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A letter from the Group’s
Non-Executive Chairman, Sir Martin Jacomb, recommending that you vote in
favour of the Disposals at the Extraordinary General Meeting appears on pages
3 to 5 of this document.
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A notice convening the Extraordinary General
Meeting, which is to be held on the 29th Floor at One Canada Square, Canary
Wharf, London E14 5AB at 9:00 a.m. on Monday 22 December 2003, is set out at
the end of this document.
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Whether or not you intend to be present at
the Extraordinary General Meeting, please complete and sign the form of proxy
accompanying this document in accordance with the instructions printed on
them and return them to the Group’s registrars, Capita Registrars, The
Registry, 34 Beckenham Road, Beckenham, Kent BR3 4BR (tel: 0870 162 3100), as
soon as possible, and in any event not later than 48 hours before the
Extraordinary General Meeting. The return of a completed form of proxy will
not prevent you from attending the Extraordinary General Meeting and voting
in person if you so wish and if you are entitled to do so.
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TABLE OF CONTENTS
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Page
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Letter from Sir Martin Jacomb
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3
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Introduction
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3
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Background to the Disposals
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3
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Information on the Properties
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4
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Terms of the Disposals
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4
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Impact on Canary Wharf
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4
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Benefits to the Company of the Disposals
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5
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Extraordinary General Meeting
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5
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Action to be taken
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5
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Consent
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5
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Recommendation
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5
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Appendix
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Unaudited pro forma statement of net assets of the Continuing Group
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6
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Notice of Extraordinary General Meeting
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9
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Definitions
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10
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Attending the Extraordinary General Meeting
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12
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Letter of recommendation from
Sir Martin Jacomb – Non-Executive Chairman and Chairman of the Independent Committee
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Registered office:
One Canada
Square
Canary Wharf
London E14 5AB
(Registered in England
under number 4191122)
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Directors:
Sir Martin Jacomb (Chairman)*
George Iacobescu (Chief Executive Officer)
A. Peter Anderson II (Managing Director, Finance)
Paul Reichmann
Sir John Carter*
Christopher Jonas*
Michael Price*
Gerald Rothman*
Robert Speirs*
Andrew Tisch*
*Non-Executive and members of the Independent Committee
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5 December 2003
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To all Shareholders, the Warrantholder and participants in the Share
Schemes
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Dear Shareholder,
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PROPOSED DISPOSAL OF PROPERTIES
SITUATED AT 5 CANADA SQUARE,
CANARY WHARF
AND AT 25 CANADA SQUARE,
CANARY WHARF
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1. Introduction
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The Board of Canary Wharf announced today that
it had agreed the terms of the sale of two leasehold properties situated at 5
Canada Square and at 25 Canada Square, Canary Wharf (the
“Properties”) to wholly-owned subsidiaries of The Royal Bank of
Scotland plc (“RBS”) for consideration of £1,112 million payable
in cash upon completion (the “Disposals”).
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I am writing to you to explain the background
to the Disposals and to describe the action you should now take. The Board
recommends that you vote in favour of the resolution required to effect the
Disposals at the Extraordinary General Meeting which will be held on the 29th
Floor at One Canada Square, Canary Wharf, London E14 5AB at 10:00 a.m. on
Monday 22 December 2003.
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2. Background to the Disposals
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The Independent Committee has received a series
of approaches from parties interested in acquiring Canary
Wharf, culminating in the recommended
Offer by the consortium led by MSREF and Simon Glick (the
“Consortium”) which was announced today. The Offer is 265 pence
per share, comprising 220 pence per share in cash and 45 pence per share in
the form of shares in Canary Wharf’s
parent company. The Offer will be implemented by way of a scheme of
arrangement.
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Brascan Corporation and IPC Advisors
Corporation have confirmed that they are considering making an offer for Canary
Wharf. They have therefore been
asked for their consent to the Disposals under Note 1 to Rule 21.1 of the
City Code. Neither of them has given this consent. The consent of the
Consortium is not required as the Offer will be conditional, inter alia,
on completion of the Disposals although, the Disposals can still be completed
even if the Offer is not successful.
