National Grid PLC F-3ASR, filed Aug 28, 2024
National Grid PLC (NGG)
Table of Contents
As filed with the Securities and Exchange Commission on August 28, 2024
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM F-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
National Grid plc
(Exact name of registrant as specified in its charter)
Not Applicable
(Translation of Registrant’s name into English)
| ENGLAND AND WALES | 98-0367158 | |
| (State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification Number) |
| Justine Campbell National Grid plc 1-3 Strand London WC2N 5EH England +011-44-207-004-3000 (Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices) |
Gregory Barone National Grid plc 300 Erie Boulevard West Syracuse, NY 13202 United States +1 315-428-6717 (Name, address, including zip code, and telephone number including area code, of agent for service) |
Copies of communications, including communications sent to agent for service, should be sent to:
Jeffrey Cohen
Linklaters LLP
1290 Avenue of the Americas
New York, NY 10104
1-212-903-9014
Approximate date of commencement of proposed sale to the public: From time to time after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box: ☐
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box: ☒
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If this Form is a post-effective amendment filed pursuant to Rule 462I under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If this Form is a registration statement pursuant to General Instruction I.C. or a post-effective amendment thereto that shall become effective upon filing with the Commission pursuant to Rule 462(e) under the Securities Act, check the following box. ☒
If this Form is a post-effective amendment to a registration statement filed pursuant to General Instruction I.C. filed to register additional securities or additional classes of securities pursuant to Rule 413(b) under the Securities Act, check the following box. ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act (Check one):
| Large accelerated filer | ☒ | Accelerated filer | ☐ | |||
| Non-accelerated filer | ☐ | Smaller reporting company | ☐ | |||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933. ☐
If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐
| † | The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012. |
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PROSPECTUS
National Grid plc
Debt Securities
We may from time to time offer and sell unsecured debt securities in one or more separate series. We will describe in one or more prospectus supplements, which must accompany this prospectus, the type and amount of a series of debt securities we are offering and selling, as well as the specific terms of these securities. Such prospectus supplements may also add, update or change information contained in this prospectus. You should read this prospectus and the prospectus supplements carefully, together with the information described under the heading “Where You Can Find More Information” before you invest in these securities.
We may offer debt securities in amounts, at prices and on terms to be determined at the time of offering. We may sell these securities directly to you, through agents we select, or through underwriters and dealers we select. If we use agents, underwriters or dealers to sell these securities, we will name them and describe their compensation in the applicable prospectus supplement.
The mailing address of our principal executive office is 1-3 Strand, London, WC2N 5EH, England and our telephone number is +011-44-207-004-3000.
Investing in these securities involves risks. See “Risk Factors” beginning on page 2 of this prospectus and “Risk Factors” in our most recent Annual Report on Form 20-F, as well as any contained in the applicable prospectus supplement.
Neither the U.S. Securities and Exchange Commission nor any state securities commission has approved or disapproved these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense.
This prospectus may not be used to consummate sales of debt securities unless accompanied by a prospectus supplement.
The date of this prospectus is August 28, 2024.
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| ENFORCEMENT OF CIVIL LIABILITIES UNDER UNITED STATES FEDERAL SECURITIES LAWS |
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You should rely only on the information contained in this prospectus, the accompanying prospectus supplement or any document to which we have referred you. We have not authorized anyone to provide you with different information. You should not assume that the information in this prospectus or the accompanying prospectus supplement is accurate as of any date other than the date on the front of these documents. We are not making an offer of these securities in any state or jurisdiction where the offer is not permitted.
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This document is called a prospectus and is part of a registration statement that we have filed with the U.S. Securities and Exchange Commission, or the SEC, using a “shelf” registration process. This prospectus provides you with a general description of the debt securities we may offer. Each time we offer debt securities, we will provide a supplement to this prospectus. The accompanying prospectus supplement will describe the specific terms of that offering, and may also include a discussion of any special considerations applicable to those securities. The accompanying prospectus supplement may also add, update or change the information contained in this prospectus. If there is any inconsistency between the information in this prospectus and the accompanying prospectus supplement, you should rely on the information in the accompanying prospectus supplement. Please carefully read this prospectus and the accompanying prospectus supplement. In addition to the information contained in the documents, we refer you to under the headings “Where You Can Find More Information” and “Incorporation of Certain Documents by Reference.” The registration statement containing this prospectus, including the exhibits to the registration statement, provides additional information about us and the debt securities offered under this prospectus. The registration statement, including the exhibits, can be read on the SEC website, which is listed under the heading “Where You Can Find More Information.”
All references in this prospectus and the accompanying prospectus supplement to “National Grid”, “NG”, “our company”, “we”, “us” or “our” mean National Grid plc, unless we state otherwise or as the context requires. In addition, the term “IFRS” means international financial reporting standards as adopted by the European Union and IFRS as issued by the International Accounting Standards Board, or IASB.
Our consolidated financial statements are published in pounds sterling. In this prospectus and the accompanying prospectus supplement, “U.S. dollars” or “$” refers to U.S. currency and “pounds sterling”, “sterling”, “£” or “pence” refers to United Kingdom currency.
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Investing in the debt securities offered using this prospectus involves risk. You should consider carefully the risks incorporated by reference in this prospectus from our most recent Annual Report on Form 20-F or in similar sections in subsequent filings incorporated by reference in this prospectus for additional information on factors that may affect our future results before you decide to buy our debt securities. If any of these risks actually occur, our business, financial condition and results of operations could suffer, and the trading price and liquidity of our debt securities could decline, in which case you may lose all or part of your investment. Additional risk factors may be included in a prospectus supplement relating to a particular series or offering of securities.
Risks Related to the Debt Securities
Your right to receive payments on the debt securities is effectively subordinate to those lenders who have a security interest in our assets.
Our obligations under the debt securities are unsecured. In the future, we may incur indebtedness that is secured by certain or substantially all of our tangible or intangible assets, including the capital stock of any of our existing and future subsidiaries. Additionally, we have previously issued notes with a negative pledge. Under certain circumstances, those previously issued notes could become secured, and the debt securities could become structurally subordinated to such previously issued notes to the extent of such security. If we were unable to repay any such secured indebtedness, the creditors of such obligations could foreclose on the pledged assets to the exclusion of holders of the debt securities, even if an event of default exists under the indenture governing the debt securities offered hereby at such time. In any such event, because the debt securities will not be secured by any of our assets, it is possible that there would be no assets remaining from which your claims could be satisfied or, if any assets remained, they might be insufficient to fully satisfy your claims.
Since we are a holding company and currently conducting operations through subsidiaries, your right to receive payments on the debt securities will be structurally subordinated to the other liabilities of our subsidiaries.
We are organized as a holding company, and substantially all of our operations are carried on through subsidiaries. Our principal source of income is the dividends and distributions received from our subsidiaries. Our ability to meet our financial obligations is dependent upon the availability of cash flows from our domestic and foreign subsidiaries and affiliated companies through dividends, intercompany advances, management fees and other payments. These subsidiaries and affiliated companies are not required to and may not be able to pay dividends or make distributions to us. In addition, various of our subsidiaries have issued debt securities or otherwise have debt from borrowed money. Claims of the creditors, whether financial or otherwise, of our subsidiaries have priority as to the assets of such subsidiaries over the claims against us. Consequently, holders of the debt securities are structurally subordinated to the prior claims of the creditors of our subsidiaries.
In addition, some of our subsidiaries are subject to laws restricting the amount of dividends they may pay. For example, these laws may prohibit dividend payments when net assets fall below subscribed share capital, when the subsidiary lacks available profits or when the subsidiary fails to meet certain capital and reserve requirements. English law prohibits those subsidiaries incorporated in the United Kingdom from paying dividends unless these payments are made out of distributable profits. These profits consist of accumulated, realized profits which have not been previously utilized by distribution or capitalization, less accumulated, realized losses which have not been previously written off in a reduction or reorganization of capital duly made.
We may incur substantially more debt in the future.
We may incur substantial additional indebtedness in the future, including in connection with future acquisitions, some or all of which may be secured by our assets. The terms of the debt securities will not limit the
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amount of indebtedness we may incur. Any such incurrence of additional indebtedness could exacerbate the risks that holders of the debt securities now face.
The debt securities lack a developed public market.
There can be no assurance regarding the future development of a market for the debt securities, the ability of holders of the debt securities to sell their debt securities or the price at which such holders may be able to sell their debt securities. If such a market were to develop, the debt securities could trade at prices that may be higher or lower than the initial offering price depending on many factors, including, among other things, prevailing interest rates, our operating results, our credit ratings and the market for similar debt securities. The underwriters may make a market in the debt securities as permitted by applicable laws and regulations. However, the underwriters are not obligated to do so, and any such market-making activities with respect to the debt securities may be discontinued at any time without notice. Therefore, there can be no assurance as to the liquidity of any trading market for the debt securities or that an active public market for the debt securities will develop. The debt securities may be listed on the New York Stock Exchange or another recognized stock exchange; however, there can be no assurance that the debt securities will be so listed by the time the debt securities are delivered to purchasers or that the listing will be granted.
The credit ratings of National Grid may not reflect all risks of an investment in the debt securities.
The credit ratings ascribed to National Grid and the debt securities are intended to reflect our ability to meet our payment obligations in respect of the debt securities, and may not reflect the potential impact of all risks related to structure and other factors on the value of the debt securities. In addition, actual or anticipated changes in our credit ratings may generally be expected to affect the market value of the debt securities.
If we default on our debt securities, your right to receive payments on such debt securities may be adversely affected by applicable insolvency laws.
We are incorporated under the laws of England and Wales. Accordingly, insolvency proceedings with respect to National Grid would be likely to proceed under, and be governed by, English insolvency law. The procedural and substantive provisions of English insolvency laws generally are more favorable to secured creditors than comparable provisions of United States law. These provisions afford debtors and unsecured creditors only limited protection from the claims of secured creditors and it will generally not be possible for us or other unsecured creditors to prevent or delay the secured creditors from enforcing their security to repay the debts due to them under the terms on which such security was granted to them.
The indenture does not restrict the amount of additional indebtedness that we may incur.
The debt securities and the indenture under which the debt securities will be issued will not place any limitation on the amount of indebtedness that may be incurred by us. Our incurrence of additional indebtedness may have important consequences for you as a holder of the debt securities, including marking it more difficult for us to satisfy our obligations with respect to the debt securities, increasing the amount of indebtedness ranking equal or (if secured) effectively senior to the debt securities in the event of our bankruptcy or insolvency, resulting in a loss in the trading value of your debt securities, if any, and increasing the risk that the credit rating of the debt securities is lowered or withdrawn.
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This prospectus and the documents incorporated by reference into this prospectus contain certain statements that are neither reported financial results nor other historical information. These statements are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, or the Exchange Act. These statements include information with respect to our financial condition, results of operations and businesses, strategy, plans and objectives. Words such as “anticipates”, “expects”, “should”, “intends”, “plans”, “believes”, “outlook”, “seeks”, “estimates”, “targets”, “may”, “will”, “continue”, “project” and similar expressions, as well as statements in the future tense, identify forward-looking statements.
These forward-looking statements are not guarantees of our future performance and are subject to assumptions, risks and uncertainties that could cause actual future results to differ materially from those expressed in or implied by such forward-looking statements. Many of these assumptions, risks and uncertainties relate to factors that are beyond our ability to control or estimate precisely, such as:
| • | changes in laws or regulations; |
| • | decisions by governmental bodies or regulators, including those relating to current and upcoming price controls in the United Kingdom and rate cases in the United States, as well as the future of systems operations in the United Kingdom; |
| • | the timing of construction and delivery by third parties of new generation projects requiring connection; |
| • | breaches of, or changes in, environmental, climate change and health and safety laws or regulations, including breaches or other incidents arising from the potentially harmful nature of our activities; |
| • | network failure or interruption, the inability to carry out critical non-network operations and damage to infrastructure, due to adverse weather conditions including the impact of major storms as well as the results of climate change, due to counterparties being unable to deliver physical commodities, |
| • | reliability of access to IT systems, including due to the failure of or unauthorized access to or deliberate breaches of our systems and supporting technology; |
| • | failure to adequately forecast and respond to disruptions in energy supply; |
| • | performance against regulatory targets and standards and against our peers with the aim of delivering stakeholder expectations regarding costs and efficiency savings, as well as against targets and standards designed to support our role in the energy transition; |
| • | customers and counterparties (including financial institutions) failing to perform their obligations to us; |
| • | fluctuations in exchange rates, interest rates and commodity price indices; |
| • | restrictions and conditions (including filing requirements) in our borrowing and debt arrangements, funding costs and access to financing; |
| • | regulatory requirements for us to maintain financial resources in certain parts of our business and restrictions on some subsidiaries’ transactions such as paying dividends, lending or levying charges; |
| • | the delayed timing of recoveries and payments in our regulated businesses and whether aspects of our activities are contestable; |
| • | the funding requirements and performance of our pension schemes and other post-retirement benefit schemes; |
| • | the failure to attract, develop and retain employees with the necessary competencies, including leadership and business capabilities, and any significant disputes arising with our employees or the breach of laws or regulations by our employees; |
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| • | the failure to respond to market developments, including competition for onshore transmission; |
| • | the threats and opportunities presented by emerging technology; |
| • | the failure by us to, or meet its own commitments as a leader in relation to, climate change development activities relating to energy transition, including the integration of distributed energy resources; and |
| • | the need to grow our business to deliver our strategy, as well as incorrect or unforeseen assumptions or conclusions (including unanticipated costs and liabilities) relating to business development activity, including the sale of the Group’s UK Gas Transmission Business, our strategic infrastructure projects and joint ventures and the separation and transfer of the energy systems operator to the public sector. |
Other factors are discussed in the sections listed under “Operating and financial review and prospects” and “Risk factors” in the cross-reference table in our most recent Annual Report on Form 20-F and may be discussed in an accompanying prospectus supplement. We may also make or disclose written and/or oral forward-looking statements in reports filed with or furnished to the SEC, our annual reports and accounts to shareholders, shareholder circulars, offering circulars, registration statements, prospectuses, prospectus supplements, press releases and other written materials and in oral statements made by our directors, management or employees to third parties, including financial analysts. We undertake no obligation to update any of our forward-looking statements.
The effects of these factors are difficult to predict. New factors emerge from time to time and we cannot assess the potential impact of any such factor on the business or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statement.
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WHERE YOU CAN FIND MORE INFORMATION
National Grid plc is subject to the filing requirements of the Exchange Act. In accordance with the Exchange Act, we file such reports and other information with the SEC. Our SEC filings are available over the internet at the SEC’s website at http://www.sec.gov. The address of the SEC’s internet site is provided solely for the information of prospective investors and is not intended to be an active link incorporating any materials via such website, except as described below.
