Victorian Current Acts Victorian Current ActsSCHEDULE 1
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Agreement for the Merger of State Bank of Victoria and
Commonwealth Bank of
Australia
THIS AGREEMENT is made the eighth day of November 1990.
BETWEEN: THE HONOURABLE THOMAS WILLIAM ROPER in his capacity as Treasurer for and on behalf of the State of Victoria (the "Treasurer" which expression includes his successors in office)
AND: COMMONWEALTH BANK OF AUSTRALIA a body corporate established pursuant to section 27 of the Commonwealth Banks Act 1959 ("CBA").
WHEREAS:
A. The State Bank of Victoria is a body corporate in existence pursuant to the State Bank Act 1988 and, pursuant to sub-section 6(2) of that Act, holds its property for and on behalf of the Crown.
B. CBA is a body corporate in existence pursuant to the Commonwealth Banks Act 1959 .
C. By a letter dated 25 August 1990 (as amended by two letters dated 26 August 1990) (the "offer") CBA offered to merge with the Bank.
D. By a letter dated 31 August 1990 the Treasurer accepted the offer of CBA to merge with the Bank.
E. This Agreement is the formal contract referred to in the offer and the parties have entered into this Agreement to record the basis, the terms and the conditions upon which the merger is to be effected.
THE PARTIES AGREE as follows:
1.1 Definitions
"1990 Accounts" means the audited consolidated accounts of the SBV Group for the year ended 30 June 1990 marked as Exhibit "A" and initialled by the parties for identification;
"Accounts Date" means, in respect of the 1990 Accounts, 30 June 1990, and in respect of the Final Accounts, the Completion Date;
"Adjusted NTA" means the amount determined by Touche Ross & Co. in accordance with clause 3.6;
"Adjustment Date" means the date which is 14 days after the Treasurer and CBA receive notification from Touche Ross & Co. of the amount of the Adjusted NTA in accordance with clause 3.7;
"Assumption Agreement" means the agreement so entitled dated 26 June 1990
between the Bank and the CWA;
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"Audit Instruction Letter" means a letter to Touche Ross & Co. in the form of the draft letter marked as Exhibit "B" and initialled by the parties for identification;
"Bank" means the State Bank of Victoria;
"Borrowing Agreement" means any agreement or instrument for the provision of Finance to any member of the SBV Group and includes any other agreement or instrument collateral or ancillary thereto;
"Business Day" means a day on which banks are open for business in Melbourne;
"Companies Code" means the Companies (Victoria) Code or any corresponding or like enactment (and a reference to any section or any other provision of the Companies Code includes a reference to the corresponding section or provision of any corresponding or like enactment);
"Completion Date" means the last day of the month in which falls the day which is seven Business Days after the day on which the last of the conditions precedent referred to in clause 5.1 is satisfied or waived;
"CWA" means the Capital Works Authority established under the Order in Council made on 28 May 1985;
"Deposit" means the amount paid by CBA in accordance with the Stakeholders Agreement and all interest accrued thereon;
"Employee" means each person who is an employee of any member of the SBV Group;
"Encumbrance" means an interest or power:
(a) reserved in or over an interest in any asset including, but not limited to, any retention of title; or
(b) created or otherwise arising in
or over any interest in any asset under a bill of sale, mortgage, charge,
lien, pledge, trust or power,
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by way of security for the payment of a debt or other monetary obligation or the performance of any other obligation and includes, but is not limited to, any agreement to grant or create any of the above;
"Farrow Deed" means the Deed of Agreement and Indemnity dated 3 August 1990 between the Treasurer and the Bank and includes the Deed of Variation dated 20 August 1990;
"Final Accounts" means the consolidated balance sheet of the SBV Group as at the Completion Date and the consolidated profit and loss statement of the SBV Group for the period 1 July 1990 to the Completion Date in each case as prepared and audited in accordance with clause 3.4 and clause 3.5 but for the purposes of clause 3.6, clause 3.9 and clause 3.11 incorporating such alterations or adjustments (if any) as Touche Ross & Co. report pursuant to clause 3.8 as being necessary to enable them to issue a report in the terms required by the Audit Instruction Letter;
"Financial Indebtedness" means any debt or other monetary liability in respect of moneys borrowed or raised or any financial accommodation whatsoever including, but not limited to, under or in respect of any:
(a) bill, bond, debenture, note, inscribed stock, certificate of deposit or similar instrument; or
(b) acceptance, endorsement or discounting arrangement; or
(c) Guarantee or other assumption of liability; or
(d) finance or capital lease; or
(e) deferred price (for more than 90 days) of any asset or service; or
(f) obligation to deliver goods or provide services paid for in advance by any financier or in relation to any financing transaction; or
(g) amount of capital and premium payable on or in connection with the redemption of any preference shares or any amount of purchase price payable for or in connection with the acquisition of redeemable preference shares,
and irrespective of whether the debt or liability:
(h) is present or future; or
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(i) is actual, prospective, contingent or otherwise; or
(j) is at any time ascertained or unascertained; or
(k) is owed or incurred alone or severally or jointly or both with any other person; or
(l) is owed to a person who originally provided such moneys or financial accommodation or to a person who acquired or succeeded to the benefit of that debt or liability; or
(m) comprises any combination of the above;
and "Financially Indebted" and "provision of Finance" shall be construed accordingly;
"Governmental Agency" means any government or governmental, semi-governmental, administrative, fiscal or judicial body, department, commission, authority, instrumentality, tribunal, agency or entity anywhere in the world;
"Guarantee" means any guarantee, suretyship, indemnity, letter of credit, letter of comfort or any other legally binding obligation (whatever called and of whatever nature):
(a) to provide funds (whether by the advance or payment of money, the purchase of or subscription for shares or other securities, the purchase of assets or services or otherwise) for the payment or discharge of; or
(b) to indemnify any person against the consequences of default in the payment of; or
(c) otherwise to be responsible for,
the Financial Indebtedness of another person or the assumption of any responsibility or obligation in respect of the insolvency or the financial condition of any other person;