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Since Canary
Wharf is in an offer period for
the purposes of the City Code, and since the consent of all the potential
offerors to the Disposals has not been obtained, the Disposals are conditional
upon the approval of Canary Wharf
shareholders under Rule 21 of the Code.
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3. Information on the Properties
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Details of the properties are as follows:
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Property
|
Principal Tenant
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NIA(1)
(sq ft)
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MV(2)
(£m)
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Rent(3)
(£m)
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25 Canada Square
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Citigroup
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1,223,474
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690
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44.9
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5 Canada Square
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Credit Suisse First Boston
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515,080
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327
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19.7
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Total
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1,738,554
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1,017
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64.6
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Notes:
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1. Net internal area
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2. Market Value as at 30
June 2003
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3. Net annual rents receivable
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The market value of the properties stated above excludes any value for
capital allowances available to purchasers.
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4. Terms of Disposals
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To effect the Disposals, Canary
Wharf has entered into a series
of agreements (the “Property Sale Agreements”) for the sale of
the leasehold interests in the Properties to wholly-owned subsidiaries of
RBS.
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Under the terms of the Property Sale Agreements,
Canary Wharf
will receive total consideration of £1,112 million payable in cash at
completion. Further limited consideration may be received by Canary
Wharf depending on the amount of
capital allowances agreed by the purchasers with the Inland Revenue.
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The obligations of the parties to complete the
Property Sale Agreements are conditional on the approval of the Disposals by Canary
Wharf’s shareholders on or
before 29 December 2003.
In addition, completion of the Disposals is conditional on Canary
Wharf procuring the release of
the Properties from certain security arrangements to which they are currently
subject. RBS may terminate if completion does not occur on or before 31 December 2003. RBS may also
terminate the Property Sale Agreement relating to either property if that
property is substantially damaged before completion. In addition, RBS may
terminate the Property Sale Agreement relating to 5
Canada Square if 25
Canada Square is substantially damaged before
completion.
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Lazard will receive a fee of £3.5 million on
completion of the Disposals. If the Disposals are completed but the Offer is
unsuccessful, MSREF will receive a fee of £4.0 million, of which £3.0 million
will be payable by Canary Wharf.
If the Disposals are not completed, Canary
Wharf will pay RBS a fee of £2.5
million but no fee, in relation to the Disposals, to Lazard or Morgan
Stanley.
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5. Impact on Canary
Wharf
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Part of the proceeds from the Disposals is
required to repay approximately £901 million of floating rate notes issued by
Canary Wharf Finance II plc in order to obtain the release of the Properties
from the security arrangements to which they are currently subject.
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As set out in the Appendix, the Disposals are
expected to increase Canary Wharf’s
net assets by approximately £8.0 million, Adjusted NAV by approximately £32.1
million, and NNNAV by approximately £71.1 million. The Disposals are expected
to reduce Canary Wharf’s
Adjusted NNNAV by approximately £96.5 million. These estimates take into
account swap breakage costs arising from repayment of the floating rate
notes, the write-off of prior period financing costs deferred in accordance
with FRS 4 and the write back of the rent free accruals recognised in
accordance with UITF 28. The cash proceeds from the Disposals are expected to
generate approximately £225.2 million of additional liquidity for Canary
Wharf.
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6. Benefits to the Company Disposals
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For the Company, the benefits of the Disposals
include the following:
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–
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the sale
price is attractive given current market conditions;
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–
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the increase
in net assets and Adjusted NAV, as described above;
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–
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the cash
proceeds from the Disposals are expected to generate approximately £225.2 million
of additional liquidity for Canary Wharf; excluding the potential release
of the £50 million Coverage Reserve established at the time of the
securitisation tap issue in October 2002;
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–
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following
the associated debt repayment, NAV gearing will fall from approximately 183
per cent. As at 30 June 2003
to approximately 128 per cent. on a pro forma basis, with reduced
amortisation payable by Canary Wharf Finance II plc.
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If the Shareholders vote in favour of the Disposals,
the Company will be obliged to complete the Disposals.