You may request a copy of the filings referred to above at no cost by writing or telephoning us at our registered office at 1-3 Strand, London WC2N 5EH, England, 011-44-207-004-3000, attn: Investor Relations.
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INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
This prospectus “incorporates by reference” certain of the reports and other information that we have filed with the SEC under the Exchange Act. This means that we are disclosing important information to you by referring you to those documents. The information incorporated by reference is considered to be a part of this prospectus. Information filed with the SEC after the date of this prospectus will update and supersede this information. Any statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this prospectus. We incorporate by reference in this prospectus the documents listed below:
| • | Our Annual Report on Form 20-F for the year ended 31 March 2024; |
| • | Any future reports on Form 6-K that we may file that indicate that they are incorporated by reference into this Registration Statement; and |
| • | Any future Annual Reports on Form 20-F that we may file with the SEC under the Exchange Act prior to the termination of any offering contemplated by this prospectus. |
Information in this prospectus may be modified by information included in subsequent Exchange Act filings that we incorporate by reference, the result of which is that only the information as modified will be part of this prospectus. All other information in the prospectus will be unaffected by the replacement of this superseded information.
The SEC maintains an internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC at http://www.sec.gov. Our website address is https://www.nationalgrid.com/investors. Information contained on our website does not constitute part of this prospectus.
Each person, including any beneficial owner to whom this prospectus is delivered, may request, orally or in writing, a copy of these documents, which will be provided at no cost, by contacting:
Investor Relations
1-3 Strand, London WC2N 5EH, England
Telephone number is 011-44-207-004-3000
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Overview
National Grid plc is the name of our holding company and we are an international energy utility based in the United Kingdom and north-eastern United States.
Our website address is http://www.nationalgrid.com. Information contained on our website does not constitute part of this prospectus.
The description of our business below contains information and data as of the date of this prospectus and may be amended or supplemented by the accompanying prospectus supplement and documents incorporated by reference herein or therein.
Our Business
Our principal operations are in the ownership and operation of electricity transmission infrastructure and electricity distribution in the United Kingdom, and electricity transmission and distribution and gas distribution in the northeastern United States. We also have interests in related matters, including electricity interconnectors and metering services in the United Kingdom and liquefied natural gas (“LNG”) storage and transportation in the United States.
At 31 March 2024, we had more than 31,400 employees located in the United Kingdom and the United States.
The performance of our principal businesses is reported by segment, reflecting the management responsibilities and economic characteristics of each activity. Our principal businesses and units, together with other activities and discontinued operations, are:
| • | United Kingdom Electricity Transmission; |
| • | United Kingdom Electricity Distribution; |
| • | United Kingdom Electricity System Operator; |
| • | New England; |
| • | New York; and |
| • | National Grid Ventures (such as commercial operations in energy metering, electricity interconnectors, wind and solar generation, LNG storage and regasification, battery storage, large-scale renewable generation, conventional generation and competitive transmission) and other activities (mainly relating to United Kingdom property business, together with insurance and corporate activities in the United Kingdom and the U.S., and National Grid plc’s investments in technology and innovation companies, through National Grid Partners). |
Our principal subsidiaries are:
| • | National Grid Electricity Transmission plc, which operates our United Kingdom electricity transmission business; |
| • | National Grid North America Inc., an indirect, wholly-owned subsidiary of National Grid plc and the top holding company in National Grid plc’s corporate structure in the United States that acts as a treasury, finance and holding company for National Grid plc in the United States and operates as a vehicle for acquisition financing for National Grid plc in the United States through intercompany lending arrangements; and |
| • | National Grid Electricity Distribution plc, which operates our United Kingdom electricity distribution business. |
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CAPITALIZATION AND INDEBTEDNESS
The following table sets forth our capitalization on an actual basis, using financial information compiled in accordance with IFRS, as at 31 March 2024. You should read this table in conjunction with our consolidated financial statements and notes and together with any updated information in the accompanying prospectus supplement and any documents incorporated by reference herein or therein.
| As at 31 March 2024 |
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| (£ millions) | ||||
| Finance debt and lease liabilities: |
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| Bank loans |
2,894 | |||
| Bonds |
41,995 | |||
| Commercial Paper |
1,444 | |||
| Lease liabilities |
779 | |||
| Total Borrowings |
47,072 | |||
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| Share Capital and reserves: |
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| Share capital |
493 | |||
| Share premium account |
1,298 | |||
| Retained earnings |
32,066 | |||
| Other equity reserves |
(3,990 | ) | ||
| Total Shareholders’ Equity |
29,867 | |||
|
|
|
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| Non-controlling interests |
25 | |||
| Total Equity |
29,892 | |||
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|
|
|||
| Total Capitalization |
76,964 | |||
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DESCRIPTION OF THE DEBT SECURITIES
General
The debt securities will be issued under an indenture between us and The Bank of New York Mellon, London Branch, as trustee, dated 12 June 2023. We have summarized material provisions of the indenture below. The summary is not complete and is subject to, and is qualified in its entirety by reference to, all provisions of the indenture, including the definition of certain terms in the indenture and those terms to be made a part of the indenture by the Trust Indenture Act of 1939, as amended. The form of indenture, which became the executed indenture, dated as of June 12, 2023, is incorporated by reference as an exhibit to the registration statement of which this prospectus is a part and you should read the indenture for provisions that may be important to you. Capitalized terms used in this summary have the meanings specified in the indenture. In this summary, “we”, “our” or “us” means National Grid and its successors under the indenture only and does not include any of its subsidiaries.
The indenture does not limit the aggregate principal amount of the debt securities which we may issue under it and provides that we may issue debt securities under it from time to time in one or more series. The indenture does not limit the amount of other indebtedness or the debt securities which we or our subsidiaries may issue.
We describe in this section the general terms that will apply to any series of debt securities that may be offered under this prospectus. At the time that we offer debt securities, we will describe in the related prospectus supplement the specific terms of the debt securities of a series and the extent to which the general terms described in this section apply or do not apply to those securities.
The debt securities will be our direct, unsecured obligations and will rank equally with all of our other existing and future unsecured and unsubordinated indebtedness. In each case, these obligations shall be without any preference among themselves. This will be subject, in the event of insolvency, to laws of general applicability relating to or affecting creditors’ rights. Other unsecured and unsubordinated indebtedness may contain covenants, events of default and other provisions which are different from or which are not contained in the debt securities.
We will issue debt securities in series. Each series of debt securities may have different terms, and, in some cases, debt securities of the same series may have different terms. We will describe the following terms of the particular series of debt securities being offered in the applicable prospectus supplement:
| • | the designation, aggregate principal amount and authorized or any minimum denominations of the series of debt securities, |
| • | the percentage or percentages of principal amount (price to public) at which the debt securities of the series will be issued, |
| • | certain dates or periods, including: |
| (a) | the original issue date or dates or periods during which the debt securities may be issued, |
| (b) | the date or dates (or manner of determining the same), if any, on which, or the range of dates, if any, within which, the principal of (and premium, if any, on) the debt securities of the series is payable, and |
| (c) | the record dates, if any, for the determination of holders to whom such principal (and premium, if any, thereon) is payable, |
| • | information with regard to interest, including: |
| (a) | the rate or rates per annum (and the manner or basis of calculation thereof) at which the debt securities of the series shall bear interest (if any), |
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| (b) | the date or dates from which such interest shall accrue, |
| (c) | the interest payment dates on which such interest shall be payable (or manner of determining the same), and |
| (d) | the regular record date for the interest payable on any interest payment date, |
| • | the place or places where: |
| (a) | the principal of (and premium, if any, on) and interest, if any, on debt securities of the series shall be payable, |
| (b) | debt securities of the series may be presented for transfer or exchange, |
| (c) | notices and demands to or upon us may be served, and |
| (d) | commercial banks and foreign exchange markets must be open to settle payments to constitute a good business day, |
| • | the terms and conditions, if any, upon which debt securities of the series may be redeemed, in whole or in part, at our option or otherwise, |
| • | our obligation, if any, to redeem, repurchase or repay debt securities of the series pursuant to any sinking fund or analogous provisions or at the option of a holder thereof and the terms and conditions in respect thereof, |
| • | with respect to debt securities of a series, if other than the principal amount thereof, the portion of the principal amount of such debt securities of the series which shall be payable upon a redemption prior to maturity or a declaration of acceleration of the maturity following an event of default, if any, thereof, |
| • | any stock exchange on which we will list a series of debt securities, |
| • | whether the debt securities will be convertible into shares of common stock and/or exchangeable for other securities, the terms and conditions upon which such debt securities will be convertible or exchangeable, |
| • | whether the debt securities are to be issued as original issue discount securities, |
| • | any additional events of default (as defined below), |
| • | any additional covenants or agreements with respect to the debt securities of the series, |
| • | if other than U.S. dollars, the currency or currency unit in which any payments on the debt securities of the series shall be made or in which the debt securities of the series shall be denominated, |
| • | if applicable, the fact that the terms of the applicable indenture described below under “Discharge, Defeasance and Covenant Defeasance” will not apply with respect to the debt securities of the series, |
| • | the date as of which any Global Security (as defined below) representing outstanding debt securities of the series shall be dated if other than the date of original issuance of the first security of the series to be issued, |
| • | if applicable, the fact that the terms of the applicable indenture described under “Redemption of Debt Securities for Tax Reasons” and “Payment of Additional Amounts” below will not apply with respect to the debt securities of the series, |
| • | whether the debt securities of the series shall be issued in whole or in part in the form of a global security or notes and, in such case, the depositary for such global security or notes, |
| • | whether any legends shall be stamped or imprinted on all or a portion of the debt securities of a series, and the terms and conditions upon which any such legends may be removed, |
| • | information with respect to book-entry procedures, if any, |
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| • | any other terms of that series, and |
| • | any material United Kingdom or U.S. federal tax consequences applicable to the particular series which are not disclosed in this Prospectus. |
The indenture does not contain any provisions that would limit our ability to incur indebtedness or that would afford holders of the debt securities protection in the event of a sudden and significant decline in our credit quality or a takeover, recapitalization or highly leveraged or similar transaction involving us. Accordingly, we could in the future enter into transactions that could increase the amount of indebtedness outstanding at that time or otherwise affect our capital structure or credit rating.
Denominations, Registration and Transfer
Unless the applicable prospectus supplement provides otherwise, we will issue debt securities registered in the name of holders as set out in the books of the security registrar (each, a “registered security”, or a security in “registered form”).
Unless the applicable prospectus supplement provides otherwise, registered securities will be represented by interests in one or more global securities (each, a “Global Security”, or a security in “global form”) deposited with a nominee for, and accepted for settlement and clearance by, one or more of The Depository Trust Company (“DTC”) and a common depositary for Euroclear Bank S.A./N.V. (“Euroclear”) and Clearstream Banking, Société anonyme (“Clearstream”), as described under “Global Securities” below. Registered securities will be issued in such denominations as are specified in the applicable prospectus supplement and a Global Security will be issued in a denomination equal to the aggregate principal amount of outstanding debt securities of the series represented by such Global Security, unless the applicable prospectus supplement provides otherwise.
In the circumstances described below under “—Securities in Definitive Form”, we may physically issue and deliver certificated securities in registered form, which are referred to as securities in “definitive form”. Registered securities of any series issued in definitive form will be exchangeable for other registered securities of the same series, of a like aggregate principal amount and tenor and of different authorized denominations. A registered security issued in definitive form may be presented for registration of transfer (with the form of transfer duly executed), at the office of the security registrar or at the office of any transfer agent we designate for such purpose with respect to any series of debt securities and referred to in an applicable prospectus supplement, without service charge but subject to payment of any taxes and other governmental charges as described in the indenture. Such transfer or exchange will be effected after the security registrar or transfer agent, as the case may be, is satisfied with the documents of title and identity of the person making the request. We have initially appointed the trustee as the security registrar under the indenture. If a prospectus supplement refers to any transfer agents (in addition to the security registrar) that we have initially designated with respect to any series of debt securities, we may at any time rescind the designation of any such transfer agent or approve a change in the location through which any such transfer agent acts, except that we will be required to maintain a transfer agent in each place of payment for such series. We may at any time designate additional transfer agents with respect to any series of debt securities.
If the debt securities of a series are redeemed in part, we shall not be required to:
| • | issue, register the transfer of or exchange debt securities of any such series during a period beginning at the opening of business 15 days before the day of the mailing of a notice of redemption of debt securities of that series selected to be redeemed and ending at the close of business on the day of mailing of the relevant notice of redemption, or |
| • | register the transfer of or exchange any registered security, or portion thereof, called for redemption, except the unredeemed portion of any registered security being redeemed in part. |
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Global Securities
The debt securities of a series may be represented in whole or in part by one or more Global Securities that will be registered in the name of and deposited with or on behalf of, DTC or a common depositary for Euroclear and Clearstream (a “Depositary”) or a nominee thereof. Global Securities will be issued in registered form unless the applicable prospectus supplement provides otherwise. Unless and until it is exchanged for registered securities in definitive form, any such Global Security may not be transferred except as a whole by the relevant Depositary to its nominee, or vice versa, or by a nominee to another nominee of such Depositary or, in either case, to a successor of such Depositary or a nominee of such successor.
The specific terms of the depositary arrangement with respect to a series of debt securities will be described in the related prospectus supplement. We anticipate that the following provisions will apply to all depositary arrangements. See also “—Clearance and Settlement” below.
Upon the issuance of a Global Security, the Depositary for such Global Security or its nominee will credit the accounts of persons entitled thereto with the respective beneficial interests in the principal amounts of the debt securities represented by such Global Security. Such accounts shall be designated by the underwriters, dealers or agents with respect to such debt securities, or by us if we offer and sell directly such debt securities. Ownership of beneficial interests in a Global Security will be limited to persons that have accounts with the Depositary for such Global Security or its nominee (“participants”) or persons that may hold interests through participants. Ownership of beneficial interests in the Global Security will be shown on, and the transfer of that ownership will be effected only through, records maintained by the Depositary or its nominee (with respect to interests of participants) for such Global Security and on the records of participants (with respect to interests of persons who hold interests through participants). The laws of some jurisdictions require that certain purchasers of securities take physical delivery of such securities in definitive form. Such limits and such laws may impair your ability to transfer beneficial interests in a Global Security.
