Exhibit 10.1
Dated 9 December
2005
(1) T&N
LIMITED
(IN ADMINISTRATION AND A DEBTOR
IN POSSESSION UNDER CHAPTER 11 OF THE US
BANKRUPTCY CODE)
and
(2) THE
ADMINISTRATORS
and
(3) FEDERAL-MOGUL (CONTINENTAL
EUROPEAN
OPERATIONS)
LIMITED
and
(4) FEDERAL-MOGUL
CORPORATION
(A DEBTOR IN POSSESSION UNDER
CHAPTER 11 OF THE US BANKRUPTCY CODE)
NOTE SALE
AGREEMENT
S IDLEY A USTIN B ROWN & W OOD
W OOLGATE E XCHANGE
25 B ASINGHALL S TREET
LONDON EC2V 5HA
TELEPHONE 020 7360 3600
FACSIMILE 020 7626 7937
R EF
: PAA/21202-30310
TABLE OF CONTENTS
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1.
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Definitions and References
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3
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2.
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Sale and Purchase of the Notes and
Substitution
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6
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3.
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Payment of Purchase Price
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7
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4.
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Pre-Closing Matters
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8
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5.
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Closing Matters
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10
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6.
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Representations and Warranties of T&N and
the Administrators
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11
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7.
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Representation and Warranty of FMC and the GI
Purchaser
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12
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8.
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Exclusion of Liability and Indemnity
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12
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9.
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Information and Further Assurance
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13
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10.
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Costs and Payments
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14
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11.
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Entire Agreement
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14
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12.
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Notices
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14
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13.
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Binding Effect
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14
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14.
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Execution in Counterparts and Fax
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15
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15.
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Third Party Rights
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15
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16.
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Governing Law
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15
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SCHEDULE 1 The Notes
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16
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SCHEDULE 2 Notice
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17
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SCHEDULE 3 Contact Details
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18
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SCHEDULE 4 Specified Encumbrances
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THIS SALE AGREEMENT is made on 9 December 2005
BETWEEN:
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(1)
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T&N
LIMITED (IN
ADMINISTRATION AND AS A DEBTOR IN POSSESSION UNDER CHAPTER 11 OF
THE US BANKRUPTCY CODE) ( “T&N” ), a company
incorporated in England and Wales with registration number 00163992
and having its registered office at Styal Road, Manchester M22 5TN,
acting by its joint administrators, James J Gleave, Simon V
Freakley and Gary P Squires of Kroll Limited, The Observatory,
Chapel Walks, Manchester, M2 1HL (the
“Administrators” );
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(3)
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FEDERAL-MOGUL (CONTINENTAL EUROPEAN OPERATIONS)
LIMITED (the
“GI Purchaser” ) a company incorporated in
England and Wales with registration number 05642166, having its
registered office at Woolgate Exchange, Basinghall Street, London
EC2V 5HA; and
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(4)
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FEDERAL-MOGUL CORPORATION
(AS A DEBTOR IN POSSESSION UNDER
CHAPTER 11 OF THE US BANKRUPTCY CODE) ( “FMC” ),
a corporation incorporated under the laws of Michigan and having
its world headquarters in Southfield, Michigan, USA,
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(each a “Party”
and together the “Parties” ).
Recitals
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(A)
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The
Administrators were appointed joint administrators of T&N by
order of the High Court of Justice of England and Wales made on
1 October 2001. On the same day, T&N, together with FMC
and other subsidiaries of FMC, filed a petition for relief under
Chapter 11 of Title 11 of the United States Bankruptcy
Code.
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(B)
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On
26 September 2005, T&N, the Administrators, FMC, the Plan
Proponents and the Pension Protection Fund entered into an
agreement to resolve all the outstanding claims and issues between
them or to provide a framework for such resolution (the
“Settlement Agreement” ). As part of that
comprehensive resolution, under the terms of the Settlement
Agreement, FMC (or its designee) was entitled (if it so chose) to
make an offer to acquire the Notes from T&N (referred to as a
‘Top Up Offer’).
