

 

13.10  Counterparts

 

Each of the Transaction Agreements may be executed in any number of counterparts and by the parties on separate counterparts. Each counterpart constitutes an original of the Transaction Agreements, all of which together constitute one agreement.

 

13.11  Indemnities

 

  (a) Each indemnity in the Transaction Agreements is a continuing obligation, separate and independent from the other obligations of the parties, and survives termination, completion or expiration of the Transaction Agreements for any reason.

 

  (b) It is not necessary for a party to incur expense or to make any payment before enforcing a right of indemnity conferred by the Transaction Agreements.

 

53


  (c) The parties agree that if any payment under a Warranty or an indemnity in the Transaction Agreements is subject to Tax then such payment (“P”) will be increased in accordance with the following formula:

 

                                P x 1


(1 – Tax rate expressed as a decimal amount)

 

  (d) If any payment under an indemnity in the Transaction Agreements would be assessable to the indemnified party but for Tax offset or other relief available to the indemnified party but not directly related to the payment being made, then the increase referred to in clause 13.11(c) shall be made disregarding the said offset or other relief. For the avoidance of doubt, nothing in this clause 13 limits the indemnities in the Transaction Agreements.

 

13.12 Entire agreement

 

To the extent permitted by law, in relation to the subject matter of the Transaction Agreements, the Transaction Agreements:

 

  (a) embodies the entire understanding of the parties, and constitutes the entire terms agreed on between the parties; and

 

  (b) supersedes any prior written or other agreement between the parties.

 

13.13 Confidentiality and public announcements

 

  (a) Subject to clause 13.13(b) and 13.13(c), each party must keep the terms of the Transaction Agreements, and information of which it has become aware in connection with the Transaction Agreements, confidential provided that the clause will not limit the ability of the Buyer and the Group Members to use such information where it relates to the Hospital Business.

 

  (b) A party may make any disclosure in relation to the terms of the Transaction Agreements:

 

  (i) to any professional adviser, financial adviser, banker, insurance broker, insurer, financier or auditor where that person is obliged to keep the information confidential;

 

  (ii) to the extent necessary to comply with any applicable law, or any requirement of any regulatory body (including any relevant recognised stock exchange);

 

  (iii) to any of its employees or their representatives to whom it is necessary to disclose the information;

 

  (iv) to the extent necessary to obtain the consent of any third party to any term of, or to any act pursuant to, the Transaction Agreements;

 

  (v) to the extent necessary to enforce its rights or to defend any claim or action under the Transaction Agreements;

 

  (vi) to a Related Body Corporate of the party, provided that Related Body Corporate first undertakes to keep the information confidential; or

 

  (vii) where the information has come into the public domain through no fault of that party.

 

  (c) If the Share and Asset Sale Deed is terminated, the Buyer will stop using and return to MGL all information and documents disclosed or provided to it or to any Related Body Corporate of it or to the directors, secretary or professional advisers of the

 

54


Buyer or of any such Related Body Corporate in connection with the sale of the:

 

  (i) Non C&P Hospital Business and the C&P Hospital Business; or

 

  (ii) the relevant C&P Hospital Business, respectively.

 

  (d) Except as required by applicable law or the requirements of any regulatory body (including any relevant stock exchange), all press releases and other public announcements in relation to the Transaction Agreements must be in terms agreed in writing by the parties (such agreement not to be unreasonably withheld or delayed).

 

  (e) MGL and the Buyer agree that on and from Umbrella Completion the Confidentiality Deed as defined in the Share and Asset Sale Deed shall not apply in respect of “Confidential Information”, as defined under the Confidentiality Deed, which substantially relates to the Hospital Business, the Group, the Assets or the Employees but in all other respects, the parties acknowledge that the Confidentiality Deed survives the Transaction Agreements in accordance with its terms.

 

  (f) Where disclosure is required by applicable law or the requirements of any regulatory body (including any recognised stock exchange) which would otherwise be prohibited by the Agreement, the party proposing to make such disclosure must give the other parties as much notice as is reasonably practicable in the circumstances of the proposed disclosure and consult in good faith concerning that disclosure.

 

13.14  Privacy

 

  (a) The Buyer shall, and shall use reasonable efforts to ensure that any of its contractors who have access to Personal Information because of the Transaction Agreements shall be bound by Privacy Laws in respect of all Personal Information disclosed by MGL or otherwise collected by the Buyer pursuant to the Transaction Agreements.

