BAE SYSTEMS PLC PROPOSED ACQUISITION OF UNITED DEFENSE INDUSTRIES, INC. AND
PLACING TO RAISE APPROXIMATELY £375 MILLION
1. Introduction
BAE Systems plc ('BAE Systems' or the 'Company') announces that its wholly-ownedU.S. subsidiary, BAE Systems North America Inc. ('BAE Systems North America'),has entered into a definitive merger agreement to acquire United Defense
Industries, Inc. ('UDI') (the 'Proposed Acquisition') for $75 per share in cash,representing a total consideration for UDI's fully diluted share capital of
approximately $3,974 million (£2,092 million)(6). Including the assumption of
net debt of $218 million (£115 million)(7), the transaction values the
enterprise at $4,192 million (£2,207 million).
UDI is a leading U.S. defence company which designs, develops and produces
combat vehicles, artillery systems, naval guns, missile launchers and precision
munitions, used by the U.S. Department of Defense and allies worldwide, and
provides non-nuclear ship repair, modernisation and conversion to the U.S. Navy
and other U.S. Government agencies. UDI will become part of a newly created
global land systems business, together with BAE Systems' existing UK and Swedish
land systems businesses, and will operate as part of BAE Systems North America.
The Proposed Acquisition is conditional, amongst other things, upon receiving
the required regulatory clearances, UDI shareholder approval and the approval of
BAE Systems shareholders at an Extraordinary General Meeting. The Proposed
Acquisition is expected to close by mid 2005.
BAE Systems also announces a placing of 150 million new ordinary shares (the '
Placing Shares') in BAE Systems, representing 4.9 per cent. of BAE Systems'
existing issued share capital (the 'Placing'), which is expected to raise
approximately £375 million(8) before expenses. The Placing, which is being
launched today, is not conditional upon the completion of the Proposed
Acquisition.
The Proposed Acquisition will be financed through the Placing, a new debt
facility (the 'Facility') and existing internal resources.
Goldman Sachs International and Gleacher Shacklock LLP are acting as financial
advisers to BAE Systems.
Hoare Govett Limited ('Hoare Govett') is acting as Sole Global Coordinator andHoare Govett and Dresdner Kleinwort Wasserstein Securities Limited are acting as
Joint Bookrunners in respect of the Placing.
2. Information on UDI
UDI is a leading producer of military ground combat vehicles and also supplies
artillery systems, naval weapons systems, missile launchers and precision
munitions to U.S. and international customers. It also provides services in
non-nuclear naval ship repair, modernisation, and conversion.
UDI is listed on the New York Stock Exchange and is headquartered in Arlington,
Virginia. It employs approximately 8,000 people in 25 locations in the U.S. and
Sweden. It gained a presence in Sweden following the acquisition of Bofors
Defence in 2000.
UDI currently comprises two business segments - Defense Systems and Ship Repair
and Maintenance.
• Defense Systems comprises the activities involved in the development,
production, upgrade and maintenance of land weapons systems, military ground
vehicles and weapons systems. UDI has a substantial installed base of over
100,000 combat vehicles for the U.S. Armed Forces and international allies.
Military ground vehicle applications include the Bradley fighting vehicle and
derivatives (over 7,000 vehicles in active service), the M88 tank recovery
vehicle and the M113 armoured personnel carrier. UDI also has secured a major
role on the future manned ground vehicle and armed robotic vehicle requirements
for the U.S. Army's Future Combat Systems ('FCS') programme. Key weapon systemsplatforms include the Mk45 Naval Gun System and the Mk41 Vertical Launching
System. UDI is well positioned as the provider of gun systems for the U.S.
Navy's next generation combat ships, the DD(X) and the Littoral Combat Ship.
For the year ended 31 December 2004, Defense Systems reported sales of $1,719
million (75% of total sales)
• Ship Repair and Maintenance operations comprise the United States Marine
Repair, Inc. business acquired by UDI in July 2002, consisting of a total of
four operating shipyards. These yards perform a full range of non-nuclear ship
repair, overhaul and modernisation services for the U.S. Navy, U.S. Coast Guard,
U.S. Maritime Administration, U.S. Army and commercial customers and provide a
secure and stable revenue stream. For the year ended 31 December 2004, Ship
Repair and Maintenance reported sales of $573 million (25% of total sales)
The table below presents UDI's sales and profit before interest and tax (PBIT)
for the three years ended 31 December 2004, in accordance with U.S. GAAP:
Year Ended 31 December
2002 2003 2004
$m $m $m
Revenue 1,725 2,053 2,292
PBIT 180 239 293
As at 30 September 2004, UDI reported net assets of $225 million(9).
3. Background to, and reasons for, the Proposed Acquisition
A key strategic objective of BAE Systems is to expand its presence in the U.S.
defence market and grow as the premier transatlantic aerospace and defence
group. The combination of the high priority afforded to U.S. national security,
a strong commitment to research and development and contracting terms that
balance risk and reward provide a healthy environment for the U.S. defence
industry.
Furthermore, BAE Systems regards the land systems sector as a key area of future
growth in the defence industry, with attractive opportunities for upgrade of the
installed product base, growing systems content and developing integrated
through-life support. In recent years, armed conflicts in Afghanistan and Iraq
have underscored the importance of land systems within the context of military
operations. This is reflected in emerging defence spending trends. In August
2004, BAE Systems acquired Alvis plc to enhance significantly its presence in
the land systems sector, building on the strengths of its existing RO Defence
business.
BAE Systems North America is a leading defence, national security, aerospace and
information systems business. It is a leading provider of electronic and
information-based systems and knowledge-based solutions. BAE Systems North
America employs over 27,000 people at sites across the U.S and in the year ended
31 December 2004 generated $5,078 million in sales. It ranks among the top ten
suppliers to the U.S. military. Since it was formed in 1999, BAE Systems North
America has made twelve acquisitions in the U.S. defence market, including
Sanders, DigitalNet and ALPHATECH, and has a track record of successful
integration and delivering shareholder value.