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(C)
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FMC and the GI
Purchaser made a Top Up Offer to the Administrators on
7 December 2005, which was accepted by the Administrators on
the date hereof.
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NOW THEREFORE, in consideration of the mutual agreements
contained herein, the Parties hereto agree as follows:
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1.
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Definitions
and References
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3
In this Agreement:
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(a)
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terms used
herein and not otherwise defined herein shall have the meanings set
forth in the Settlement Agreement.
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(b)
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the following
terms shall have the following meanings:
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“Administrators’
(FMC) Account” mean
the account at The Royal Bank of Scotland plc, account number
00771185, sort code 16-23-37 held in the name of “JJ Gleave,
SV Freakley and GP Squires Joint Administrators of the T&N
Group of Companies No.2 Account”;
“Administrators’ (GI)
Account” means the
account at The Royal Bank of Scotland plc, account number 00771096,
sort code 16-23-37 held in the name of “JJ Gleave, SV
Freakley and GP Squires Joint Administrators of the T&N Group
of Companies”;
“Closing
Date” means the day
determined in accordance with Section 5.1;
“Deutsche
Agreements” means
the Agreements dated 22 June 2005, 3 August 2005,
9 November 2005 and 8 December 2005, each entered into
between T&N, the Administrators and Deutsche Bank;
“Encumbrance”
means any mortgage, charge (fixed or
floating), pledge, lien, hypothecation, trust, right of set-off or
any third party right or interest (legal or equitable) including
any right of pre-emption, assignment by way of security,
reservation of title, or any other security interest of any kind
howsoever created or arising or any other agreement or arrangement
(including a sale and purchase agreement) having similar effect
including the Specified Encumbrances;
“Excluded
Claims” means all
right, entitlement and interest in or to the Next Interest
Payments;
“ FMC
Deposit” has the meaning given to it by
Section 3.2;
“French Purchase
Price” means the
proportion of the Purchase Price attributable to the French Loan
Notes, namely: 5%;
“German and Italian
Purchase Price” means the proportion of the Purchase Price
attributable to the German Notes and the Italian Note, namely:
95%;
“GI
Deposit” has the
meaning given to it by Section 3.3;
“Guarantee/LC”
has the meaning given it by
Section 3.4;
“Guarantee/LC
Interest” means, in
respect of the amount of a Guarantee/LC or of the amount drawn or
to be drawn thereunder, a sum equal to interest on such amount at
the rate of 4.5% (four and one half per cent) per annum for a
period of three English business days;
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“Next Interest
Payments” means the
interest payments due from the Obligors under the Notes on
31 December 2005, being the sums of €28,752,805.69 in
the case of the German Obligor, €17,063,823.63 in the case of
the French Obligor and €8,528,359.64 in the case of the
Italian Obligor.
“Notes”
means the notes, details of which
are set out in Schedule 1 to this Agreement and the
“French Notes” means the notes set out in Part I
of that Schedule, the “German Notes” means the
notes set out in Part II of that Schedule and the “Italian
Note” means the note set out in Part III of that
Schedule;
“Obligors”
means, in relation to each of the
Notes, the obligor indicated against each Note in Schedule 1 to
this Agreement and “French Obligor”, “German
Obligor” or “Italian Obligor” means
the obligor entities listed in Parts I, II and III respectively of
that Schedule;
“Person”
shall be construed as a reference to
any person, firm, company, corporation, limited liability
partnership, partnership or unincorporated body of person, wherever
established;
“Purchase
Price” means, on
any day, the price payable by FMC or its designee to the
Administrators under Clause 6 of the Settlement Agreement (which,
for the avoidance of doubt, shall be calculated at the opening of
banking business on that day);
“Specified
Encumbrances” means
those charges and security interests in respect of the Notes in
favour of T&N International Limited and AE International
Limited and FMC, the particulars of which are registered at the
Companies Registry in the file of documents maintained there and
which are listed in Schedule 4 hereto;
In this Agreement:
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(a)
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references to
any of the Parties include their respective assignees, transferees
and successors in title.
