AGREEMENT FOR THE SALE AND PURCHASE OF ALL THE ISSUED SHARES IN Koninklijke Lankhorst-Euronete group B.V.

ADMINISTRATIEKANTOOR LANKHORST B.V., a private limited liability company (besloten vennootschap met beperkte aansprakelijkheid) incorporated under the laws of the Netherlands, with its registered office at (8607AD) Prinsengracht 2, Sneek, the Netherlands registered with the trade register of the chamber of commerce under file number 01030349 (Lankhorst BV);

the individuals listed in Schedule 1 (Sellers);

WIRECO DUTCH ACQUISITION B.V., a private limited liability company (besloten vennootschap met beperkte aansprakelijkheid) incorporated under the laws of the Netherlands, having its official seat in Rotterdam, the Netherlands and with its registered office at (3194DA) Mandenmakerstraat 51, Hoogvliet, the Netherlands, registered with the trade register of the chamber of commerce for Rotterdam under file number 55481973 (the Purchaser);

CASAR DRAHTSEILWERK SAAR GMBH, a private limited liability company incorporated under the laws of Germany with its seat in Kirkel and its business address at Casarstraße 1, 66459 Kirkel, Germany registered with the trade register of the local court of Saarbrücken under HRB 17125 (the Guarantor).

The Sellers are the owners of all the issued and outstanding shares in the capital of Koninklijke Lankhorst-Euronete Group B.V. (the Shares), a private limited liability company (besloten vennootschap met beperkte aansprakelijkheid) incorporated under the laws of the Netherlands, with its registered office at (8607AD) Prinsengracht 2, Sneek, the Netherlands, registered with the trade register of the chamber of commerce under file number 01081428 (the Company).

On 5 March 2012, the Sellers and the Guarantor entered into a letter of intent in which it was contemplated that the Parties would, following certain due diligence by the Purchaser, enter into an agreement to effect the sale and purchase of the Shares, substantially on the terms set out in the letter of intent.

Each of the Company and the Purchaser has complied with the provisions of paragraphs 3, 4 and 8 of the Social and Economic Council Merger Regulation for the protection of employees (SER-Besluit Fusiegedragsregels 2000 ter bescherming van de belangen van werknemers) and the Dutch Works Council Act (Wet op de Ondernemingsraden), to the extent applicable.

The Guarantor is an Affiliate of the Purchaser and is willing to guarantee all the obligations of the Purchaser pursuant to this Agreement and all related documents including, in particular, payment of the Purchase Price.

In this Agreement, unless a different intention clearly appears, a reference to a clause, a sub-clause or schedule is a reference to a clause, sub-clause or schedule of this Agreement. The schedules form part of this Agreement.

in the event that Completion occurs after 30 June 2012, an amount (the Additional Amount) equal to the Interest Rate, calculated over an amount equal to the Base Purchase Price, less the amount of the Deposit, and over the period from (and including) 1 July 2012 up to and including the Completion Date, on the basis of a 365-day year.

an amount of EUR1,318,000 (one million, three hundred and eighteen thousand) on account of certain QREN (EU) program loans which are not convertible into grants; and

Subject to clause 6.3, the Purchase Price is fixed and payable by the Purchaser in cash on Completion, provided that the amount so payable on Completion shall be reduced by the aggregate of:

the amount of the Deposit paid in accordance with clause 3; and

the aggregate amount of any Transaction Costs and Leakage Amounts (together with any Leakage Interest) as set out in the Completion Statement to be delivered by the Sellers in accordance with clause 2.6.

an overview of any Transaction Costs and Leakage arising or expected to arise before Completion, together with copies of supporting documents evidencing such Transactions Costs and Leakage; and

a calculation of the aggregate amount of such Transaction Costs, Leakage Amounts and the Leakage Interest until the anticipated Completion Date. With respect to the Transaction Costs, the Parties agree that such shall be included in the Completion Statement on a gross basis, without any regard for the possible tax deductibility of such amounts.

the Purchaser shall have the right to challenge the correctness of the Completion Statement (both with respect to any amount set out in the Completion Statement and the absence of any amount of Transaction Costs and/or Leakage in the Completion Statement), irrespective of whether such challenge is made before, on or after Completion (it being understood that mutual agreement on the Completion Statement shall not be a condition to Completion and that in the event of an unresolved challenge by the Purchaser, Completion will proceed on the basis of the Sellers' position in relation to the relevant disputed item); and

the Purchaser shall not forfeit any rights it has under this clause 2.6 and/or under clauses 6.1 and 6.2 through (A) not having objected to the Completion Statement, or a particular item therein, prior to Completion or (B) having proceeded to Completion despite the existence of any unresolved challenge, which shall in that case be resolved after Completion.

approving, or being deemed to approve in accordance with the relevant competition laws, the transaction contemplated by this Agreement and any applicable waiting periods having expired or being terminated; or

not taking a decision within the time limits as set by the relevant competition laws, if such failure constitutes an automatic approval of the transaction contemplated by this Agreement under the relevant competition laws

 

The Purchaser shall use all reasonable efforts to procure that the Condition is satisfied by no later than the date that is sixty (60) days following the Signing Date (the Long Stop Date). Without prejudice to clause 5.5, the Purchaser (to the extent within its powers) shall:

cooperate with and provide without undue delay all necessary information and assistance reasonably requested or required by a Competition Authority in connection with the Condition and, to the extent possible, answer any questions raised and handle any request made by the relevant Competition Authorities;

 

provide the Sellers (or any adviser nominated by them) with draft copies of all submissions and material communications to the relevant Competition Authority in relation to obtaining any relevant consent, approval or action at such time as will allow the Sellers a reasonable opportunity to provide comments on such submissions and communications before they are submitted. The Purchaser shall take into account any such comments as are reasonable and shall amend such submissions or material communications where the Purchaser, acting reasonably, considers such appropriate; and

 

inform the Sellers of any material communication received from, or given by it, to a Competition Authority with respect to the Condition.