Together BAE Systems and UDI will have an enhanced capability to meet the
requirements of their U.S., UK, Swedish and export customers. In particular,
BAE Systems believes that the Proposed Acquisition of UDI will:
• Represent a significant step in the delivery of BAE Systems' strategy to
grow as the premier transatlantic aerospace and defence contractor by:
• expanding and developing its business in North America
• creating a global land systems business
• developing its worldwide through-life support and services capabilities
• Create a leading international position in the fast growing land systems
sector. As a result of the global war on terror and ongoing operations in Iraq
and Afghanistan, the U.S. Department of Defense has significantly shifted its
priorities and budget towards land systems
• Position the new global land systems business to take advantage of the
U.S. Department of Defense's mission and funding outlook, which is expected to
prioritise the evolutionary and affordable development of military platforms and
the refurbishment and upgrade of existing systems. The planned restructuring of
the U.S. Army is also likely to require an upgrade of the large inventory of
Bradley and other UDI vehicles. The 2005 U.S. defence budget and supplemental
request include approximately $1.3 billion for resets and upgrades to the
Bradley vehicle fleet
• Provide the enlarged land systems business with a significant position
within the Future Combat Systems programme, the U.S. Army's largest procurement
programme, as well as enhanced opportunities on programmes such as the UK's FRES
and Sweden's SEP, and in the export market
• Complement BAE Systems North America's advanced electronic systems and
subsystems in areas such as targeting, communications, protection and
situational awareness, creating significant synergy potential
• Further develop BAE Systems' through-life support and services
capabilities by adding to its operations the U.S. Navy's largest non-nuclear
ship repair and overhaul business
The Proposed Acquisition is expected to be immediately accretive to BAE Systems'
earnings, with a step-up expected in the first full year (2006)(10) as well as
delivering returns in excess of BAE Systems' cost of capital in the second full
year (2007) following the Proposed Acquisition(11).
4. Board, Management and Employees
On completion of Proposed Acquisition, UDI will become part of a newly created
global land systems business, together with BAE Systems' existing UK and Swedish
land systems businesses, which will be headquartered and led in the U.S., as
part of BAE Systems North America, by the highly regarded and experienced UDI
management team.
5. Termination Arrangements and Fees
The merger agreement for the Proposed Acquisition provides that UDI will pay to
BAE Systems North America a termination fee of approximately $119 million upon
termination by UDI to accept a superior proposal or termination in certain
circumstances following the making of a competing proposal.
6. Current Trading and Prospects
As stated at the time of its preliminary results for the year ended 31 December
2004, which were announced on 24 February 2005, BAE Systems expects that the
overall performance of the company's defence businesses will continue to improve
in 2005 albeit at a lower rate of growth than that achieved in 2004.
The board of BAE Systems believes that the Proposed Acquisition will provide
significant opportunities for UDI and the new global lands systems business.
Accordingly, the board of BAE Systems has confidence in the trading prospects of
the enlarged group.
7. Approvals and Consents
The Proposed Acquisition will be subject to the approval of BAE Systems
shareholders at an Extraordinary General Meeting. A circular to shareholders
setting out the notice of this meeting, including the Directors' recommendation
to vote in favour of the Proposed Acquisition, will be dispatched in due course.
The Proposed Acquisition is also conditional, amongst other things, upon
receiving the required regulatory clearances and UDI shareholder approval.
The Proposed Acquisition is expected to close in mid 2005.
8. The Placing
The Placing, by Hoare Govett and Dresdner Kleinwort Wasserstein Securities
Limited, of 150 million new ordinary shares representing approximately 4.9
percent of BAE Systems' existing issued share capital, is expected to raise
approximately £375 million before expenses and will contribute to the funding
for the Proposed Acquisition. The Placing has been underwritten by Hoare Govett
and Dresdner Bank AG, London Branch, and is not conditional on the completion of
the Proposed Acquisition.
The Placing Shares will rank equally in all respects with the existing ordinary
shares of the Company, including the right to receive all future dividends and
other distributions hereafter, including the final dividend for the year ended
31 December 2004 of 5.8 pence per ordinary share announced on 24 February 2005.
Subject to shareholder approval, the final dividend will be paid on 1 June 2005
to shareholders registered on 22 April 2005. The ex-dividend date is 20 April
2005.
Application will be made for the Placing Shares to be admitted to the Official
List maintained by the UKLA and to be admitted for trading by the London Stock
Exchange on its main market for listed securities. Admission of the Placing
Shares is expected to take place on 10 March 2005. In connection with the
Placing, BAE Systems has agreed not to issue ordinary shares (other than the
Placing Shares) for a period beginning on the date of this Announcement and
ending 90 days after Admission. This agreement is subject to certain customary
exceptions, including, with the prior consent of the Bookrunners.
Attention is drawn to the detailed terms and conditions of the Placing described
in Appendix 1 to this announcement and, in particular, the requirement that a
Placee must either have made a nationality declaration (which is still in effect
and correct) or must make a nationality declaration in accordance with the
provisions of the Company's articles of association before the directors of the
Company are entitled to register a Placee's allocation. This declaration can be
made through CREST or via a declaration form which can be obtained from either
of the Bookrunners.
9. The Facility
In addition to the Placing, BAE Systems will finance the Proposed Acquisition
with a new debt facility of $3,000 million. The Facility has been underwritten
by Goldman Sachs Credit Partners L.P. and Dresdner Bank AG, London Branch.
This announcement is for information purposes only and does not constitute an
offer or invitation to acquire or dispose of any securities or investment advice
in any jurisdiction.
Goldman Sachs International, which is authorised and regulated by the Financial
Services Authority, is acting exclusively for BAE Systems and for no one else in
connection with the Proposed Acquisition and will not be responsible to anyone
other than BAE Systems for providing the protections afforded to the customers
of Goldman Sachs International or for providing advice in relation to the
Proposed Acquisition.
Gleacher Shacklock LLP, which is authorised and regulated by the Financial
Services Authority, is acting exclusively for BAE Systems and for no one else in
connection with the Proposed Acquisition and will not be responsible to anyone
other than BAE Systems for providing the protections afforded to the customers
of Gleacher Shacklock LLP or for providing advice in relation to the Proposed
Acquisition.
Hoare Govett Limited and ABN AMRO Bank N.V. (London branch), which are
authorised and regulated by the Financial Services Authority, are acting
exclusively for BAE Systems and for no one else solely in connection with the
Placing and will not be responsible to anyone other than BAE Systems for
providing the protections afforded to the customers of Hoare Govett Limited and
ABN AMRO Bank N.V. (London branch) or for providing advice in relation to the
Placing.
Dresdner Bank AG, London Branch and Dresdner Kleinwort Wasserstein Securities
Limited, which are authorised and regulated by the Financial Services Authority,
are acting exclusively for BAE Systems and for no one else solely in connection
with the Placing and will not be responsible to anyone other than BAE Systems
for providing the protections afforded to the customers of Dresdner Bank AG and
Dresdner Kleinwort Wasserstein Securities Limited or for providing advice in
relation to the Placing.