So long as the relevant Depositary, or its nominee, is the registered owner of such Global Security, it will be considered the sole owner or holder of the debt securities represented by such Global Security for all purposes under the indenture governing the debt securities. Except as provided below, owners of beneficial interests in a Global Security will not be entitled to have debt securities of the series represented by such Global Security registered in their names, will not receive or be entitled to receive physical delivery of securities of such series in definitive form and will not be considered the owners or holders thereof under the indenture governing such debt securities. Such owners of beneficial interests will not have the direct right to act upon any solicitation for actions from holders of the debt securities and will be permitted to act only to the extent appropriate proxies to do so from DTC, Euroclear or Clearstream, as applicable, have been received. Similarly, upon the occurrence of an event of default, unless and until debt securities in definitive form are issued, owners of beneficial interests in Global Securities will be restricted to acting only to the extent appropriate proxies have been received from DTC, Euroclear or Clearstream, as applicable.
Any payments of principal, premium, if any, or interest, if any, on debt securities registered in the name of a Depositary or its nominee will be made to it as the registered owner of the Global Security representing such debt securities. Neither we, nor any of the applicable trustees, paying agents or security registrars for such debt securities will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests of a Global Security for such debt securities or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests.
We expect that the Depositary for a Global Security or its nominee, upon receipt of any payment of principal, premium (if any) or interest (if any), will credit participants’ accounts with payments in amounts proportionate to their respective beneficial interests in the principal amount of the debt securities of such series represented by such Global Security as shown on the records of such Depositary or its nominee. We also expect that payments by participants to owners of beneficial interests in such Global Security held through such
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participants will be governed by standing instructions and customary practices, as is now the case with securities payable to bearer or registered in “street name” (holders of debt securities in accounts at banks or brokers), and will be the responsibility of such participants.
Securities in Definitive Form
If a Depositary for a Global Security in respect of a series of debt securities is at any time unwilling or unable to continue as depositary, and we do not appoint a successor depositary within 120 days, or in the event of our winding up we fail to make any payment on any debt securities when due, and the trustee has received notice from the registered owner of such Global Security requesting the exchange of a specified amount of such debt securities for debt securities of such series in definitive form, we will issue registered securities in respect of the debt securities of such series in definitive form in exchange for the Global Security representing such series of debt securities.
We may at any time and in our sole discretion determine that the registered securities, in respect of the debt securities of any series represented by one or more Global Securities, shall no longer be represented by such Global Security or Securities. In such event, we will issue registered securities in respect of the debt securities of such series in definitive form. Further, if we so specify with respect to the debt securities of a series, you may, on terms acceptable to us and the Depositary for such Global Security, receive registered securities of such series in definitive form.
In any such instance, you will be entitled to physical delivery in definitive form of securities of the series of debt securities represented by such Global Security, equal in principal amount to your beneficial interest, registered in your name.
Debt securities of any series so issued in definitive form will only be issued as registered securities in authorized minimum denominations and bearing any applicable restrictive legend. There should be no tax consequences associated with an exchange of registered securities in global form for registered securities in definitive form. If we issue debt securities in definitive form in exchange for a particular Global Security, the relevant Depositary, as holder of that Global Security, will surrender it against receipt of the debt securities in definitive form, cancel the book-entry debt securities of that series, and distribute through DTC, Euroclear or Clearstream, as the case may be, the debt securities in definitive form of that series to the persons and in the amounts specified by DTC, Euroclear or Clearstream, as the case may be.
To the extent permitted by law, we, the trustee, the paying agents and the security registrars shall be entitled to treat the person in whose name any debt security in definitive form is registered as the absolute owner.
Payments in respect of a debt security in definitive form will be made to the person in whose name the definitive debt security is registered as it appears in the register for that series. They will be made either by check mailed or delivered to the address of the person entitled thereto as such address shall appear in the security register or by wire transfer to an account maintained by the person entitled thereto as specified in the security register. Debt securities issued in definitive form should be presented to the applicable paying agent for redemption.
Holders of debt securities in definitive form will have the direct right to act upon any solicitation for actions from holders of the debt securities, including upon the occurrence of an event of default, and will not be required to rely upon receipt of proxies from DTC, Euroclear or Clearstream.
Payments on Debt Securities
The applicable prospectus supplement will specify the date on which we will pay interest, if any, and the date for payments of principal (and premium, if any, thereon) on any particular series of debt securities. The prospectus supplement will also specify the interest rate or rates, if any, or how such rate or rates will be calculated.
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Redemption at the Option of NG
The applicable prospectus supplement will specify whether we may redeem the debt securities of any series, in whole or in part, at our option or in any other circumstances. The prospectus supplement will also specify the notice that we will be required to provide and the prices (and premium, if any, thereon) at which and the dates on which the debt securities may be redeemed. Any notice of redemption of debt securities will state:
| • | the date fixed for redemption; |
| • | the record date; |
| • | the amount of debt securities to be redeemed if we are only redeeming part of a series; |
| • | the series and relevant identification codes of the debt securities to be redeemed; |
| • | the redemption price; |
| • | that on the date fixed for redemption the redemption price will become due and payable on each debt security to be redeemed and, if applicable, that any interest will cease to accrue on or after the redemption date; and |
| • | the place or places at which each holder may obtain payment of the redemption price. |
Redemption at the Option of Debt Security Holders
The applicable prospectus supplement will specify whether holders of the debt securities of any series may have the option to require us to redeem such debt securities in the event of a restructuring of National Grid. This option is referred to as a “put option”. In the event that the applicable prospectus supplement states that debt security holders of such series have a put option, then the provisions described below relating to the notices that NG and/or such debt security holders will be required to provide and the prices (and premium, if any, thereon), at which and the dates on which the affected debt securities may be redeemed will be applicable.
Public Announcement upon Occurrence of Restructuring Event
If the applicable prospectus supplement specifies that debt security holders of such series have a put option, then at any time while any of such debt securities remains outstanding, there occurs a restructuring event (as described further below), we shall make a public announcement of such event. The public announcement will consist of an announcement by us or the trustee, of the occurrence of the restructuring event published in a leading national newspaper having general circulation in the United States (which is expected to be The Wall Street Journal).
Determining whether a Restructuring Event Has Occurred
A “restructuring event” shall be deemed to have occurred when at any time while any of such series of debt securities remain outstanding, the sum of disposal percentages for NG within any consecutive period of 36 months commencing on or after the initial issue date of any such series of debt securities is greater than 50 per cent, as determined by NG.
The “disposal percentages for NG” are calculated, in relation to a sale, transfer, lease or other disposal or dispossession of any disposed assets of NG, the ratio of (a) the aggregate operating profit of disposed assets of NG to (b) the consolidated operating profit of NG, expressed as a percentage.
“Disposed assets of NG” for the purposes of the calculation of disposal percentages for NG means, where NG and/or any of its subsidiaries sells, transfers, leases or otherwise disposes of or is dispossessed by any means (but excluding sales, transfers, leases, disposals or dispossessions which, when taken together with any related lease back or similar arrangements entered into in the ordinary course of business, have the result that the
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operating profit of NG directly attributable to any such undertaking, property or assets continues to accrue to NG or, as the case may be, such subsidiary), otherwise than to a wholly-owned subsidiary of NG or to NG, of the whole or any part (whether by a single transaction or by a number of transactions whether related or not) of its undertaking or (except in the ordinary course of business of NG or any such subsidiary) property or assets, the undertaking, property or assets sold, transferred, leased or otherwise disposed of or of which it is so dispossessed.
“Operating profit of disposed assets of NG”, in relation to any disposed assets of NG, means the operating profits on ordinary activities before tax and interest (for the avoidance of doubt, exceptional items, as reflected in the relevant accounts of NG, shall not be included) of NG and its subsidiaries directly attributable to such disposed assets as determined in accordance with IFRS by reference to the relevant accounts and, if relevant accounts of NG do not yet exist, determined in a manner consistent with the assumptions upon which the directors’ report of NG is to be based. Where the directors of NG have employed assumptions in determining the operating profit of NG, those assumptions should be clearly stated in the directors’ report of NG;
“Relevant accounts of NG” means the most recent annual audited consolidated financial accounts of NG and its subsidiaries preceding the relevant sale, transfer, lease or other disposal or dispossession of any disposed asset of NG.
“Directors’ report of NG” refers to a report prepared and signed by two directors of NG addressed to the trustee setting out the operating profit of NG, the consolidated operating profit of NG and the disposal percentage for NG and stating any assumptions which the directors of NG have employed in determining the operating profit of NG.
“Consolidated operating profit of NG” means the consolidated operating profit on ordinary activities before tax and interest and before taking account of depreciation and amortization of goodwill and regulatory assets (for the avoidance of doubt, exceptional items, as reflected in the relevant accounts of NG shall not be included) of NG and its subsidiaries (including any share of operating profit of associates and joint ventures) determined in accordance with IFRS by reference to the relevant accounts of NG.
For the purpose of determining whether a restructuring event has occurred, “subsidiary” means a subsidiary within the meaning of Section 1159 of the Companies Act 2006.
Events Giving Rise to a Put Option
If debt security holders have a put option, then such debt security holders shall be able to exercise a put option only in the circumstances described below.
If at any time while any given series of debt securities with a put option remains outstanding, there occurs a restructuring event, and if, within the applicable NG restructuring period, either:
| (a) | (if at the time that the restructuring event occurs there are rated debt securities (as defined below)) a rating downgrade in respect of the restructuring event occurs; or |
| (b) | (if at the time that the restructuring event occurs there are no rated debt securities) a negative rating event in respect of the restructuring event occurs, |
then the holders of each such affected series of debt securities will have the option upon the giving of a notice to the trustee to require us to redeem or, at our option, purchase (or procure the purchase of) such debt security on any business day falling within the period of 45 days after a notice of the exercise of the put option is given to us (at its principal amount together with accrued interest to the date of redemption). The restructuring event and rating downgrade or the restructuring event and negative rating event, as the case may be, occurring within the NG restructuring period, together are referred to as a “put event”.
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For the purpose of determining whether a put event has occurred, “NG restructuring period” shall refer to the period ending 90 days after a public announcement of a restructuring event (or such longer period in which the rated debt securities or rateable debt, as the case may be, is or are under consideration (announced publicly within the first mentioned period) for rating review or, as the case may be, rating by a rating agency).
“Rating agency” refers to Moody’s Investors Services Ltd. and its successors or S&P Global Ratings UK Ltd. and its successors or Fitch Ratings Ltd. and its successors or any rating agency substituted for either of them (or any permitted substitute of them) by NG from time to time with prior written notice to the trustee.
“Rated debt securities” means for each series, the debt securities of such series, if and for so long as they shall have an effective rating from a rating agency and otherwise any rateable debt which is rated by a rating agency; provided that if there shall be no such rateable debt outstanding prior to the maturity of such series of debt securities, the holders of not less than one-quarter in principal amount of such outstanding debt securities may require us to obtain and thereafter update on an annual basis a rating of such debt securities from a rating agency. In addition, we may at any time obtain and thereafter update on an annual basis a rating of such debt securities from a rating agency, provided that, except as provided above, we shall not have any obligation to obtain such a rating of such debt securities;
A “negative rating event” shall be deemed to have occurred if either (a) we do not, either prior to or not later than 21 days after the relevant restructuring event, seek, and thereupon use all reasonable efforts to obtain, a rating of the affected series of debt securities or any other rateable debt from a rating agency or (b) if we do so seek and use such efforts, we are unable, as a result of such restructuring event, to obtain such a rating of at least investment grade (BBB- or Baa3 or their respective equivalents for the time being), provided that a negative rating event shall not be deemed to have occurred in respect of a particular restructuring event if the rating agency declining to assign a rating of at least investment grade (as described above) does not announce or publicly confirm that its declining to assign a rating of at least investment grade was the result, in whole or in part, of any event or circumstance comprised in or arising as a result of, or in respect of, the applicable restructuring event (whether or not the restructuring event shall have occurred at the time such investment grade rating is declined);
“Rateable debt” shall be understood to refer to unsecured and unsubordinated debt of NG having an initial maturity of five years or more; and
“Rating downgrade” shall be deemed to have occurred in respect of the restructuring event if the then current rating whether provided by a rating agency at our invitation or by its own volition assigned to the rated debt securities by any rating agency is withdrawn or reduced from an investment grade rating (BBB- or Baa3 or their respective equivalents for the time being or better) to a non-investment grade rating (BB+ or Ba1, or their respective equivalents for the time being, or worse) or, if a rating agency shall already have rated the rated debt securities below investment grade (as described above), the rating is lowered one full rating category; provided that a rating downgrade otherwise arising by virtue of a particular reduction in rating shall not be deemed to have occurred in respect of a particular restructuring event if the rating agency making the reduction in rating to which this definition would otherwise apply does not announce or publicly confirm that the reduction was the result, in whole or part, of any event or circumstance comprised in or arising as a result of, or in respect of, the applicable restructuring event (whether or not the applicable restructuring event shall have occurred at the time of the rating downgrade).
The trustee has no responsibility to monitor whether the debt securities are rated or incur a Rating downgrade.
Our Obligations upon the Occurrence of a Put Event
Promptly upon our becoming aware that a put event has occurred, we shall, or at any time upon the trustee becoming similarly so aware the trustee may, and if so requested in writing by the holders of at least the majority
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of the principal amount of the affected series of debt securities then outstanding, the trustee shall give notice to such debt security holders specifying the nature of the put event and the procedures for exercising the put option. We refer to this notice as a “put event notice”.
We shall, forthwith upon becoming aware of the occurrence of the restructuring event (a) notify the trustee and provide the trustee with the relevant directors’ report of NG and (b) provide, or procure that the reporting accountants provide, the trustee with the accountants’ report. “Reporting accountants” refers to the auditors of NG (but not acting in their capacity as auditors) or such other firm of accountants as may be appointed by NG and notified in writing to the trustee. The directors’ report and the accountants’ report shall, in the absence of manifest error, be conclusive and binding on all concerned, including the trustee and the holders of the affected series of debt securities. The trustee shall be entitled to act, or not act, and rely on without being expected to verify the accuracy of the same (and shall have no liability to debt security holders for doing so) any directors’ report and/or any accountants’ report (whether or not addressed to it).
“Accountants’ report” means a report of the reporting accountants stating whether the amounts included in the calculation of the operating profit and the amount for consolidated operating profit as included in the directors’ report have been accurately extracted from the accounting records of NG Group and whether the disposal percentage included in the directors’ report has been correctly calculated which will be prepared pursuant to an engagement letter to be entered into by and among the reporting accountants and us.
Our delivery to the trustee of the directors’ report of NG or the accountants’ report shall be for informational purposes only. Nothing therein shall impute knowledge to the trustee of a default or event of default.