 

The Sellers shall, and shall procure that the Group Companies, at their own cost, use all reasonable efforts to assist the Purchaser in fulfilling the Condition as soon as possible after the Signing Date, in particular, but not limited to:

without limiting the Sellers’ obligations under this clause 5.3, procuring that each Group Company co-operates with and provides without undue delay all reasonable assistance to the Purchaser to enable it to fulfil the Condition.

make all necessary filings to obtain the required approval or approvals as soon as reasonably practicable after the Signing Date (and in any event use all reasonable efforts to do so within five (5) Business Days after the Signing Date), and use all reasonable efforts to obtain the approval of the Competition Authorities as soon as practicable;

not, in the period between the Signing Date and Completion, enter into any transaction which at the time of entering into such transaction is reasonably expected to materially worsen its position in respect of obtaining such approval or deliberately make public any information that materially deviates from the information set out in the filings to be made or is likely to materially worsen the chances of obtaining approval from the Competition Authorities, unless in each case such transaction or disclosure of information is in the ordinary course of business or is required by applicable law or regulation; and

 

in addition to keeping the Sellers informed of all material communications with the Competition Authorities in accordance with clause 5.2(c), when the Sellers so desire and where permitted by the relevant Competition Authority, include the Sellers in any discussion with the Competition Authorities.

the Purchaser's or any Group Company's compliance with any condition, obligation or other requirement imposed or contained in any decision by any relevant Competition Authority, or the effectuation of any offer made by the Purchaser to any relevant Competition Authority pursuant to clause 5.5 will not result in any change to the terms and conditions of this Agreement (including the Purchase Price); and

the Purchaser shall bear all filing fees, costs, penalties, fines and other liabilities incurred by it or the Group in respect of the fulfilment of the Condition other than advisor fees of the Group Companies, if any.

If (i) the Condition is not fulfilled or waived on or before the Long Stop Date, or (ii) for any other reason, Completion does not occur on or before the Long Stop Date, either the Purchaser or the Sellers may by written notice to the other (and the Guarantor) terminate this Agreement, in which event:

following such termination, except for this clause 5.7, clauses 3.3 and 3.5 (Deposit), 16 (Confidentiality), 18 (Notices), 19 (Further Assurances), 20 (Assignments), 21 (Payments), 22 (Costs), 23 (General), 24 (No Rescission), 25 (Whole Agreement), 26 (Governing Law), 27 (Dispute Resolution) and 28 (Language), together with the provisions of clause 1 and Schedule 17 (Interpretation), all the other clauses of this Agreement shall lapse and cease to have effect, provided that any rights or liabilities of any Party in respect of any previous breach of this Agreement shall be unaffected; and

subject to the rights of the Sellers under clause 3.3, no Party shall have any claim against any other Party as a result of such termination.

The Sellers furthermore agree that to the extent that any Transaction Costs have been incurred by any Group Company after the Accounts Date, the Sellers shall cause such to be reimbursed to the relevant Group Company through the mechanism provided for in this clause 6.

an amount (the Leakage Interest) equal to the Interest Rate, calculated over that Leakage Amount and the amount of the relevant Transaction Costs over the period from and including the date that is the later to occur of:

the date upon which the relevant Leakage occurred (or, in the case of Transaction Costs, the date upon which the relevant Transaction Costs were paid to the relevant third party); and

To the extent possible, the payment of any Leakage Amount, Transaction Costs and Leakage Interest shall be satisfied by way of an adjustment to the Purchase Price payable at Completion. If any Leakage and Transaction Costs are notified by the Sellers or a Group Company to the Purchaser prior to Completion in accordance with clause 2.6, the Purchase Price payable to the Sellers in accordance with clauses 2.4 and 2.5 shall be reduced by the relevant Leakage Amount, Transaction Costs and Leakage Interest so notified (subject to any adjustments thereto agreed pursuant to clause 2.6). If at Completion there remains any unresolved challenge (as referred to in clauses 2.6(i) and 2.6(ii)), the Sellers shall reimburse the portion of such Leakage Amount, Transaction Costs and Leakage Interest to which the unresolved challenge relates within ten (10) Business Days of such matter being resolved (whether by mutual agreement or arbitral determination). If any Leakage is notified by the Purchaser to the Sellers after Completion, the Sellers shall, subject to clause 6.5, reimburse such Leakage Amount, Transaction Costs and Leakage Interest within ten (10) Business Days of such notice (unless the Sellers dispute the notice, in which case the relevant amounts shall be paid within ten (10) Business Days of such matter being resolved (whether by mutual agreement or arbitral determination)).

prior to 1 April 2014 the Purchaser has given bona fide notice to the Sellers of (i) a breach of clause 6.1 or (ii) the fact that Transaction Costs have been incurred by a Group Company after the Accounts Date, in which case, the Sellers may be liable for that breach and/or amount of Transaction Costs, irrespective of the expiry of the above-mentioned period.

Completion shall take place at the offices of the Sellers' Lawyers on the tenth (10th) Business Day after the date on which the Condition is satisfied or at such other time and on such other date as the Sellers and the Purchaser may agree in writing.

In accordance with the Notary letter, the Purchaser will pay or procure the payment of the Purchase Price (as adjusted pursuant to clause 2.5) on the Completion Date by wire transfer into the Notary's account as listed in clause 21. Until execution of the Deed of Transfer, the Notary will hold the funds so received for the benefit of the party who has paid them. Upon execution of the Deed of Transfer, the Notary will hold the Purchase Price (less the Escrow Amount) for the benefit of the Sellers or any other beneficiaries stipulated in the Notary Letter. The Notary will only pay such amounts to the Sellers, the Escrow Agent and any other beneficiary stipulated in the Notary Letter in accordance with this Agreement and the Notary Letter after execution of the Deed of Transfer.

In the event that the Purchaser and the Sellers agree that any debt of the Group Companies should be repaid at Completion, the Sellers will cooperate in good faith and provide all reasonable assistance to procure that the Group Companies do so, acknowledging that this can only be done in accordance with the Dutch Works Council Act, if applicable, and provided that the Purchaser will be responsible for putting the Group Companies in funds in order to make the repayment and provided further that any fees or penalties payable by a Group Company in connection with the early repayment of debt shall be borne by the Purchaser. To the extent practicable, the Parties shall arrange for the funds flow related to the repayment of such debt (and the reimbursement by the Sellers of pre-payment fees or penalties, if applicable) to be included in the mechanisms provided for in the Notary Letter.