This announcement includes 'forward-looking statements'. All statements other
than statements of historical facts included in this announcement, including,
without limitation, those regarding the Company's financial position, business
strategy, plans and objectives of management for future operations, the expected
timing and strategic and financial effects of the Proposed Acquisition and
trends in the U.S. defence budget and the defence industry, are forward-looking
statements. Such forward-looking statements involve known and unknown risks,
uncertainties and other important factors which could cause the actual results,
performance or achievements of the Company or the markets and economies in which
the Company operates to be materially different from future results, performance
or achievements expressed or implied by such forward-looking statements,
including, without limitation, risks related to: the integration of UDI's
business with the Company's, the costs related to the Proposed Acquisition,
inability to obtain, or meet conditions imposed for, required governmental and
regulatory approvals and consents and inability to obtain the approval of the
shareholders of UDI or the Company for the Proposed Acquisition. The Company
cannot give any assurance that the Proposed Acquisition will be completed or
that it will be completed on the terms described in this announcement.
This announcement is not an offer for sale within the United States of any
security of the Company. Securities of the Company, including its ordinary
shares, may not be offered or sold in the United States absent registration
under the U.S. securities laws or unless exempt from registration under such
laws.
APPENDIX 1: TERMS AND CONDITIONS OF THE PLACING
THIS ANNOUNCEMENT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO THE
UNITED STATES, CANADA, AUSTRALIA, JAPAN OR THE REPUBLIC OF IRELAND
IMPORTANT INFORMATION FOR PLACEES ONLY ON THE PLACING
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THE
ANNOUNCEMENT AND THIS APPENDIX AND THE TERMS AND CONDITIONS SET OUT HEREIN ARE
DIRECTED ONLY AT PERSONS WHOSE ORDINARY ACTIVITIES INVOLVE THEM IN ACQUIRING,
HOLDING, MANAGING AND DISPOSING OF INVESTMENTS (AS PRINCIPAL OR AGENT) FOR THE
PURPOSES OF THEIR BUSINESS AND WHO HAVE PROFESSIONAL EXPERIENCE IN MATTERS
RELATING TO INVESTMENTS AND WHO FALL WITHIN ARTICLE 19(5) OF THE FINANCIAL
SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2001, AS AMENDED (THE
ORDER) OR ARE PERSONS WHO FALL WITHIN ARTICLE 49(2)(A) TO (D) ('HIGH NET WORTHCOMPANIES, UNINCORPORATED ASSOCIATIONS, ETC') OF THE ORDER OR TO WHOM IT MAY
OTHERWISE LAWFULLY BE COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO
AS RELEVANT PERSONS). THE ANNOUNCEMENT AND THIS APPENDIX AND THE TERMS AND
CONDITIONS SET OUT HEREIN MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE
NOT RELEVANT PERSONS. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS
APPENDIX AND THE TERMS AND CONDITIONS SET OUT HEREIN RELATES IS AVAILABLE ONLY
TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. THE
ANNOUNCEMENT AND THIS APPENDIX DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR
SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY. THE NEW ORDINARY SHARES THAT ARE
THE SUBJECT OF THE PLACING (THE PLACING SHARES) REFERRED TO HEREIN HAVE NOT BEEN
AND WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED
(THE SECURITIES ACT) AND, MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES
EXCEPT PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.
Persons who are invited to and who choose to participate in the Placing by
making an oral offer to subscribe for Placing Shares, will be deemed to have
read and understood the announcement (including this Appendix) in its entirety
and to be making such offer on the terms and conditions, and to be providing the
representations, warranties, acknowledgements and undertakings, contained in
this Appendix. In particular each such Placee represents, warrants and
acknowledges that it:
1. is a Relevant Person and undertakes that it will acquire, hold,
manage or dispose of any Placing Shares that are allocated to it for the
purposes of its business; and
2. is subscribing for the Placing Shares for its own account or is
subscribing for the Placing Shares for an account with respect to which it
exercises sole investment discretion and that (i) it (and any such account) is
outside the United States, within the meaning of Regulation S under the
Securities Act; or (ii) if it is not outside the United States, is a qualified
institutional buyer (QIB) as such term is defined in Rule 144A under the
Securities Act (Rule 144A) and has duly executed an investment letter in the
form provided to it and has delivered the same to either Dresdner Kleinwort
Wasserstein Securities LLC or ABN AMRO Incorporated.
The announcement and this Appendix do not constitute an offer to sell or issue
or the solicitation of an offer to buy or subscribe for Placing Shares in any
jurisdiction including, without limitation, the United Kingdom, the United
States, Canada, Australia, Japan or the Republic of Ireland or any other
jurisdiction in which such offer or solicitation is or may be unlawful. The
announcement and the information contained in this Appendix is not for
publication or distribution, directly or indirectly, to persons in the United
States, Canada, Australia, Japan or in any jurisdiction in which such
publication or distribution is unlawful.
The Placing Shares referred to in the announcement have not been and will not be
registered under the Securities Act and may not be offered, sold or transferred
within the United States except pursuant to an exemption from, or as part of a
transaction not subject to, the registration requirements of the Securities Act.
The Placing Shares are being offered and sold (i) in reliance on Regulation S
under the Securities Act and (ii) to QIBs as defined in Rule 144A in reliance on
Rule 144A or another exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act.
The Placing Shares have not been approved or disapproved by the U.S. Securities
and Exchange Commission, any state securities commission or other regulatory
authority, nor have the foregoing authorities endorsed the merits of this
offering or the accuracy or adequacy of the offering materials. Any
representation to the contrary is unlawful.
The distribution of the announcement (including this Appendix) and the Placing
and/or issue of the Placing Shares in certain jurisdictions may be restricted by
law. No action has been taken by BAE Systems PLC (the Company) or Dresdner Bank
AG, London Branch (DrAG) or Hoare Govett Limited (Hoare Govett and, together
with DrAG, the Managers) that would permit an offer of Placing Shares or
possession or distribution of the announcement (including this Appendix) or any
other offering or publicity material relating to such Placing Shares in any
jurisdiction where action for that purpose is required. Persons to whose
attention the announcement (including this Appendix) is drawn are required by
the Company and the Managers to inform themselves about and to observe any such
restrictions.
Details of the Placing Agreement and the Placing Shares
The Managers have entered into a placing agreement (the Placing Agreement) with
the Company whereby each of the Managers has (whether through it or its
affiliates including, in the case of DrAG and without limitation, Dresdner
Kleinwort Wasserstein Securities Limited (DrKW) and, in the case of Hoare Govett
and without limitation, ABN AMRO Bank N.V. (London branch)), on and subject to
the terms and conditions set out therein, agreed severally, and not jointly nor
jointly and severally, as agent for and on behalf of the Company, to use its
reasonable endeavours to seek to procure Placees for the Placing Shares and,
failing which, to subscribe for its relevant proportion of the Placing Shares at
the Placing Price in accordance with the provisions of the Placing Agreement.