 

  (b) The Buyer acknowledges its legal obligations under the Privacy Laws, and will use reasonable endeavours to procure that its contractors who have access to Personal Information because of the Transaction Agreements acknowledge their legal obligations under the Privacy Laws, in respect of all Personal Information provided by MGL to the Buyer or its contractors pursuant to the Transaction Agreements.

 

  (c) The Buyer undertakes that it will, and will use reasonable endeavours to procure that its contractors who have access to Personal Information because of the Transaction Agreements:

 

  (i) promptly follow any reasonable direction of MGL in relation to Personal Information;

 

  (ii) only use Personal Information for the primary purpose for which the relevant individuals provided that information, or any secondary purpose permitted by the Privacy Laws, and

 

  (iii) ensure that only authorised personnel have access to Personal Information and all relevant personnel are properly trained to meet the requirements of this clause.

 

55


  (d) Where the preceding requirements of this clause require the Buyer to communicate with individuals in respect of Personal Information provided by MGL to the Buyer or its contractors pursuant to the Transaction Agreements, the Buyer shall act in accordance with MGL’s reasonable directions, in respect of such communications.

 

  (e) The Buyer will use reasonable endeavours, on request by MGL, to provide reasonable assistance to MGL in dealing with any enquiries in relation to Personal Information provided by MGL to the Buyer or its contractors pursuant to the Transaction Agreements.

 

13.15  Survival of certain provisions; no merger

 

  (a) Clause 12 will survive rescission or termination of the Transaction Agreements.

 

  (b) If the Transaction Agreements are rescinded or terminated, no party will be liable to any other party except in respect of any breach of the Transaction Agreements occurring before rescission or termination.

 

  (c) No right or obligation of any party (including in respect of any warranty or representation, including any Warranty or in respect of any indemnity) will merge on completion of any transaction under the Transaction Agreements.

 

  (d) All rights and obligations under the Transaction Agreements survive the execution and delivery of any transfer or other document which implements any transaction under the Transaction Agreements.

 

14. Insurance Recovery in relation to medical malpractice

 

14.1 Insurance Recovery

 

  (a) If requested by the Buyer, MGL will and will procure that each Seller Group Member will at all times use their respective best endeavours to pursue all rights title and interests in and to recovery of any Liability that may be payable under any Insurance Policy if MGL or any other Seller Group Member would otherwise be entitled to be indemnified for that Liability by the Buyer or any Buyer Group Member pursuant to any Transaction Agreement (“Insured Buyer Liability”).

 

  (b) If the Buyer requests MGL to seek to recover an Insured Buyer Liability pursuant to clause 14(a):

 

  (i) MGL will, or procure that a Seller Group Member will make a claim under the relevant Insurance Policy;

 

  (ii) the Buyer will:

 

  A. make, and use, its best endeavours to pursue the claim;

 

  B. have responsibility for the conduct of any legal proceedings; and

 

  C. indemnify MGL all Claims, Costs and Liabilities incurred or suffered by MGL or any other Seller Group Member (including legal costs on a full indemnity basis) in the pursuit of any such claim.

 

  (c) MGL will account to the Buyer to the extent to which any recovery is made as a consequence of the pursuit of its right title and interest in and under any Insurance Policy as described above (less any costs of such recovery which have not been reimbursed by the Buyer).

 

56


  (d) Nothing in this clause shall in any way prejudice or derogate from the obligation of Buyer and Buyer Group to make any payment to Mayne or a member of the Seller Group pursuant to the provisions of any Transaction Agreement.

 

  (e) If MGL has paid an Insured Buyer Liability, before the conclusion of a claim under an Insurance Policy in respect of that Liability, the Buyer must immediately upon demand by MGL make a loan to MGL of an amount equal to the Insured Buyer Liability (“Loan”) on the following terms:

 

  (i) the Buyer must advance the Loan within 10 days of receipt of a certificate in writing signed by an officer certifying the amount to be advanced;

 

  (ii) the certificate referred to in paragraph (i) is prima facie evidence of the amount to be lent by the Buyer in accordance with this clause;

 

  (iii) the Buyer will not be entitled to charge MGL any interest or costs in respect of the Loan; and

 

  (iv) MGL will repay the Loan in accordance with clause 14(g).