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7. Extraordinary General Meeting
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A notice convening the Extraordinary General
Meeting to consider the ordinary resolution to approve the Disposals is set out
on pages 9 of this document. The Extraordinary General Meeting will be held
on the 29th Floor at One Canada Square,
Canary Wharf,
London E14 5AB at 9:00 a.m. on Monday 22 December 2003.
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8. Action to be taken
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Whether or not they intend to be present at the
meeting, Shareholders are requested to complete and return the enclosed form
of proxy for the Extraordinary General Meeting in accordance with the
instructions printed on the form. Completed forms of proxy should be
returned to the Group’s registrars, Capita Registrars, The Registry, 34
Beckenham Road, Beckenham,
Kent BR3
4BR, as soon as possible, and in any
event not later than 48 hours before the time appointed for the Extraordinary
General Meeting. The completion and return of a form of proxy will not
prevent you from attending the Extraordinary General Meeting and voting in
person if you so wish.
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9. Consent
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Lazard has given and not withdrawn its consent
to the inclusion of the references to its name in this document in the form and
content in which it appears.
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10. Recommendation
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The Independent Directors, having been so
advised by Lazard and Cazenove, believe that the Disposals are in the best
interests of the Company and its shareholders taken as a whole. In providing
advice to the Independent Directors, Lazard and Cazenove have taken into
account the Directors’ commercial assessments.
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The Independent Directors unanimously
recommend that you vote in favour of the resolution to approve the Disposals at
the Extraordinary General Meeting, as they intend to do in respect of their
own beneficial shareholdings.
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Yours faithfully,
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Sir Martin Jacomb
Non-Executive Chairman
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UNAUDITED PRO FORMA STATEMENT OF
NET ASSETS OF THE CONTINUING GROUP
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The unaudited pro forma statement of Canary
Wharf’s net asset values
set out below has been prepared solely to illustrate the effect of the
transaction on Canary Wharf’s
net asset values as if the transaction had taken place at 30 June 2003.
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The information, which is produced for illustrative
purposes only, by its very nature may not give a true picture of, and is not
necessarily indicative of the results and financial position of the Group
which would have been reported if the transaction had taken place on 30 June 2003.
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Per Statutory
Balance Sheet
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Uplift in
Property Values to Market
Value
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Property Values
at Market
Value
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Disposals
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Pro Forma
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£ million
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Total Property
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5,315.8 (1)
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448.0 (2)
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5,763.8
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(1,017.0)
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4,746.8
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Securitisation I
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(590.0)
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(590.0)
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(590.0)
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Securitisation II
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(3,027.0)
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(3,027.0)
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856.3 (3)
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(2,170.7)
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Other Debt
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(1,093.0)
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(1,093.0)
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(12.2)(4)
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(1,105.2)
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Unrestricted Cash
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276.8
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276.8
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225.2 (5)
|
502.0
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Restricted Cash
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752.3
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752.3
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–
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752.3
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FRS 19 – deferred tax provision
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(47.9)
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(47.9)(6)
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(24.1)(13)
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(72.0)
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Other Net Assets
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(67.6)
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(67.6)
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(20.2)(7)
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(87.8)
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NAV incl. FRS 19
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1,519.4
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448.0
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1,967.4
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8.0
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1,975.4
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Add-back of FRS 19
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47.9 (6)
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24.1 (13)
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72.0
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Adjusted NAV
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2,015.3
|
32.1
|
2,047.4