The Placing Shares will, when issued, be credited as fully paid and will rank
pari passu in all respects with the existing issued ordinary shares of 2.5 pence
per share in the capital of the Company (the Ordinary Shares), including the
right to receive all dividends and other distributions declared, made or paid on
or in respect of such Ordinary Shares after the date of issue of the Placing
Shares and, in particular, the right to receive the final dividend for the year
ended 31 December 2004 of 5.8 pence per Ordinary Share announced on 24 February
2005. Subject to shareholder approval, the final dividend will be paid on 1
June 2005 to shareholders registered on 22 April 2005. The ex-dividend date is
20 April 2005.
In this Appendix, unless the context otherwise requires, Placee means a person
(including individuals, funds or others) on whose behalf a commitment to
subscribe for Placing Shares has been given.
Application for listing and admission to trading
Application will be made to the UK Listing Authority (the UKLA) for admission of
the Placing Shares to the Official List of the UKLA (the Official List) and to
London Stock Exchange plc (the London Stock Exchange) for admission to trading
of the Placing Shares on the London Stock Exchange's market for listed
securities (together Admission). It is expected that Admission will become
effective at 8:00 a.m. on Thursday, 10 March 2005 and that dealings in the
Placing Shares will commence at that time.
Bookbuild
Commencing today each of the Managers will be conducting an accelerated
bookbuilding process (the Bookbuilding Process) to determine demand for
participation in the Placing by Placees. This Appendix gives details of the
terms and conditions of, and the mechanics of participation in, the Placing. No
commissions will be paid to Placees or by Placees in respect of any Placing
Shares.
The Managers will be entitled to effect the Placing by such alternative method
to the Bookbuilding Process as they may, in their sole discretion, determine. To
the fullest extent permissible by law, neither of the Managers nor any holding
company thereof, nor any subsidiary, branch or affiliate of the Banks or any
holding company thereof (each an Affiliate) shall have any liability to Placees
(or to any other person whether acting on behalf of a Placee or otherwise). In
particular, neither of the Managers nor any Affiliate thereof shall have any
liability in respect of its conduct of the Bookbuilding Process or of such
alternative method of effecting the Placing as the Managers may determine.
Participation in, and Principal terms of, the Bookbuilding Process
By participating in the Bookbuilding Process and the Placing, Placees will be
deemed to have read and understood the announcement (including this Appendix)
in its entirety and to be participating and making an offer for Placing Shares
on the terms and conditions, and to be providing the representations,
warranties, acknowledgements and undertakings, contained in this Appendix. A
further announcement will be made following the close of the Bookbuilding
Process detailing the Placing Price at which the Placing Shares are being placed
(the Pricing Announcement).
Each of DrAG and Hoare Govett (whether through themselves or their respective
Affiliates) is arranging the Placing severally, and not jointly nor jointly and
severally, as an agent of the Company.
Each of the Managers and their respective Affiliates is entitled to participate
as principal in the Bookbuilding Process.
The Bookbuilding Process will establish a single price (the Placing Price)
payable to the Managers by all Placees. Any discount to the market price of the
Ordinary Shares of the Company will be determined in accordance with the Listing
Rules as published by the UKLA pursuant to Part IV of the Financial Services and
Markets Act 2000 (the FSMA).
The Bookbuilding Process is expected to close no later than 6.30 p.m. London
time on Monday, 7 March 2005, but may be closed earlier at the sole discretion
of the Managers. Each of the Managers may, at its sole discretion, accept bids
that are received after the Bookbuilding Process has closed.
A bid in the Bookbuilding Process will be made on the terms and conditions in
this Appendix and will not be capable of variation or revocation after the close
of the Bookbuilding Process.
A Placee who wishes to participate in the Bookbuilding Process should
communicate its bid by telephone to the usual sales contact at ABN AMRO Bank
N.V. (London branch) or DrKW. If successful, an allocation will be confirmed
orally following the close of the Bookbuilding Process, and a conditional
contract note will be dispatched as soon as possible thereafter. Hoare Govett's
or DrKW's oral confirmation will constitute a legally binding commitment upon
the Placee to subscribe for the number of Placing Shares allocated to that
Placee at the Placing Price set out in the Pricing Announcement and otherwise on
the terms and conditions set out in this Appendix and in accordance with the
Company's Memorandum and Articles of Association.
Each Placee will be required to make a 'nationality declaration' (see '
Registration and Settlement' below for further details).
Each Placee's obligations will be owed to the Company and to the Manager through
whom such Placee submitted its bid. Each Placee will also have an immediate,
separate, irrevocable and binding obligation, owed to the relevant Manager, to
pay to it (or as it may direct) in cleared funds an amount equal to the product
of the Placing Price and the number of Placing Shares such Placee has agreed to
subscribe for. The relevant Manager will procure the allotment by the Company
of such Placing Shares to each Placee following each Placee's payment to the
relevant Manager of such amount.
All obligations under the Placing will be subject to fulfilment of the
conditions referred to below under 'Conditions of the Placing'.
Conditions of the Placing
The Placing is conditional upon the Placing Agreement becoming unconditional and
not having been terminated in accordance with its terms.
The obligations of the Managers under the Placing Agreement are conditional
upon, inter alia:
1. the Pricing Announcement being published through a Regulatory
Information Service by 6:30 p.m. on Monday, 7 March 2005 (or such later time and
/or date as the Company and the Managers may agree in writing);
2. the Company allotting, subject only to Admission, the Placing Shares
and having complied with its obligations under the Placing Agreement to procure
that, immediately upon Admission, the Placing Shares are credited to the CREST
stock account of ABN AMRO Bank N.V. (London branch) (CREST ID: 521); and
3. Admission and Commencement of Trading occurring by no later than 9.00
a.m. on Thursday, 10 March 2005 (or such later time and/or date as the Company
and the Managers may agree in writing).
If (a) any of the conditions contained in the Placing Agreement is not fulfilled
or waived by both of the Managers by the time and date specified or referred to
therein (or such later time and/or date as the Company and the Managers may
agree), or (b) the Placing Agreement is terminated in the circumstances
specified below, the Placing will lapse and the Placee's rights and obligations
hereunder shall cease and terminate at such time and each Placee agrees that no
claim can be made by or on behalf of the Placee (or any person on whose behalf
the Placee is acting) in respect thereof.
By participating in the Bookbuilding Process, each Placee agrees that its rights
and obligations cease and terminate only in the circumstances described above
and will not be capable of rescission or termination by it.