 

  (f) The Buyer or relevant Buyer Group Member will be liable to pay MGL the amount of the Insured Buyer Liability under the relevant indemnity:

 

  (i) less any amount actually recovered by MGL or any other Seller Group Member in respect of that Liability from its insurer;

 

  (ii) plus the Seller Group Member’s reasonable costs (including legal costs on a full indemnity basis) of making and pursuing the claim to the extent that those costs have not already been paid by the Buyer Group Member,

 

which must be paid either:

 

  (iii) if no applicable Loan exists, in immediately available funds; or

 

  (iv) if an applicable Loan exists:

 

  A. by way of set off against all or any part of an applicable Loan (with any remaining amount of Loan after such set off to be repaid); and

 

  B. if any amount of the Insured Buyer Liability would remain payable under the relevant indemnity following the set-off in paragraph (A), that remaining amount in immediately available funds.

 

For the purposes of this clause 14:

 

“Insurance Policy” means a policy in effect on or before 30 June 2002 insuring the interests of MGL or any Seller Group Member arranged with an insurer which is not a Seller Group Member nor Transport Security Insurance Pte Limited (“TSI”) except to the extent that TSI is entitled to and does in fact recover from a reinsurer in respect of the particular claim.

 

57


Executed as a deed.

    
Executed for and on behalf of Mayne Group Limited ABN 56 004 073 410 by its Attorneys under Power of Attorney dated 30 January 2002 each of whom declares that he or she holds the office in Mayne Group Limited indicated under his or her signature and that he or she has no notice of revocation of the Power of Attorney   

Mayne Group Limited

ABN 56 004 073 410 by

its Attorneys:

    

/s/ Stuart Bruce James


    

Signature of Attorney

    

Stuart Bruce James


    

Name of Attorney in full

    

Director


    

Office

    

/s/ Paul Andrew Binfield


    

Signature of Attorney

    

Paul Andrew Binfield


    

Name of Attorney in full

    

Chief Financial Officer


    

Office

Executed by Mayne Healthcare Holdings

Pty Limited ACN 078 954 631 by or in the presence of:

    

/s/ Stuart Bruce James


  

/s/ Paul Andrew Binfield


Signature of Director

  

Signature of Secretary/other Director

Stuart Bruce James


  

Paul Andrew Binfield


Name of Director in full

  

Name of Secretary/other Director in full

 


     
Signed sealed and delivered for and on behalf of Australian Newco Holdings Pty Limited ACN 106 722 347 by its Attorney under a Power of Attorney dated 20 October 2003, and the Attorney declares that the Attorney has not received any notice of the revocation of such Power of Attorney, in the presence of:  

/s/ Philip Kapp


 

Signature of Attorney

     

/s/ Jonathan Algor


 

Philip Kapp


Signature of Witness

 

Name of Attorney in full

Jonathan Algor


   

Name of Witness in full

   
Signed sealed and delivered for and on behalf of Joondalup Hospital Pty Limited ACN 106 723 193 by its Attorney under a Power of Attorney dated 20 October 2003, and the Attorney declares that the Attorney has not received any notice of the revocation of such Power of Attorney, in the presence of:  

/s/ Philip Kapp


 

Signature of Attorney

     

/s/ Jonathan Algor


 

Philip Kapp


Signature of Witness

 

Name of Attorney in full

Jonathan Algor


   

Name of Witness in full

   

 


Signed sealed and delivered for and on behalf of Caboolture Hospital Pty Limited ACN 106 723 219 by its Attorney under a Power of Attorney dated 20 October 2003, and the Attorney declares that the Attorney has not received any notice of the revocation of such Power of Attorney, in the presence of:  

/s/ Philip Kapp


 

Signature of Attorney

/s/ Jonathan Algor


 

Philip Kapp


Signature of Witness

 

Name of Attorney in full

Jonathan Algor


   

Name of Witness in full

   
Signed sealed and delivered for and on behalf of Frances Perry Hospital Pty Limited ACN 106 723 228 by its Attorney under a Power of Attorney dated 20 October 2003, and the Attorney declares that the Attorney has not received any notice of the revocation of such Power of Attorney, in the presence of:  

/s/ Philip Kapp


 

Signature of Attorney

/s/ Jonathan Algor


 

Philip Kapp


Signature of Witness

 

Name of Attorney in full

Jonathan Algor


   

Name of Witness in full

   


Signed sealed and delivered for and on behalf of Port Macquarie Hospital Pty Limited ACN 106 723 399 by its Attorney under a Power of Attorney dated 20 October 2003, and the Attorney declares that the Attorney has not received any notice of the revocation of such Power of Attorney, in the presence of:  

/s/ Philip Kapp


 