 

 

(b)

each Group Company takes all reasonable steps to preserve and protect the assets and goodwill (including the existing relationships with customers and suppliers) associated with the Business and its operations; and

dispose of or grant, create, allot, issue, redeem or repurchase any share or loan capital or right of pre-emption (voorkeursrecht) or other security or grant any option over or other right to subscribe for any share or loan capital (including shareholder loans or profit participation rights);

borrow any money (other than as permitted under existing financing arrangements that have been disclosed in the Data Room) or grant any third party interest bearing debt (including making any amendments to such debt arrangements);

change its accounting procedures, principles, practices, its articles of association or other constitutional documents or its internal allocation policies in relation to any fiscal unity for tax purposes and, in particular, amend its (tax) accounting policies or enter into any special tax arrangements, compromises, rulings or other arrangements with any tax authority which may materially affect the tax position of any of the Group Companies;

enter into, terminate or materially amend any contract, agreement or commitment (i) which has an aggregate contract value in excess of EUR250,000 or (ii) which is likely to result in a material change in the nature or scope of the operations of the Business (or any modification of an existing contract or arrangement which would itself fall, or cause the contract or arrangement concerned to fall, within any of (i) and (ii)) or make any bid, tender, proposal or offer likely to lead to any such contract or arrangement;

 

make any changes in the terms of employment (including pension fund commitments) of the directors and employees of any Group Company other than those required by law or pursuant to other existing binding obligations;

 

are given reasonable access to the books and records of such respective Group Companies at such times during normal business hours on any Business Day on reasonable notice to the Sellers, provided that such access shall not unreasonably disturb or interfere with the normal operations of the Group Companies; and

for purposes of purchase price accounting, can undertake a fair value, as defined under accounting principles generally accepted in the US (US GAAP), valuation of all real and personal property of the Group Companies, including, but not limited to all land, buildings and equipment and are provided with the available information required for the valuation, given reasonable access to the facilities of the Group Companies and to those employees familiar with the equipment;

provide the Purchaser after the end of each calendar month with a copy of the most recent management accounts for the Business, as soon as practicable after the approval of such management accounts by the management board;

use all reasonable efforts to procure that the Group Companies effect the steps referred to in Schedule 14 (Pre-Completion Steps) before Completion, provided that completion of such steps shall not be a condition to Completion; and

make available, or cause to be made available, to the Sellers and their (ultimate) shareholders, all information, records or documents which may be reasonably requested by the Sellers or (ultimate) shareholders to fulfil their reporting or filing requirements (including in relation to tax matters); and

 

make available, or cause to be made available, to the Purchaser and its (ultimate) shareholders, all information, records or documents pertinent to the Group Companies which may be reasonably requested by the Purchaser; and

it has performed, with the assistance of professional advisors, a due diligence investigation with respect to the Shares, the Group Companies and their Businesses during the period 16 April 2012 to 25 May 2012 and has had, amongst other things:

 

access to financial, legal, tax, commercial, operational, environmental, insurance and other information provided in the Data Room and Red Room prepared in relation to certain Group Companies by the Sellers;

the Purchaser’s advisers have had the opportunity to review the information made available in the Data Room and the Red Room, it being understood that the Purchaser’s advisors were only permitted to report to the Purchaser on the findings out of such Red Room in compliance with the provisions of the Red Room Agreement, save in certain circumstances where a variation of such provisions was agreed to by the Sellers.

The information fairly disclosed in the Data Room (other than the Red Room), the reports based on documents in the Red Room that have been made available to the Purchaser, the written answers to the Purchaser to questions raised by the Purchaser and its advisors, and any other written information provided to or shared with the Purchaser in connection with the Due Diligence Investigation or fairly disclosed in Schedule 8 (the Disclosure Schedule) (together the Disclosed Information), shall be deemed disclosed to the Purchaser and have the effect as set out in clause 10.3. The content of the Data Room has been recorded on a DVD, an original of which will be deposited with the Notary on the Signing Date and which will provide final proof of the content of the Data Room and each party shall receive a copy of such DVD.

unless the Warranty Breach on its own or when aggregated with other Warranty Breaches of or exceeding the amount referred to in clause 11.2(a)(i) exceeds EUR500,000, in which case, the whole amount (and not only the excess) may be recovered by the Purchaser;

in respect of all other Warranty Breaches, and all other Claims that relate to a breach of any Seller’s obligations between the Signing Date and Completion (excluding in respect of Leakage, Transaction Costs, Tax, the Specific Indemnities and the Environmental Indemnity, which shall be regulated as specified elsewhere in this Agreement), the later of:

all Claims under the Environmental Indemnity, Tax Indemnity and Specific Indemnities,

in respect of all other Claims, the Sellers' aggregate liability shall not exceed the Base Purchase Price and each individual Seller's liability shall not exceed an amount equal to its pro rata portion thereof (by reference to the Seller's shareholding in the Company),

otherwise be available to the Purchaser, whether based on article 7:17 Dutch Civil Code or otherwise), it being understood that, other than in respect of the Sellers' Warranties, this does not limit the Purchaser’s ability to claim for performance and for breaches of covenants or other obligations under this Agreement; and

 

the Sellers (and their advisers) make no representation or warranty as to the completeness or accuracy of forecasts, estimates, projections, management presentations, statements of intent or statements of opinion provided to the Purchaser or its advisers on or prior to the Signing Date (including the information contained in the Data Room),

The Purchaser represents and warrants to the Sellers and that as at the Signing Date and as at the Completion Date each of the statements set out in Schedule 4 (Purchaser's Warranties) is and will be true and accurate.

the Sellers’ Representative (on behalf of all Sellers) acknowledges in writing towards the Purchaser that the matter underlying the Third Party Claim constitutes a breach of this Agreement and that as such the Sellers shall be liable towards the Purchaser with respect to such Third Party Claim, subject to the limits on liability contained in this Agreement;

the Purchaser shall procure that the relevant Group Company makes available to the Sellers’ Representative such persons and all such information as the Sellers’ Representative may reasonably require for assessing, contesting, appealing or compromising the Third Party Claim, however, without any unreasonable disruption to the day-to-day responsibilities of the relevant persons;

the Purchaser shall procure that the relevant Group Company takes such action to contest, appeal or compromise the Third Party Claim as may be requested by the Sellers’ Representative and does not make any admission of liability, agreement, settlement or compromise in relation to the Third Party Claim without the prior written approval of the Sellers’ Representative; and

When deciding whether to settle, avoid, dispute, resist, appeal, compromise or defend the relevant Third Party Claim or any adjudication in respect thereof, the Sellers shall first consult the Purchaser and shall, in making decisions on which action to take, take into account any adverse effect that the Sellers’ decision may have on the Purchaser’s Group, including the relevant Group Company. If the Sellers’ Representative (on behalf of the Sellers) decides that the Third Party Claim will not be settled but will be defended or decides that the relevant Group Company must appeal from an awarded judgment, the Sellers shall use reasonable efforts to conduct such litigation in their own name, including announcing publicly (if so requested by the Purchaser) that the Sellers are conducting such litigation in their capacity as the Sellers under this Agreement with a view to limiting their respective potential liability towards the Purchaser or relevant Group Company in connection with such Third Party Claim.