"Lending Agreement" means any agreement or instrument for the provision of Finance by any member of the SBV Group and includes any other agreement or instrument collateral or ancillary thereto;
"Material Contract" means:
(a) in respect of a Lending
Agreement or Borrowing Agreement, a Lending Agreement or Borrowing Agreement
involving the provision of Finance by or to a member of the SBV Group in an
amount in excess of $10 000 000; and
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(b) in respect of any other agreement, an agreement:
(i) which imposes on a member of the SBV Group an obligation to pay in aggregate more than $10 000 000; or
(ii) a breach or default in respect of which, or termination of which, could have an adverse effect on the business or financial condition of a member of the SBV Group in excess of $5 000 000;
"Reimbursement Agreement" means the Reimbursement Agreement dated 26 June 1990 between the Treasurer and the Bank;
"SBV Deed" means the Deed of Acquisition of Indebtedness or Interest or the Benefit Thereof dated 27 July 1990 and made between the Treasurer and the Bank and includes the Deed of Variation dated 23 August 1990;
"SBV Group" means the Bank and each of its Subsidiaries;
"SBV Multitrust" means the trust constituted by the Trust Deed between Tricontinental Management Limited, Tricontinental Holdings Limited and The Perpetual Executors and Trustees Association of Australia Limited dated 6 November 1985 (as amended by Supplemental Deeds dated 16 July 1987, 29 September 1987, 16 November 1987, 28 March 1988, 26 October 1989 and 5 April 1990);
"Stakeholders Agreement" means the agreement dated 14 September 1990 between the Treasurer and CBA;
"Subsidiaries" means subsidiaries (within the meaning of the Companies Code) of the Bank (as if the Bank were incorporated under the Companies Code) other than Tricontinental Holdings Limited and subsidiaries (within the meaning of the Companies Code) of Tricontinental Holdings Limited;
"Superannuation Funds" means each of the SBV Staff Superannuation Fund, the SBV External Superannuation Fund, the SBV Productivity Fund, the Australian Bank Superannuation Scheme, the Australian Bank Superannuation Fund and the Printing Industry Superannuation Fund;
"Tax" means any tax, payment in the nature of tax (including, without
limitation, any payment under section 38(1)(a) of the State Bank Act 1988 ),
levy, charge, impost, duty, fee, deduction, compulsory loan or withholding
which is assessed, levied, imposed or collected by any Governmental Agency and
includes, but is not limited to, any interest, penalty, charge, fee or any
other amount imposed on or in respect of any of the above;
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"Trico Deed" means the Deed of Agreement for the Acquisition of Indebtedness or the Benefit Thereof dated 22 February 1990 and made between Robert Allen Jolly in his capacity as Treasurer for and on behalf of the State of Victoria and Tricontinental Corporation Limited;
"Trico Group" means Tricontinental Holdings Limited and each of its subsidiaries (within the meaning of the Companies Code);
"Warranties" means the warranties set out in Schedule B and "Warranty" means each or any of them.
1.2 Interpretation
In this Agreement, unless the contrary intention appears:
(a) any reference to any document or information given or provided or disclosed by the Treasurer or by a member of the SBV Group includes any document or information given or provided or disclosed by any of his or their professional advisors, consultants or agents;
(b) any reference to any document or
information given or provided or disclosed to CBA includes any document or
information given or provided or disclosed to any of CBA's professional
advisors, consultants or agents;
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(c) any reference to an agreement includes an undertaking, deed, agreement or legally enforceable arrangement or understanding whether or not in writing;
(d) any reference to a document includes any agreement in writing or any certificate, notice, instrument or other document of any kind;
(e) any reference to a "member of the SBV Group" is a reference to each of the Bank and its Subsidiaries;
(f) any reference to a "member of the Trico Group" is a reference to each of Tricontinental Holdings Limited and its subsidiaries;
(g) any reference to disclosure includes any matter known to CBA;
(h) words importing the singular include the plural and vice-versa;
(i) words importing a gender include each other gender;
(j) any reference to a statute or statutory provision includes any statute or statutory provision which amends, extends, consolidates or replaces the same or which has been amended, extended, consolidated or replaced by the same and any orders, regulations, instruments or other subordinate legislation made thereunder;
(k) headings are for reference only and do not affect the interpretation of this Agreement;
(l) references to this Agreement include the schedules to this Agreement;
(m) all references to clauses, recitals and schedules are to clauses of and recitals and schedules to this Agreement;
(n) all references to "$" and "dollars" are, unless otherwise expressed, to the lawful currency for the time being of Australia;
(o) all references to dates and
times are to Melbourne time; and
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(p) except in relation to clause 2, where the day on or by which any thing is to be done pursuant to this Agreement is not a Business Day, that thing must be done on or by the next succeeding Business Day.
The parties agree that with effect on the day immediately following the Completion Date:
(a) all property and rights of the Bank, wherever located, vest in CBA;
(b) all liabilities of the Bank, wherever located, become liabilities of CBA;
(c) CBA is the successor in law of the Bank; and
(d) the Bank is dissolved,
and in this clause 2, "property", "rights" and "liabilities" will have the meaning to be given thereto by the State Bank (Succession of Commonwealth Bank) Act 1990 .
3.1 CBA agrees to pay to the Treasurer a purchase price of $1 600 000 000 subject to adjustment (if any) in accordance with clause 3.9.
3.2 It is acknowledged that CBA has paid a cash deposit in the amount and on the terms set out in the Stakeholders Agreement.
3.3 On the Completion Date CBA will pay to the Treasurer by bank cheque on account of the purchase price payable under clause 3.1 the sum of $1 500 000 000 (less the amount payable by CBA to the Bank under clause 4.2) and will cause the Deposit to be paid or assigned to the Treasurer (of which $100 000 000 will be taken to have been paid on account of the purchase price payable under clause 3.1).
3.4 On or prior to the Completion Date the
Treasurer and CBA will to the extent of their respective powers:
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(a) procure the Bank to retain Touche Ross & Co. to audit the Final Accounts and to determine the amount of the Adjusted NTA; and
(b) execute and give to Touche Ross & Co. the Audit Instruction Letter and give to the officers and employees of CBA referred to in clause 3.5(a) a copy of the executed Audit Instruction Letter.