Signature of Attorney

/s/ Jonathan Algor


 

Philip Kapp


Signature of Witness

 

Name of Attorney in full

Jonathan Algor


   

Name of Witness in full

   
Signed sealed and delivered for and on behalf of Logan Hospital Pty Limited ACN 106 723 406 by its Attorney under a Power of Attorney dated 20 October 2003, and the Attorney declares that the Attorney has not received any notice of the revocation of such Power of Attorney, in the presence of:  

/s/ Philip Kapp


 

Signature of Attorney

/s/ Jonathan Algor


 

Philip Kapp


Signature of Witness

 

Name of Attorney in full

Jonathan Algor


   

Name of Witness in full

   


Signed for and on behalf of Melbourne Hospital Pty Limited ACN 106 723 415 by its Attorney under a Power of Attorney dated 20 October 2003, and the Attorney declares that the Attorney has not received any notice of the revocation of such Power of Attorney, in the presence of:   

/s/ Philip Kapp


  

Signature of Attorney

 

/s/ Jonathan Algar


  

Philip Kapp


Signature of Witness

  

Name of Attorney in full

Jonathan Algar


    

Name of Witness in full

    
Signed sealed and delivered for and on behalf of Noosa Privatised Hospital Pty Limited ACN 106 723 380 by its Attorney under a Power of Attorney dated 20 October 2003 , and the Attorney declares that the Attorney has not received any notice of the revocation of such Power of Attorney, in the presence of:   

/s/ Philip Kapp


  

Signature of Attorney

 

/s/ Jonathan Algar


  

Philip Kapp


Signature of Witness

  

Name of Attorney in full

Jonathan Algar


    

Name of Witness in full

    


     
Signed sealed and delivered for and on behalf of Armidale Hospital Pty Limited ACN 106 723 200 by its Attorney under a Power of Attorney dated 20 October 2003, and the Attorney declares that the Attorney has not received any notice of the revocation of such Power of Attorney, in the presence of:  

/s/ Philip Kapp


 

Signature of Attorney

     

/s/ Jonathan Algar


 

Philip Kapp


Signature of Witness

 

Name of Attorney in full

Jonathan Algar


   

Name of Witness in full

   
Signed sealed and delivered for and on behalf of P.O.W. Hospital Pty Limited ACN 106 723 871 by its Attorney under a Power of Attorney dated 20 October 2003, and the Attorney declares that the Attorney has not received any notice of the revocation of such Power of Attorney, in the presence of:  

/s/ Philip Kapp


 

Signature of Attorney

     

/s/ Jonathan Algar


 

Philip Kapp


Signature of Witness

 

Name of Attorney in full

Jonathan Algar


   

Name of Witness in full

   

 

 


Schedule 1 Last Accounts

 

Part A - Balance Sheet

 

Attached


MAYNE HEALTH HOSPITALS

AGGREGATED ACCOUNTS - PRO FORMA BALANCE SHEET AS AT 30 JUNE 2003

LAST ACCOUNTS (Version 15/10/2003)

 

REGION


  AUSTRALIAN HOSPITALS BUSINESS

 

LEGAL CONTRACT GROUP


  NON C&P HOSPITALS BUSINESS

    C&P HOSPITALS BUSINESS

 

HOSPITALS


      Various

    Various

    TOTAL
ENTITIES


    Shared
Services


    TOTAL
NON C&P
HOSPITALS
BUSINESS


   

Frances

Perry House


    Melbourne
Private


    Armidale
Private


 
                 
                 
        A

    B

    C = A + B

    D

    E = D + C

    F

    G

    H

 
        [1]

    [2]

          [3]

                         
    Petty Cash   0.0     0.0     0.0     0.0     0.0     [* ]   [* ]   [* ]

[4]

  Trade Debtors   19.6     122.9     142.5     0.1     142.5     [* ]   [* ]   [* ]
    Provision for Doubtful Debts   (0.1 )   (8.8 )   (8.8 )   0.0     (8.8 )   [* ]   [* ]   [* ]

[5]

  Stock On Hand   4.3     20.1     24.4     0.0     24.4     [* ]   [* ]   [* ]

[6]

  Other Current Receivables   0.7     8.3     9.1     0.0     9.1     [* ]   [* ]   [* ]
    Prepayments   0.2     3.0     3.3     1.0     4.2     [* ]   [* ]   [* ]
       

 

 

 

 

 

 

 

   

Total Current Trading Assets

  24.9     145.6     170.4     1.1     171.5     [* ]   [* ]   [* ]