We shall use reasonable efforts to procure that there shall at the relevant time be reporting accountants who have (a) entered into an engagement letter with us which shall (i) not limit the liability of the reporting accountants by reference to a monetary cap and (ii) be available for inspection by holders of debt securities at the principal corporate trust office of the trustee or (b) agreed to provide accountants’ reports on such other terms as we shall approve. If we, having used reasonable efforts, are unable to procure that there shall at the relevant time be reporting accountants who have entered into an engagement letter complying with (i) above, the trustee may rely on an accountants’ report which contains a limit on the liability of the reporting accountants by reference to a monetary cap or otherwise.
You should be aware that the engagement letter for the reporting accountants may contain a limit on the liability of the reporting accountants which may impact on the interests of debt security holders.
We shall give notice to the trustee of the identity of the reporting accountants.
Put Option Redemption Procedures
In order to exercise the option of redemption of a debt security in the event of an occurrence of a put event, the debt security holder must deliver each debt security to be redeemed accompanied by a duly signed and completed notice (which we refer to as a “put notice”). The put notice must be delivered on any business day falling within the period of 45 days after we or the trustee on behalf of NG, as the case may be, provide a put event notice to the debt security holders. We refer to this period as the “put period”.
The put notice may also specify an account to which payment is to be made for the put option redemption. The debt security should be delivered after the date falling seven days after the expiry of the put period, otherwise payment will be made in the same manner as payment for the principal or any premium and interest on the debt securities. We refer to the date on which the debt security should be delivered as the “put date”.
In return for the receipt of the debt security and put notice, the debt security holder will receive a non-transferable receipt. Unless otherwise specified in the applicable prospectus supplement, payment in respect
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of any debt security so delivered will be made, if the debt security holder duly specified a bank account in the put notice to which payment is to be made, on the put date by transfer to that bank account. A put notice, once given, shall be irrevocable. We shall redeem the relevant debt securities on the put date unless previously redeemed or purchased.
If you hold your debt securities through a nominee or broker, you will need to instruct your nominee or broker, as applicable, to tender the required notice and deliver the applicable debt securities so that such tender complies with the procedures set forth above.
Negative Pledge
Unless otherwise specified in the applicable prospectus supplement, so long as any debt securities of a series remain outstanding (as defined in the indenture), NG will not create or permit to subsist any mortgage, charge, pledge, lien or other form of encumbrance or security interest upon the whole or any part of its undertaking, its assets or revenues present or future to secure any Relevant Indebtedness (as defined below), or any guarantee of or indemnity in respect of any Relevant Indebtedness unless, at the same time or prior thereto, our obligations under the debt securities and the indenture (a) are secured equally and rateably therewith or benefit from a guarantee or indemnity in substantially identical terms thereto, as the case may be, in each case to the satisfaction of the trustee, or (b) have the benefit of such other security, guarantee, indemnity or other arrangement as the trustee in its absolute discretion shall deem to be not materially less beneficial to the holders of the debt securities or as shall be approved by the holders of not less than 75 per cent. in aggregate principal amount of the debt securities of any series.
“Relevant Indebtedness” means any present or future indebtedness in the form of, or represented by, bonds, notes, debentures, loan stock or other securities which are, or are intended, with the agreement of NG, to be, or capable of being, quoted, listed or ordinarily dealt in on any stock exchange.
Consolidation, Amalgamation, Merger and Sale or Lease of Assets
Unless the applicable prospectus supplement provides otherwise, so long as any debt security of a series remains outstanding, we are permitted to consolidate, amalgamate with or merge into any other corporation or convey, transfer or lease our properties and assets substantially as an entirety to any person (as defined in the indenture). However, we may not take these actions unless:
| • | the corporation formed by such consolidation or amalgamation or into which we are merged, or the person which acquires, leases or is the transferee of or recipient of the conveyance of substantially all or all of our properties and assets, shall: |
| (c) | be a corporation or other person organized and validly existing under the laws of the United States, the United Kingdom or any other country that is a member of the Organisation for Economic Co-operation and Development (as the same may be constituted from time to time); and |
| (d) | expressly assume, by a supplement to the applicable indenture that is executed and delivered in form reasonably satisfactory to the trustee, with any amendments or revisions necessary to take account of the jurisdiction in which any such corporation or other person is organized (if other than England and Wales); |
| (i) | the due and punctual payment of the principal of (and premium, if any, on) and interest, if any, on all of the debt securities of such a series; |
| (ii) | the performance of every covenant of the indenture (other than a covenant included in the indenture solely for the benefit of a series of debt securities other than such debt securities) and of such debt securities on our part to be performed; |
| (iii) | such assumption shall provide that such corporation or person shall pay to the holder of any such debt securities such additional amounts as may be necessary in order that every net |
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| payment of the principal of (and premium, if any, on) and interest, if any, on such debt securities will not be less than the amounts provided for in such debt securities to be then due and payable; and |
| (iv) | with respect to (iii) above, such obligation shall extend to any deduction or withholding for or on account of any present or future tax, assessment or governmental charge imposed upon such payment by the United Kingdom or the country in which any such corporation or person is organized or resident for tax purposes or any district, municipality or other political subdivision or taxing authority thereof (subject to the limitations contained in “—Payments of Additional Amounts” below, as applied to such corporation or person and, if applicable, such other country); and |
| • | immediately after giving effect to such transaction, no event of default with respect to the debt securities of such a series, and no event which, after notice or lapse of time, or both, would become an event of default, with respect to such debt securities, shall have occurred and be continuing. |
Upon any such consolidation, amalgamation or merger, or any such conveyance, transfer or lease, the successor corporation or person will succeed to, and be substituted for, and may exercise all of our rights and powers under the indenture with the same effect as if such successor corporation or person had been named as the issuer thereunder and thereafter, except in the case of a lease, the predecessor corporation shall be relieved of all obligations and covenants under the applicable indenture and such debt securities.
Events of Default
Unless the applicable prospectus supplement provides otherwise, the following events will constitute an event of default under the indenture with respect to a series of debt securities (whatever the reason for such event of default and whether it will be voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body):
| (a) | default in the payment of any principal (or premium, if any) due on the debt securities, and continuance of such default for a period of 14 days; |
| (b) | default in the payment of any interest (and additional amounts, if any) due on the debt securities, and continuance of such default for a period of 30 days; |
| (c) | default in the performance, or breach, of any covenant or warranty (other than any obligation for the payment of any principal or interest with respect to the debt securities) applicable to us contained in the indenture, and which default is incapable of remedy or, if in the opinion of the trustee is capable of remedy and has not been remedied within 90 days after the trustee having given us written notice as provided in the indenture; |
| (d) | if (i) any of our or any Principal Subsidiary’s (as defined below) present or future Relevant Indebtedness becomes due and payable prior to its stated maturity by reason of an actual event of default or (ii) any amount with respect to such Relevant Indebtedness is not paid when due or, as the case may be, within any applicable grace period, provided that the aggregate amount of the Relevant Indebtedness with respect to any of the events described in this paragraph equals or exceeds £100,000,000; |
| (e) | either a court in the United Kingdom issues a final order or an effective shareholders’ resolution is validly adopted, and where possible, such resolution or final order is not discharged or stayed within 90 days, for our winding up or dissolution; |
| (f) | attachment is made of the whole or substantially the whole of our assets or undertakings and such attachment is not released or cancelled within 90 days or an encumbrancer takes possession or an |
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| administrative or other receiver or similar officer is appointed of the whole or substantially the whole of our undertaking or assets or an administration or similar order is made to us, and such taking of possession, appointment or order is not released, discharged or cancelled within 90 days; |
| (g) | we cease to carry on all or substantially all of our business, or we are unable to pay debts within the meaning of Section 123 (1)(e) or Section 123(2) of the United Kingdom Insolvency Act 1986; or |
| (h) | we are adjudged bankrupt or insolvent by a court of competent jurisdiction in our country of incorporation. |
“Principal Subsidiary” means each of National Grid Electricity Transmission plc, National Grid North America Inc., National Grid USA, National Grid Electricity Distribution (East Midlands) plc, National Grid Electricity Distribution (West Midlands) plc, National Grid Electricity Distribution (South West) plc and National Grid Electricity Distribution (South Wales) plc and includes any successor entity thereto or any member of the NG Group to which all or substantially all of the assets of a Principal Subsidiary are transferred, provided that any such company shall cease to be a Principal Subsidiary if at any time NG, or any direct or indirect subsidiary of NG, ceases to control (as defined below) such company. In the event that all or substantially all of the assets of a Principal Subsidiary are transferred to a member of the NG Group as described above, the transferor of such assets shall cease to be deemed to be a Principal Subsidiary. Herein, “control” of a company means holding more than 50 percent of the issued or allotted ordinary shares in such company.
If an event of default with respect to a series of debt securities occurs and is continuing, either the trustee or the holders of at least 25 per cent. in principal amount of the outstanding debt securities of that series by written notice as provided in the indenture may declare the principal amount of all outstanding debt securities of that series to be due and payable immediately. At any time after a declaration of acceleration has been made, but before a judgment or decree for payment of money has been obtained by the trustee, and subject to applicable law and certain other provisions of the indenture, the holders of a majority in aggregate principal amount of the debt securities may, under certain circumstances, rescind and annul such acceleration.
The indenture provides that, within 120 days after the occurrence of any event which is, or after notice or lapse of time or both would become, an event of default with respect to a series of debt securities, the trustee will transmit, in the manner set forth in the indenture and subject to the exceptions described below, notice of such default to the holders of the debt securities of that series unless such default has been cured or waived. However, except in the case of a default in the payment of principal of, or premium, if any, or interest on, or additional amounts with respect to, any debt securities, the trustee may (although there is no obligation on it to do so) withhold such notice if and so long as the board, executive committee or a trust committee of directors and/or responsible officers of the trustee in good faith determine that the withholding of such notice is in the best interest of the holders of the debt securities. If an event of default occurs, has not been waived and is continuing with respect to a series of debt securities, the trustee may in its discretion proceed to protect and enforce its rights and the rights of the holders of the debt securities of that series by all appropriate judicial proceedings. The indenture provides that, subject to the duty of the trustee during any default to act with the required standard of care, the trustee will be under no obligation to exercise any of its rights or powers under the indenture at the request or direction of any of the holders of the debt securities, unless such holders shall have offered to the trustee indemnity or security satisfactory to the trustee. Subject to such provisions for the indemnification of the trustee, and subject to applicable law and certain other provisions of the indenture, the holders of a majority in aggregate principal amount of the outstanding debt securities of a series will have the right to direct the time, method and place of conducting any proceeding for any remedy available to the trustee, or exercising any trust or power conferred on the trustee, with respect to the debt securities of that series.
Modification and Waiver
In general, we and the trustee may modify or amend the indenture with the consent of the holders of not less than a majority in aggregate principal amount of the debt securities of each series affected by such modification;
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provided, however, that no such modification or amendment may, without the consent of the holder of each outstanding debt security affected thereby:
| • | change the stated maturity of the principal of, or any premium or instalment of interest on, the debt securities; |
| • | reduce the principal amount of, or the rate (or modify the calculation of such principal amount or rate) of interest on, or any premium payable upon the redemption of, the debt securities; |
| • | change the redemption provisions of the debt securities or, following the occurrence of any event that would entitle a holder to require us to redeem or repurchase the debt securities at the option of the holder, adversely affect the right of redemption or repurchase at the option of such holder, of the debt securities; |
| • | change the place of payment or the coin or currency in which the principal of, any premium or interest on or any additional amounts with respect to, the debt securities is payable; |
| • | impair the right to institute suit for the enforcement of any payment on or after the stated maturity of the debt securities (or, in the case of redemption, on or after the redemption date or, in the case of repayment at the option of any holder, on or after the repayment date); |
| • | reduce the percentage in principal amount of the debt securities, the consent of whose holders is required in order to take specific actions; |
| • | reduce the requirements for quorum or voting by holders of the debt securities in the applicable section of the indenture; |
| • | modify any of the provisions in the indenture regarding the waiver of past defaults and the waiver of certain covenants by the holders of such debt securities except to increase any percentage vote required or to provide that other provisions of the indenture cannot be modified or waived without the consent of the holder of each note affected thereby; or |
| • | modify any of the above provisions. |
We and the trustee may modify or amend the indenture and the debt securities without the consent of any holder in order to, among other things:
| • | provide for our successor pursuant to a consolidation, amalgamation, merger or sale of assets that complies with the provisions under “—Consolidation, Amalgamation, Merger and Sale or Lease of Assets” above; |
| • | add to our covenants for the benefit of the holders of the debt securities or to surrender any right or power conferred upon us by the indenture; |
| • | provide for a successor trustee with respect to the debt securities; |
| • | cure any ambiguity or correct or supplement any provision in the indenture which may be defective or inconsistent with any other provision, or to make any other provisions with respect to matters or questions arising under the indenture which will not adversely affect the interests of the holders of the debt securities; |
| • | change the conditions, limitations and restrictions on the authorized amount, terms or purposes of issue, authentication and delivery of the debt securities under the indenture; |
| • | add any additional events of default with respect to the debt securities; |
| • | provide for conversion or exchange rights of the holders of the debt securities; or |
| • | make any other change that does not materially adversely affect the interests of the holders of the debt securities. |
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The holders of at least a majority in aggregate principal amount of the debt securities of any series may, on behalf of the holders of the debt securities, waive compliance by us with certain restrictive provisions of the indenture. The holders of not less than a majority in aggregate principal amount of the debt securities of any series may, on behalf of the holders of the debt securities, waive any past default and its consequences under the indenture with respect to the debt securities, except a default (1) in the payment of principal of, any premium or interest on or any additional amounts with respect to the debt securities or (2) in respect of a covenant or provision of the indenture that cannot be modified or amended without the consent of the holder of each note.
Under the indenture, we are required to furnish the trustee annually a statement as to performance by us of certain of our obligations under the indenture and as to any default in such performance.
Discharge, Defeasance and Covenant Defeasance
Unless the applicable prospectus supplement provides otherwise, we may discharge certain obligations to holders of a series of debt securities that have not already been delivered to the trustee for cancellation and that either have become due and payable or will become due and payable within one year (or called for redemption within one year) by depositing with the trustee, in trust, funds in U.S. dollars or Government Obligations (as defined below) in an amount sufficient to pay the entire indebtedness on the debt securities with respect to principal and any premium, interest and additional amounts to the date of such deposit (if the debt securities have become due and payable) or with respect to principal, any premium and interest to the maturity or redemption date thereof, as the case may be.