3.5 The Treasurer and CBA will to the extent of their respective powers procure that the Final Accounts will be:
(a) prepared in accordance with this Agreement and the Audit Instruction Letter by appropriate officers and employees of CBA who immediately prior to the Completion Date were officers and employees of the SBV Group responsible for the preparation of the accounts of the SBV Group;
(b) signed by two persons who were directors of the Bank as at 30 June 1990 (or if there are no such persons able and willing to sign the Final Accounts any two, or if there is only one such person able and willing to sign that one person and any one, of the officers and employees referred to in clause 3.5(a)) and stated by them (having regard to this Agreement and the Audit Instruction Letter) to present fairly the results of transactions of the SBV Group during the period from 1 July 1990 to the Completion Date and to sufficiently explain the financial position of the SBV Group at the Completion Date;
(c) audited by Touche Ross & Co. in accordance with this Agreement and the Audit Instruction Letter;
(d) prepared on the basis that no member of the Trico Group is a subsidiary of the Bank; and
(e) except as otherwise set out in this Agreement or the Audit Instruction Letter, prepared and audited in accordance with the same accounting principles and practices as were applied in the preparation and auditing of the 1990 Accounts.
3.6 The Adjusted NTA is:
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(a) the amount shown in the Final Accounts as representing Capital and Reserves of the SBV Group
plus
(b) the amounts shown in the Final Accounts as representing provisions for deferred tax liabilities
minus
(c) the amounts shown in the Final Accounts as representing future income tax benefits and goodwill.
3.7 Upon completion of the audit of the Final Accounts, Touche Ross & Co. will issue to each of the Treasurer and CBA a report in the terms required by the Audit Instruction Letter and setting out the amount of the Adjusted NTA.
3.8 If upon completion of the audit of the Final Accounts, Touche Ross & Co. is not prepared to report in the terms required by the Audit Instruction Letter, Touche Ross & Co. will also report on such alterations and adjustments to the Final Accounts as are necessary to be made to enable Touche Ross & Co. to issue a report in those terms.
3.9 If Adjusted NTA is less than $850 000 000, the Treasurer will pay to CBA on the Adjustment Date by bank cheque an amount equal to the difference between $850 000 000 and Adjusted NTA.
3.10 The fees of Touche Ross & Co. for auditing the Final Accounts will be borne and paid by CBA.
3.11 In the event an error in the preparation or compilation of the Final Accounts affecting any money paid or payable under clause 3.9 or which would have been payable under that clause if that error had not been made is discovered and notified by either party to the other party after the date the auditor's report is received by the parties and before 31 December 1991, CBA will pay to the Treasurer or the Treasurer will pay to CBA (as the case requires) such amount as the parties agree or, in default of agreement within thirty days after notice is first given by one party to the other party, as the President for the time being of the Institute of Chartered Accountants or his nominee determines, reflects the amount of any overpayment or underpayment.
3.12 Any person required to make a
determination in accordance with clause 3.11:
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(a) will act as an expert and not as an arbitrator;
(b) will be jointly instructed by the Treasurer and CBA in accordance with this Agreement;
(c) must not furnish to either the Treasurer or CBA any explanation or reasons as to the basis of his determination; and
(d) will be remunerated as to one half of his fees by the Treasurer and as to the other half of his fees by CBA,
and the determination of such person will be final and binding on the parties.
3.13 That part of the purchase price attributable to the Adjusted NTA will be apportioned between the various assets and liabilities making up the Adjusted NTA in accordance with the values ascribed thereto in or used in compiling the Final Accounts.
4.1 Subject to clause 5, completion will take place on the Completion Date at the offices of the Treasurer, 1 Treasury Place, Melbourne.
4.2 On the Completion Date CBA (at the direction of the Treasurer) will pay to the Bank the amount of $194 000 000 (being the consideration payable by the Treasurer for the acquisition of all of the rights referred to in clause 28 of the State Bank (Succession of Commonwealth Bank) Bill 1990 marked Exhibit "C" and initialled by the parties for identification and which amount will be deducted from the amount payable by CBA to the Treasurer pursuant to clause 3.3) at which time the parties will procure that if the same has not occurred prior to the Completion Date:
(a) the Bank will transfer to the Treasurer or his nominee all of the issued capital of Tricontinental Holdings Limited;
(b) the existing directors of Tricontinental Holdings Limited will retire and there will be appointed in place of such directors such persons as the Treasurer may nominate;
(c) SBV Futures Pty Limited and SBV Investment Management Limited will change their names to exclude "SBV"; and
(d) SBV Investment Management Limited will retire as manager of the SBV Multitrust and Commonwealth Management Services Limited will be appointed as manager in its stead.
4.3 (a) On or prior to the Completion Date the Treasurer
will:
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(i) negotiate and will procure that his nominee negotiates in good faith with CBA a facility agreement and any other agreements ancillary or collateral thereto for the provision of Finance by CBA to the nominee on the terms and conditions outlined in the term sheet marked as Exhibit "D" and initialled by the parties for identification;
(ii) enter into and will procure that the nominee enters into the facility agreement and other agreements referred to in paragraph (i);
(iii) negotiate in good faith with CBA a guarantee in respect of the facility agreement referred to in paragraph (i) and all securities issued thereunder on the terms and conditions outlined in the aforementioned term sheet;
(iv) enter into the guarantee referred to in paragraph (iii); and
(v) procure that all Financial Indebtedness of each member of the Trico Group to any member of the SBV Group other than the Financial Indebtedness under the facility agreement referred to in paragraph (i) is repaid or discharged in full.
(b) CBA will in good faith negotiate and enter into the facility agreement and other agreements referred to in clause 4.3(a)(i) and the guarantee referred to in clause 4.3(a)(iii) on or prior to the Completion Date and CBA will subject to the terms of the facility agreement advance to the nominee on the Completion Date the sum demanded by the nominee up to $2 300 000 000 pursuant to that facility agreement.
4.4 On or prior to the Completion
Date the Treasurer will procure that:
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(a) the CWA will pay to the Bank such amount as would, if invested by the Bank on the Completion Date at the rates applying to the respective Obligations (as defined in the Assumption Agreement) for terms ending on the maturity date of the respective Obligations (as defined in the Assumption Agreement), result in the Bank receiving sufficient funds on such maturity date to enable the Bank or CBA as the successor of the Bank to pay out all Obligations (as defined in the Assumption Agreement) then assumed by the CWA pursuant to the Assumption Agreement;
(b) the Assumption Agreement is lawfully terminated; and
(c) neither the CWA nor any member of the SBV Group has any outstanding liability, responsibility or obligation under the Assumption Agreement or any other agreement, arrangement or understanding collateral or ancillary to the Assumption Agreement.