[7]

 

Land & Building @ Cost/Valuation

  119.9     578.3     698.7     0.0     698.7     [* ]   [* ]   [* ]
   

Accumulated Depreciation of L&B

  (4.5 )   (27.9 )   (32.4 )   0.0     (32.4 )   [* ]   [* ]   [* ]

[8]

  Plant & Equipment @ Cost   58.6     178.5     237.1     36.7     273.8     [* ]   [* ]   [* ]
   

Accumulated Depreciation of P&E

  (38.4 )   (127.4 )   (165.8 )   (19.9 )   (185.7 )   [* ]   [* ]   [* ]
    Impairment Provision   (9.4 )   (33.3 )   (42.8 )   (144.9 )   (187.7 )   [* ]   [* ]   [* ]

[9]

  Assets Under Construction   1.2     15.6     16.8     2.6     19.4     [* ]   [* ]   [* ]

[9]

  Asset Clearing Accounts   (0.0 )   0.4     0.4     2.5     2.9     [* ]   [* ]   [* ]
       

 

 

 

 

 

 

 

   

Total Property Plant & Equipment

  127.4     584.6     712.1     (123.1 )   589.0     [* ]   [* ]   [* ]
    Investments @ Cost/Valuation   0.0     2.4     2.4     0.0     2.4     [* ]   [* ]   [* ]
    Goodwill   0.0     0.0     0.0     0.0     0.0     [* ]   [* ]   [* ]

[10]

  Future Income Tax Benefit   0.0     0.0     0.0     0.0     0.0     [* ]   [* ]   [* ]
    Licences   0.0     0.0     0.0     0.0     0.0     [* ]   [* ]   [* ]
   

Other Non Current Receivables

  0.7     0.0     0.8     0.0     0.8     [* ]   [* ]   [* ]
       

 

 

 

 

 

 

 

   

Total Other Non Current Assets

  0.8     2.4     3.2     0.0     3.2     [* ]   [* ]   [* ]
       

 

 

 

 

 

 

 

   

Total Non Current Trading Assets

  128.2     587.0     715.2     (123.1 )   592.2     [* ]   [* ]   [* ]
       

 

 

 

 

 

 

 

    TOTAL TRADING ASSETS   153.0     732.6     885.6     (122.0 )   763.7     [* ]   [* ]   [* ]
       

 

 

 

 

 

 

 

    Trade Creditors   (5.4 )   (26.2 )   (31.6 )   0.0     (31.6 )   [* ]   [* ]   [* ]
    Accrued Creditors   (1.7 )   (9.4 )   (11.1 )   (0.1 )   (11.2 )   [* ]   [* ]   [* ]

[11]

  Other Accrued Liabilities   (3.2 )   (32.7 )   (35.8 )   (0.6 )   (36.4 )   [* ]   [* ]   [* ]
    Provision for Med Mal   0.0     (8.6 )   (8.6 )   0.0     (8.6 )   [* ]   [* ]   [* ]
   

Provision for Workers Compensation

  0.5     (7.8 )   (7.3 )   (4.0 )   (11.3 )   [* ]   [* ]   [* ]
    Employee Entitlements                                 [* ]   [* ]   [* ]

[12]

 

•       Annual Leave

  (5.2 )   (25.1 )   (30.3 )   (2.0 )   (32.3 )   [* ]   [* ]   [* ]
   

•       Long Service Leave

  (2.5 )   (18.3 )   (20.9 )   0.0     (20.9 )   [* ]   [* ]   [* ]
   

•       RDO’s

  (0.4 )   (0.9 )   (1.3 )   0.0     (1.3 )   [* ]   [* ]   [* ]

[10]

  Provision for Income Tax   0.0     0.0     0.0     0.0     0.0     [* ]   [* ]   [* ]
       

 

 

 

 

 

 

 

   

Total Current Trading Liabilities

  (17.9 )   (129.1 )   (146.9 )   (6.7 )   (153.6 )   [* ]   [* ]   [* ]
    Employee Entitlements                                                
   

•       Long Service Leave

  (0.8 )   (8.3 )   (9.1 )   0.0     (9.1 )   [* ]   [* ]   [* ]
   

Provision for Deferred Income Tax

  0.0     (0.0 )   0.0     0.0     0.0     [* ]   [* ]   [* ]
    Other Non Current Liabilities   0.0     (2.8 )   (2.8 )   (0.3 )   (3.0 )   [* ]   [* ]   [* ]
       