The indenture provides that, unless the provisions relating to discharge and defeasance are made inapplicable to the debt securities, we may elect either (1) to defease and be discharged from any and all obligations with respect to the debt securities (except for, among other things, the obligation to pay additional amounts, if any, upon the occurrence of certain events of taxation, assessment or governmental charge with respect to payments on the debt securities and other obligations to register the transfer or exchange of the debt securities, to replace temporary or mutilated, destroyed, lost or stolen debt securities, to maintain an officer or agency with respect to the debt securities and to hold moneys for payment in trust) (“defeasance”) or (2) to be released from our obligations with respect to the debt securities under certain covenants such that any omission to comply with such obligations thereafter will not constitute a default or an event of default with respect to the debt securities (“covenant defeasance”). Defeasance or covenant defeasance, as the case may be, will be conditioned upon the irrevocable deposit by us with the trustee, in trust, of an amount in U.S. dollars, or Government Obligations, or both, applicable to such debt securities which through the scheduled payment of principal and interest in accordance with their terms will provide money in an amount sufficient to pay the principal of, any premium and interest on the debt securities on the scheduled due dates or any prior redemption date.
Such a trust may only be established if, among other things:
| (1) | the applicable defeasance or covenant defeasance does not result in a breach or violation of, or constitute a default under, any material agreement or instrument, other than the indenture, to which we are a party or by which we are bound; |
| (2) | no event of default or event which with notice or lapse of time or both would become an event of default with respect to the debt securities to be defeased will have occurred and be continuing on the date of establishment of such a trust after giving effect to such establishment and, with respect to defeasance only, no insolvency proceeding will have occurred and be continuing at any time during the period ending on the 91st day after such date; |
| (3) | we have delivered to the trustee an opinion of counsel (as specified in the indenture) to the effect that the beneficial owners of the debt securities will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such defeasance or covenant defeasance and will be subject to U.S. |
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| federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such defeasance or covenant defeasance had not occurred, and such opinion of counsel, in the case of defeasance, must refer to and be based upon a letter ruling of the Internal Revenue Service received by us, a Revenue Ruling published by the Internal Revenue Service or a change in applicable U.S. federal income tax law occurring after the date of the indenture; |
| (4) | with respect to defeasance, we have delivered to the trustee an officers’ certificate as to solvency and the absence of intent by us to prefer holders of the debt securities over our other creditors; and |
| (5) | we have delivered to the trustee an officers’ certificate and opinion of counsel stating that all conditions precedent to defeasance or covenant defeasance in the indenture, as the case may be, have been complied with. |
“Government Obligations” means debt securities which are (1) direct obligations of the United States of America for the payment of which its full faith and credit is pledged or (2) obligations of a person controlled or supervised by and acting as an agency or instrumentality of the United States of America the timely payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America which, in the case of clauses (1) and (2), are not callable or redeemable at the option of the issuer or issuers thereof, and will also include a depository receipt issued by a bank or trust company as custodian with respect to any such Government Obligation or a specific payment of interest on or principal of or any other amount with respect to any such Government Obligation held by such custodian for the account of the holder of such depository receipt, provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian with respect to the Government Obligation or the specific payment of interest on or principal of or any other amount with respect to the Government Obligation evidenced by such depository receipt.
In the event we effect covenant defeasance with respect to the debt securities and the debt securities are declared due and payable because of the occurrence of any event of default other than an event of default with respect to any covenant as to which there has been covenant defeasance, the Government Obligations on deposit with the trustee, will be sufficient to pay amounts due on the debt securities at the time of the stated maturity or redemption date but may not be sufficient to pay amounts due on the debt securities at the time of the acceleration resulting from such event of default. However, we would remain liable to make payment of such amounts due at the time of acceleration.
Payment of Additional Amounts
Unless otherwise specified in the applicable prospectus supplement, we will make all payments of principal and premium, if any, interest and any other amounts on, or in respect of, the debt securities without withholding or deduction at source for, or on account of, any present or future taxes, fees, duties, assessments or governmental charges of whatever nature imposed or levied by or on behalf of any Relevant Jurisdiction, as defined below, or any political subdivision of any Relevant Jurisdiction or any authority in or of any Relevant Jurisdiction having the power to tax, unless such taxes, fees, duties, assessments or governmental charges are required to be withheld or deducted. If a withholding or deduction at source is required, we will, unless the applicable prospectus supplement provides otherwise, subject to certain limitations and exceptions described below, pay to the holder of any debt securities, as additional interest, such additional amounts as may be necessary so that every net payment of principal, premium, if any, interest or any other amount made to such holder, after the withholding or deduction, will not be less than the amount provided for in such debt securities or in the indenture to be then due and payable.
We will not be required to pay any additional amounts:
| (1) | for or on behalf of a person who is liable to such taxes or duties in respect of such debt securities by reason of having some connection with the Relevant Jurisdiction other than the mere holding of such debt securities; |
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| (2) | in connection with presentation in the Relevant Jurisdiction where presentation is required; |
| (3) | if the holder or the beneficial owner of the relevant debt security failed to comply with a request by us or other authorized person addressed to the holder or beneficial owner, as the case may be, to provide information concerning the nationality, residence or identity of the holder or the beneficial owner or to make any declaration or other similar claim to satisfy any information or other requirement, which is required or imposed by a statute, treaty, regulation or administrative practice of a taxing jurisdiction as a precondition to exemption from all or part of the tax and which such holder or beneficial owner is legally able to satisfy; |
| (4) | where presentation is required, more than 30 days after the Relevant Date (as defined below) except to the extent that the holder would have been entitled to such additional amounts, on presenting the same for payment on such thirtieth day; or |
| (5) | with respect to any combination of items (1), (2), (3) or (4) above. |
“Relevant Date” means the date on which the payment of principal of (or premium, if any) or interest, if any, on any series of debt securities first becomes due or (if any amount of the money payable is improperly withheld or refused) the date on which payment in full of the amount outstanding is made or (if earlier) the date on which notice is duly given to the holder that upon presentation of the debt security in global or definitive form payment will be made provided that payment is in fact made upon such presentation.
“Relevant Jurisdiction” as used herein means the United Kingdom or any other jurisdiction in which we are resident for tax purposes.
Notwithstanding any other provision of the indenture, any amounts to be paid on the debt securities by or on behalf of us, will be paid net of any deduction or withholding imposed or required pursuant to an agreement described in Section 1471(b) of the U.S. Internal Revenue Code of 1986, as amended (the “Code”), or otherwise imposed pursuant to Sections 1471 through 1474 of the Code (or any regulations thereunder or official interpretations thereof) or an intergovernmental agreement between the United States and another jurisdiction facilitating the implementation thereof (or any fiscal or regulatory legislation, rules or practices implementing such an intergovernmental agreement) (any such withholding or deduction, a “FATCA Withholding”). Neither we nor any other person will be required to pay any additional amounts in respect of FATCA Withholding.
In addition, unless otherwise specified in the applicable prospectus supplement, we will not pay additional amounts with respect to any payment of principal of, or premium, if any, interest or any other amounts on, any such debt securities to any holder who is a fiduciary or partnership or other than the sole beneficial owner of such debt securities if such payment would be required by the laws of the Relevant Jurisdiction (or any political subdivision or relevant taxing authority thereof or therein) to be included in the income for tax purposes of a beneficiary or partner or settlor with respect to such fiduciary or a member of such partnership or a beneficial owner to the extent such beneficiary, partner or settlor would not have been entitled to such additional amounts had it been the holder of the note.
Redemption of Debt Securities for Tax Reasons
Unless otherwise specified in the applicable prospectus supplement, we or our successor may redeem any series of the debt securities at our option, in whole but not in part, at a redemption price equal to 100 per cent. of the principal amount, together with accrued and unpaid interest and additional amounts, if any, to the date fixed for redemption, if as a result of any change in or amendment to the laws or treaties (or any regulations or rulings promulgated under these laws or treaties) of the Relevant Jurisdiction or any taxing authority in the Relevant Jurisdiction (or any political subdivision) or any change in the application or official interpretation of such laws, regulations or rulings occurring, in the case of a redemption by us, on or after the date of issuance of the series of debt securities or, in the case of a redemption by our successor, on or after the date on which the successor
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corporation assumes the obligation under the debt securities, we will be required as of the next interest payment date to pay additional amounts with respect to the debt securities as provided in “—Payment of Additional Amounts” above and such requirements cannot be avoided by the use of reasonable measures (such measures not involving any material additional payments or expense by us) then available. If we elect to redeem the debt securities under this provision, we will give written notice of such election to the trustee and the holders of the debt securities. Interest on the debt securities will cease to accrue unless we default in the payment of the redemption price.
Prior to giving the notice of a tax redemption, we will deliver to the trustee a certificate signed by a duly authorized officer stating that we are entitled to effect the redemption and setting forth a statement of facts showing that the conditions precedent to our right to so redeem have occurred.
Governing Law
The indenture and the debt securities will be governed by, and construed in accordance with, the laws of the State of New York applicable to agreements made or instruments entered into and, in each case, performed in that state.
Information Concerning the Trustee
The indenture provides that the trustee will have no obligations other than the performance of such duties as are specifically set forth in such indenture, except that, if an event of default has occurred and is continuing, the trustee will use the same degree of care and skill in its exercise of the rights and powers vested in it by the indenture as a prudent person would exercise under the circumstances in the conduct of such person’s own affairs. The trustee will be under no obligation to exercise any of its rights or powers under the indenture unless such holders shall have offered to the trustee security and indemnity satisfactory to the trustee against any loss, liability or expense, and then only to the extent required by the terms of the indenture. The Bank of New York Mellon, London Branch is to be the trustee and paying agent under the indenture, is one of a number of banks with which NG and its subsidiaries maintain banking relationships in the ordinary course of business and they are the depositary for our American Depositary Shares.
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Unless the applicable prospectus supplement provides otherwise, if we issue Global Securities representing any debt securities, then the Global Securities will be deposited upon issuance with, or on behalf through one or more international and domestic clearing systems. The principal clearing systems we will use are the book-entry systems operated by DTC in the United States, Clearstream in Luxembourg and Euroclear in Brussels, Belgium. These systems have established electronic debt securities and payment transfer, processing, depositary and custodial links among themselves and others, either directly or through custodians and depositaries. These links allow debt securities to be issued, held and transferred among the clearing systems without the physical transfer of certificates.
Special procedures to facilitate clearance and settlement have been established among these clearing systems to trade securities across borders in the secondary market. Where payments for debt securities we issue in global form will be made in U.S. dollars, these procedures can be used for cross-market transfers and the securities will be cleared and settled on a delivery against payment basis.
Global securities will be registered in the name of and deposited with a nominee for, and accepted for settlement and clearance by, one or more of DTC and a common depositary for Euroclear and Clearstream, and any other clearing system identified in the applicable prospectus supplement.
Cross-market transfers of debt securities that are not in global form may be cleared and settled in accordance with other procedures that may be established among the clearing systems for these securities. Investors in securities that are issued outside of the United States, its territories and possessions must initially hold their interests through Euroclear, Clearstream or the clearing system that is described in the applicable prospectus supplement.
The policies of DTC, Euroclear and Clearstream will govern payments, transfers, exchange and other matters relating to investors’ interests in debt securities held by them. This is also true for any other clearing system that may be named in a prospectus supplement.
Neither we, nor any trustee, paying agent or registrar have any responsibility for any aspect of the actions of DTC, Euroclear and Clearstream or any of their direct or indirect participants or accountholders. Neither we, nor any trustee, paying agent or registrar have any responsibility for any aspect of the records kept by DTC, Euroclear and Clearstream or any of their direct or indirect participants or accountholders. Neither we, nor any trustee, paying agent or registrar supervise these systems in any way. This is also true for any other clearing system indicated in a prospectus supplement.
DTC, Euroclear and Clearstream and their participants and accountholders perform these clearance and settlement functions under agreements they have made with one another or with their customers. You should be aware that they are not obligated to perform these procedures and may modify them or discontinue them at any time.
The description of the clearing systems in this section reflects our understanding of the rules and procedures of DTC, Euroclear and Clearstream as they are currently in effect. Those systems could change their rules and procedures at any time.
The Clearing Systems
DTC
DTC has advised us as follows:
| • | DTC is: |
| • | a limited purpose trust company organized under the laws of the State of New York; |
| • | a “banking corporation” within the meaning of New York Banking Law; |
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| • | a member of the Federal Reserve System; |
| • | a “clearing corporation” within the meaning of the Uniform Commercial Code; and |
| • | a “clearing agency” registered pursuant to the provisions of Section 17A of the Exchange Act. |
| • | DTC was created to hold securities for its participants and to facilitate the clearance and settlement of securities transactions between participants through electronic book-entry changes to accounts of its participants. This eliminates the need for physical movement of certificates. |
| • | Participants in DTC include securities brokers and dealers, banks, trust companies and clearing corporations and may include certain other organizations. DTC is partially owned by some of these participants or their representatives. |
| • | Indirect access to the DTC system is also available to banks, brokers, dealers and trust companies that have relationships with participants. |
| • | The rules applicable to DTC and DTC participants are on file with the SEC. |
Clearstream
Clearstream has advised us as follows:
| • | Clearstream is a duly licensed bank organized as a société anonyme incorporated under the laws of Luxembourg and is subject to regulation by the Luxembourg Commission for the Supervision of the Financial Sector (Commission de Surveillance du Secteur Financier). |
| • | Clearstream holds securities for its customers and facilitates the clearance and settlement of securities transactions among them. It does so through electronic book-entry charges to the accounts of its customers. This eliminates the need for physical movement of certificates. |
| • | Clearstream provides other services to its accountholders, including safekeeping, administration, clearance and settlement of internationally traded securities and lending and borrowing of securities. |
| • | Clearstream’s customers include worldwide securities brokers and dealers, banks, trust companies and clearing corporations and may include professional financial intermediaries. Its U.S. customers are limited to securities brokers and dealers and banks. |
| • | Indirect access to the Clearstream system is also available to others that clear through Clearstream customers or that have custodial relationships with its customers, such as banks, brokers, dealers and trust companies. |
Euroclear
Euroclear has advised us as follows:
| • | Euroclear is incorporated under the laws of Belgium as a bank and is subject to regulation by the Belgian Banking and Finance Commission (Commission Bancaire et Financière) and the National Bank of Belgium (Banque Nationale de Belgique). |
| • | Euroclear holds securities for its customers and facilitates the clearance and settlement of securities transactions among them. It does so through simultaneous electronic book-entry delivery against payment, thereby eliminating the need for physical movement of certificates. |
| • | Euroclear provides other services to its customers, including credit custody, lending and borrowing of securities and tri-party collateral management. It interfaces with the domestic markets of several other countries. |
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| • | Euroclear customers include banks, including central banks, securities brokers and dealers, trust companies and clearing corporations and may include certain other professional financial intermediaries. |
| • | Indirect access to the Euroclear system is also available to others that clear through Euroclear customers or that have relationships with Euroclear accountholders. |
| • | All securities in Euroclear are held on a fungible basis. This means that specific certificates are not matched to specific securities clearance accounts. |
Other Clearing Systems
We may choose any other clearing system for a particular series of debt securities. The clearance and settlement procedures for the clearing system we choose will be described in the applicable prospectus supplement.