4.5 On or prior to the Completion Date, the Treasurer will procure that all assignments of Indebtedness (as defined in the Trico Deed) and declarations of trust in respect of such Indebtedness that have been made to any member of the SBV Group pursuant to the Trico Deed will be annulled or reassigned.
4.6 On or prior to the Completion Date the Treasurer will procure that the Bank and SBV Staff Superannuation Pty Ltd enters into a trust deed in the form of the draft trust deed marked as Exhibit "E" and initialled by the parties for identification or such other form as may be agreed between the parties, whereupon CBA will execute that trust deed.
4.7 On or prior to the Completion Date the Treasurer will, and will procure that the Bank will, enter into a Deed amending the Farrow Deed in the form of the draft Deed marked Exhibit "F" and initialled by the parties for identification or such other form as may be agreed between the parties.
4.8 On or prior to the Completion Date the Treasurer will, and will procure that the relevant parties will, enter into a Deed of Variation in the form of the draft Deed marked Exhibit "G" and initialled by the parties for identification or such other form as may be agreed between the parties.
4.9 (a) On or prior to the Completion Date the Treasurer will:
(i) procure
that the Bank will make a Past Interest Notice of Claim (as defined in the SBV
Deed) for an amount of not less than $51 700 000 and the Treasurer
will pay to the Bank by bank cheque the amount the subject of that Past
Interest Notice of Claim;
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(ii) direct the Bank not to make any assignments or declare any trusts under clause 3.3 of the SBV Deed that might otherwise have been required as a consequence of the payment of that Past Interest Notice of Claim; and
(iii) release the Bank from any obligation under clause 6(a) of the SBV Deed that it might otherwise have had as a consequence of the payment of that Past Interest Notice of Claim;
and, notwithstanding the matters referred to in paragraphs (ii) and (iii) above or any other matter, the payment by the Treasurer will not operate as a discharge of any Indebtedness or Interest (as defined in the SBV Deed) and the Treasurer will treat the payment made pursuant to paragraph (i) above as having been made pursuant to and in accordance with his obligations under the SBV Deed.
(b) Upon payment of the amount referred to in clause 4.9(a)(i), the Bank and CBA as the successor of the Bank will release the Treasurer from any obligations under the SBV Deed or Warranty 24 of this Agreement to make any further payments relating to the Interest on Indebtedness (as defined in the SBV Deed) accrued on or before 30 June 1990 the subject of that Past Interest Notice of Claim.
4.10 On or prior to the Completion Date the Treasurer will, and will procure that the Bank will, enter into a Deed of Release in the form of the draft Deed marked Exhibit "H" and initialled by the parties for identification or such other form as may be agreed between the parties.
5.1 It is a condition precedent to completion that:
(a) the Parliament of the State of Victoria has passed the legislation marked Exhibit "C" and initialled by the parties for identification without amendment of the name of the Bill or of sections 1, 2, 3, 5, 6, 7, 30, 31, 32, 34, 35, 36 or 37 or Part 3, or of any definition contained in section 4 of such legislation which affects those sections or that Part, of such legislation or any other amendment affecting the rights or obligations of the parties under this Agreement;
(b) the Australian Parliament has passed all necessary legislation to:
(i) give effect to the legislation referred to in clause 5.1(a);
(ii) permit CBA
to issue to persons other than the Commonwealth of Australia and agencies or
authorities of the Commonwealth of Australia capital of CBA;
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(iii) implement the taxation compensation and reimbursement arrangements agreed between the Treasurer and the Commonwealth Treasurer in connection with the merger of the Bank and CBA; and
(iv) ensure that CBA is entitled to the benefit of any certificate granted to the Bank under section 128F of the Income Tax Assessment Act and that the succession of CBA to the assets, liabilities and commitments of the Bank will not be treated as a change in the ownership of, or in the interest of persons in, property for the purposes of section 59AA of that Act; and
(c) the relevant parties have entered into the agreements and guarantee referred to in clause 4.3 and CBA has advanced all moneys pursuant thereto.
5.2 The conditions in clause 5.1(b)(ii) and (iv) are for the sole benefit of CBA and may be waived by it. The condition in clause 5.1(b)(iii) is for the sole benefit of the Treasurer and may be waived by him.
5.3 If a condition set out in clause 5.1 has not been satisfied or waived by 31 December 1990 either party may terminate this Agreement within seven days by notice in writing to the other party and any such termination will be a lawful termination for the purposes of the Stakeholders Agreement.
6.1 CBA will merge the staff of the Bank into CBA as soon as possible after the Completion Date and will treat all staff on their merits irrespective of origin.
6.2 CBA will offer the current Chief Executive Officer of the Bank an appropriate senior executive position with CBA.
6.3 CBA will aim to strengthen the
retail, commercial and corporate operations of CBA in Victoria.
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6.4 CBA will recommend to the Commonwealth Treasurer that the necessary steps be taken to permit the appointment to the governing body of CBA or its successor of two extra persons and that, as soon as practicable after the Completion Date, the current Chairman of the Bank and one other person resident in Victoria be appointed to that governing body or its successor.
6.5 CBA undertakes that as soon as reasonably practicable after the Completion Date CBA will at its own expense do everything reasonably within its power to give every notice and obtain every consent and do every other thing required to be given or obtained or done under the Material Contracts referred to in Warranty 10.5 in order to avoid any breach or default under such Material Contracts provided that this clause does not require CBA to pay any money to any party to a Material Contract or accept any other liability or onerous obligation.
7.1 Unless inconsistent with the context or the subject matter, the Treasurer gives the Warranties in favour of CBA:
(a) as at the date of this Agreement;
(b) for each day up to the Completion Date; and
(c) as at the Completion Date.
7.2 The fact that CBA may know or ought reasonably to know that a Warranty is false or misleading, whether as a result of its due diligence, investigation or any other investigation made by CBA in respect of the business, undertaking and assets of the SBV Group or any knowledge as to the business, undertaking and assets of the SBV Group does not affect:
(a) the Warranties; or
(b) the rights, powers, authorities or discretions of CBA if any Warranty is false or is misleading.
7.3 Each Warranty:
(a) is to be construed independently and is not limited by reference to any other Warranty; and
(b) survives the completion of this Agreement.