The Managers may, at their discretion and upon such terms as they jointly think
fit, waive compliance by the Company with, or extend the time and/or date for
fulfilment by the Company of, the whole or any part of any of the Company's
obligations in relation to the conditions in the Placing Agreement, save that
condition 3 above may not be waived. Any such extension or waiver will not
affect Placees' commitments as set out in the announcement (including this
Appendix).
Neither of the Managers shall have any liability to any Placee (or to any other
person whether acting on behalf of a Placee or otherwise) in respect of any
decision the Managers may make as to whether or not to waive or to extend the
time and/or date for the satisfaction of any condition to the Placing nor for
any decision any of them may make as to the satisfaction of any condition or in
respect of the Placing generally.
The Placing Agreement, and therefore the Placing, are not conditional on the
proposed acquisition of United Defense Industries, Inc. (UDI). A subsidiary of
the Company has entered into a merger agreement providing for the proposed
acquisition as described elsewhere in the announcement . However, no assurance
can be given that the proposed acquisition will be completed or completed on the
terms described in the announcement (including in relation to the consideration
payable).
Right to terminate under the Placing Agreement
Either of the Managers may, at any time before Admission, terminate the Placing
Agreement by giving notice to the Company if:
1. in the bona fide opinion of such Manager, any of the representations
and warranties set out in the Placing Agreement is untrue, inaccurate or
misleading or, if repeated at any time up to and including Admission, would be
untrue, inaccurate or misleading by reference to the facts then subsisting in
any respect which such Manager regards as material in the context of the Placing
and/or Admission;
2. in the bona fide opinion of such Manager, the Company is in breach of
any of its obligations under this Agreement in any respect which such Manager
regards as material in the context of the Placing and/or Admission;
3. in the bona fide opinion of such Manager, there has been a material
adverse change in the financial or trading position or prospects of the Company
and/or the Company and its subsidiary undertakings from time to time; or
4. in the absolution discretion of such Manager, there has been a change
in national or international financial, political, economic or stock market
conditions (primary or secondary); an incident of terrorism, outbreak or
escalation of hostilities, war, declaration of martial law or any other calamity
or crisis; a suspension or material limitation in trading of the Ordinary Shares
or securities generally on any stock exchange; any change in currency exchange
rates or exchange controls or a disruption of settlement systems or a material
disruption in commercial banking as would be, in the bona fide opinion of such
Manager, likely to prejudice the success of the Placing.
If the Managers' obligations under the Placing Agreement are terminated in
accordance with its terms, the rights and obligations of each Placee in respect
of the Placing as described in the announcement (including this Appendix) shall
cease and terminate at such time and no claim can be made by any Placee in
respect thereof.
By participating in the Placing each Placee agrees with the Managers that the
exercise by the Managers of any right of termination or other discretion under
the Placing Agreement shall be within the absolute discretion of such Manager
(as the case may be) and that such Manager need not make any reference to such
Placee and that the Managers shall have no liability whatsoever to the Placee
(or to any other person whether acting on behalf of a Placee or otherwise) in
connection with any such exercise.
No Prospectus
No offering document or prospectus or listing particulars has been or will be
submitted to be approved by the UKLA or filed with the Registrar of Companies in
England and Wales in relation to the Placing and Placees' commitments will be
made solely on the basis of the information contained in the announcement
(including this Appendix) and any information that is publicly available,
including any Exchange Information (as defined below). Each Placee, by accepting
a participation in the Placing, agrees that the content of the announcement
(including this Appendix) and the Pricing Announcement is exclusively the
responsibility of the Company and confirms that it has neither received nor
relied on any other information, representation, warranty, or statement made by
or on behalf of the Managers or the Company or any other person and neither of
the Managers nor the Company nor any other person will be liable for any
Placee's decision to participate in the Placing based on any other information,
representation, warranty or statement which the Placees may have obtained or
received. Each Placee acknowledges and agrees that it has relied on its own
investigation of the business, financial or other position of the Company in
accepting a participation in the Placing. Nothing in this paragraph shall
exclude the liability of any person for fraudulent misrepresentation.
Registration and Settlement
Settlement of transactions in the Placing Shares (ISIN: GB0002634946) following
Admission will take place within the CREST system, subject to certain
exceptions. Each of the Managers reserves the right to require settlement for
and delivery of the Placing Shares to Placees in such other means that it deems
necessary if delivery or settlement is not possible or practicable within the
CREST system within the timetable set out in the announcement (including this
Appendix) or would not be consistent with the regulatory requirements in the
Placee's jurisdiction.
Each Placee allocated Placing Shares in the Placing will be sent a trade
confirmation stating the number of Placing Shares allocated to it, the Placing
Price, the aggregate amount owed by such Placee to the relevant Bank and
settlement instructions. In the case of Hoare Govett, ABN AMRO Bank N.V. is
acting as its settlement agent and Placees should settle against CREST ID: 521,
and in the case of DrAG, DrKW is acting as its settlement agent and Placees
should settle against CREST ID: 318. It is expected that such trade
confirmation will be despatched on 7 March 2005 and that this will also be the
trade date. Each Placee agrees that it will do all things necessary to ensure
that delivery and payment is completed in accordance with either the standing
CREST or certificated settlement instructions which it has in place with the
relevant Manager.
Each Placee will be required to make a 'nationality declaration' as part of the
settlement process. Under the Company's Articles of Association every person
(whether or not an existing holder of Ordinary Shares) seeking to purchase or be
allotted Ordinary Shares must make a nationality declaration before the
directors of the Company are entitled to register such person as a holder of
such Ordinary Shares. A Placee which is settling its subscription for Placing
Shares through CREST can make the nationality declaration through CREST. A
Placee which is not settling its subscription for Placing Shares through CREST
must apply to one of the Managers for a nationality declaration form and
complete and return such form to one of the Managers no later than noon on the
day before Admission. If a Placee does not make the required nationality
declaration or if a completed nationality declaration indicates that the
allocation of Placing Shares to such Placee would be in breach of the Company's
Articles of Association, no allocation of Placing Shares will be made to such
person.
It is expected that settlement will be on Thursday, 10 March 2005 on a T+3 basis
in accordance with the instructions set out in the trade confirmation.
Interest is chargeable daily on payments not received from Placees on the due
date in accordance with the arrangements set out above at the rate of 2
percentage points above the base rate of Barclays Bank Plc.