Notwithstanding any other provision of this clause 12, the Purchaser shall not be required to take, permit or omit, or procure the taking, permitting or omission of, any step or action in relation to any Third Party Claim nor shall the Purchaser be prevented from making any admission of liability, agreement or compromise with any person, body or authority if and for so long as:

grants (and are therefore not included in the amount referred to in clause 2.4(b)(ii)), except to the extent that the obligation to repay arises as a result of any act or omission of the Purchaser or the Group Companies after Completion; and

any fines or penalties imposed by the relevant government authorities in the municipalities of Murça, Viana do Castelo and Maia, Portugal, in respect of the industrial permits for which an application is, as at the Signing Date, currently pending (including due to the failure to obtain any such permit), except to the extent such fine or penalty arises as a result of any act or omission by any Group Company after Completion,

for a period of three (3) years from Completion, be engaged or concerned in carrying on any business which is competitive with any of the businesses carried on by a Group Company at Completion;

for a period of three (3) years from Completion, induce or attempt to induce any person who is or was at any time during the last twelve (12) months before the date hereof a customer, supplier or other business relation of any Group Company, their Affiliates and/or the Business to cease doing business with such companies, to materially reduce its business with such companies or to do business with such companies on less favourable terms, or in any way interfere with the relationship between such companies and/or the Business, on the one hand, and any of their customers, suppliers or other business relations, on the other; or

for a period of three (3) years from Completion (other than in a response to a newspaper or trade advertisement) offer employment or induce or attempt to induce any director or senior/key employee of a Group Company to leave the employment of that Group Company with a view to hiring such person.

Each of the undertakings in clause 14.1 is given to the Purchaser and to each of its Affiliates (including the Group Companies after Completion). Each of Mr. J.L. Guerreiro Gramaxo and Ms M. de L. Guerreiro Gramaxo Rozeira acknowledge that each is an entirely independent restriction and is no greater than is reasonably necessary to protect the interests of the Purchaser and its Affiliates. If any such restriction shall be held void or unenforceable but would be valid if deleted in part or reduced in its application, then that restriction shall apply with such modifications as may be necessary to make it valid and effective.

As security for the payment obligations of the Sellers arising in respect of Claims, an amount equal to EUR17,800,000 (such amount, the Escrow Amount), minus the Deposit already held by the Escrow Agent pursuant to clause 3.1, shall at Completion be transferred to the Escrow Agent and be held in escrow on the terms contained in the escrow agreement to be entered into by the Purchaser, the Company, Lankhorst BV and the Escrow Agent on or around the Signing Date, which shall be in the form contained in Schedule 13 (Escrow Agreement) (the Escrow Agreement).

In the event of a Claim, subject to the relevant provisions of this Agreement (in particular the time periods and other limitations clause 11.2) the Purchaser and the Sellers (or, in the case of a Seller Specific Claim, the relevant Seller) shall instruct the Escrow Agent to promptly release the relevant part of the Escrow Amount (plus any interest accrued over the amount to be released while held in the Escrow Account) from the Escrow Account to the Purchaser and/or the relevant Seller(s) who are (pursuant to paragraph (a) or (b) below) entitled to such amount, within five (5) Business Days after:

 

the Purchaser has obtained judgment in respect of the amount of the claim that is the subject of the relevant Escrow Claim Notice (as referred to in the Escrow Agreement), and the judgment is no longer subject to appeal.

The Purchaser and the Sellers' Representative (on behalf of the relevant Seller(s)) shall send notices to the Escrow Agent to release the relevant part of the Escrow Amount at the times specified in this Agreement and the Escrow Agreement. Furthermore, the Sellers acknowledge and agree (i) that the Escrow Agreement provides that amounts to be released under the Escrow Agreement to the Sellers shall be released either to the Company (in the circumstances referred to in clause 3.4) or Lankhorst B.V. (in all other cases) and (ii) that any such release to the Company or Lankhorst B.V., as the case may be, shall be deemed to be a payment that was duly made to all relevant Sellers entitled to receive a part of the amount so released.

to the extent required by law, regulation or any competent regulatory body or exchange, provided that a Party required to make such disclosure or announcement shall without undue delay notify the other Parties, where practicable and lawful to do so, before the disclosure or announcement occurs and cooperate with the other Parties regarding the timing and content of such disclosure or announcement or any action which the other Parties may reasonably elect to take to challenge the validity of such requirement;

to the extent any announcement, disclosure or use is required by the terms of the US$425 million 9.5% Senior Notes due 2017 issued by WireCo WorldGroup Inc (an Affiliate of the Purchaser) or any bond or security issued by WireCo WorldGroup Inc or any of its Affiliates after the date of this Agreement;

 

In proving service of a notice or other communication, it shall be sufficient to show that delivery in person was made or that the envelope containing the communication was properly addressed and posted in accordance with clause 18.2, or that the fax or email was properly addressed and transmitted, as the case may be.

If a Party is required by law to make a deduction or withholding in respect of any sum payable under this Agreement, that Party shall, at the same time as the sum which is the subject of the deduction or withholding is payable, pay to the receiving Party such additional amount as shall be required to ensure that the net amount received by the receiving Party will equal the full amount which would have been received by the receiving Party had no such deduction or withholding been required to be made.

Each of the Sellers has the requisite power and authority to carry on its business as currently conducted and to execute this Agreement and any other agreements contemplated herein to which it is a party, to exercise its rights and to perform its obligations hereunder and to consummate the transactions contemplated herein.

The execution of this Agreement and the agreements contemplated herein have been duly authorised by all requisite corporate action and, save as set forth in this Agreement, no consents, approvals, orders or authorisations of, or registrations, declarations or filings with, any person are required in connection with the entering into of this Agreement, or of the agreements contemplated herein.

None of the Sellers or any part of its assets or undertakings is involved in or subject to any bankruptcy, liquidation, receivership, administration, arrangement or scheme with creditors, moratorium, interim or provisional supervision, whether in the jurisdiction of the place of incorporation or in any other jurisdiction, no such action or request is pending or currently threatened and no circumstances exist that would justify any such action being taken. No meeting has been convened at which a resolution is to be proposed, no resolution has been passed, no petition has been presented and no order has been made for the winding up of any Seller and no circumstances exist that would justify any such action being taken.