7.4 The Treasurer indemnifies CBA in
respect of:
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(a) every cause of action (including every civil right to seek relief in a court of law) the subject of any claim, action, suit, prosecution, litigation, arbitration, proceeding or dispute to which CBA as the successor of the Bank or any member of the SBV Group is or may at any time be a party and which arises from any act done or omitted to be done on or prior to the Completion Date by any member of the SBV Group or any member of the Trico Group or any officer, employee, agent or contractor of any member of the SBV Group or of the Trico Group and any damage, loss, liability, cost, charge, expense, outgoing or payment (other than payments made by CBA or any member of the SBV Group without legal obligation to do so to any person in the nature of a claimant or plaintiff) which CBA as the successor of the Bank or any member of the SBV Group suffers, incurs or is liable for as a result thereof;
(b) any claim, action, damage, loss, liability, cost, charge, expense, outgoing or payment (other than payments made by CBA or any member of the SBV Group without legal obligation to do so to any person in the nature of a claimant or plaintiff) which CBA as the successor of the Bank or any member of the SBV Group suffers, incurs or is liable for in respect of:
(i) the Deed of Guarantee and Trust dated 25 May 1989 between the Bank and The Perpetual Executors and Trustees Association of Australia Limited guaranteeing the obligations of various members of the Trico Group;
(ii) the Deed Poll dated 23 June 1989 by the Bank indemnifying various members of the Trico Group (as amended by the Supplemental Deed dated 21 September 1989);
(iii) any act
done or omitted to be done prior to the Completion Date by any member of the
Trico Group or any officer, employee, agent or contractor of any member of the
Trico Group;
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(iv) the Indemnity Agreement dated 14 September 1989 between Tricontinental Corporation Limited and the Bank marked as Exhibit "I" and initialled by the parties for identification and the Deed of Acknowledgement to be entered into on or prior to the Completion Date by Tricontinental Corporation Limited and the Bank in the form of the draft deed marked as Exhibit "J" and initialled by the parties for identification or such other form as may be agreed between the parties or the failure by Tricontinental Corporation Limited to comply with its obligations under that Indemnity Agreement or that Deed of Acknowledgement;
(v) any fraudulent activities or unauthorised securities, currency or futures trading committed or carried out by any officer or employee of a member of the SBV Group prior to the Completion Date (and in this sub-paragraph (v) "employee" includes any trader who works full time in the business and under the control of a member of the SBV Group);
(vi) the repudiation, revocation, rescission or termination of any Guarantee given by the Crown or any entity which represents the Crown in right of the State of Victoria or any member of the Trico Group in favour of or for the benefit of any member of the SBV Group (other than as contemplated by clause 8.2) or the failure by the Crown or any such entity or any such member of the Trico Group to comply with its obligations under any such Guarantee;
(vii) Parts 4 or 5 or Schedule 3 of the Agreement for the Sale of Shares between Austech Ventures Limited and the Bank dated 10 January 1990 or Part 7 of the Agreement for Sale of Shares between the Crown in right of the State of Victoria and the Bank dated 30 June 1990; and
(viii) any insurance provided by Housing Loan Insurance Corporation to the National Mortgage Market Corporation Limited being or becoming void, voidable or unenforceable.
7.5 Where by virtue of sections
160M(7), 160Z, 160ZC and 160ZO of the Income Tax Assessment Act 1936 any
amount received by CBA from the Treasurer under this clause 7 is included in
the assessable income of CBA, the Treasurer shall pay such additional amounts
as are necessary in order that the net amount received by CBA after the
payment of Tax as a result thereof equals the amount which would have been
received by CBA in the absence of such Tax.
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7.6 Each indemnity in favour of CBA contained in this Agreement:
(a) is a legal valid and binding obligation of the Treasurer;
(b) may be enforced against the Treasurer by action at law, suit in equity or other action or proceeding and it will not be necessary or required in order to enforce the Treasurer's obligations and liabilities thereunder that CBA prosecutes or exhausts any right, remedy or claim or proceeds in any manner against any other person;
(c) is a continuing indemnity and will remain in full force and effect until all money owing (contingently or otherwise) under any indemnity has been paid in full;
(d) is and will be absolute and unconditional irrespective of any acts, omissions or circumstances which would or could (in the absence of this clause) adversely affect its validity;
(e) survives the completion or termination of this Agreement; and
(f) is given by the Treasurer as a principal debtor and not as a surety.
7.7 Notwithstanding any other provision of this Agreement, CBA may only claim under this clause 7 in respect of any matter:
(a) to the extent it is not recoverable by CBA under a policy of insurance;
(b) except in respect of a claim under Warranty 17.1 arising out of a failure to pay federal debits tax, to the extent it is not provided for in the Final Accounts or taken into account in the determination of the value of any assets included in the Final Accounts;
(c) to the extent that it does not
relate to an act done or omitted to be done by CBA or any member of the SBV
Group after the Completion Date which contributes to a cause of action
referred to in clause 7.4;
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(d) under Warranties 3, 10.1, 10.5, 13.1, 13.2 and 14 if all books, papers and records (including working papers and computer records) created or obtained by CBA or its professional advisors, consultants or agents during its due diligence review of the SBV Group which are material to the claim made under the Warranty have been retained by CBA or such advisors, consultants and agents and all reasonable access thereto is provided within a reasonable time to the Treasurer and his professional advisors, consultants and agents; or
(e) to the extent it does not relate to Finance provided by CBA or a member of the SBV Group after the Completion Date.
7.8 (a) Any claim made by CBA under this clause 7 will be made in writing and will describe in reasonable detail the nature of the claim and the amount claimed.
(b) Any amount payable by the Treasurer in respect of any claim made by CBA under this clause 7 is payable by the Treasurer within seven days of receiving a notice of claim pursuant to clause 7.8(a).
(c) Making a claim under clause 7.8(a) does not of itself prevent CBA making a further or different claim in respect of the same matter.
(d) Any moneys payable by the Treasurer pursuant to a claim made by CBA under this Agreement will be paid and received in diminution of the purchase price referred to in clause 3.1.
7.9 CBA will only be entitled to make any claim under this clause 7:
(a) for a single claim with a monetary value of $1 000 000 or more; or
(b) for claims which are all of one class arising from substantially the same circumstances with an aggregate monetary value of $1 000 000 or more.