Primary Distribution
The distribution of the debt securities will be cleared through one or more of the clearing systems that we have described above or any other clearing system that is specified in the applicable prospectus supplement. Payment for debt securities will be made on a delivery versus payment or free delivery basis. These payment procedures will be more fully described in the applicable prospectus supplement.
Clearance and settlement procedures may vary from one series of debt securities to another according to the currency that is chosen for the specific series of debt securities. Customary clearance and settlement procedures are described below.
We will submit applications to the relevant system or systems for the debt securities to be accepted for clearance. The clearance numbers that are applicable to each clearance system will be specified in the prospectus supplement.
Clearance and Settlement Procedures—DTC
DTC participants that hold debt securities through DTC on behalf of investors will follow the settlement practices applicable to U.S. corporate debt obligations in DTC’s Same-Day Funds Settlement System.
Securities will be credited to the securities custody accounts of these DTC participants against payment in same-day funds, for payments in U.S. dollars, on the settlement date. For payments in a currency other than U.S. dollars, securities will be credited free of payment on the settlement date.
Clearance and Settlement Procedures—Euroclear and Clearstream
We understand that investors that hold their debt securities through Euroclear or Clearstream accounts will follow the settlement procedures that are applicable to conventional Eurobonds in registered form, or such other procedures as are applicable for other securities.
Securities will be credited to the securities custody accounts of Euroclear and Clearstream accountholders on the business day following the settlement date, for value on the settlement date. They will be credited either free of payment or against payment for value on the settlement date.
Secondary Market Trading
Trading between DTC Participants
Secondary market trading between DTC participants will occur in the ordinary way in accordance with DTC’s rules. Secondary market trading will be settled using procedures applicable to U.S. corporate debt obligations in DTC’s Same-Day Funds Settlement System for debt securities.
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If payment is made in U.S. dollars, settlement will be in same-day funds. If payment is made in a currency other than U.S. dollars, settlement will be free of payment. If payment is made other than in U.S. dollars, separate payment arrangements outside of the DTC system must be made between the DTC participants involved.
Trading between Euroclear and/or Clearstream Accountholders
We understand that secondary market trading between Euroclear and/or Clearstream accountholders will occur in the ordinary way following the applicable rules and operating procedures of Euroclear and Clearstream. Secondary market trading will be settled using procedures applicable to conventional Eurobonds in registered form.
Trading between DTC and Euroclear or Clearstream
A purchaser of securities that are held in the account of a DTC participant must send instructions to Euroclear or Clearstream at least one business day prior to settlement. The instructions will provide for the transfer of the securities from the selling DTC participant’s account to the account of the purchasing Euroclear or Clearstream participant. Euroclear or Clearstream, as the case may be, will then instruct the common depositary for Euroclear and Clearstream to receive the securities either against payment or free of payment.
The interests in the securities will be credited to the respective clearing system. The clearing system will then credit the account of the participant, following its usual procedures. Credit for the securities will appear on the next day, European time. Cash debit will be back-valued to, and the interest on the securities will accrue from, the value date, which would be the preceding day, when settlement occurs in New York. If the trade fails and settlement is not completed on the intended date, the Euroclear or Clearstream cash debit will be valued as of the actual settlement date instead.
Euroclear participants or Clearstream participants will need the funds necessary to process same-day funds settlement. The most direct means of doing this is to preposition funds for settlement, either from cash or from existing lines of credit, as for any settlement occurring within Euroclear or Clearstream. Under this approach, participants may take on credit exposure to Euroclear or Clearstream until the securities are credited to their accounts one business day later.
As an alternative, if Euroclear or Clearstream has extended a line of credit to them, participants can choose not to preposition funds and will instead allow that credit line to be drawn upon to finance settlement. Under this procedure, Euroclear participants or Clearstream participants purchasing securities would incur overdraft charges for one business day (assuming they cleared the overdraft as soon as the securities were credited to their accounts). However, interest on the securities would accrue from the value date. Therefore, in many cases, the investment income on securities that is earned during that one business day period may substantially reduce or offset the amount of the overdraft charges. This result will, however, depend on each participant’s particular cost of funds.
Because the settlement will take place during New York business hours, DTC participants will use their usual procedures to deliver securities to the depositary on behalf of Euroclear participants or Clearstream participants. The sale proceeds will be available to the DTC seller on the settlement date. For the DTC participants, then, a cross-market transaction will settle no differently than a trade between two DTC participants.
Special Timing Considerations
You should be aware that investors will only be able to make and receive deliveries, payments and other communications involving the debt securities through Clearstream and Euroclear on days when those systems are open for business. Those systems may not be open for business on certain days when banks, brokers and other institutions are open for business in the United States.
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In addition, because of time-zone differences, there may be problems with completing transactions involving Clearstream and Euroclear on the same business day as in the United States. U.S. investors who wish to transfer their interests in the debt securities, or to receive or make a payment or delivery of the debt securities, on a particular day, may find that the transactions will not be performed until the next business day in Luxembourg or Brussels, depending on whether Clearstream or Euroclear is used.
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This section discusses the material United Kingdom withholding tax treatment of payments of interest in respect of, and the material U.S. federal income tax consequences of the acquisition, ownership, and disposition of U.S. dollar-denominated debt securities that we may issue, in each case as of the date of this prospectus. The discussion that follows is of a general nature, and additional disclosure regarding the tax treatment of specific debt securities may be provided in the prospectus supplement for such instruments. To the extent there is any inconsistency in the discussion of tax consequences between this prospectus and the applicable prospectus supplement, you should rely on the discussion in the prospectus supplement. Prospective investors are advised to consult their own tax advisers concerning the application of the United Kingdom tax and U.S. federal income tax laws to their particular situations as well as any tax consequences arising under the laws of any other taxing jurisdiction or any applicable tax treaties, and the possible effect of changes in applicable tax law.
United Kingdom
The comments in this part are based on current United Kingdom tax law as applied in England and Wales and HM Revenue & Customs practice (which may not be binding on HM Revenue & Customs), in each case as of the date of this prospectus.
References in this part to “interest” shall mean amounts that are treated as interest for the purposes of United Kingdom taxation.
Interest on the debt securities
While the debt securities are and continue to be listed on a recognized stock exchange, within the meaning of Section 1005 Income Tax Act 2007, payments of interest by NG may be made without withholding or deduction for or on account of United Kingdom income tax. The London Stock Exchange is a recognized stock exchange for these purposes. Debt securities will be treated as listed on the London Stock Exchange if they are included in the Official List of the Financial Conduct Authority and are admitted to trading on the London Stock Exchange. The New York Stock Exchange, the Irish Stock Exchange and the Luxembourg Stock Exchange are also recognized stock exchanges for these purposes. Debt securities will be treated as listed on those exchanges if they are both admitted to trading on such exchanges and are officially listed in the respective jurisdictions in accordance with provisions corresponding to those generally applicable in countries in the European Economic Area. Accordingly, so long as the particular series of debt securities are listed on any such exchange, interest payments made on the debt securities will be payable without withholding or deduction for or on account of United Kingdom income tax. The applicable prospectus supplement will indicate the exchanges on which the debt securities are listed.
In all other cases, interest will generally be paid by NG under deduction of United Kingdom income tax at the basic rate (currently 20 per cent.), subject to the availability of other reliefs under domestic law or to any direction to the contrary from HM Revenue & Customs in respect of such relief as may be available pursuant to the provisions of any applicable double taxation treaty.
Investors who are in any doubt as to their position or would like to know more should consult their professional advisers.
U.S. Federal Income Taxation
The following is a summary of certain U.S. federal income tax consequences of the acquisition, ownership and disposition of debt securities by a U.S. Holder (as defined below). This summary deals only with initial purchasers of debt securities at the “issue price” that are U.S. Holders and that will hold the debt securities as capital assets. The issue price is the first price to the public (not including bond houses, brokers or similar
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persons or organizations acting in the capacity of underwriters, placement agents or wholesalers) at which a substantial amount of the debt securities is sold for money. The discussion does not cover all aspects of U.S. federal income taxation that may be relevant to, or the actual tax effect that any of the matters described herein will have on, the acquisition, ownership or disposition of debt securities by particular investors (including consequences under the alternative minimum tax or net investment income tax), and does not address state, local, non-U.S. or other tax laws. This summary also does not discuss all of the tax considerations that may be relevant to certain types of investors subject to special treatment under the U.S. federal income tax laws (such as financial institutions, insurance companies, individual retirement accounts and other tax-deferred accounts, tax-exempt organizations, dealers in securities or currencies, investors that will hold the debt securities as part of straddles, hedging transactions or conversion transactions for U.S. federal income tax purposes, persons that have ceased to be U.S. citizens or lawful permanent residents of the United States, investors holding the debt securities in connection with a trade or business conducted outside of the United States, U.S. citizens or lawful permanent residents living abroad, U.S. holders that are required to take certain amounts into income no later than the time such amounts are reflected on an applicable financial statement, or investors whose functional currency is not the U.S. dollar). This summary deals only with debt securities that are due to mature 30 years or less from the date on which they are issued. If we issue debt securities that are due to mature more than 30 years from their date of issue, we will describe the U.S. federal income tax treatment of such debt securities in the applicable prospectus supplement.
As used herein, the term “U.S. Holder” means a beneficial owner of debt securities that is, for U.S. federal income tax purposes, (i) an individual citizen or resident of the United States, (ii) a corporation created or organized under the laws of the United States or any state thereof or the District of Columbia, (iii) an estate the income of which is subject to U.S. federal income tax without regard to its source or (iv) a trust if a court within the United States is able to exercise primary supervision over the administration of the trust and one or more U.S. persons have the authority to control all substantial decisions of the trust, or the trust has validly elected to be treated as a domestic trust for U.S. federal income tax purposes.
The U.S. federal income tax treatment of a partner in an entity or arrangement treated as a partnership for U.S. federal income tax purposes that holds debt securities will depend on the status of the partner and the activities of the partnership. Prospective purchasers that are entities or arrangements treated as partnerships for U.S. federal income tax purposes should consult their tax advisers concerning the U.S. federal income tax consequences to them and their partners of the acquisition, ownership and disposition of debt securities by the partnership.
This summary is based on the tax laws of the United States, including the Internal Revenue Code of 1986, as amended, its legislative history, existing and proposed regulations thereunder, published rulings and court decisions, all as of the date hereof and all subject to change at any time, possibly with retroactive effect.
THE SUMMARY OF U.S. FEDERAL INCOME TAX CONSEQUENCES SET OUT BELOW IS FOR GENERAL INFORMATION ONLY. YOU SHOULD CONSULT YOUR TAX ADVISERS AS TO THE PARTICULAR TAX CONSEQUENCES TO YOU OF ACQUIRING, OWNING, AND DISPOSING OF THE DEBT SECURITIES, INCLUDING THE APPLICABILITY AND EFFECT OF STATE, LOCAL, NON-U.S. AND OTHER TAX LAWS AND POSSIBLE CHANGES IN TAX LAW.
Interest Payments
Payments or accruals of “qualified stated interest” (as defined below) (including any additional amounts paid in respect of withholding taxes and without reduction for any amounts withheld) on the debt securities will be includible in your gross income as ordinary interest income at the time you receive or accrue such amounts (in accordance with your regular method of tax accounting). The term “qualified stated interest” generally means stated interest that is unconditionally payable at least annually during the entire term of a debt security at a single fixed interest rate or, subject to certain conditions, at a floating rate based on one or more interest indices.
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Unless otherwise specified in the applicable prospectus supplement, we expect interest payments on the debt securities to be treated as “qualified stated interest” and we expect the debt securities to be issued without “original issue discount” (i.e. the stated principal amount of the debt securities is not expected to exceed their issue price by an amount equal to or more than a statutorily defined de minimis amount, generally, 0.0025 multiplied by the stated principal amount and the number of complete years to maturity from the issue date) or bond premium. If we issue debt securities that have “original issue discount” or bond premium, or provide for payments of interest that we do not expect to be treated as “qualified stated interest” or denominated in a currency other than U.S. dollars, we will describe the tax treatment of such debt securities in the applicable prospectus supplement.
Interest paid by us on the debt securities constitutes foreign source income for U.S. federal income tax purposes. For foreign tax credit limitation purposes, interest on the debt securities generally will constitute passive income.
Sale, Exchange, Redemption and Other Disposition of the Debt Securities
Upon the sale, exchange, redemption or other disposition of the debt securities, you will recognize taxable gain or loss equal to the difference, if any, between the amount realized on the sale, exchange, redemption or other disposition (other than accrued but unpaid interest which will be treated as ordinary interest income) and your adjusted tax basis in such debt securities. Your adjusted tax basis in the debt securities generally will equal the cost of such debt securities reduced by any principal paid on the debt securities. The amount realized does not include the amount attributable to accrued but unpaid interest, which will be taxable as interest income to the extent not previously included in income. Any such gain or loss generally will be capital gain or loss and will be long-term capital gain or loss if, at the time of sale, exchange, redemption or other disposition you held the debt securities for more than one year. The deductibility of capital losses is subject to certain limitations. Any gain or loss realized by a U.S. holder on the sale, exchange, redemption or other disposition of the debt securities generally will be treated as U.S. source gain or loss, as the case may be.
Information Reporting and Backup Withholding
Information returns may be filed with the Internal Revenue Service (“IRS”) in connection with payments of interest on the debt securities and the proceeds from a sale or other disposition of the debt securities unless the holder of the debt securities establishes an exemption from the information reporting rules. A holder of debt securities that does not establish such an exemption may be subject to U.S. backup withholding on these payments if the holder fails to provide its taxpayer identification number or otherwise comply with the backup withholding rules. Backup withholding is not an additional tax. The amount of any backup withholding from a payment to you will be allowed as a credit against your U.S. federal income tax liability and you may be entitled to a refund, provided that the required information is furnished to the IRS. You should consult your tax advisors about these rules and any other reporting obligations that may apply to the ownership or disposition of debt securities, including requirements related to the holding of certain “specified foreign financial assets”.