This Agreement and all other agreements and obligations undertaken in connection with the transaction contemplated herein constitute or will constitute, following the execution thereof, the valid and legally binding obligations of the Sellers, enforceable against it in accordance with their respective terms.

The execution and performance by each Seller of this Agreement, and of the agreements contemplated herein, will not violate the provisions of any law by which it is bound, any decree or order of a governmental entity or other authority by which it is bound, its articles of association, its deed of incorporation or bylaws or other similar documents (each as amended from time to time), any contract, agreement or other instrument by which it is bound or any resolution of its supervisory board, management board or other corporate governing body or of its shareholders.

The Shares set out opposite each Seller's name in Schedule 1 (Sellers) constitute the whole of that Seller's interest in the issued share capital of the Company. The Shares (in aggregate) constitute the whole of the issued share capital of the Company.

The Sellers have full power, right and authority to transfer the Shares to the Purchaser on the terms of the Agreement and the Sellers are not under any obligation of any kind whatsoever, whether actual or contingent to sell, create any Encumbrance, deliver, transfer or otherwise dispose of any of the Shares, other than as set out in the Agreement. The Sellers have not entered into any agreement, arrangement or obligation to do the same.

The Shares are fully paid up and have not been repaid, are free and clear of Encumbrances and there are no obligations on the part of the Sellers or any person acquiring the Shares to contribute any debt or equity to the Company.

Neither the Company nor the Sellers have granted to any person any right (whether exercisable now or in the future and whether contingent or not) to call for the conversion, issue, registration, sale or transfer, amortisation or repayment of the share capital or any other security giving rise to a right over, or an interest in, the capital of the Company. There are no outstanding depository receipts (certificaten) in relation to the Shares.

The Sellers have not voted any of their Shares in favour of any resolution of the Group Companies by which the Group Companies grant, and the Sellers have not themselves granted, to any person any right (whether exercisable now or in the future and whether contingent or not) to call for the conversion, issue, registration, sale or transfer, amortisation or repayment of the share capital or any other security giving rise to a right over, or an interest in, the capital of the Group Companies.

The Group Companies are duly incorporated, properly formed and validly existing under the laws of the relevant country of incorporation. Each of the Group Companies has the requisite power and authority (corporate and other) to carry on its business as currently conducted.

The Company owns, directly or indirectly, the Subsidiary Shares. Unless otherwise specified in Schedule 2 (Subsidiaries), the Subsidiary Shares constitute the whole of the issued and outstanding share capital of the respective Subsidiaries.

There is no Encumbrance on, over or affecting any of the Subsidiary Shares, nor is there any commitment to give or create any Encumbrance. The Subsidiary Shares are fully paid up and have not been repaid.

No Group Company nor any part of its assets or undertakings is involved in or subject to any bankruptcy, liquidation, receivership, administration, arrangement or scheme with creditors, moratorium, interim or provisional supervision, whether in the jurisdiction of the place of incorporation or in any other jurisdiction, no such action or request is pending or currently threatened and no circumstances exist that would justify any such action being taken.

No meeting has been convened at which a resolution is to be proposed, no resolution has been passed, no petition has been presented and no order has been made for the winding up of any Group Company and, to the best knowledge of the Sellers, no circumstances exist that would justify any such action being taken.

have been prepared in accordance with generally accepted accounting principles and practices in the Netherlands;

Other than in respect of any liabilities arising or incurred under or in connection with Environmental Laws (as defined in the Environmental Indemnity), Tax, compliance with applicable laws and regulations or in connection with the matters addressed by the Fundamental Warranties, there are no actual or contingent liabilities of any of the Group Companies (whether or not those liabilities are required to be disclosed or provided for in accordance with generally accepted accounting principles in the Netherlands) which individually exceed an amount of EUR500,000 except for: (i) liabilities disclosed or provided for in the Accounts or incurred in the ordinary course of business since the Accounts Date; and (ii) liabilities disclosed elsewhere in this Agreement or in the Disclosed Information.

 

Other than as disclosed or provided for in the Accounts, no Group Company has any liability (including through guarantees, indemnities or other forms of security provided by any Group Company) in respect of any obligation or liability of any entity listed in Schedule 2 (Subsidiaries), other than a pro rata share of any liability or obligation which does not exceed the relevant Group Company's pro rata share of the issued and outstanding ordinary shares in such entity.

 

In the period between the Accounts Date and the Signing Date, there has been no fact, circumstance or event that would have resulted in a breach of the provisions of clauses 8.1 and 8.2(a) to 8.2(i) (inclusive) if such clauses were drafted to apply during the period between the Accounts Date and the Signing Date.

each Group Company has conducted its business and corporate affairs in accordance with its memorandum and articles of association, by-laws or other equivalent constitutional documents and in accordance with all applicable laws and regulations (including the competition legislation or practice of any jurisdiction);

no Group Company is in material default of or subject to any statute, regulation, order, decree or judgment of any court or any governmental or regulatory authority in any jurisdiction, including in relation to competition matters;

no Group Company (and no director, employee or consultant of any Group Company or any person who advises, directs or instructs any Group Company) has received written notice

that it is in violation of, or in default with respect to, any statute, law, regulation, order, decree or judgment of any court or government agency of the jurisdiction in which it is incorporated or operates, including from any governmental entity having jurisdiction in competition matters.

The Purchaser has the requisite power and authority (corporate and other) to carry on its business as currently conducted and it is authorised to execute this Agreement and any other agreements contemplated herein to which it is a party and to consummate the transaction contemplated herein. The execution of this Agreement and the agreements contemplated herein have been duly authorised by all requisite corporate action and save as set forth in this Agreement, no consents, approvals, orders or authorisations of, or registrations, declarations or filings with, any person are required in connection with the entering into of this Agreement, or of the agreements contemplated herein.

Neither the Purchaser nor any part of its assets or undertakings is involved in or subject to any bankruptcy, liquidation, receivership, administration, arrangement or scheme with creditors, moratorium, interim or provisional supervision, whether in the jurisdiction of the place of incorporation or in any other jurisdiction, no such action or request is pending or currently threatened and no circumstances exist that would justify any such action being taken.

No meeting has been convened at which a resolution is to be proposed, no resolution has been passed, no petition has been presented and no order has been made for the winding up of the Purchaser and to the best knowledge of the Purchaser, no circumstances exist that would justify any such action being taken.