Each Placee is deemed to agree that if it does not comply with these
obligations, the relevant Manager may sell any or all of the Placing Shares
allocated to that Placee on such Placee's behalf and retain from the proceeds,
for the Manager's account and benefit, an amount equal to the aggregate amount
owed by the Placee plus any interest due. The relevant Placee will, however,
remain liable for any shortfall below the aggregate amount owed by it and may be
required to bear any stamp duty or stamp duty reserve tax (together with any
interest or penalties) which may arise upon the sale of such Placing Shares on
such Placee's behalf.
If Placing Shares are to be delivered to a custodian or settlement agent,
Placees should ensure that the trade confirmation is copied and delivered
immediately to the relevant person within that organisation.
Insofar as Placing Shares are registered in a Placee's name or that of its
nominee or in the name of any person for whom a Placee is contracting as agent
or that of a nominee for such person, such Placing Shares should, subject as
provided below, be so registered free from any liability to UK stamp duty or
stamp duty reserve tax. No participant will be entitled to receive any fee or
commission in connection with the Placing.
Representations and Warranties
By participating in the Bookbuilding Process each Placee (and any person acting
on such Placee's behalf):
1. represents and warrants that it has read the announcement (including
this Appendix) in its entirety;
2. represents and warrants that it has not received a prospectus,
listing particulars, or other offering document in connection with the Placing
and acknowledges that no prospectus, listing particulars or other offering
document has been prepared in connection with the Placing;
3. acknowledges that the ordinary shares of the Company, nominal value
2.5p each are listed on the Official List of the UKLA, and the Company is
therefore required to publish certain business and financial information in
accordance with the rules and practices of the UKLA (collectively, the Exchange
Information), which includes a description of the nature of the Company's
business and the Company's most recent balance sheet and profit and loss
account, and similar statements for preceding financial years, and that it is
able to obtain or access the Exchange Information without undue difficulty;
4. acknowledges that none of the Managers, nor any of their respective
Affiliates nor any person acting on such Manager's or Affiliate's behalf has
provided, and will not provide it with any other material regarding the Placing
Shares or the Company; nor has it requested the Managers, any of their
respective Affiliates or any person acting on such Manager's or Affiliate's
behalf to provide it with any such information;
5. acknowledges that the content of the announcement (including this
Appendix) is exclusively the responsibility of the Company and that neither the
Managers, nor any of their respective Affiliates nor any person acting on such
Manager's or Affiliate's behalf has or shall have any liability for any
information, representation or statement contained in the announcement
(including this Appendix) or any information previously published by or on
behalf of the Company and will not be liable for any Placee's decision to
participate in the Placing based on any information, representation or statement
contained in the announcement (including this Appendix) or otherwise. Each
Placee further represents, warrants and agrees that the only information on
which it is entitled to rely and on which such Placee has relied in committing
to subscribe for the Placing Shares is contained in the announcement (including
this Appendix) and any information that is publicly available, including any
Exchange Information, such information being all that it deems necessary to make
an investment decision in respect of the Placing Shares and that it has relied
on its own investigation with respect to the Placing Shares and the Company in
connection with its decision to subscribe for the Placing Shares and
acknowledges that it is not relying on any investigation that either of the
Managers, any of their respective Affiliates or any person acting on such
Manager's or Affiliate's behalf may have conducted with respect to the Placing
Shares or the Company and none of such persons has made any representations to
it, express or implied, with respect thereto;
6. acknowledges that it has not relied on any information relating to
the Company contained in any research reports prepared by any of the Managers,
any of their respective Affiliates or any person acting on such Manager's or
Affiliate's behalf and understands that (i) none of the Managers, nor any of
their respective Affiliates nor any person acting on such Manager's or
Affiliate's behalf has or shall have any liability for public information or any
representation; (ii) none of the Managers, nor any of their respective
Affiliates nor any person acting on such Manager's or Affiliate's behalf has or
shall have any liability for any additional information that has otherwise been
made available to such Placee, whether at the date of publication, the date of
the announcement or otherwise; and that (iii) none of the Managers, nor any of
their respective Affiliates nor any person acting on such Manager's or
Affiliate's behalf makes any representation or warranty, express or implied, as
to the truth, accuracy or completeness of such information, whether at the date
of publication, the date of the announcement or otherwise;
7. represents and warrants that it, or the beneficial owner, as
applicable, is entitled to subscribe for and/or purchase Placing Shares under
the laws of all relevant jurisdictions which apply to it, or the beneficial
owner, as applicable, and that it has fully observed such laws and obtained all
such governmental and other guarantees and other consents in either case which
may be required thereunder and complied with all necessary formalities;
8. represents and warrants that it is, or at the time the Placing Shares
are acquired that it will be, the beneficial owner of such Placing Shares, or
that the beneficial owner of such Placing Shares is not a resident of Australia,
Canada, Japan or the Republic of Ireland;
9. acknowledges that the Placing Shares have not been and will not be
registered under the securities legislation of the United States, Australia,
Canada, Japan or the Republic of Ireland and, subject to certain exceptions, may
not be offered, sold, taken up, renounced or delivered or transferred, directly
or indirectly, within those jurisdictions;
10. if the Placing Shares were offered to it in the United States,
represents and warrants that in making its investment decision, (i) it has
relied on its own examination of the Company and the terms of the Placing,
including the merits and risks involved, (ii) it has made its own assessment of
the Company, the Placing Shares and the terms of the Placing based on such
information as is publicly available, (iii) it has consulted its own independent
advisors or otherwise has satisfied itself concerning, without limitation, the
effects of United States federal, state and local income tax laws and foreign
tax laws generally and the U.S. Employee Retirement Income Security Act of 1974,
the U.S. Investment Company Act of 1940, as amended and the Securities Act and
(iv) it has received all information that it believes is necessary or
appropriate in order to make an investment decision in respect of the Company
and the Placing Shares;
11. represents and warrants that it is either (i) a QIB and it has duly
executed an investment letter in the form provided to it by the Managers, or
(ii) purchasing the Placing Shares in an 'offshore transaction' in accordance
with Regulation S under the Securities Act, and if it is a QIB, (i) it is
subscribing for the Placing Shares for its own account, or for one or more
managed accounts, for investment purposes, and not with a view to any
distribution within the meaning of U.S. securities laws and (ii) has such
knowledge and experience in financial and business matters as to be capable of
evaluating the merits and risks of its investment in the Placing Shares, and it
and each managed account (i) are each able to bear the economic risk of its or
their investment in the Placing Shares, (ii) will not look to the
