This REIMBURSEMENT
AGREEMENT (this “ Agreement ”) is made and
entered into on October 13, 2006 (the “ Effective
Date ”), between The Shaw Group Inc., a Louisiana
corporation (“ Shaw ”), and Toshiba Corporation,
a Japanese corporation (“ Toshiba ”). Shaw and
Toshiba are also referred to herein together as the “
Parties ” and individually as a “ Party
”.
A. On the
terms and subject to the conditions set forth in the Investment
Agreement, dated as of October 4, 2006, among Toshiba, Nuclear
Energy Holdings, L.L.C., a Delaware limited liability company
(“ NEH ”), Toshiba Nuclear Energy Holdings
(US) Inc., a Delaware corporation (“ US
Holdco” ), and Shaw, NEH has directly agreed to acquire
800 shares of Class A Stock of US Holdco for a consideration
of $800,000,000 and representing, as of the Closing Date (as
defined in such Investment Agreement), twenty percent (20.0%) of
the outstanding capital stock thereof (collectively, the “
US Shares ”). On the terms and subject to the
conditions set forth in the Investment Agreement, dated as of
October 4, 2006, among Toshiba, NEH, Toshiba Nuclear Energy
Holdings (UK) Limited , a company incorporated in
England (“ UK Holdco ” and, together with US
Holdco, the “ Holdcos ”), and Shaw, NEH has
directly agreed to acquire 280 Class A Shares in the capital
of UK Holdco for a consideration of $280,000,000 and representing,
as of the Closing Date (as defined in such Investment Agreement),
twenty percent (20.0%) of the outstanding capital stock thereof
(collectively, the “ UK Shares ”; and, together
with the US Shares, the “ Shares ”).
B. On even
date herewith, Toshiba and NEH have entered into two Put Option
Agreements (the “ Put Option Agreements ”)
pursuant to which Toshiba provides to NEH put options with respect
to the Shares, on the terms and conditions set forth
therein.
C. As a
condition to Toshiba entering into the Put Option Agreements,
Toshiba has requested that Shaw, and Shaw has agreed to, reimburse
Toshiba for certain amounts paid by Toshiba in connection with
stamp or transfer taxes, tax withholdings or deduction in
connection with any exercise by NEH of the put rights under the Put
Option Agreements on the terms and subject to the conditions set
forth in this Agreement.
NOW, THEREFORE,
the Parties, in consideration of the premises and the terms,
covenants and conditions set forth below, hereby agree as
follows:
1.
DEFINITIONS; INTERPRETATION.
1.1 Terms Not
Defined in this Agreement . Term used but not otherwise defined
herein shall have the meanings given to such terms in the Put
Option Agreement.
(a)
Certain Terms . The words “hereof,”
“herein,” “hereunder” and similar words
refer to this Agreement as a whole and not to any particular
provision of this Agreement. The term “including” is
not limited and means “including without
limitation.”
(b)
Section References; Titles and Subtitles . Unless
otherwise noted, all references to Sections herein are to Sections
of this Agreement. The titles, captions and headings of this
Agreement are inserted for convenience of reference only and are
not intended to be a part of or to affect the meaning or
interpretation of this Agreement.
2.
REIMBURSEMENT OBLIGATION.
2.1
Reimbursement by Shaw . (a) If and to the extent that,
(i) in connection with the transfer of Shares pursuant to the
Put Option Agreements, Toshiba or its subsidiaries are required to
pay any stamp duty, stamp duty reserve tax, transfer tax or other
similar tax or duty (“ Transfer Taxes ”) or
(ii) in accordance with Section 3.2 either of the Put
Option Agreement, Toshiba (or its permitted designee under a Put
Option Agreement) (A) is required under applicable law to
withhold or deduct from the Put Price any taxes, duties,
assessments or governmental charges of whatever nature imposed,
levied, collected, withheld or assessed by or within Japan or any
authority therein or thereof having power to tax (“
Taxes ”) and (B) pays to NEH any additional
amounts as will result in the receipt by NEH of such amounts as
would have been received by NEH had no withholding or deduction
been required (“ Tax Gross-Up Amounts ”), Shaw
shall reimburse Toshiba for (x) all such Tax Gross-Up Amounts,
(y) all such Transfer Taxes and (z) additional Taxes paid
or payable by Toshiba in respect of the amounts reimbursed under
the preceding clauses (x) and (y) (collectively, the “
Put Loss Amounts ”) within two Business Days after
receipt from Toshiba of a written request for payment thereof
(together with substantiating documentation).
(b) In
addition, Shaw agrees to pay on demand any and all costs, including
reasonable legal fees and expenses, and other expenses incurred by
Toshiba in enforcing Shaw’s payment obligations under this
Section 2.1; provided that Shaw shall not be liable for
any such costs and expenses if no payment under this
Section 2.1 is due (such amounts, together with the Put Loss
Amounts, the “ Reimbursable Amounts
”).
2.2 Nature of
Obligations . The obligations of Shaw hereunder are primary and
unconditional, and Toshiba shall not be required to bring an action
against NEH to enforce its rights against Shaw with respect to any
Reimbursable Amounts. Until payment in full of Reimbursable
Amounts, Shaw expressly waives, on behalf of itself and NEH, any
and all rights of subrogation, reimbursement, indemnity,
exoneration, contribution or any other claim which Shaw or NEH may
now or hereafter have against Toshiba arising from the existence or
performance of this Agreement or any other agreement.
2.3
Dividend . Upon receipt by Shaw of a written request for
payment as contemplated by Section 2.1, Shaw shall cause NEH
(subject to any restrictions in NEH’s financing
documentation) to assign and pay over to Toshiba all Dividends that
NEH receives after exercise of the Put Right up to an amount, when
combined with any payments made by or on behalf of Shaw in respect
of its obligations under Section 2.1, equal to the full amount
of all Reimbursable Amounts (“ Assigned Dividends
”), and all such rights shall thereupon become
2
vested in
Toshiba, which shall have the sole and exclusive right and
authority to receive and retain any such Assigned Dividends. In
such event, Shaw shall cause NEH to promptly notify (or if NEH does
not do so promptly, shall allow Toshiba to notify) the applicable
HoldCo and instruct such HoldCo to pay any and all such Assigned
Dividends directly to Toshiba free and clear of, and without
withholding or deduction for, any taxes, duties, assessments or
governmental charges of whatever nature imposed, levied, collected,
withheld or assessed by any Government Authority having power to
tax, unless such withholding or deduction is required by law. All
Assigned Dividends received by Shaw or its Subsidiaries contrary to
the provisions of this Section 2.3 shall be held in trust for
the benefit of Toshiba, shall be segregated from other property or
funds of Shaw and such Subsidiaries and upon receipt shall be
forthwith delivered to Toshiba in the same form as so received
(with any necessary endorsement), free and clear of, and without
withholding or deduction for, any taxes, duties, assessments or
governmental charges of whatever nature imposed, levied, collected,
withheld or assessed by any Government Authority having power to
tax, unless such withholding or deduction is required by law. For
the purposes of this Section 2.3, the term “
Dividends ” shall mean any dividends, interest, cash,
instruments and other property distributed from time to time by the
applicable HoldCo in respect of the Shares or any shares, interests
or other securities issued or
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