The execution and performance by the Purchaser of this Agreement, and of the agreements contemplated herein, will not violate the provisions of any law by which it is bound, any decree or order of a governmental entity or other authority by which it is bound, its articles of association, its deed of incorporation or bylaws or other similar documents (each as amended from time to time), any contract, agreement or other instrument by which it is bound or any resolution of its supervisory board, management board or other corporate body or of its shareholders.

This Agreement and all other agreements and obligations undertaken in connection with the transaction contemplated herein constitute or will constitute, following the execution thereof, the valid and legally binding obligations of the Purchaser, enforceable against it in accordance with their respective terms.

The Guarantor has the requisite power and authority (corporate and other) to carry on its business as currently conducted and it is authorised to execute this Agreement and any other agreements contemplated herein to which it is a party and to fulfil its obligations under this Agreement. The execution of this Agreement and the agreements contemplated herein have been duly authorised by all requisite corporate action and save as set forth in this Agreement, no consents, approvals, orders or authorisations of, or registrations, declarations or filings with, any person are required in connection with the entering into of this Agreement, or of the agreements contemplated herein.

Neither the Guarantor nor any part of its assets or undertakings is involved in or subject to any bankruptcy, liquidation, receivership, administration, arrangement or scheme with creditors, moratorium, interim or provisional supervision, whether in the jurisdiction of the place of incorporation or in any other jurisdiction, no such action or request is pending or currently threatened and no circumstances exist that would justify any such action being taken.

No meeting has been convened at which a resolution is to be proposed, no resolution has been passed, no petition has been presented and no order has been made for the winding up of the Guarantor and to the best knowledge of the Guarantor, no circumstances exist that would justify any such action being taken.

The execution and performance by the Guarantor of this Agreement, and of the agreements contemplated herein, will not violate the provisions of any law by which it is bound, any decree or order of a governmental entity or other authority by which it is bound, its articles of association, its deed of incorporation or bylaws or other similar documents (each as amended from time to time), any contract, agreement or other instrument by which it is bound or any resolution of its supervisory board, management board or other corporate body or of its shareholders.

 

This Agreement and all other agreements and obligations undertaken in connection with the transaction contemplated hereby constitute or will constitute, following the execution thereof, the valid and legally binding obligations of the Guarantor, enforceable against it in accordance with their respective terms.

any payment of Tax made or to be made by a Group Company the liability for which arises as a result of any Transaction or Transactions occurring before the Accounts Date (other than Tax arising in respect of income, profits or gains earned after the Accounts Date as a result of any such Transaction or Transactions) or in respect of any profits earned before the Accounts Date;

any payment of Tax made or to be made by a Group Company the liability for which arises as a result of any Transaction or Transactions occurring in the period between the Accounts Date and the Completion Date to the extent that it occurs outside the ordinary course of business carried on by the Group Companies in that period; or

the use or setting off of a Purchaser’s Relief against any payment of Tax or any income, profits or gains, where, but for such use or setting off, the Group Company would have had an actual liability to Tax in respect of which a claim could be made under paragraph 2.1(a) of this Schedule.

To the extent a Group Company is not a Wholly Owned Group Company, the indemnity in paragraph 2.1 above shall only apply to the extent of the percentage of shares of such Group Company directly or indirectly held by the Company as set out in Schedule 2.

The indemnity in paragraph 2.1 above shall extend to all reasonable costs and expenses incurred by the Purchaser in connection with a claim made under the indemnity in paragraph 2.1 above, or in satisfying or settling any Tax liability in accordance with paragraph 8.

The Parties agree that any payment made by the Sellers under this Schedule is made by way of repayment of the Purchase Price.

ultimately twenty (20) Business Days after the date on which the Sellers have received notice in accordance with paragraph 8.1 of the amount due from the Purchaser or the relevant Group Company; or

if later, ultimately two (2) Business Days before the first date on which the Tax in question becomes recoverable by the Tax Authority demanding the same.

If a payment or payments to the relevant Tax Authority prior to the date otherwise specified by this paragraph would avoid or minimise interest or penalties, the Sellers may at their option pay the whole or part of the amount due to the Purchaser on an earlier date or dates, and the Purchaser shall procure that the Tax in question (or the appropriate part of it) is promptly paid to the relevant Tax Authority.

it would not have arisen (or would have been reduced) but for a change in legislation or a change in the interpretation of legislation on the basis of case law made after the date of this Agreement (whether relating to Tax, the rate of Tax or otherwise) or any amendment to or the withdrawal of any practice previously published by a Tax Authority, in either case occurring after the date of this Agreement;

it is caused by any act or omission of the Purchaser or any Group Company after Completion (including for instance a restructuring) other than an act or omission which occurred (i) in the ordinary course of business of the Group Companies, (ii) in compliance with an obligation of a Group Company that existed before Completion, or (iii) in accordance with a provision of this Agreement;

recovery has been made or can be made, recovery is available under an insurance policy or is otherwise compensated for without cost to the Purchaser or a member of the Purchaser's Group;

it arises as a result of any change after Completion of the date to which a Group Company makes up its accounts or in the bases, methods or policies of accounting of a Group Company other than a change which is reported by the auditors of a Group Company to be necessary in their opinion because such bases, methods or policies of accounting as at the date of Completion are not in accordance with any generally accepted accounting practice or principle then current; or

it would not have arisen, or would have been reduced, but for a cessation, or any change in the nature or conduct, of any trade carried on by a Group Company at Completion, being a cessation or change occurring on or after Completion, unless such cessation or change occurred as a result of or due to the actions or omissions of the Sellers or any of the Group Companies before Completion.

If a member of the Purchaser's Group realises or is deemed to realise a benefit or saving which it would not have received or made but for the circumstances giving rise to a claim under this Schedule, or if a member of the Purchaser's Group has obtained or reasonably can or will obtain a corresponding adjustment as a result of a transfer pricing adjustment applied to a Group Company pursuant to transfer pricing legislation (or its equivalent), then:

the Purchaser shall procure that full details of the benefit or saving are given to the Sellers as soon as practicable and in any event within ten (10) Business Days of receipt of the benefit or saving in question; and

 

(b)

If a member of the Purchaser's Group is entitled to receive a benefit or make a saving, as referred to in paragraph 5.1 of this Schedule, it shall make reasonable endeavours to obtain any such benefit or make such saving within a reasonable time.

the Purchaser shall give the Sellers full details of the entitlement as soon as practicable and in any event within ten (10) Business Days of the relevant member of the Purchaser's Group becoming aware of the entitlement arising;

any member of the Purchaser's Tax Group shall at the request of the Sellers take all appropriate steps to procure that the repayment or credit shall be obtained, keeping the Sellers fully informed of the progress of any action taken; and

an amount equal to the repayment or credit (including any repayment supplement or interest) received by a member of the Purchaser's Tax shall reduce any current or future liabilities of the Sellers under paragraph 2.