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UITF 28 – Aldersgate & Broadgate
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(179.0)(8)
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(179.0)
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FRS 13 (net of tax)
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(346.5)(9)
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39.0 (9)
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(307.5)
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|
Contingent Tax (pre EZA uplift)
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|
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(258.1)(10)
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0.0 (10)
|
(258.1)
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NNNAV
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1,231.7
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71.1
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1,302.8
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Uplift in Market Value attributable to EZAs
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|
|
525.0 (11)
|
(136.0)(11)
|
389.0
|
|
FRS 19 – deferred tax provision
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|
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(84.9)(12)
|
(52.6)(13)
|
(137.5)
|
|
Contingent Tax on EZA uplift
|
|
|
(147.4)(14)
|
21.0 (14)
|
(126.4)
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|
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NNNAV adjusted for EZAs
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|
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1,524.4
|
(96.5)
|
1,427.9
|
|
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|
NAV p.s. (p)
|
|
|
344
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6
|
350
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|
NNNAV p.s. (p)
|
|
|
211
|
12
|
223
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NNNAV p.s. adj. for EZAs (p)
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|
|
261
|
(17)
|
244
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|
|
Net Debt
|
|
|
(3,680.9)
|
1,069.3
|
(2,611.6)
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Notes
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The unaudited pro forma statement of net assets
is based on the published annual report and financial statements of Canary
Wharf to which the following
adjustments have been made:
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(1)
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Total property comprises (i) investment properties stated
at 30 June 2003 Market Value derived in accordance with the Appraisal and
Valuation Manual published by the Royal Institution of Chartered Surveyors
(’Market Value’) (excluding any uplift for the benefit of
EZAs), net of an adjustment of £47.7 million required by Urgent Issues Task
Force Abstract 28 (Operating Lease Incentives) (’UITF 28’) in
respect of tenant incentives attributable to such properties, (ii)
properties under construction stated at cost and (iii) properties held for
development stated at cost. The Market Value of 25 Canada Square at 30 June 2003 was £690 million and
the Market Value of 5 Canada Square at that date was £327 million.
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(2)
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Uplift in carrying value of properties under construction
and properties held for development to Market Value in existing state.
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(3)
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Repayment of £901.3 million of floating rate notes
less the D Notes of £45 million currently held by Canary
Wharf. The quantum and class of
notes to be repaid is subject to the consent of the trustee and affirmation
of the rating of the remaining notes by the rating agencies.
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(4)
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The Group’s debt instruments are stated net
of financing costs and such costs are charged to the profit and loss
account over the term of the debt instruments at a constant rate based on
the carrying amount of the debt. To the extent that debt instruments are
repaid early, the unamortised financing costs attributable to that debt
must be written off to the profit and loss account.
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(5)
|
The Disposals are expected initially to generate
additional liquidity for the Group of £225.2 million, excluding the
potential release of £50 million from the Coverage Reserve. The expected
initial proceeds are calculated as follows:
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£ million
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|
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|
Sale of
properties
|
1,112.0
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Less: Prepayment of debt (net of cancellation of D Notes
held by the Group)
|
(856.3)(a)
|
|
Less: Breakage costs of hedging instruments
|
(27.0)(b)
|
|
Less: Estimated fees
|
(3.5)(c)
|
|
Add: Release of Coverage Reserve
|
– (d)
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225.2
|
(a) It is anticipated that the
following classes of notes will be repaid:
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|
Tranche
|
Repayment £
million
|
|
|
|
A2
|
100.8
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|
A4
|
90.0
|
|
A5 (part)
|
95.5
|
|
A6
|
325.0
|
|
R1
|
125.0
|
|
R2
|
60.0
|
|
B1
|
60.0
|
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|
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|
856.3
|
|
D notes held by the Group
|
45.0
|
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Total
|
901.3
|
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(b)
|
The estimated breakage costs referred to above have
been based on mid-market quotes as at close of business on 26 November 2003. The costs include any premium
payable on redemption of the notes. The actual amount of breakage costs
will depend on the market price of the hedges on the date of completion
of the transaction. The amount of
breakage costs also includes the fee payable in respect of the facility
referred to in (e) below.
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(c)
|
Estimated fees payable to Canary
Wharf’s advisers in
connection with the Disposals.
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|
(d)
|
Subject to the consent of the trustee and the rating
agencies, it is anticipated that as a result of repaying the A6, R1 and R2
notes, security over the £50 million Coverage Reserve established as a
result of the tap issue in October
2002 will be released. However, this has not been assumed in the pro forma
statement of the net assets.