7.10 CBA will not be entitled to make any claim under this clause 7 unless it has given notice (whether under clause 7.8 or otherwise) describing the nature or anticipated nature of the claim and, where possible, the amount of the claim:
(a) in the case of a claim relating to Tax, within seven years of the Completion Date; and
(b) in the case of any other claim,
within five years of the Completion Date, and
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(c) in any case, within three months of CBA first becoming aware of the claim or anticipated nature of the claim or within three months of the Completion Date, whichever is the later.
7.11 For the purpose of clause 7.7(a), CBA will after the Completion Date maintain in relation to its business (including the SBV Group) insurance cover of the same type and of a level not less than the level of insurance cover maintained by the SBV Group on the Completion Date.
7.12 Not withstanding any other provision of this Agreement, if the Treasurer is liable to CBA for a breach or breaches of Warranty 17 arising out of a failure to pay federal debits tax, his total liability in respect of that breach or those breaches will be the difference between:
(a) the liability which would have applied in the absence of this clause 7.12; and
(b) the lesser of $33 000 000 and the excess (if any) of Adjusted NTA over $850 000 000.
8.1 The Treasurer agrees that so long as any of the borrowing and note issues and other agreements listed in Schedule A to this Agreement remain outstanding or any commitment or liability remains thereunder and CBA continues to indemnify the Treasurer and the Government of Victoria under clause 8.2(c) and that indemnity is guaranteed by the Commonwealth of Australia the Treasurer will procure that there remains in full force and effect all guarantees and indemnities relating to such issues and agreements given by the Treasurer or the Government of Victoria which are in force at the date of this Agreement.
8.2 CBA:
(a) undertakes to do everything reasonably within its power (including the proffering of a guarantee or indemnity by CBA and, to the extent within CBA's power, the Commonwealth of Australia, in substitution for the guarantees and indemnities given by the Treasurer or by the Government of Victoria referred to in clause 8.1) to procure as soon as reasonably practicable the absolute and unconditional release and discharge of the Treasurer and the Government of Victoria from all and any duties, responsibilities, obligations and liabilities whatsoever arising in connection with the guarantees and indemnities referred to in clause 8.1;
(b) covenants not to issue any further securities or materially breach or be in default under the borrowing and note issues and agreements listed in Schedule A; and
(c) indemnifies the Treasurer and the Government of Victoria against every claim, action, damage, loss, liability, cost, charge, expense, outgoing or payment (other than payments made by the Treasurer or the Government of Victoria without legal obligation to do so to any person in the nature of a claimant or plaintiff) which the Treasurer or the Government of Victoria suffers, incurs or is liable for after the Completion Date under or pursuant to the guarantees and indemnities referred to in clause 8.1.
8.3 The indemnity in clause 8.2(c):
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(a) is a legal valid and binding obligation of CBA;
(b) may be enforced against CBA by action at law, suit in equity or other action or proceeding and it will not be necessary or required in order to enforce CBA's obligations and liabilities thereunder that the Treasurer prosecutes or exhausts any right, remedy or claim or proceeds in any manner against any other person;
(c) is a continuing indemnity and will remain in full force and effect until all money owing (contingently or otherwise) under the indemnity has been paid in full;
(d) is and will be absolute and unconditional irrespective of any acts, omissions or circumstances which would or could (in the absence of this clause) adversely affect its validity;
(e) survives the completion or termination of this Agreement;
(f) is given by CBA as a principal debtor and not as a surety; and
(g) does not apply to the deeds referred to in the list marked as Exhibit "K" and initialled by the parties for identification.
8.4 (a) Any claim made by the Treasurer under the indemnity in clause 8.2(c) will be made in writing and will describe in reasonable detail the nature of the claim and the amount claimed.
(b) Any amount payable by CBA in respect of any claim made by the Treasurer under the indemnity in clause 8.2(c) is payable by CBA within seven days of receiving a notice of claim pursuant to clause 8.4(a).
The Treasurer agrees to bear any Victorian stamp duty or other Victorian taxes chargeable under any Act in respect of anything done under the State Bank (Succession of Commonwealth Bank) Act 1990 or this Agreement or in respect of any act or transaction connected with or necessary to be done by reason of the State Bank (Succession of Commonwealth Bank) Act 1990 or this Agreement, including a transaction entered into or an instrument made, executed, lodged or given.
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The Treasurer will do all acts and things and execute all documents or procure the doing or execution of such acts things and documents as are within his power to do or procure and are necessary so that CBA will have the right after the Completion Date to use the name "State Bank of Victoria" and all relevant trade, business and brand names and marks and logos used by the Bank.