 

 

 

 

 

 

 

   

Total Non Current Liabilities

  (0.8 )   (11.1 )   (11.9 )   (0.3 )   (12.2 )   [* ]   [* ]   [* ]
       

 

 

 

 

 

 

 

   

TOTAL TRADING LIABILITIES

  (18.7 )   (140.2 )   (158.9 )   (7.0 )   (165.0 )   [* ]   [* ]   [* ]
       

 

 

 

 

 

 

 

[a]

  NET TRADING ASSETS   134.4     592.4     726.8     (129.0 )   597.8     [* ]   [* ]   [* ]
       

 

 

 

 

 

 

 

[13]

  Intercompany Funding   32.6     (435.4 )   (402.8 )   0.0     (402.8 )   [* ]   [* ]   [* ]
       

 

 

 

 

 

 

 

[b]

  BORROWING/ FUNDING   32.6     (435.4 )   (402.8 )   0.0     (402.8 )   [* ]   [* ]   [* ]
       

 

 

 

 

 

 

 

[a] + [b] = [c]

  NET ASSETS   167.0     157.1     324.0     (129.0 )   195.1     [* ]   [* ]   [* ]
       

 

 

 

 

 

 

 

    Share Capital   (95.9 )   (323.7 )   (419.7 )                              
    Reserves   (57.7 )   49.3     (8.4 )                              
    Retained Earnings   (13.3 )   117.4     104.0                                
       

 

 

                             

Must = [c]

  SHAREHOLDERS FUNDS   (167.0 )   (157.1 )   (324.0 )                              
       

 

 

                             
    CHECK   0.0     (0.0 )   0.0                                

 

REGION


  AUSTRALIAN HOSPITALS BUSINESS

 

LEGAL CONTRACT GROUP


  C&P HOSPITALS BUSINESS

       

HOSPITALS


      Port
Macquarie
Base


    Prince of
Wales
Private


    Caboolture
Private


    Logan
Private


    Noosa
Hospital


    Joondalop
Health
Campers


   

TOTAL

C & P

HOSPITALS

BUSINESS


    TOTAL
AUSTRALIAN
HOSPITALS
BUSINESS


 
                 
                 
        I

    J

    K

    L

    M

    N

    Q = F to P

    S = E + Q + R

 
                                                     
    Petty Cash   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   0.1  

[4]

  Trade Debtors   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   184.6  
    Provision for Doubtful Debts   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   (9.2 )

[5]

  Stock On Hand   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   30.5  

[6]

  Other Current Receivables   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   14.6  
    Prepayments   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   6.4  
       

 

 

 

 

 

 

 

   

Total Current Trading Assets

 

[

*]

 

[

*]

 

[

*]

 

[

*]

 

[

*]

 

[

*]

 

[

*]

  226.9  

[7]

 

Land & Building @ Cost/Valuation

  [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   770.7  
   

Accumulated Depreciation of L&B

  [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   (43.1 )

[8]

  Plant & Equipment @ Cost                                             318.7  
   

Accumulated Depreciation of P&E

  [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   (215.9 )
    Impairment Provision   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   (210.2 )

[9]

  Assets Under Construction   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   20.6  

[9]

  Asset Clearing Accounts   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   2.8  
       

 

 

 

 

 

 

 

   

Total Property Plant & Equipment

  [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   643.6  
    Investments @ Cost/Valuation   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   2.4  
    Goodwill   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   0.0  

[10]

  Future Income Tax Benefit   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   0.0  
    Licences   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   1.3  
   

Other Non Current Receivables

  [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   0.8  
       

 

 

 

 

 

 

 

   

Total Other Non Current Assets

  [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   4.5  
       

 

 

 

 

 

 

 

   

Total Non Current Trading Assets

  [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   648.1  
       

 

 

 

 

 

 

 

    TOTAL TRADING ASSETS   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   875.0  
       

 

 

 

 

 

 

 

    Trade Creditors   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   (37.8 )
    Accrued Creditors   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   (16.4 )

[11]

  Other Accrued Liabilities   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   (52.5 )
    Provision for Med Mal   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   (8.6 )
   

Provision for Workers Compensation

  [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   (11.7 )
    Employee Entitlements   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]      

[12]

 

•       Annual Leave

  [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   (42.3 )
   

•       Long Service Leave

  [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   (24.7 )
   

•       RDO’s

  [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   (1.7 )

[10]

  Provision for Income Tax   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   0.0  
       

