BT 2015 Annual Report Download - page 220

218 BT Group plc
Annual Report 2015
consideration and therefore the value of the Acquisition would
increase above £12.5 billion.
If the cash element of the consideration due to Deutsche Telekom
is estiated to be less than ero at opletion as a result of s
estimated adjusted net debt position as at Completion), BT can reduce
the number of Ordinary Shares to be issued to Deutsche Telekom by such
number as results in the cash consideration payable to Deutsche Telekom
then being as near as possible to zero. In such circumstances, Deutsche
Telekom would then receive less than 12% of BT’s enlarged issued share
capital as a result of the Acquisition.
2. Conditions
Completion is conditional upon satisfaction or, where capable of being
waived, waiver of the following Conditions prior to the Long Stop Date
or such later date as the parties a aree
a passin the cuisition esolution
b allotent of the onsideration hares to the ellers subect onl to
their admission to listing and trading;
c the UK istin uthorit havin approved the adission of the
onsideration hares to the cial ist and the ondon toc
Exchange having approved admission of the Consideration Shares
to tradin with eect fro opletion
d clearance of the cuisition b the  eanin
i clearance of the cuisition b the  at hase 1
unconditionally, or conditionally on BT giving remedies, which
are at s sole discretion to aree but in co-ordination and
consultation with the Sellers); or
ii clearance of the cuisition b the  at hase 
unconditionally, or conditionally on BT giving remedies, which
are to be agreed by BT acting reasonably and in co-ordination
and consultation with the Sellers, provided that BT shall not
be required to give any remedy which would have a material
adverse eect on  or the  roup or would not be
reasonable fro a financial or strateic perspective and in the
event that BT agrees such remedies, the Sellers shall share the
cost of such remedies by way of a reasonable reduction in the
purchase price for the Acquisition;
e or if the cuisition is referred to the uropean oission
clearance of the Acquisition by the European Commission, meaning;
i clearance of the cuisition b the uropean oission
under rticle 1b of the uropean Union erer
Regulation unconditionally, or conditionally on BT giving
reedies which are at s sole discretion to aree but in co-
ordination and consultation with the Sellers); or
ii clearance of the cuisition b the uropean oission
under rticle 1 or  of the uropean Union erer
Regulation unconditionally, or conditionally on BT giving
remedies, which are to be agreed by BT acting reasonably and
in co-ordination and consultation with the Sellers, provided
that BT shall not be required to give any remedy which would
have a aterial adverse eect on  or the  roup or would
not be reasonable fro a financial or strateic perspective
and in the event that BT agrees such remedies, the Sellers
shall share the cost of such remedies by way of a reasonable
reduction in the purchase price for the Acquisition;
f no  aterial adverse chane havin occurred and
 no  aterial adverse chane havin occurred.
If the Acquisition Resolution is approved at the General Meeting and each
of the other onditions is satisfied or where capable of bein waived
waived prior to the on top ate or such later date as the parties
may agree), the Company will be contractually obliged to proceed to
Completion unless the Share Purchase Agreement is otherwise terminated.
 epects the cuisition to coplete before the end of s 011
financial ear on 1 arch 01.
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3.1 BT
BT has agreed that until Completion or earlier termination of the Share
Purchase Agreement, it shall:
a ensure at all ties that its shares are aditted to the cial ist
and to trading on the London Stock Exchange;
b not undertae an share issuance or create an riht to subscribe
for any Ordinary Shares or share capital, or issue or create any right
to subscribe for any other securities or equity interests convertible
into rdinar hares or share capital save in connection with an
existing BT employee share plans);
c not announce authorise declare ae or pa an dividend other
than ordinary course dividends payable in cash in accordance with
its announced dividend policy;
d not ipleent an share bu-bac or other return of capital
except in accordance with its existing ordinary course share buy-
back programme;
e not ipleent an reoranisation or other deerer or spin-o
f not tae an other action which would aect the nuber of
Ordinary Shares in issue or make any other shareholder distribution
of incoe or capital or siilar arraneent other than the
exceptions outlined above); or
 subect to custoar eceptions not solicit an taeover oer for
BT or any similar transaction which would materially prejudice the
likelihood of Completion.
As a result of the undertakings described above, BT will be unable
to access the equity capital markets to raise additional capital until
Completion or earlier termination of the Share Purchase Agreement.
3.2 EE
The Sellers have agreed that until Completion or earlier termination of
the Share Purchase Agreement, they shall procure that EE:
a carries on its business in the ordinar course and eercises such
rihts as it has to procure that the aairs of  are carried on in
the ordinary course; and
b does not without the prior consent of  ecept in relation to
certain projects of EE agreed with BT around the time of entry into
the Share Purchase Agreement):
i ae an aterial acuisitions or disposals of assets or
properties;
ii enter into or alter an aterial contracts ecept in the
ordinary course of business;
iii enter into or alter an eistin aterial arraneents with the
Sellers’ Groups;
iv incur an new aterial indebtedness or incur an new aterial
guarantee obligations or, except in the ordinary course,
indemnity obligations;
v aree to an chane in the ters of the eistin investent
strategy or, except in limited circumstances, the funding basis
of the  defined benefit pension schee
vi aree an surrender of or tae an action which could
prejudice the use of, the EE Group’s tax losses;
vii enter into or settle an aterial litiation or other aterial
dispute;
viii acuire an wireless spectru
i ae an fundaental chanes to the networ technoloies
or principal billin sstes of the  roup andor
 perfor a nuber of further custoar actions includin
changing the material general terms of employment of its
employees; adopting or materially amending any employee
benefit bonus or profit sharin schee ateriall chanin its
pension and retirement arrangements for employees; declaring
a dividend ecept in accordance with s 01 budet
which would result in the Deutsche Telekom cash consideration
resulting from the Aquisition being less than zero; issuing or
encumbering shares; or making changes to its accounting
policies, constitutional documents or corporate group structure.
The Sellers have also agreed to customary standstill provisions prohibiting
acuisitions of rdinar hares or the ain of an taeover oer for
BT prior to Completion, from which point the terms of the Relationship
Agreement and Standstill and Lock-up Agreement shall apply.