FATCA Withholding
Certain provisions of U.S. law, commonly known as FATCA, impose reporting requirements and a withholding tax of 30 per cent. on, among other things, certain “foreign passthru payments” by non-U.S. financial institutions (“FFIs”) (including an intermediary through which debt securities are held) to persons that fail to meet certain certification or reporting requirements. The term “foreign passthru payment” is not yet defined. A number of jurisdictions (including the United Kingdom) have entered into, or have agreed in substance to, intergovernmental agreements to facilitate the implementation of FATCA with the United States (“IGAs”), which modify the way in which FATCA applies in their jurisdictions.
Certain aspects of the application of the FATCA provisions and IGAs to instruments such as the debt securities, including whether withholding would ever be required pursuant to FATCA or an IGA with respect to
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payments on instruments such as the debt securities, are uncertain and may be subject to change. Even if withholding would be required pursuant to FATCA or an IGA with respect to payments on instruments such as the debt securities, proposed regulations have been issued that provide that such withholding would not apply prior to the date that is two years after the date on which final regulations defining foreign passthru payments are published in U.S. Federal Register. In the preamble to the proposed regulations, the U.S. Treasury Department indicated that taxpayers may rely on these proposed regulations until the issuance of final regulations. Additionally, debt securities characterized as debt (or which are not otherwise characterized as equity and have a fixed term) for U.S. federal tax purposes that are issued on or prior to the date that is six months after the date on which final regulations defining “foreign passthru payments” are filed with the U.S. Federal Register generally would be “grandfathered” for purposes of FATCA withholding unless materially modified after such date.
In the event that FATCA withholding were relevant with respect to payments on the debt securities, if any amount were to be deducted or withheld from interest, principal or other payments on the debt securities as a result of FATCA, neither we nor any paying agent or any other person would be required to pay additional amounts as a result of the deduction or withholding.
FATCA is particularly complex and significant aspects of when and how FATCA will apply remain unclear. You should consult your own tax advisers to obtain a more detailed explanation of FATCA and to learn how these rules may affect you in your particular circumstances.
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We may sell the debt securities directly to purchasers or underwriters or through agents, dealers or underwriters.
The prospectus supplement with respect to the offered securities will set forth the terms of the offering of the offered securities, including the name or names of any underwriters, dealers or agents, the purchase price of the offered securities and the proceeds to us, from such price and any discounts or concessions allowed or reallowed or paid to dealers and any securities exchange on which such offered securities may be listed. Any public offering price, discounts or concessions allowed or reallowed or paid to dealers may be changed from time to time.
The distribution of the offered securities may be effected from time to time in one or more transactions at a fixed price or prices, which may be changed, at market prices prevailing at the time of sale, at prices related to such prevailing market prices or at negotiated prices.
Agents appointed by us may solicit offers to purchase debt securities. The prospectus supplement will name these agents, who may be underwriters, and discuss any commissions payable to them. Unless otherwise indicated in the prospectus supplement, these agents will be acting on a best efforts basis for the period of their appointment. We may also sell debt securities to an agent as principal. Any such agent may be deemed to be an underwriter, as that term is defined in the Securities Act, of the offered debt securities. Agents may be entitled to indemnification by us against certain liabilities, including liabilities under the Securities Act, and may be customers of, engage in transactions with or perform services for us in the ordinary course of business.
If any underwriters are utilized in the sale of debt securities, we will enter into an underwriting agreement with such underwriters and the names of the underwriters and the terms of the transaction, including, commissions, discounts and any other compensation of the underwriters, if any, will be set forth in the prospectus supplement, which will be used by the underwriters to make resales of the debt securities to the public. If underwriters are utilized in the sale of the debt securities, the debt securities will be acquired by the underwriters for their own account and may be offered and may be resold from time to time in one or more transactions, including negotiated transactions, at fixed public offering prices, or at varying prices determined by the underwriters at the time of sale.
Our debt securities may be offered to the public either through underwriting syndicates represented by managing underwriters or directly by the managing underwriters. Unless otherwise indicated in the prospectus supplement, the underwriting agreement will provide that the obligations of the underwriters are subject to certain conditions precedent. The underwriters will be obligated to purchase all of the debt securities of a series if they purchase any of such securities. We may grant to the underwriters options to purchase additional debt securities, to cover over-allotments, if any, at the public offering price (with additional underwriting discounts or commissions), as may be set forth in the prospectus supplement relating thereto. If we grant any over-allotment option, the terms of such over-allotment option will be set forth in the prospectus supplement relating to such securities. The underwriters may be entitled to indemnification by us against certain liabilities, including liabilities under the Securities Act, and may be customers of, engage in transactions with or perform services for us in the ordinary course of business.
If a dealer is utilized in the sale of debt securities in respect of which this prospectus is delivered, we will sell the debt securities to the dealer, as principal. The dealer may then resell the debt securities to the public at varying prices to be determined by such dealer at the time of resale. Any such dealer may be deemed to be an underwriter, as such term is defined in the Securities Act, of the debt securities so offered and sold. The name of the dealer and the terms of the transaction will be set forth in the related prospectus supplement. Dealers may be entitled to indemnification by us against certain liabilities, including liabilities under the Securities Act, and may be customers of, engage in transactions with or perform services for us in the ordinary course of business.
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Offers to purchase offered securities may be solicited directly by us, and the sale thereof may be made by us directly to institutional investors or others, who may be deemed to be underwriters within the meaning of the Securities Act with respect to any resale thereof. The terms of any such sales will be described in the related prospectus supplement.
Debt securities may also be offered and sold, if so indicated in the prospectus supplement, in connection with a remarketing upon their purchase, in accordance with a redemption or repayment pursuant to their terms, or otherwise, by one or more marketing firms, or remarketing firms, acting as principals for their own accounts or as agents for us. Any remarketing firm will be identified and the terms of its agreement, if any, with us and its compensation will be described in the prospectus supplement. Remarketing firms may be deemed to be underwriters in connection with the debt securities remarketed thereby. Remarketing firms may be entitled under agreements which may be entered into with us to indemnification by us against certain liabilities, including liabilities under the Securities Act, and may be customers of, engage in transactions with or perform services for us in the ordinary course of business.
If indicated in the prospectus supplement, we will authorize agents, underwriters, dealers or other persons to solicit offers by certain purchasers to purchase debt securities from us at the public offering price set forth in the prospectus supplement pursuant to delayed delivery contracts providing for payment and delivery on a specified date in the future. Such contracts will be subject to only those conditions set forth in the prospectus supplement, and the prospectus supplement will set forth the commission payable for solicitation of such offers.
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling us pursuant to the foregoing provisions, we have been informed that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is therefore unenforceable.
Each series of debt securities will be a new issue and will have no established trading market. We may elect to list any series of debt securities on an exchange but, unless otherwise specified in the applicable prospectus supplement, we shall not be obligated to do so. No assurance can be given as to the liquidity of the trading market for any of the debt securities.
Underwriters, dealers, agents and remarketing firms, or their affiliates, may be customers of, engage in transactions with, or perform services for, us and our subsidiaries in the ordinary course of business.
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Certain legal matters in connection with the debt securities to be offered hereby will be passed upon for us by Linklaters LLP. Certain legal matters in connection with the debt securities to be offered hereby will be passed upon for any underwriters or agents by counsel to be named in the applicable prospectus supplement.
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The consolidated financial statements incorporated in this prospectus by reference from National Grid plc’s Annual Report on Form 20-F, and the effectiveness of National Grid plc’s internal control over financial reporting have been audited by Deloitte LLP, an independent registered public accounting firm, as stated in their reports, which are incorporated herein by reference. Such financial statements have been so incorporated in reliance upon the reports of such firm given upon their authority as experts in accounting and auditing.
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ENFORCEMENT OF CIVIL LIABILITIES UNDER UNITED STATES FEDERAL
SECURITIES LAWS
We are an English public limited company. Most of our directors and executive officers are resident outside the United States and a substantial portion of our assets and the assets of such persons are located outside the United States. As a result, it may be difficult for you to effect service of process within the United States upon these persons or to enforce against them or us in U.S. courts judgments obtained in U.S. courts predicated upon the civil liability provisions of the federal securities laws of the United States. We have been advised by Linklaters LLP that there is doubt as to enforceability in England and Wales, in original actions or in actions for enforcement of judgments of U.S. courts, of liabilities predicated solely upon the federal securities laws of the United States. National Grid plc have consented to service of process in New York City for claims based upon the indenture and the debt securities described under “Description of the Debt Securities.”
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INFORMATION NOT REQUIRED IN PROSPECTUS
| ITEM 8. | INDEMNIFICATION OF DIRECTORS AND OFFICERS |
The United Kingdom Companies Act 2006 (the “Companies Act”) allows an English company to indemnify its directors against liability and to provide its directors with funds to cover the costs incurred in defending legal proceedings against him or her. Under the Companies Act, an English company is allowed to indemnify its directors against any liability incurred by a director to any person (other than the company itself or any associated company) in connection with any negligence, default, breach of duty or breach of trust in relation to the company, by means of a “qualifying third party indemnity provision”. A “qualifying third party indemnity provision” may cover the costs of a judgment against a director but cannot include (i) costs incurred by a director to the company or any associated company; (ii) fines imposed in criminal proceedings and penalties imposed by regulatory authorities by way of a penalty in respect of non-compliance with any requirement of a regulatory nature; (iii) costs incurred in defending criminal proceedings where the director is convicted or civil proceedings brought by the company or an associated company where judgment is given against him; or (iv) costs incurred in proceedings for certain relief where the court refuses to grant such relief.
NG arranges Directors’ and Officers’ liability insurance cover. A qualifying third party indemnity provision was granted in favor of the directors in accordance with Sections 232 to 234 of the Companies Act. The indemnity provision is contained in NG’s articles of association at Articles 126.1 to 126.3 which are set out below.
Article 126.1
“To the fullest extent permitted by law, we will indemnify all our Directors and officers out of our own funds against the following:
| (a) | Any liability incurred by or attaching to them in connection with any negligence, default, breach of duty or breach of trust by them in relation to NG other than: |
| (i) | any liability to us or any associated company; and |
| (ii) | any liability of the kind referred to in Section 234(3) of the Companies Act. |
| (b) | Any other liability incurred by or attaching to them: |
| (i) | in actually or seemingly carrying out their duties; |
| (ii) | in using or seemingly using their powers; and |
| (iii) | in any other activity connected to their duties, powers or office. |
Where a Director or officer is indemnified against any liability in line with this Article 126, the indemnity will cover all costs, charges, losses, expenses and liabilities incurred by them.”
Article 126.2
“As well as the cover provided under Article 126.1 above, the Directors will have power to purchase and maintain insurance for or for the benefit of:
| (a) | any person who is or was at any time a Director or officer of any relevant company; or |
| (b) | any person who is or was at any time a trustee of any pension fund or employees’ share scheme in which employees of any relevant company are interested. |
This includes insurance against any liability incurred by or attaching to them through any act or omission:
| (i) | in actually or seemingly carrying out their duties; |
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| (ii) | in using or seemingly using their powers; and |
| (iii) | in any other activity connected to their duties, powers or offices; |
in relation to:
| (a) | any relevant company; |
| (b) | any pension fund; or |
| (c) | any employees’ share scheme; |
and all costs, charges, losses, expenses and liabilities incurred by them in relation to any act or omission.”
Article 126.3
“Subject to the law, we will:
| (a) | provide a Director or officer with funds to meet expenditure they have incurred or may incur in defending any criminal or civil proceedings or in connection with any application under the provisions mentioned in Section 205(5) of the Companies Act; |
| (b) | provide a Director or officer with funds to meet expenditure they have incurred or may incur in defending an investigation by a regulatory authority or against action proposed by a regulatory authority in connection with any alleged negligence, default, breach of duty or breach of trust by him or her in relation to us; and |
| (c) | do anything to enable a Director or officer to avoid incurring such expenditure, but any funds we provide or other things we do will be in line with Section 205(5) of the Companies Act.” |
The relevant provisions of the Companies Act which permit the giving of such indemnities are Sections 205 and 232 to 234.
Section 232(1) of the Companies Act states that a company cannot exempt a director from any liability that would otherwise attach to him in connection with any negligence, default, breach of duty or breach of trust in relation to the company. Furthermore, Section 232(2) of the Companies Act states that a company cannot, either directly or indirectly, provide an indemnity for a director of the company, or of an associated company, against any liability attaching to him in connection with any negligence, default, breach of duty or breach of trust in relation to the company of which he is a director, except as permitted by Sections 233, 234 and 235 of the Companies Act. Section 233 permits a company to purchase and maintain insurance against the liability mentioned in Section 232(2). Section 234 sets out the conditions which must be fulfilled for an indemnity to be a qualifying third party indemnity. The indemnity must not provide: (i) any indemnity against any liability incurred by the director to the company or to any associated company; (ii) any indemnity against any liability incurred by the director to pay a fine imposed in criminal proceedings or a sum payable to a regulatory authority by way of a penalty in respect of non-compliance with any requirement of a regulatory nature; and (iii) any indemnity against any liability incurred by the director (a) in defending criminal proceedings in which he is convicted, (b) in defending civil proceedings brought by the company or an associated company in which judgment is given against him or (c) where the court refuses to grant him relief in connection with an application under Section 661(3) or (4) (relief in case of acquisition of shares by innocent nominee) or under Section 1157 (relief in case of honest and reasonable conduct). Section 235 permits indemnification of a director of a company that is a trustee of an occupational pension scheme against liability incurred in connection with the company’s activities as a trustee of the scheme, but not against any liability incurred by the director to pay a fine imposed in criminal proceedings or a sum payable to a regulatory authority by way of a penalty in respect of non-compliance with any requirement of a regulatory nature, or any liability incurred by the director in defending criminal proceedings in which he is convicted as a final decision.
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Section 205 of the Companies Act provides that a company can provide a director with funds to meet expenditures incurred or to be incurred by him in defending any criminal or civil proceedings in connection with any alleged negligence, default, breach of duty or breach of trust by him in relation to the company or an associated company, or in connection with any application for relief under Section 661(3) or (4) (relief in case of acquisition of shares by innocent nominee) or Section 1157 (relief in case of honest and reasonable conduct).
The terms on which such loan or other assistance is given must include a requirement that the loan be repaid or the liability discharged if the director is convicted, judgment is given against him or the court refuses to grant the relief on the application.
Except in limited circumstances (Section 994 of the Companies Act) when a company’s affairs are being or have been conducted in a manner unfairly prejudicial to the interests of all or some shareholders, or when any act or omission of the company is or would be so prejudicial, English law does not generally permit class action lawsuits by shareholders on behalf of the company or on behalf of other shareholders.
We will indemnify and hold harmless each of our directors and officers or authorized representatives who signs the registration statement from and against civil liabilities, including liabilities under U.S. securities laws, which they may incur in their capacity.