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(e)
|
In connection with the securitisation of 25 Canada
Square, the Group entered into a facilityagreement with Gibralter Holdings
Limited, (the “DS5 Facility Provider”), whereby,
inconsideration for the payment of a commitment fee, the DS5 Facility
Provider made availableon an interest free basis a loan facility drawable
in circumstances where in respect of 25 Canada Square there is a default in
the payment of rent. As a result of the proposed sale of 25
Canada Square and its withdrawal from the
securitisation, it is proposed that the benefit of the facility be
transferred to 33 Canada Square,
another property leased to Citigroup, in consideration for the payment of a
fee. This fee is taken in the estimated breakage costs referred to in (b)
above.
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|
|
(6) Deferred tax arises from timing
differences between the recognition of gains and losses for accounts purposes
and their recognition in the Group’s corporation tax return. In accordance
with Financial Reporting Standard 19 (Deferred Tax) (“FRS 19”)
the Group has recognised a deferred tax provision in respect of timing
differences that have originated but not reversed at the balance sheet date.
These timing differences originate when transactions or events that result in
an obligation to pay more or less tax in the future have occurred on or
before the balance sheet date. As permitted by FRS 19, deferred tax is
calculated on a discounted basis to reflect the time value of money over the
period between the balance sheet date and the dates on which it is estimated
that the underlying timing differences will reverse or, where the timing
differences are not expected to reverse beforehand, a period not exceeding 50
years. At 30 June 2003,
the Group recognised a deferred tax provision of £47.9 million. This
provision reflects, inter alia, the clawback of EZAs already claimed
in respect of certain properties which would arise in the event of the
disposal of those properties.
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|
|
In arriving at Adjusted NAV, the
provision for deferred tax recognised in accordance with FRS 19 has been
added back. FRS 19 requires, inter alia, provision to be made for
deferred tax on capital allowances claimed notwithstanding that the related
tax would not become payable unless the related properties were disposed of.
In contrast, no provision is required for the tax which would become payable
on the profits which would be realised if the Group were to dispose of its
properties at their Market Value. This inconsistency in the accounting
standard has therefore been reversed in calculating the adjusted net asset
value per share. No element of the deferred tax provision recognised at 30 June 2003 related to either 5
Canada Square or 25
Canada Square.
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|
|
|
(7) In accordance with UITF 28, the rental
income receivable under a lease is allocated to periods evenly over the lease
term, or, if earlier, to the period to the first open market rent review. The
effect of this policy is to recognise rental income during rent free periods,
which adjustment then reverses from the date of rent commencement. The rent
free adjustment in respect of 5 Canada Square
and 25 Canada Square at 30 June 2003 was £20.2 million and
this balance must be written off to the profit and loss account upon sale of
the properties.
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|
|
|
(8) At 30 June 2003, the Group recognised a provision of £123.5
million in respect of the estimated liability relating to vacant leasehold
property assumed from Clifford Chance in connection with its lease of 10
Upper Bank Street. At that date the Group also
accrued £28.2 million and provided a further £27.3 million in respect of
certain liabilities to Lehman Brothers in connection with its lease of 25-30
Bank Street. These amounts, totalling £179.0
million, are treated as lease incentives and accounted for in accordance with
UITF 28. Accordingly £179.0 million was included in prepayments at 30 June 2003 which will be
amortised through the profit and loss account over the period to the first
open market review on, as applicable, 10 Upper Bank
Street and 25-30 Bank
Street. UITF 28 requires that, upon completion
of these two properties (which has occurred since 30 June 2003) and their revaluation to Market
Value, the valuation should be reduced for these incentives.
|
|
|
|
(9) At 30 June 2003, the adjustment required by Financial
Reporting Standard 13 (Derivatives and Other Financial Instruments)
(“FRS 13”) in order to mark the Group’s financial
instruments to market was £495.2 million, or £346.5 million net of tax. The
adjustment has been shown on a post tax basis as the loss arising on
redemption of debt at above nominal values could be offset against taxable
profits.
|
|
|
|
Of the amount of £346.5 million,
£39.6 million is attributable to the swaps and notes which will be closed out
as a result of repaying £901.3 million of notes in connection with the
proposed transaction.
|
|
|
|
(10) The figure of £258.1 million represents
the contingent tax which would be payable upon disposal of the Group’s
properties at their Market Value at 30
June 2003, excluding any value attributable to EZAs. The disposal
of 5 Canada Square and 25
Canada Square at their EZA-exclusive values does
not reduce this contingent tax liability because the profit arising on the
sale of these properties may be fully sheltered by the Group’s tax
losses. As such, although the contingent profits are reduced as a result of
the sale of these properties, the losses that may be used to shelter these
lower contingent profits are reduced by the same amount.
|
|
|
|
(11) The Group has received an assessment from
its valuers that the increase in Market Value attributable to EZAs at 30 June 2003, was £525.0 million.