11.1 To the end of the Completion Date, the Treasurer will use his best endeavours to procure that the business of the Bank and each Subsidiary is carried out properly and in its ordinary course and without limiting the foregoing that the Bank and each Subsidiary will not, without the prior written consent of CBA (which consent CBA covenants will not be withheld unreasonably), do any of the following:
(a) change its policy with respect to investment or trading securities;
(b) incur any single capital expenditure commitment of more than $1 000 000;
(c) enter into any Lending Agreement involving the provision of Finance in an amount in excess of $5 000 000 (not including any rollover pursuant to an existing Lending Agreement);
(d) in relation to any existing Lending Agreement involving the provision of Finance in an amount in excess of $5 000 000:
(i) amend or vary in any material way such Lending Agreement;
(ii) vary or
release any security for any such Lending Agreement;
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(iii) waive any default in respect of such Lending Agreement; or
(iv) increase any limit applicable to such Lending Agreement;
(e) vary in any material way any Borrowing Agreement;
(f) employ any new person who would on commencement of employment receive, or terminate any Employee who currently receives, a salary package (inclusive of benefits) with an aggregate value in excess of $100 000 per annum or, without limiting the foregoing, make or terminate any senior appointment;
(g) change the terms and conditions of employment applicable to Employees generally or a significant number of them;
(h) change its lending, deposit taking or foreign exchange activities or policies;
(i) introduce any new product or service;
(j) cease to offer any product or service offered as at the date of this Agreement;
(k) open any new branch or office or close any branch or office in operation as at the date of this Agreement;
(l) maintain any net open position with respect to foreign exchange exposures which is not both:
(i) within existing approved trading limits; and
(ii) subject to mark-to-market revaluation processes with any resulting profit or loss reflected in the accounts of the relevant member of the SBV Group;
(m) maintain any uncovered interest rate position in excess of the structural balance sheet mismatch inherent in normal bank activities which is not both:
(i) within existing approved trading limits; and
(ii) subject to mark-to-market revaluation processes with any resulting profit or loss reflected in the accounts of the relevant member of the SBV Group;
(n) allow holdings of assets the
subject of the "Prime Assets Ratio" used by the Reserve Bank of Australia to
be less than $150 million in excess of the minimum requirement of the Reserve
Bank of Australia;
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(o) increase any delegated authority or trading exposure limit granted to any person or applicable to any position within a member of the SBV Group including, without limitation, any discretionary lending authority;
(p) change any accounting policies or practices of any member of the SBV Group;
(q) raise any capital which would be tier 1 or tier 2 capital for the purposes of the Reserve Bank of Australia's prudential guidelines;
(r) permit the shares in, or assets of, SBV Futures Limited (or any substantial portion of either of them) to be sold or disposed of;
(s) create, acquire or revalue any brand names, copyright, franchises, intellectual property, licences, mastheads, patents or trademarks;
(t) except for the disposal by the Bank of Tricontinental Holdings Limited contemplated by clause 4.2(a) of this Agreement, acquire or incorporate or dispose of any subsidiary;
(u) issue any shares or securities convertible to shares or incur any obligation to do so;
(v) amend or waive any rights under, or agree to amend or waive any rights under, the Assumption Agreement, the Reimbursement Agreement, the SBV Deed, the Trico Deed or the deeds and agreements referred to in Warranty 21.2 except as expressly required or permitted by this Agreement;
(w) serve any Notice of Claim (as defined in the SBV Deed) on the Treasurer other than the Past Interest Notice of Claim contemplated by clause 4.9; or
(x) pay or incur a liability to pay any amount under section 38(1)(d) of the State Bank Act 1988 or pay, make or declare any dividend or other distribution of profits or capital.
11.2 The Treasurer will use his best
endeavours to procure that at all times prior to the Completion Date :
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(a) CBA will have the right to appoint an observer to attend all meetings of the Board of Directors of the Bank;
(b) CBA will receive all notices of such meetings, board papers or other documents which and at the times at which CBA would be entitled to receive them if it were a natural person and a member of the Board of Directors of the Bank;
(c) CBA will receive copies of all returns or other documents provided to the Reserve Bank of Australia by the Bank or any Subsidiary;
(d) the Bank will—
(i) provide every reasonable assistance to CBA in conducting its due diligence review of the SBV Group; and
(ii) cause the Subsidiaries to provide every reasonable assistance to CBA in conducting its due diligence review of the SBV Group; and
(e) CBA will have full access to all computer facilities and development operations, and the right to examine computing operations, of the Bank and each Subsidiary.
11.3 The parties acknowledge that prior to the date of this Agreement, CBA commenced a due diligence review of the SBV Group and that it is intended that this review will continue until the Completion Date.
12.1 Where, pursuant to the terms of this Agreement, a party (the "Indemnifying Party") indemnifies the other party (the "Indemnified Party") against any action, suit or proceeding being brought against the Indemnified Party, the following clauses 12.2 to 12.5 apply.
12.2 Within 10 Business Days of
being notified or becoming aware of the institution of any action, suit or
proceeding which may give rise to a claim under the relevant indemnity, the
Indemnified Party must notify the Indemnifying Party of that fact and give to
the Indemnifying Party (so far as it is able to do so) full details of such
action, suit or proceeding.
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12.3 The Indemnified Party must not agree to arbitrate any claim or pay, settle or compromise such action, suit or proceeding without the consent (not to be unreasonably withheld) of the Indemnifying Party within 20 Business Days of the giving of the notice referred to in clause 12.2 nor at any time thereafter provided within that 20 Business Days, the Indemnifying Party has notified the Indemnified Party that it intends to defend the relevant action, suit or proceeding and has commenced such defence or has taken such steps as are reasonably open to it to do so.
12.4 Any defence of an action, suit or proceeding by the Indemnifying Party pursuant to clause 12.3 will be conducted (if necessary) in the name of the Indemnified Party but in accordance with the reasonable directions and at the expense of the Indemnifying Party. The Indemnifying Party in defending an action, suit or proceeding will have regard to, and not unreasonably pursue a course of action which would jeopardise, any ongoing business relationships, reputation or manpower requirements of the Indemnified Party.
12.5 The Indemnified Party will at the expense of the Indemnifying Party (which expense will include executive time at usual hourly rates) render or cause to be rendered to the Indemnifying Party such reasonable assistance as the Indemnifying Party may reasonably require in connection with such defence including, without limiting the generality of the foregoing, taking such action and providing such witnesses and documentary or other evidence as the Indemnifying Party may reasonably request to avoid, dispute, resist, appeal, compromise or defend the action, suit or proceeding and affording the Indemnifying Party and his lawyers and other representatives all reasonable access to all relevant books, records, files and documents and to appropriate personnel of the Indemnified Party for the purposes of such defence.
Each party will bear its own costs in relation to the preparation and execution of this Agreement.
Any amount payable under this Agreement by one party to the other and not paid timeously will bear interest on the amount outstanding from time to time at the same rate as is payable from time to time on a judgement for debt entered in the Supreme Court of Victoria.
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As to any of the provisions of this Agreement remaining to be performed or capable of having effect after the Completion Date, this Agreement will remain in full force and effect notwithstanding completion.
Neither party to this Agreement will assign or purport to assign any of that party's rights under this Agreement without the prior written consent of the other party (which consent may be withheld at the sole discretion of that other party).
17.1 Each party agrees to do all such things and execute all such deeds, instruments, transfers or other documents as may be reasonably necessary or desirable to give full effect to the provisions of this Agreement and the transactions contemplated by it.
17.2 The Treasurer up to the Completion Date and CBA after the Completion Date undertakes to use his or its best endeavours to procure that each member of the SBV Group does all things and executes all deeds, instruments, transfers or other documents as may be reasonably necessary or desirable to give full effect to the provisions of this Agreement and the transactions contemplated by it.
This Agreement constitutes the entire agreement between the parties pertaining to its subject matter and supersedes all prior agreements and understandings of the parties in connection with it.