 

 

 

 

 

 

 

   

Total Current Trading Liabilities

  [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   (195.6 )
    Employee Entitlements   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]      
   

•       Long Service Leave

  [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   (11.6 )
   

Provision for Deferred Income Tax

  [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   0.0  
    Other Non Current Liabilities   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   (3.0 )
       

 

 

 

 

 

 

 

   

Total Non Current Liabilities

  [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   (14.6 )
       

 

 

 

 

 

 

 

   

TOTAL TRADING LIABILITIES

  [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   (210.2 )
       

 

 

 

 

 

 

 

[a]

  NET TRADING ASSETS   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   664.8  
       

 

 

 

 

 

 

 

[13]

  Intercompany Funding   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   (402.8 )
       

 

 

 

 

 

 

 

[b]

  BORROWING/ FUNDING   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   (402.8 )
       

 

 

 

 

 

 

 

[a] + [b] = [c]

  NET ASSETS   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   [ *]   262.0  
       

 

 

 

 

 

 

 

    Share Capital                                                
    Reserves                                                
    Retained Earnings                                                
                                                     

Must = [c]

  SHAREHOLDERS FUNDS                                                
                                                     
    CHECK                                                

* Certain confidential portions of these exhibits have been omitted pursuant to a request for confidential treatment and filed separately with the Commission.

 

Notes to Last Accounts

[1] Excludes the following legal entities which are excluded from the sale agreement.
  Larches Pty Ltd and Subsidiaries
  AME Medical Services Pty Ltd
  Jandale Pty Ltd and Subsidiaries
  St George Private Hospital Nuclear Medicine Pty Ltd.
[2] Includes all subsidiaries of HCoA Hospital Holdings (Australia) Pty Ltd.
[3] Represents extract from Mayne Group Limited balance sheet (ie. Asset sale rather than legal entity sale)
[4] Includes trade receivables, accrued revenue, intercompany trade receivables.
[5] Includes all stocks on hand (consumable medical supplies, food, linen, stationary etc.)
[6] Includes all other receivables items (proceeds from sale of PP&E, GST Clearing, Other Miscellaneous Receivables)

 

69


MAYNE HEALTH HOSPITALS

AGGREGATED ACCOUNTS - PRO FORMA BALANCE SHEET AS AT 30 JUNE 2003

LAST ACCOUNTS (Version 15/10/2003)

 

REGION


   AUSTRALIAN HOSPITALS BUSINESS

LEGAL CONTRACT GROUP


   NON C&P HOSPITALS BUSINESS

HOSPITALS


        Various

   Various

   TOTAL
ENTITIES


   Shared
Services


   TOTAL NON
C&P
HOSPITALS
BUSINESS


          A

   B

   C = A + B

   D

   E = D + C

          [1]

   [2]

        [3]

    

 

REGION


   AUSTRALIAN HOSPITALS BUSINESS

LEGAL CONTRACT GROUP


   C&P HOSPITALS BUSINESS

    

HOSPITALS


       

Frances

Perry House


   Melbourne
Private


   Armidale
Private


   Port
Macquarie
Base


   Prince of Wales
Private


   Caboolture
Private


   Logan
Private


   Noosa
Hospital


   Joondalup
Health
Campus


   TOTAL C&P
HOSPITALS
BUSINESS


  

TOTAL
AUSTRALIAN

HOSPITALS
BUSINESS


          F

   G

   H

   I

   J

   K

   L

   M

   N

   Q = F to P

   S = E + Q + R

                                                             
[7] Includes Leasehold Improvements, Plant Integral to Buildings, Commissioning Costs and Capitalised Interest.
[8] Plant & Equipment category includes Computer Software.
[9] For purposes of Completion Accounts, Asset Clearing and Assets Under Construction will be fully allocated out of Corporate balance sheet into individual hospitals.
[10] Last Accounts have been prepared on the assumption Mayne Group Ltd elects to adopt Tax Consolidation.

Tax Balances (FITB, PDIT, PIT) are reflected as Nil values in Last Accounts. Deferred Tax Balances that transfer to purchaser on acquisition will be reflected in Adjusted Net Trading Assets Statement.

[11] Includes salary and wage related accruals, property related accruals, and all other miscellaneous accruals/provisions.
[12] Includes leave loading, extra leave, and public holiday leave where applicable as recorded through the SAP payroll system in line with financial policy.
[13] Represents intercompany funding accounts between AME & HCoA Group (entities being sold), MGL Group (Entities being retained by MGL) and the Capital Account Interest Free with MGL

Last Accounts for C&P’s and Shared Services (ie. non-legal entity sales) will not reflect intercompany balances. Any notional intercompany balance will be within MGL and does not impact the transaction.