This increase represents the valuers’ assessment of the additional
amount that a third party purchaser would pay for a property recognising that
a third party purchaser would pay more for a building that attracts EZAs than
for a building that does not. Of the increase in Market Value of £525.0
million, £136.0 million in total is attributable to 5
Canada Square and 25
Canada Square.
|
|
|
|
It should be noted that the
assessment of the value of EZAs above, based on the sale of properties as at
30 June 2003, is not a suitable measure of their worth to the Group on an on-going
basis. For example, the 100% initial allowance which maximises the value of
the EZAs in a sale to a third party is only available on the first sale
within two years of the building being occupied. If an intra-group transfer
of the property is made to allow the Group to claim the EZAs, a claim for
either the initial allowance or for writing down allowances at the rate of up
to 25% of the qualifying expenditure will be made as required in future
accounting periods. After this first intra-group sale, the value of the EZAs
to a third party will fall considerably as a third party would then only be
able to claim writing down allowances at a rate of approximately 4% per annum
thereafter. Of the totalincrease in value of £525.0 million, approximately
£475 million is attributable to EZAs on buildings in respect of which a
purchaser could claim the 100% initial allowance. Accordingly, the disclosed
amount of additionalvalue attributable to EZAs will reduce over the next
couple of years as buildings are transferred within the Group in order to
preserve the entitlement of the Group to claim accelerated rates of writing
down allowances.
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(12) A sale of the properties at their Market
Value with the benefit of EZAs would trigger a clawback of EZAs previously
claimed on those properties. Deferred tax has been provided in the
Group’s balance sheet at 30
June 2003 in relation to EZAs already claimed but this provision
has been discounted to recognise that any clawback would under normal
circumstances take place in the future. If all properties are deemed to be
sold at 30 June 2003 the
clawback would be triggered immediately and the liability would become the
undiscounted amount. This would increase the discounted liability of £47.9
million by £37.0 million to £84.9 million at 30 June 2003.
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(13) In order to shelter the profit realised
on disposal of 5 Canada Square
and 25 Canada Square it
will be necessary to claim EZAs to cover the element of that profit which cannot
be sheltered by losses. A deferred tax provision would need to be recognised
in respect of the EZAs claimed and it has been estimated by the company that
the provision required would be £24.1 million on a discounted basis or £52.6
million undiscounted.
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(14) If the properties were sold at a value of
£525 million above their Market Value, i.e. at their Market Value inclusive
of EZAs, the contingent tax liability would increase accordingly. The Group
has calculated that on a basis consistent with the calculation of the £258.1
million referred to in (11), after allowing for utilisation of capital
losses, the contingent tax liability as at 30 June 2003 based on the Market
Values inclusive of EZAs would be £147.4 million higher, i.e. £405.5 million in
total. Alternatively put, the uplift in value attributable to EZAs would fall
from £525.0 million to approximately £378 million after taking account of the
resulting increase in the related tax liability.
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Of the amount of additional contingent
tax arising due to the EZA uplift, £21.0 million relates to 5
Canada Square and 25
Canada Square.
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NOTICE OF EXTRAORDINARY GENERAL
MEETING CANARY WHARF GROUP PLC
(Registered No. 4191122)
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NOTICE IS HEREBY GIVEN that an extraordinary
general meeting of Canary Wharf Group plc (the “Company”) will be
held on the 29th Floor at One Canada Square, Canary Wharf, London E14 5AB at
9:00 a.m. on Monday 22 December 2003 for the purpose of considering and, if
thought fit, passing the following resolution as an ordinary resolution.