above-mentioned names for all or part of any such loss or losses it or they may
suffer, (iii) are able to sustain a complete loss on its or their investment in
the Placing Shares, (iv) have no need for liquidity with respect to its or their
investment in the Placing Shares and (v) have no reason to anticipate any change
in its or their circumstances, financial or otherwise, which may cause or
require any sale or distribution by it or them of all or any part of the Placing
Shares;
12. acknowledges (and each beneficial owner of the Placing Shares has been
advised) that the Placing Shares have not been and will not be registered under
the Securities Act or with any State or other jurisdiction of the United States,
nor approved or disapproved by the U.S. Securities and Exchange Commission, any
state securities commission in the United States or any other United States
regulatory authority, and, if it is a QIB, agrees not to reoffer, resell, pledge
or otherwise transfer the Placing Shares except (i) in offshore transactions in
accordance with Regulation S under the Securities Act (if available), (ii) to
QIBs pursuant to Rule 144A under the Securities Act, or (iii) pursuant to Rule
144 under the Securities Act (if available), and in any case in compliance with
all applicable laws and regulations;
13. acknowledges that where it is subscribing for the Placing Shares for
one or more managed accounts, it represents and warrants that (i) each such
account is a QIB and (ii) it is authorised in writing by each managed account
(a) to subscribe for the Placing Shares for each managed account and (b) to
execute and deliver an investment letter in the form provided to it by either of
the Managers on behalf of each managed account. It agrees to indemnify and hold
the Company and the Managers harmless from any and all costs, claims,
liabilities and expenses (including legal fees and expenses) arising out of or
in connection with any breach of the representations and warranties in this
paragraph 13. It agrees that the provisions of this paragraph 13 shall survive
the resale of the Placing Shares by or on behalf of the managed accounts;
14. if it is a QIB, acknowledges that no representation has been made as
to the availability of Rule 144 or any other exemption under the Securities Act
for the reoffer, resale, pledge or transfer of the Placing Shares and agrees to
notify any transferee to whom it subsequently reoffers, resells, pledges or
transfers the Placing Shares of the foregoing restrictions on transfer;
15. acknowledges and understands that the Placing Shares not sold in
offshore transactions in accordance Regulation S are being offered and sold in
reliance on Rule 144A or another exemption from, or in a transaction not subject
to, the registration requirements of the Securities Act and are 'restricted
securities' within the meaning of Rule 144(a)(3) under the Securities Act and,
if it is a QIB, represents and warrants on its own behalf and on behalf of any
accounts for which it is acting that, so long as the Placing Shares are '
restricted securities', it will not deposit the Placing Shares into any
unrestricted depositary facility established or maintained by any depositary
bank in respect of the Ordinary Shares and will only transfer the Placing Shares
in accordance with paragraph 12 above;
16. acknowledges and agrees, without prejudice to the representations and
warranties in paragraph 15 above, that regardless of whether the Placing Shares
that it has acquired are restricted securities, it will not deposit the Placing
Shares into any into any unrestricted depositary facility established or
maintained by any depositary bank in respect of the Ordinary Shares for 40 days
following the Placement;
17. represents and warrants that the allocation, allotment, issue and
delivery to it, or the person specified by it for registration as holder, of
Placing Shares will not give rise to a liability under any of sections 67, 70,
93 or 96 of the Finance Act 1986 (depositary receipts and clearance services)
and that the Placing Shares are not being subscribed for by it in connection
with arrangements to issue depositary receipts or to transfer Placing Shares
into a clearance system;
18. represents and warrants that it has complied with its obligations in
connection with money laundering and terrorist financing under the Proceeds of
Crime Act 2002, the Terrorism Act 2003 and the Money Laundering Regulations 2003
(the Regulations) and, if making payment on behalf of a third party, that
satisfactory evidence has been obtained and recorded by it to verify the
identity of the third party as required by the Regulations;
19. represents and warrants that it and any person acting on its behalf is
a person falling within Article 19(5) and/or 49(2)(A) to (D) of the Financial
Services and Markets Act 2000 (Financial Promotion) Order 2001, as amended, and
undertakes that it will acquire, hold, manage or dispose of any Placing Shares
that are allocated to it for the purposes of its business;
20. represents and warrants that it has not offered or sold and will not
offer or sell any Placing Shares to persons in the United Kingdom prior to
Admission except to persons whose ordinary activities involve them in acquiring,
holding, managing or disposing of investments (as principal or agent) for the
purposes of their business or otherwise in circumstances which have not resulted
and which will not result in an offer to the public in the United Kingdom within
the meaning of the Public Offers of Securities Regulations 1995, as amended or
the FSMA;
21. represents and warrants that it has only communicated or caused to be
communicated and will only communicate or cause to be communicated any
invitation or inducement to engage in investment activity (within the meaning of
section 21 of FSMA) relating to the Placing Shares in circumstances in which
section 21(1) of FSMA does not require approval of the communication by an
authorised person;
22. represents and warrants that it has complied and will comply with all
applicable provisions of FSMA with respect to anything done by it in relation to
the Placing Shares in, from or otherwise involving the United Kingdom;
23. represents and warrants that it and any person acting on its behalf is
entitled to subscribe for the Placing Shares under the laws of all relevant
jurisdictions and that it has all necessary capacity and has obtained all
necessary consents and authorities to enable it to commit to this participation
in the Placing and to perform its obligations in relation thereto (including,
without limitation, in the case of any person on whose behalf it is acting, all
necessary consents and authorities to agree to the terms set out or referred to
in the announcement (including this Appendix)) and will honour such obligations;
24. undertakes that it (and any person acting on its behalf) will make
payment for the Placing Shares allocated to it in accordance with the
announcement (including this Appendix) on the due time and date set out herein,
failing which the relevant Placing Shares may be placed with other subscribers
or sold as the relevant Manager may in its sole discretion determine and without
liability to such Placee;
25. acknowledges that neither of the Managers, nor any of their respective
Affiliates nor any person acting on such Manager's or Affiliate's behalf, is
making any recommendations to it, advising it regarding the suitability of any
transactions it may enter into in connection with the Placing nor providing
advice in relation to the Placing nor in respect of any representations,
warranties, undertakings or indemnities contained in the Placing Agreement nor
the exercise or performance of any of the Manager's rights and obligations
thereunder including any rights to waive or vary any conditions or exercise any
termination right;
26. undertakes that the person who it specifies for registration as holder
of the Placing Shares will be (i) itself or (ii) its nominee, as the case may
be. Neither of the Managers nor the Company will be responsible for any
liability to stamp duty or stamp duty reserve tax resulting from a failure to
observe this requirement. Each Placee and any person acting on behalf of such
Placee agrees to participate in the Placing and it agrees to indemnify the
Company and each of the Managers in respect of the same on the basis that the
Placing Shares will be credited to the CREST stock account of ABN AMRO Bank N.V.