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(b)
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headings to
Sections, sub-sections and paragraphs are for information only and
shall not form part of the operative provisions of this
Agreement.
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(c)
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references to
Sections or Schedules are to sections of and schedules to this
Agreement.
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(d)
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references in this Agreement to
any agreement, deed or document (including, references to this
Agreement) shall be deemed to include references to such agreement,
deed or document as varied, amended, modified, novated,
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5
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supplemented or replaced by any
other documents, deeds, instruments or agreements from time to
time.
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2.
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Sale and
Purchase of the Notes
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2.1
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With effect
from the Closing Date, or, if any part of the Purchase Price is to
be paid under the Guarantee/LC, such later date (the “LC
Receipt Date”) on which all amounts demanded under the
Guarantee/LC are received by the Administrators, T&N
irrevocably and unconditionally and free of the Specified
Encumbrances (other than those in favour of FMC) sells the French
Notes (together with all rights and claims, other than (subject to
Section 2.3) the Excluded Claims, of T&N in relation to
the French Notes) to FMC for the French Purchase Price together
with the right (other than (subject to Section 2.3) in
relation to the Excluded Claims) to receive all payments, if any,
made under the French Notes referable to the period commencing on
1 January 2006.
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2.2
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With effect
from the Closing Date, or, if later, the LC Receipt Date, T&N
irrevocably and unconditionally and free of the Specified
Encumbrances (other than those in favour of FMC) sells (and in the
case of the Italian Note also assigns the credit of) the German
Notes and the Italian Note (together with all rights and claims,
other than (subject to Section 2.3) the Excluded Claims, of
T&N in relation to the German Notes and the Italian Note) to
the GI Purchaser for the German and Italian Purchase Price together
with the right (other than (subject to Section 2.3) in
relation to the Excluded Claims) to receive all payments, if any,
made under the German Notes and the Italian Note referable to the
period commencing on 1 January 2006.
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2.3
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If the Closing
Date occurs before 31 December 2005, the sale and assignment
of each of the Notes shall include, free of the Specified
Encumbrances (other than those in favour of FMC), all rights and
claims to receive the relevant Next Interest Payments in respect of
such Notes.
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2.4
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If under the
laws of any jurisdiction any Obligor is required to make a
deduction or withholding from or on account of the tax from any
Next Interest Payment and T&N obtains, utilises and retains any
credit against, relief or remission for, or repayment of, any tax,
then T&N shall pay an amount to FMC to the extent that the
relevant deduction or withholding relates to the French Notes or
the GI Purchaser to the extent that the relevant deduction or
withholding relates to the German Notes or the Italian Note which
leaves T&N (after that payment) in the same after-tax position
as it would have been in had no deduction or withholding been
required to be made.
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2.5
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For the
avoidance of doubt references in this Agreement to the
“German and Italian Purchase Price” or the
“French Purchase Price” shall mean the German and
Italian Purchase Price or the French Purchase Price as the same may
have been adjusted following an adjustment to the Purchase Price in
accordance with Section 4.4 below.
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2.6
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If at any time
prior to the Closing Date, FMC or the GI Purchaser receives any
amount on account of any Next Interest Payment, it shall account
for the amount so received to T&N within 3 English business
days of receipt and pending such accounting shall hold such amount
on trust for T&N.
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2.7
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If at any time
either prior to or following the Closing Date T&N receives or
the Administrators receive any amount on account of the Notes
(other than a Next Interest Payment not agreed to be sold under
Section 2.3), it shall following the Closing Date account for
the amount so received to FMC or the GI Purchaser as appropriate
within 3 English business days and pending such accounting shall
hold such amount on trust for FMC or the GI Purchaser. The
obligations of T&N and the Administrators under this
Section 2.7 shall terminate if this Agreement is lawfully
terminated by T&N as a result of a breach of this Agreement by
FMC or the GI Purchaser.
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3.