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ORDINARY RESOLUTION
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THAT the Disposals, on the terms set out in the
Property Sale Agreements (as defined in the circular to shareholders of the Company
dated 5 December 2003, of which this notice forms part), be and is hereby
approved and the Directors of the Company (or a duly constituted committee
thereof) be and hereby are authorised to waive, amend, vary or extend any of
the terms of the Property Sale Agreements and any ancillary agreements and
arrangements thereto as they think fit and to do all such things as they (or
a committee) may consider to be necessary, expedient or appropriate to
complete or to give effect to, or otherwise in connection with, such
Disposals and any matters incidental to such Disposals.
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Dated: 5 December 2003
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Registered office By
order of the Board
One Canada Square John
Garwood
Canary Wharf Secretary
London E14 5AB
Registered in England No. 4191122
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Notes:
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1. A member entitled to attend and vote
at the above meeting is entitled to appoint one or more proxies to attend
and, on a poll, to vote in his place. A proxy need not be a member of the
Company.
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2. To be valid, a form of proxy must be
completed in accordance with the instructions printed on it and must be
deposited (together with the power of attorney or other authority, if any,
under which it is signed or a notarially certified or office copy thereof) by
9:00 a.m. on 20 December 2003 with the Company’s Registrars, Capita
Registrars, The Registry, 34 Beckenham Road, Beckenham, Kent BR3 4BR.
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3. Completion of a form of proxy will not
prevent you from attending and voting in person.
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4. The Company specifies, pursuant to
regulation 34 of the Uncertificated Securities Regulations 1995, that only
those shareholders registered in the register of members of the Company as at
6.00 p.m. on 20 December 2003 or, in the event that the meeting is adjourned,
in the register of members at 6.00 p.m. on the second day prior to the day of
any adjourned meeting shall be entitled to attend or vote at the aforesaid
general meeting in respect of the number of shares registered in their name
as at the relevant time. Changes to entries in the relevant register of
securities after 6.00 p.m. on 20 December 2003 or, in the event that the
meeting is adjourned, in the register of members after 6.00 p.m. on the
second day prior to the day of any adjourned meeting shall be disregarded in
determining the rights of any person to attend or vote at the meeting.
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DEFINITIONS
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The following definitions apply throughout this document, unless the
context requires otherwise:
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“Board”
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The board of Directors
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“Companies Act”
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The Companies Act 1985, as amended
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“Canary Wharf”
or “Company”
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Canary Wharf Group plc
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“Cazenove”
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Cazenove & Co. Ltd
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“City Code”
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The City Code on Takeovers and Mergers
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“Continuing Group”
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Canary Wharf
following the Disposals
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“Directors”
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The directors of Canary Wharf
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“Disposals”
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The sale of the properties to RBS
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“Extraordinary General Meeting”
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The extraordinary general meeting of Canary Wharf convened by the
notice set out at the end of this document, including any adjournment
thereof
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“EZAs”
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Capital allowances in accordance with Part 3 of the Capital Allowance
Act 2001
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“Group”
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Canary Wharf
and its subsidiaries and subsidiary undertakings
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“Independent Committee”
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The committee of independent, non-executive Directors constituted by a
resolution of the Board on 2 April
2003 with responsibility for dealing with any offer for Canary
Wharf on the Group’s
behalf
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“Lazard”
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Lazard & Co., Limited
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“Morgan Stanley”
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Morgan Stanley & Co. Limited
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“MSREF”
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real estate private equity funds managed by MSREF IV
International-G.P., L.L.C., consisting of MSREF IV TE Holding, L.P., Morgan
Stanley Real Estate Fund IV International-T, L.P., Morgan Stanley Real
Estate Investors IV International, L.P. and Morgan Stanley Real Estate Fund
IV Special International, L.P.