19.1 Either party by notice to the other party may waive its rights in respect of the strict and literal performance of or compliance with any provision, condition or requirement herein in the manner and for the time set out in the notice.
19.2 No waiver by either party of
any default in the strict and literal performance of or compliance with any
provision, condition or requirement herein will be deemed to be a waiver of
strict and literal performance of and compliance with any other provision,
condition or requirement herein nor to be a waiver of or in any manner release
either party from strict compliance with any provision, condition or
requirement in the future nor will any delay or omission of either party to
exercise any right hereunder in any manner impair the exercise of any such
right accruing to it thereafter or of any other right.
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20.1 Any demand, consent, notice or other communication ("notice") authorised or required to be made hereunder will be in writing and may be given by facsimile, post or hand to a party addressed as follows or as otherwise notified to the other party:
To the Treasurer: 4th Floor,
1 Treasury Place,
MELBOURNE. VIC. 3002.
Facsimile: (03) 650 5421
To CBA: 2nd Floor,
48
Martin Place,
SYDNEY. N.S.W. 2000.
Attention: The Secretary
Facsimile: (02) 221 4827
20.2 A notice:
(a) sent by prepaid registered or certified post (airmail, if appropriate) will be deemed to have been given (where posted to an address in the same country) on the Business Day following the day on which it was posted or (where posted to an address in another country) on the seventh Business Day following the day on which it was posted;
(b) transmitted by facsimile or delivered by hand before 5.00 p.m. on a Business Day will be deemed to have been given on that day, or in any other case of facsimile transmission or hand delivery, will be deemed to have been given on the Business Day following the day of transmission or delivery.
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This Agreement is governed by and will be construed in accordance with the laws of the State of Victoria, Australia and each party hereby irrevocably submits to the jurisdiction of the courts of that State and all courts of appeal therefrom.
IN WITNESS whereof the parties have executed this Agreement on the day and year first above written.
|
SIGNED by THE HONOURABLE E. ELDRIDGE
|
|
|
THE COMMON SEAL of D. SANDERS |
L.S. |
—————————
SCHEDULE A
(Debt instruments issued or guaranteed by the Bank and swap
agreements—Clause 8.1)
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|
Issue Amount |
Description of Amount |
Maturity Date |
|---|---|---|
|
USD 250 million |
Guaranteed Undated |
— |
|
USD 125 million |
Guaranteed Ten Year |
June 1999 |
|
AUD 300 million |
Extendible Floating Rate Stock |
22 December 2004 |
|
USD 100 million |
9 1 / 4 % Guaranteed Notes |
26 July 1993 |
|
AUD 75 million |
15 1 / 4 % Guaranteed Notes |
14 February 1991 |
|
AUD 50 million |
15 1 / 2 % Guaranteed Notes |
13 July 1994 |
|
JPY 10 billion |
5 3 / 8 % Guaranteed Notes |
18 October 1991 |
|
AUD 350 million |
12% SBV Bonds |
15 March 1993 |
|
GBP 20 million |
11·35% Note |
14 April 1994 |
|
AUD 75 million |
12 1 / 2 % SBV Bonds |
15 February 1995 |
|
JPY 10 billion |
7% Guaranteed Bear Notes |
21 November 1992 |
|
GBP 75 million |
11 1 / 2 % Guaranteed Notes |
21 August 1994 |
|
CAD 75 million |
11% Guaranteed Notes |
26 May 1992 |
|
USD 20 million |
Loan Agreement dated 24/11/88 |
25 November 1993 |
|
AUD 100 million |
12 1 / 2 % SBV Bonds issued 12/7/90 |
15 October 1996 |
|
AUD 252 560 164 |
Zero Coupon Inscribed Stock issued 29/12/89 |
30 April 1992 |
|
AUD 22 572 816 |
Zero Coupon Inscribed Stock issued 29/12/89 |
30 April 1991 |
|
AUD 200 million |
12 month deposit facility issued 5/8/90 |
2 August 1991 |
|
AUD 15 million |
12 1 / 2 % Term Deposit issued 8/12/88 |
1 June 1997 |
|
AUD 3·675 million |
Zero Coupon Deposit issued 27/12/89 |
14 March 1995 |
| | | |
|
AUD 3 million |
Fixed Deposits issued 1/12/89 |
AUD 1 million on 3 December 1990 AUD 2 million on 2 December 1991 |
|
USD 250 million |
Loan Agreement dated 8/4/86 with S.B. Victoria Funding Inc., Delaware |
Various |
|
USD 250 million |
Multi-currency Euro |
Various |
|
USD 250 million |
Multi-currency London |
Various |
|
AUD 500 million |
Euro Commercial Paper |
Various |
|
USD 125 million |
Guaranteed Undated* |
— |
|
USD 125 million |
8 1 / 2 % Guaranteed Notes* |
18 June 1993 |
|
USD 300 million |
Guaranteed Floating |
23 July 1996 |
|
JPY 5 billion |
Loan Agreement dated 24/6/86* |
27 June 1991 |
|
JPY 3·3 billion |
Loan Agreement dated 14/7/86* |
24 July 1991 |
|
JPY 3 billion |
Loan Agreement dated 30/7/87* |
31 July 1992 |
|
JPY 4 billion |
Loan Agreement dated 28/9/87* |
29 September 1997 |
|
JPY 4 billion |
Loan Agreement dated 28/9/87* |
30 September 1997 |
|
USD 68 704 913 |
8% Guaranteed Rainbow Notes* |
27 July 1992 |
|
JPY 15 billion |
7% Guaranteed Bear Notes* |
10 May 1992 |
|
JPY 20 billion |
Guaranteed Stepped-up |
10 December 1991 |
|
JPY 10 billion |
5% Guaranteed Notes* |
12 March 1992 |
|
JPY 30 billion |
4·75% Guaranteed Notes* |
7 July 1992 |
* Contractual guarantee
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Swap agreements
1. Interest Rate Exchange Agreement dated 24 November 1988 between the Bank and The Long-Term Credit Bank of Japan, Limited.
2. Interest Rate and Currency Exchange Agreement dated 25 July
1988
between the Commissioners of the State Bank of Victoria and The
Fuji Bank, Limited, Tokyo.
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3. Interest Rate and Currency Exchange Agreement dated 13 April 1989 between the Bank and Baring Brothers & Co., Limited.
_______________