No liability shall arise for the Sellers under this Schedule in respect of a liability to Tax unless, and then only to the extent that, the amount of that liability to Tax exceeds the Saveable Amount in respect of:

any Sellers' Relief which would have been available to mitigate that liability to Tax had it not been used against one or more Tax liabilities which do not give rise to a liability for the Sellers under this Schedule (other than because of subparagraph 6.1(a) above).

The Purchaser shall, if the Sellers shall at any time request and at the Sellers' expense, deliver to the Sellers a report from the Group Company's auditors confirming that in their opinion all such Sellers' Reliefs have been used in accordance with subparagraph 6.1.

the Sellers (or their advisers) shall be provided promptly with any information received by the Purchaser or a member of the Purchaser's Group, or of which any of them otherwise becomes aware, which may be relevant to the Sellers' Conduct Matters, and with such assistance including assistance from employees of the members of the Purchaser's Group, and access to such documents and records of, or relating to, a Wholly Owned Group Company, as the Sellers (or their advisers) may reasonably require in connection with the Sellers' Conduct Matters;

a Wholly Owned Group Company shall immediately authorise, sign and submit to the relevant Tax Authority any Tax Returns relating to a Relevant Period and make such claims and elections and give such consents and comply with all procedural requirements in respect of the making or giving of such Tax Returns or such claims, elections or consents as the Sellers (or their advisers) may, in its absolute discretion, direct in writing; and

 

Subject to the provisions of subparagraphs 7.3 and 7.4 and paragraph 8, the Purchaser and its advisers shall have sole conduct of all Tax affairs of a Group Company other than Sellers' Conduct Matters, but to the extent a Tax Return relates to the period between the Accounts Date and the Completion Date the Purchaser shall submit a draft thereof to the Sellers’ Representative at least fifteen (15) Business Days before its intended submission to any Tax Authority and the Sellers’ Representative and its advisers shall be given access to all information necessary to determine its accuracy.

Where any Tax Return is required to be submitted for, or in respect of, a Straddle Period, a draft shall be submitted by the Purchaser to the Sellers at least fifteen (15) Business Days before its intended submission to any Tax Authority and the Sellers and their advisers shall be given access to all information necessary to determine its accuracy. In addition, the Sellers shall be kept informed by the Purchaser of any negotiations regarding the Tax liabilities of a Group Company relating to the Straddle Period and before any agreement in respect of those Tax liabilities is reached with a Tax Authority, details of the proposed agreement shall be given by the Purchaser to the Sellers at least fifteen (15) Business Days before the proposed conclusion of such agreement.

If, within fifteen (15) Business Days of receiving any draft Tax Return or details of negotiations or proposed agreements referred to in subparagraph 7.2 or 7.3, the Sellers make any representations to the Purchaser those representations shall, to the extent that they are reasonable, be reflected in the Tax Returns, negotiations or agreement with the relevant Tax Authority.

If a member of the Purchaser's Group receives any letter, enquiry, notice, demand, determination, assessment or other document, or a tax authority takes any action, from which it appears that a Group Company may incur or suffer a Potential Liability, or if a member of the Purchaser's Group is, or becomes, aware of any fact which affects, or which may affect, any assessment which may give rise to a Potential Liability, the Purchaser shall or shall procure that a Group Company shall:

notify the Sellers of the relevant facts as soon as practicable and in any case involving an assessment with a time limit for appeal at least ten (10) Business Days before the expiry of that time limit and in any other case, in any event within ten (10) Business Days of receipt thereof; and

On the giving of the notice referred to in subparagraph 8.1, the Sellers shall be entitled to elect that subparagraphs 7.1(a) and 7.1(b) shall apply to the Potential Liability as if it were Sellers' Conduct Matter and shall be entitled to resist the Potential Liability in the name of a Group Company and have the conduct of any appeal, dispute, compromise or defence of the Potential Liability and of any incidental negotiations relating thereto.

Subject to any election made under subparagraph 8.2 and the provisions of subparagraph 8.4, the Purchaser and its advisers shall have sole conduct of negotiations and correspondence relating to the Potential Liability. The Purchaser agrees to conduct such negotiations and correspondence as expeditiously as reasonably practicable.

The Purchaser will not, and will procure that a Group Company will not, compromise or settle any Potential Liability or agree any matter which may affect the outcome of any dispute or negotiation with any Tax Authority in relation to any Potential Liability without the written consent of the Seller.

 

The Sellers' liability in respect of a claim under paragraph 2 of this Schedule shall cease on the date that is six (6) years following the Completion Date, except in the event that bona fide notice of a claim is given to the Sellers before the expiry of the relevant period and legal proceedings have been initiated with respect to such claim within six (6) months after that date.

which would not have arisen but for a change in legislation or regulations, or a change in the interpretation or implementation thereof by any government body or by reason of development in case law, made after the Completion Date or any amendment to or withdrawal of any practice previously published or statutory concession previously made (whether or not the change purports to be effective retrospectively in whole or in part);

which would not have arisen but for a change after the Completion Date to the accounting policies or standards applied by the Group Companies, the bases on which any Group Company values its assets, the tax structure or corporate structure of the Group Companies;

occasioned by any act or omission of the Purchaser or any Group Company after Completion, unless such act or omission occurred (i) in the ordinary course of business of the Group Companies, (ii) in compliance with an obligation of a Group Company that existed before Completion, (iii) in accordance with a provision of this Agreement or (iv) required by law or regulation; or

The damages payable by the Sellers in respect of any Warranty Breach or other Claim (excluding in respect of Leakage, Transaction Costs, Tax and the Environmental Indemnity, which shall be regulated as specified elsewhere in this Agreement) (after taking into account all compensating factors) shall be calculated on a euro-for-euro basis (i.e. without multiplication) and limited to the amount necessary to indemnify any members of the Purchaser's Group for the pro rata loss of or costs to them as a result of the facts giving rise to such Warranty Breach or other Claim. The amount of the damages are to be determined on the basis of sections 6:95 and 6:96 of the Dutch Civil Code and shall be calculated on an after-Tax basis.