(London branch) (CREST ID: 521) who will hold them as nominee for the
subscribers of such shares until settlement in accordance with its standing
settlement instructions;
27. acknowledges that any agreements entered into by it pursuant to these
terms and conditions shall be governed by and construed in all respects in
accordance with English law and it submits (on behalf of itself and on behalf of
any person on whose behalf it is acting) to the exclusive jurisdiction of the
courts of England as regards any claim, dispute or matter arising out of any
such contract, except that enforcement proceedings in respect of the obligation
to make payment for the Placing Shares (together with any interest chargeable
thereon) may be taken by the Company or the Managers in any jurisdiction in
which the relevant Placee is incorporated or in which any of its securities have
a quotation on a recognised stock exchange; and
28. represents and warrants that it is aware of the requirements under the
Company's Articles of Association that every person seeking to purchase or be
allotted Ordinary Shares must either have made a nationality declaration (which
is still in effect and correct) or must make a nationality declaration before
the directors of the Company are entitled to register such person as a holder of
such Ordinary Shares;
29. represents and warrants that (i) it either has made or will make the
required nationality declaration through CREST on behalf of itself or any
managed account for which it is subscribing Placing Shares; or (ii) if it does
not propose to take delivery of Placing Shares through CREST, it will (a) apply
to the Managers for a nationality declaration form; (b) complete such form on
behalf of itself or any managed account for which it is subscribing Placing
Shares; and (c) return it to the Managers no later than noon on the day before
Admission;
30. acknowledges that (i) if it has not made or does not make the required
nationality declaration; or (ii) if the allocation of Placing Shares to it would
be in breach of the individual foreign shareholding restriction set out in
Article 43 of the Company's Articles of Association, no allocation of Placing
Shares will be made to it on behalf of itself or any managed account for which
it is subscribing Placing Shares;
31. acknowledges that each of the Managers may (at their absolute
discretion) satisfy their obligations to procure Placees by themselves agreeing
to become a Placee in respect of some or all of the Placing Shares or by
nominating any connected or associated person to do so; and
32. agrees that the Company, the Managers and others will rely upon the
truth and accuracy of the foregoing representations, warranties,
acknowledgements and undertakings which are given to the Managers on their own
behalf and on behalf of the Company and are irrevocable.
No UK stamp duty or stamp duty reserve tax should be payable to the extent that
the Placing Shares are issued into CREST to, or to the nominee of, a Placee who
holds those shares beneficially (and not as agent or nominee for any other
person) within the CREST system and registered in the name of such Placee or
such Placee's nominee.
Any arrangements to issue or transfer the Placing Shares into a depositary
receipts system or a clearance service or to hold the Placing Shares as agent or
nominee of a person to whom a depositary receipt may be issued or who will hold
the Placing Shares in a clearance service, or any arrangements subsequently to
transfer the Placing Shares, may give rise to UK stamp duty and/or stamp duty
reserve tax, for which neither the Company nor either of the Managers will be
responsible and the Placee to whom (or on behalf of whom, or in respect of the
person for whom it is participating in the Placing as an agent or nominee) the
allocation, allotment, issue or delivery of Placing Shares has given rise to
such UK stamp duty or stamp duty reserve tax undertakes to pay such UK stamp
duty or stamp duty reserve tax forthwith and to indemnify on an after-tax basis
and to hold harmless the Company and the Managers in the event that any of the
Company and/or the Managers has incurred any such liability to UK stamp duty or
stamp duty reserve tax.
In addition, Placees should note that they will be liable for any capital duty,
stamp duty and all other stamp, issue, securities, transfer, registration,
documentary or other duties or taxes (including any interest, fines or penalties
relating thereto) payable outside the UK by them or any other person on the
subscription by them for any Placing Shares or the agreement by them to
subscribe for any Placing Shares.
The announcement (including this Appendix) has been issued by the Company and is
the sole responsibility of the Company.
Hoare Govett Limited and ABN AMRO Bank N.V. (London branch), which are
authorised and regulated by the Financial Services Authority, are acting
exclusively for the Company and for no one else solely in connection with the
Placing and will not be responsible to anyone other than the Company for
providing the protections afforded to the customers of Hoare Govett Limited and
ABN AMRO Bank N.V. (London branch) or for providing advice in relation the
Placing.
Dresdner Bank AG, London Branch and Dresdner Kleinwort Wasserstein Securities
Limited, which are authorised and regulated by the Financial Services Authority,
are acting exclusively for the Company and for no one else solely in connection
with the Placing and will not be responsible to anyone other than the Company
for providing the protections afforded to the customers of Dresdner Bank AG and
Dresdner Kleinwort Wasserstein Securities Limited or for providing advice in
relation to the Placing..
When a Placee or person acting on behalf of the Placee is dealing with either of
the Managers, any money held in an account with such Manager on behalf of the
Placee and/or any person acting on behalf of the Placee will not be treated as
client money within the meaning of the rules and regulations of the Financial
Services Authority made under the FSMA. The Placee acknowledges that the money
will not be subject to the protections conferred by the client money rules; as a
consequence, this money will not be segregated from the Manager's money in
accordance with the client money rules and will be used by the Manager in the
course of its own business; and the Placee will rank only as a general creditor
of the Manager.
Past performance is no guide to future performance and persons needing advice
should consult an independent financial adviser.
All times and dates in the announcement (including this Appendix) may be subject
to amendment. The Managers shall notify the Placees and any person acting on
behalf of the Placees of any changes.
The announcement (including this Appendix) includes 'forward-looking statements
'. All statements other than statements of historical facts included in the
announcement (including this Appendix), including, without limitation, those
regarding the Company's financial position, business strategy, plans and
objectives of management for future operations, the expected timing and
strategic and financial effects of the Proposed Acquisition and trends in the
U.S. defence budget and the defence industry, are forward-looking statements.
Such forward-looking statements involve known and unknown risks, uncertainties
and other important factors which could cause the actual results, performance or
achievements of the Company or the markets and economies in which the Company
operates to be materially different from future results, performance or
achievements expressed or implied by such forward-looking statements, including,
without limitation, risks related to: the integration of UDI's business with the
Company's, the costs related to the Proposed Acquisition, inability to obtain,
or meet conditions imposed for, required governmental and regulatory approvals
and consents and inability to obtain the approval of the shareholders of UDI or
the Company for the Proposed Acquisition. The Company cannot give any assurance
that the Proposed Acquisition will be completed or that it will be completed on
the terms described in this announcement.
The announcement (including this Appendix) is not an offer for sale within the
United States of any security of the Company. Securities of the Company,
including its Ordinary Shares, may not be offered or sold in the United States
absent registration under the U.S. securities laws or unless exempt from
registration under such laws.