Where the C&P or Shared Service notional intercompany balance is within AME or HCoA, the balance is already reflected in AME and HCoA Last Accounts.

 

Other   Non Current Assets will not be revalued between Last Accounts and Completion Accounts


Part B - Profit and Loss

 

Attached


MAYNE HOSPITALS

PROFIT AND LOSS ANALYSIS AND RECONCILIATION

 

        FINAL JUNE 2003

 

BREAKDOWN


  State

  Patient
Revenue


    Prosthesis
Margin


    Other
Revenue


  Total
Revenue


    Labour

  Supply

  Professional
Service


  Contracted
Services


  Laundry

  Repairs
&
Maint


 

HOSPITAL OPERATIONS

                                                   

      1  Armidale

  NSW   [*]     [*]     [*]   [*]     [*]   [*]   [*]   [*]   [*]   [*]  

      2  Castlecrag

  NSW   [*]     [*]     [*]   [*]     [*]   [*]   [*]   [*]   [*]   [*]  

      3  Christo Rd

  NSW   [*]     [*]     [*]   [*]     [*]   [*]   [*]   [*]   [*]   [*]  

      4  Kareena

  NSW   [*]     [*]     [*]   [*]     [*]   [*]   [*]   [*]   [*]   [*]  

      5  Lady Davidson

  NSW   [*]     [*]     [*]   [*]     [*]   [*]   [*]   [*]   [*]   [*]  

      6  Lingard

  NSW   [*]     [*]     [*]   [*]     [*]   [*]   [*]   [*]   [*]   [*]  

      7  Macarthur

  NSW   [*]     [*]     [*]   [*]     [*]   [*]   [*]   [*]   [*]   [*]  

      8  Nepean

  NSW   [*]     [*]     [*]   [*]     [*]   [*]   [*]   [*]   [*]   [*]  

      9  Nowra

  NSW   [*]     [*]     [*]   [*]     [*]   [*]   [*]   [*]   [*]   [*]  

    10  North Gosford

  NSW   [*]     [*]     [*]   [*]     [*]   [*]   [*]   [*]   [*]   [*]  

    11  Orange

  NSW   [*]     [*]     [*]   [*]     [*]   [*]   [*]   [*]   [*]   [*]  

    12  PMBH

  NSW   [*]     [*]     [*]   [*]     [*]   [*]   [*]   [*]   [*]   [*]  

    13  Port Private

  NSW   [*]     [*]     [*]   [*]     [*]   [*]   [*]   [*]   [*]   [*]  

    14  Prince of Wales

  NSW   [*]     [*]     [*]   [*]     [*]   [*]   [*]   [*]   [*]   [*]  

    15  St George

  NSW   [*]     [*]     [*]   [*]     [*]   [*]   [*]   [*]   [*]   [*]  

    16  Strathfield

  NSW   [*]     [*]     [*]   [*]     [*]   [*]   [*]   [*]   [*]   [*]  

    17  The Hills

  NSW   [*]     [*]     [*]   [*]     [*]   [*]   [*]   [*]   [*]   [*]  

    18  Warners Bay

  NSW   [*]     [*]     [*]   [*]     [*]   [*]   [*]   [*]   [*]   [*]  
       

 

 
 

 
 
 
 
 
 

    18  TOTAL NSW

      393,931     2,058     6,045   402,034     224,660   71,497   2,243   4,484   7,254   11,360  
       

 

 
 

 
 
 
 
 
 

      1  Belmont

  QLD   [*]     [*]     [*]   [*]     [*]   [*]   [*]   [*]   [*]   [*]  

      2  Caboolture

  QLD   [*]     [*]     [*]   [*]     [*]   [*]   [*]   [*]   [*]   [*]  

      3  Caloundra

  QLD   [*]     [*]     [*]   [*]     [*]   [*]   [*]   [*]   [*]   [*]  

      4  Hillcrest

  QLD   [*]     [*]     [*]   [*]     [*]   [*]   [*]   [*]   [*]   [*]  

      5  John Flynn

  QLD   [*]     [*]     [*]   [*]     [*]   [*]   [*]   [*]   [*]   [*]  

      6  Logan

  QLD   [*]     [*]     [*]   [*]     [*]   [*]