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“Offer”
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The offer by Silvestor UK Properties Limited to acquire Canary
Wharf by at a price of 265
pence per Canary Wharf Share
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“Panel”
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The Panel on Takeovers and Mergers
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“pounds” or “£”
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UK
pounds sterling
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“Property Sale
Agreements”
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(A) the agreement of even date herewith made among Canary Wharf
Limited, Canary Wharf Holdings Limited, The Royal Bank of Scotland Public
Limited Company and R.B. Drummond Investments Limited for the sale of the
999 year leasehold interest in relation to building DS1 at Canary Wharf,
London E14;
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(B) the agreement of even date herewith made among Canary Wharf
Limited, Canary Wharf Holdings Limited, The Royal Bank of Scotland Public
Limited Company and R.B. Bishopsgate Investments Limited for the sale of
the 999 year leasehold interest in relation to building DS5 at Canary Wharf,
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(C) the option agreement of even date herewith made among Canary Wharf
Investments Limited, CWCB Investments (DS1) Limited, Formatfolder Limited
and Canary Wharf Holdings Limited in relation to the freehold interest in
building DS1 at Canary Wharf,
London E14. Note this option is exercisable between 3 years and 21 years
after completion;
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(D) the option agreement of even date herewith made among Canary Wharf
Investments Limited, CWCB Investments (DS5) Limited, Craftformat Limited
and Canary Wharf Holdings Limited in relation to the freehold interest in
building DS5 at Canary Wharf,
London E14. Note this option is exercisable between 3 years and 21 years
after completion;
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(E) the option agreement of even date herewith made between CWCB
Leasing (RT2) Limited and Riverupper Limited in relation to a 150 year
lease of Retail Units 50 to 53 inclusive and Walkway,
Canada Place at Canary
Wharf, London E14. Note this
option is exercisable between 6 months and one year after completion; and
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(F) the option agreement of even date herewith made between Cabot
Place (RT2) Limited and Strongcycle Limited in relation to a 40 year lease
of Retail Units 50 to 53 inclusive and Walkway,
Canada Place at Canary
Wharf, London E14. Note this
option is not exercisable until 2019;
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“Properties”
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the properties situated at 5 Canada Square
and at 25 Canada Square,
Canary Wharf
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“RBS Group”
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The Royal Bank of Scotland plc
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“Shareholders”
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Holders for the time being of Shares
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“Share Schemes”
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The Canary Wharf Long Term Incentive Plan, the Canary Wharf Company
Share Option Plan, the Canary Wharf Group plc 1997 Executive Share Option
Plan, the Canary Wharf All Employee Share Plan adopted on 8 November 2000 and the Canary
Wharf All Employee Share Plan adopted on 16 October 2001
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“Shares”
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Ordinary shares of 1 pence each in Canary
Wharf
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“subsidiary undertaking”
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A subsidiary undertaking as that term is defined in section 258 of the
Companies Act
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“Takeover Code”
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The City Code on Takeovers and Mergers
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“United Kingdom”
or “UK”
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The United Kingdom of Great Britain and Northern Ireland
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“Warrantholder”
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IPC Advisors Limited, the holder of all of the Warrants
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“Warrants”
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The 1997 Warrants and the 1999 Warrants
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“1997 Warrants”
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The warrants over 10,710,279 Shares issued to European Investment Bank
and subsequently purchased by the Warrantholder
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“1999 Warrants”
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The warrants over 32,240,400 Shares issued to and held by the
Warrantholder
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ATTENDING THE EXTRAORDINARY
GENERAL MEETING
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Venue
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29th Floor, One Canada
Square, Canary
Wharf, London
E14 5AB. A map is reproduced below. The nearest DLR and underground stations
are Canary Wharf.
If travelling by car please contact us on 020 7537 5396 for car parking
details.
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Date and Time
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Monday
22 December 2003. The meeting will start at 9.00 am and registration will be available from 8.00 am. On arrival at the building please
report to the east reception desk where you will be issued with a building
pass and directed to the appropriate lifts to take you to the 29th floor.
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Security
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For your personal safety and security random
security checks will be carried out. To assist with security please do not
take excess baggage to the meeting. Recording equipment, cameras and other
items and behaviour that might interfere with the good order of the meeting
will not be permitted. You will be asked to switch off mobile telephones and
pagers during the meeting.
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Disabilities
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One Canada Square
is a wheelchair accessible building. If you have any disabled parking
requirements or other special needs please contact us on 020 7537 5396 or
e-mail, annamarie.holland@canarywharf.com
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