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Payment of
Purchase Price
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3.1
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As
consideration for the sale, assignment and transfer contemplated in
Sections 2.1, 2.2 and 2.3, FMC shall pay the French Purchase Price
and the GI Purchaser shall pay the German and Italian Purchase
Price to T&N on the Closing Date.
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3.2
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If FMC has made
a cash payment (the “FMC Deposit”) to credit of
the Administrators’ (FMC) Account in accordance with the
provisions of Section 4.1(a) below, the FMC Deposit shall
on the Closing Date be applied by the Administrators towards the
French Purchase Price payable by FMC. FMC irrevocably and
unconditionally consents to such application (which shall to the
extent so applied operate in satisfaction pro tanto of FMC’s
obligations to pay the French Purchase Price under
Section 3.1).
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3.3
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If the GI
Purchaser has made a cash payment (the “GI
Deposit”) to the Administrators’ (GI) Account in
accordance with the provisions of Section 4.1(b) below, the GI
Deposit shall on the Closing Date be applied by the Administrators
towards the German and Italian Purchase Price payable by the GI
Purchaser. The GI Purchaser irrevocably and unconditionally
consents to such application (which shall to the extent so applied
operate in satisfaction pro tanto of the GI Purchaser’s
obligations to pay the German and Italian Purchase Price under
Section 3.1).
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3.4
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If FMC has
provided a bank guarantee or letter of credit (the
“Guarantee/LC”) to the Administrators in
accordance with the provisions of Section 4.1(c) below,
T&N shall on the Closing Date make a drawing under the
Guarantee/LC in an amount not exceeding the lower of (a) the
maximum amount that may be drawn thereunder and (b) an amount
equal to the Purchase Price payable on the Closing Date plus the
Guarantee/LC Interest (less the amount of any FMC Deposit and any
GI Deposit applied in accordance with Sections 3.2 and 3.3). The
amount so drawn shall on the Closing Date or if later the LC
Receipt Date be applied by the Administrators in or towards payment
of the French Purchase Price and the German and Italian Purchase
Price payable by FMC or the GI Purchaser as appropriate pro rata to
the amounts outstanding and FMC and the GI Purchaser each
irrevocably and unconditionally consents to such application (which
shall to the extent so applied operate in satisfaction pro tanto of
FMC’s obligation to pay the French Purchase Price and the GI
Purchaser’s obligation to pay the German and Italian Purchase
Price, under Section 3.1). FMC shall not have or acquire
ownership of or any interest in the German Notes or the Italian
Note as a result of the amount drawn under the Guarantee/LC being
so applied.
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3.5
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FMC shall on the Closing Date pay
the balance, if any, of the French Purchase Price and the GI
Purchaser shall on the Closing Date pay the balance, if any, of the
German and Italian Purchase Price outstanding, in the case of the
French Purchase Price, after
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application of (a) the FMC
Deposit under Section 3.2 and (b) of the amount drawn
under the Guarantee/LC which is to be or has been applied in or
towards payment of the French Purchase Price, and, in the case of
the German and Italian Purchase Price, after application of
(a) the GI Deposit under Section 3.3 and (b) of the
amount drawn under the Guarantee/LC which is to be or has been
applied in or towards payment of the German and Italian Purchase
Price. Such sum shall be paid in cleared funds to such account as
the Administrators may designate, without set-off or
counterclaim.
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4.1
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Within three
English business days of the date of this Agreement (time to be of
the essence):
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(a)
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FMC shall pay
the FMC Deposit to the credit of the Administrators’ (FMC)
Account in an amount equal to the French Purchase Price (or such
amount as may, together with any Guarantee/LC and any GI Deposit,
equal in aggregate the Purchase Price) which the Administrators
shall:
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(i)
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at all times
prior to the Closing Date hold separate from all other assets of
T&N; and
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(ii)
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apply only on
the Closing Date in accordance with Section 3.2;
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and which shall (subject only to the
provisions of Section 4.4) only be repayable to FMC if and to
the extent that the same i