 

For the purposes of determining the amount of damages claimable as a result of a Warranty Breach, the Purchaser shall be deemed to have suffered at least the same amount of damages as the relevant member of the Group (or such pro rata amount thereof as the Company's shareholding in the relevant member of the Group represents).

 

the existence of any Hazardous Materials on, in, at, under or migrating from any of the Sites at any time on or prior to the Completion Date (including soil, soil air, water, groundwater, pipes, drainage or sewage systems, and any buildings (including roofs) or other permanent structures on, in or below the land); or

any discharge, release, leakage, spillage, escape or disposal of Hazardous Material at any Site at any time on or prior to the Completion Date onto or into any land or waters, which causes, will cause or is likely to cause a risk to human health or pollution of the Environment; or

any agreement with any regulator, governmental authority or other third party concluded in order to avoid any Environmental Proceedings upon the prior written consent of Seller (which shall not be unreasonably withheld); or

any Remedial Action and/or Reasonable Containment Measures required under any Environmental Laws to come into compliance with any Environmental Laws and carried out upon the prior written consent of Seller (which shall not be unreasonably withheld); or

any measures required under Environmental Laws to deal with any immediate risk to human health or to the Environment resulting from any Existing Environmental Condition.

other than the Agreed Audits, the carrying-out of any environmental investigation or audit other than any investigation or audit required under Environmental Laws or in relation to any Environmental Proceeding or in accordance with good business practices;

information voluntarily given to a regulatory authority in circumstances other than where there is a reporting requirement under Environmental Laws (including, for the avoidance of doubt, any legally required disclosure of any of the Agreed Audits to any regulatory authority) or under any environmental permit (including, for the avoidance of doubt, an obligation to disclose any of the Agreed Audits to any regulatory authority) or where the Sellers have previously proposed or approved this course of action in writing.

 

The Sellers shall cease to be liable for any claim under this Indemnity on 1 April 2014, except in respect of any valid bona fide claim that has been notified in writing prior to that date, in respect of which the Indemnity shall survive until such time as the claim is either satisfied or otherwise settled, or dismissed, abandoned or withdrawn.

The Purchaser shall not be entitled to recover any Environmental Liabilities (i) to the extent that provision has been made in the Accounts for the matter which has given rise to, or is giving rise to, such Environmental Liabilities, (ii) in respect of any Reasonable Containment Measures that were already being implemented prior to the Accounts Date, or (iii) in respect of any Reasonable Containment Measures that after the Completion Date supersede containment measures that were already being implemented prior to the Accounts Date, save to the extent the cost of such Reasonable Containment Measures is higher than the cost of the superseded containment measures as reflected in the Accounts (in both cases as calculated on an annual basis).

The Purchaser shall take all reasonable steps which are necessary to mitigate any Environmental Liabilities. Furthermore, and without prejudice to the generality of the preceding sentence, the Purchaser shall procure that to the extent feasible the Group Companies shall employ Reasonable Containment Measures in respect of all Existing Environmental Conditions, such in an attempt to mitigate the need for Remedial Action.

The Sellers shall be entitled, upon their request, to participate in discussions and/or negotiations with any party imposing or seeking to impose any Environmental Liabilities, including any discussions or negotiations regarding an agreement with any regulatory authority or third party.

Provided that the Sellers accept by written notice to the Purchaser that the relevant Environmental Liability will be indemnified under clause 2 above (subject to the limitations contained or referred to in this Schedule), the Sellers shall, if they so request, be allowed to:

assume the conduct of any negotiations, proceedings or appeals relating to any claim or potential claim. The provisions of clauses 12.2(b), (c) and (d), 12.3 and 12.4 (excluding clause 12.4(b) and provided that in respect of clause 12.4(a) the reference to clause 12.2(a) shall be deemed to be a reference to clause 8.3 of this schedule) of the Agreement shall apply mutatis mutandis thereto.

The Sellers shall have the opportunity to comment, before or within four (4) weeks after the Signing Date, on any matter referred to in the Agreed Audits described in clause 1.2(a) which the Sellers believe is factually incorrect, and, provided that AMEC Environmental and Infrastructure, Inc. and the Purchaser agree (such consent not to be unreasonably withheld), the relevant matter shall be corrected in an updated version of the report, which shall, for the purposes of this Indemnity, be the relevant report.

Review of Environmental Reports & Documentation.  AMEC personnel will review all environmental reports and other relevant documentation (permits, etc…) released by Lankhorst for the seven (7) sites listed in 1.2 (b) above. It should be noted that at this time, AMEC is only aware of environmental reports pertaining to two (2) of the locations in France (i.e., Guilvinec and Treffiagat) and the Brazil Site.  Furthermore, owing to the potential third party claim relative to the former owner and/or operations at the Brazil location by Nebraska (foundry), AMEC will endeavor to evaluate the existing legal decree against Nebraska and determine if there are any impacts to this property that require consideration by the Purchaser.

Site visits.  At the specific request of the Purchaser, AMEC personnel will visit only the France (3), Germany (1) and Brazil (1) locations to confirm information contained in the environmental reports (where applicable) and verify site conditions/operations.  AMEC will also evaluate each site for other environmental issues/concerns not contained in the reports (where applicable) and conduct interviews with designated Lankhorst site representative(s) as a resource for current and historical site information.  Each site visit will also include a visual assessment of the surrounding properties and any land use practices that may have impacted the environmental condition of the Site.  It is expected that AMEC staff will be provided with unrestricted access to the site and site buildings, and would ask that this expectation be communicated to Lankhorst in advance.

Environmental Summary Reports.  AMEC will prepare a summary report or letter for each of the seven (7) locations that includes review and interpretation of all relevant environmental reports and publically available information, site visit observations/findings (where applicable), and a summary of environmental liability/risk for consideration by the Purchaser.  The reports and/or letters will include a statement as to whether, in respect of any contamination, clean-up (or only containment) is required. Prior to finalising their reports and/or letters, AMEC will provide drafts to the Sellers and the Purchaser and allow them a reasonable opportunity to respond to the content thereof. Where Phase II ESA activities are deemed necessary to adequately evaluate the environmental liability/risk at a particular site, the report will also include scope of work and associated budget for immediate execution of Phase II ESA activities for consideration by the Purchaser.