The form of underwriting agreement to be filed or furnished in connection with the issuance of any debt securities using the prospectus to which this Registration Statement relates will provide that each underwriter, severally, will indemnify NG and each of its directors, officers and representatives who signed the registration statement and each person, if any, who controls NG within the meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act from and against certain civil liabilities.
| ITEM 9. | EXHIBITS |
The exhibits to this registration statement are listed in the Index to Exhibits below.
| ITEM 10. | UNDERTAKINGS |
| (A) | Undertaking pursuant to Rule 415: |
The registrant hereby undertakes:
| (1) | To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement; |
| (i) | To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933; |
| (ii) | To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20 per cent. change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and |
| (iii) | To include any plan of distribution or any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; |
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provided, however, that paragraphs (A)(1)(i), (A)(1) (ii) and (A)(1) (iii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the Commission by the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement, or is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the registration statement.
| (2) | That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. |
| (3) | To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. |
| (4) | To file a post effective amendment to the registration statement to include any financial statements required by Item 8.A. of Form 20-F at the start of any delayed offering or throughout a continuous offering. Financial statements and information otherwise required by Section 10(a)(3) of the Securities Act need not be furnished, provided that the registrant includes in the prospectus, by means of a post-effective amendment, financial statements required pursuant to this paragraph (4) and other information necessary to ensure that all other information in the prospectus is at least as current as the date of those financial statements. Notwithstanding the foregoing, a post-effective amendment need not be filed to include financial statements and information required by Section 10(a)(3) of the Securities Act or Item 8-A of Form 20-F if such financial statements and information are contained in periodic reports filed with or furnished to the Commission by the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act that are incorporated by reference in the registration statement. |
| (5) | That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser: |
| (i) | Each prospectus filed by a registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and |
| (ii) | Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5) or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii) or (x) for the purpose of providing the information required by Section 10(a) of the Securities Act of 1933 shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which the prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date. |
| (6) | That, for the purpose of determining liability of a registrant under the Securities Act to any purchaser in the initial distribution of the securities, each undersigned registrant undertakes that in a primary offering of securities of an undersigned registrant pursuant to this Registration Statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold |
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| to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser: |
| (i) | Any preliminary prospectus or prospectus of an undersigned registrant relating to the offering required to be filed pursuant to Rule 424; |
| (ii) | Any free writing prospectus relating to the offering prepared by or on behalf of an undersigned registrant or used or referred to by an undersigned registrant; |
| (iii) | The portion of any other free writing prospectus relating to the offering containing material information about an undersigned registrant or its securities provided by or on behalf of an undersigned registrant; and |
| (iv) | Any other communication that is an offer in the offering made by an undersigned registrant to the purchaser. |
| (B) | Undertaking regarding filings incorporating subsequent Exchange Act documents by reference: |
That, for purposes of determining any liability under the Securities Act of 1933, each filing of National Grid’s annual report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
| (C) | Undertaking regarding request for acceleration of effective date or filing of registration statement becoming effective upon filing: |
Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of each registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act of 1933 and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by a registrant of expenses incurred or paid by a director, officer or controlling person of a registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, that registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act of 1933 and will be governed by the final adjudication of such issue.
II-5
Table of Contents
II-6
Table of Contents
POWER OF ATTORNEY AND SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, National Grid plc certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form F-3 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in London, England on the 28 day of August 2024.
| National Grid plc | ||
| By: | /s/ Alexandra Lewis | |
| Alexandra Lewis | ||
| Group Treasurer | ||
The undersigned do hereby constitute and appoint John Pettigrew, Chief Executive Officer; Andy Agg, Chief Financial Officer; Justine Campbell, Chief Legal Officer, and Alexandra Lewis, Group Treasurer, all or any one of them, our true and lawful attorneys and agents, to sign for us or any of us in our names and in the capacities indicated below, any and all amendments (including post-effective amendments) to this Registration Statement, or any related registration statement that is to be effective upon filing pursuant to Rule 462(b) under the Securities Act of 1933, and to file the same, with all exhibits thereto and other documents required in connection therewith, and to do any and all acts and things in our names and in the capacities indicated below, which said attorneys and agents, or either of them, may deem necessary or advisable to enable said corporation to comply with the Securities Act of 1933, and any rules, regulations, and requirements of the Securities and Exchange Commission, in connection with this Registration Statement; and we do hereby ratify and confirm all that the said attorneys and agents, or either of them, shall do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities indicated on the 28 day of August 2024.
| Signature | Title | Date | ||
| /s/ John Pettigrew John Pettigrew |
Chief Executive (Principal Executive Officer) |
August 28, 2024 | ||
| /s/ Andy Agg Andy Agg |
Chief Financial Officer |
August 28, 2024 | ||
| /s/ Alexandra Lewis Alexandra Lewis |
Group Treasurer |
August 28, 2024 | ||
| /s/ Justine Campbell Justine Campbell |
Chief Legal Officer |
August 28, 2024 | ||
| /s/ Paula Rosput Reynolds Paula Rosput Reynolds |
Chair and Non-executive Director; Independent |
August 28, 2024 | ||
| /s/ Jacqui Ferguson Jacqui Ferguson |
Non-executive Director; Independent |
August 28, 2024 | ||
| /s/ Lord Ian Livingston Lord Ian Livingston |
Non-executive Director; Senior Independent Director |
August 28, 2024 | ||
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| Signature | Title | Date | ||
| /s/ Iain Mackay Iain Mackay |
Non-executive Director; Independent |
August 28, 2024 | ||
| /s/ Anne E. Robinson Anne E. Robinson |
Non-executive Director; Independent |
August 28, 2024 | ||
| /s/ Earl Shipp Earl Shipp |
Non-executive Director; Independent |
August 28, 2024 | ||
| /s/ Jonathan Silver Jonathan Silver |
Non-executive Director; Independent |
August 28, 2024 | ||
| /s/ Tony Wood Tony Wood |
Non-executive Director; Independent |
August 28, 2024 | ||
| /s/ Martha B. Wyrsch Martha B. Wyrsch |
Non-executive Director; Independent |
August 28, 2024 | ||
| /s/ Gregory Barone Gregory Barone |
(Authorised Representative in the United States) |
August 28, 2024 | ||
II-8
Exhibit 1.1
[Form of Underwriting Agreement]
UNDERWRITING AGREEMENT
National Grid plc
$____________% Notes due 20______
______, 20______
[Name(s) of Representative(s)]
As representatives of the
several underwriters listed
in Schedule 1 hereto
Ladies and Gentlemen:
National Grid plc, a public limited company incorporated under the laws of England and Wales (the “Company”), proposes to issue and sell to the several underwriters listed in Schedule 1 hereto (the “Underwriters”), for whom you are acting as representatives (the “Representatives”), $______ principal amount of its ______Notes due 20______ (the “Securities”). The Securities will be issued pursuant to an Indenture, as heretofore supplemented, dated June 12, 2023 (the “Base Indenture”), as supplemented by a _____ supplemental indenture dated as of ______, 20______ (the “______ Supplemental Indenture”, and together with the Base Indenture, the “Indenture”) between the Company and Bank of New York Mellon, London Branch as trustee and paying agent (the “Trustee”).
The Company hereby confirms its agreement with the several Underwriters concerning the purchase and sale of the Securities, as follows:
1. Registration Statement. The Company has prepared and filed with the Securities and Exchange Commission (the “Commission”) under the Securities Act of 1933, as amended, and the rules and regulations of the Commission thereunder (collectively, the “Securities Act”), a registration statement on Form F-3 (File No. ______), including a prospectus (the “Base Prospectus”), relating to the debt securities to be issued from time to time by the Company. The Company has also filed, or proposes to file, with the Commission pursuant to Rule 424 under the Securities Act a prospectus supplement specifically relating to the Securities (the “Prospectus Supplement”). The registration statement, as amended at the time it
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became effective, including the information, if any, deemed pursuant to Rule 430A, 430B or 430C under the Securities Act to be part of the registration statement at the time of its effectiveness (“Rule 430 Information”), is referred to herein as the “Registration Statement”; and as used herein, the term “Preliminary Prospectus” means any preliminary prospectus supplement specifically relating to the Securities that is first filed pursuant to Rule 424(b), together with the Base Prospectus, and the term “Prospectus” means the Base Prospectus as supplemented by the Prospectus Supplement specifically relating to the Securities in the form first used (or made available upon request of purchasers pursuant to Rule 173 under the Securities Act) in connection with confirmation of sales of the Securities. References in this agreement (this “Agreement”) to the Registration Statement, the Base Prospectus, any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include the documents incorporated by reference therein as of the effective date of the Registration Statement or the date of such Preliminary Prospectus or the Prospectus, as the case may be. The terms “supplement,” “amendment” and “amend” as used herein with respect to the Registration Statement, any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include any documents filed by the Company after such date under the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission thereunder (collectively, the “Exchange Act”) subsequent to the date of this Agreement which are deemed to be incorporated by reference therein. Capitalized terms used but not defined herein shall have the meanings given to such terms in the Registration Statement and the Prospectus.
At or prior to ______, the time when sales of the Securities were first made (the “Time of Sale”), the Company had prepared the following information (collectively, the “Time of Sale Information”): a Preliminary Prospectus dated ______, 20______, and each “free-writing prospectus” (as defined pursuant to Rule 405 under the Securities Act) listed on Annex A hereto.
2. Purchase and Sale of the Securities by the Underwriters.
(a) The Company agrees to issue and sell the Securities to the several Underwriters as provided in this Agreement, and each Underwriter, on the basis of the representations, warranties and agreements set forth herein and subject to the conditions set forth herein, agrees, severally and not jointly, to purchase from the Company the respective principal amount of Securities set forth opposite such Underwriter’s name in Schedule 1 hereto at a price equal to ______% of the principal amount thereof plus accrued interest, if any, from ______, 20______ to the Closing Date (as defined below). The Company will not be obligated to deliver any of the Securities except upon payment for all the Securities to be purchased as provided herein.
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(b) The Company understands that the Underwriters intend to make a public offering of the Securities as soon after the effectiveness of this Agreement as in the judgment of the Representatives is advisable, and initially to offer the Securities on the terms set forth in the Time of Sale Information. The Company acknowledges and agrees that the Underwriters may offer and sell Securities to or through any affiliate of an Underwriter and that any such affiliate may offer and sell Securities purchased by it to or through any Underwriter.
(c) Payment for and delivery of the Securities will be made at ____________ at ______, New York City time, on ______, 20______, or at such other time or place on the same or such other date, not later than the fifth business day thereafter, as the Representatives and the Company may agree upon in writing. The time and date of such payment and delivery is referred to herein as the “Closing Date”.
(d) Payment for the Securities shall be made by wire transfer in immediately available funds to the account(s) specified by the Company to the Representatives against delivery to the nominee of The Depository Trust Company, for the account of the Underwriters, of one or more global notes representing the Securities (collectively, the “Global Note”), with any transfer taxes payable in connection with the sale of the Securities duly paid by the Company. The Global Note will be made available for inspection by the Representatives not later than ______, New York City time, on the business day prior to the Closing Date.
(e) The Company acknowledges and agrees that each Underwriter is acting solely in the capacity of an arm’s length contractual counterparty to the Company with respect to the offering of Securities contemplated hereby (including in connection with determining the terms of the offering) and not as a financial advisor or a fiduciary to, or an agent of, the Company or any other person. Additionally, neither the Representatives nor any other Underwriter is advising the Company or any other person as to any legal, tax, investment, accounting or regulatory matters in any jurisdiction. The Company shall consult with its own advisors concerning such matters and shall be responsible for making its own independent investigation and appraisal of the transactions contemplated hereby, and the Underwriters shall have no responsibility or liability to the Company with respect thereto. Any review by the Representatives or any Underwriters of the Company, the transactions contemplated hereby or other matters relating to such transactions will be performed solely for the benefit of the Representatives or such Underwriters, as the case may be, and shall not be on behalf of the Company, as the case may be, or any other person.
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3. Representations and Warranties of the Company. The Company represents and warrants to each Underwriter that:
(a) Preliminary Prospectus. No order preventing or suspending the use of any Preliminary Prospectus has been issued by the Commission, and each Preliminary Prospectus, at the time of filing thereof, complied in all material respects with the Securities Act and did not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that the Company makes no representation or warranty with respect to any statements or omissions made in reliance upon and in conformity with the Underwriter Supplied Information (as defined below).
(b) Registration Statement and Prospectus. The Registration Statement is an “automatic shelf registration statement” as defined under Rule 405 of the Securities Act that has been filed with the Commission not earlier than three years prior to the date hereof; and no notice of objection of the Commission to the use of such registration statement or any post-effective amendment thereto pursuant to Rule 401(g)(2) under the Securities Act has been received by the Company. No order suspending the effectiveness of the Registration Statement or the Prospectus has been issued by the Commission and no proceeding for that purpose or pursuant to Section 8A of the Securities Act against the Company or related to the offering has been initiated or threatened by the Commission; as of the applicable effective date of the Registration Statement and any amendment thereto, the Registration Statement complied and will comply in all material respects with the Securities Act and the Trust Indenture Act of 1939, as amended, and the rules and regulations of the Commission thereunder (collectively, the “Trust Indenture Act”), and did not and will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein not misleading; and as of the date of the Prospectus and any amendment or supplement thereto and as of the Closing Date, the Prospectus did not and will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that the Company makes no representation or warranty with respect to (i) that part of the Registration Statement that constitutes the Statement of Eligibility and Qualification (Form T-1) of the Trustee under the Trust Indenture Act or (ii) any statements or omissions in the Registration Statement and the Prospectus and any amendment or supplement thereto made in reliance upon and in conformity with Underwriter Supplied Information.
(c) Time of Sale Information. The Time of Sale Information, at the Time of Sale did not, and at the Closing Date will not, contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that the Company makes no representation or warranty with respect to any statements or omissions made in reliance upon and in conformity with Underwriter Supplied Information. No statement of material fact included in the Prospectus has been omitted from the Time of Sale Information and no statement of material fact included in the Time of Sale Information that is required to be included in the Prospectus has been omitted therefrom.
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(d) Issuer Free Writing Prospectus. The Company (including its agents and representatives, other than the Underwriters in their capacity as such) has not made, used, prepared, authorized, approved or referred to and will not prepare, make, use, authorize, approve or refer to any “written communication” (as defined in Rule 405 under the Securities Act) that constitutes an offer to sell or solicitation of an offer to buy the Securities (each such communication by the Company or its agents and representatives (other than a communication referred to in clauses (i), (ii) and (iii) below) an “Issuer Free Writing Prospectus”) other than (i) any document not constituting a prospectus pursuant to Section 2(a)(10)(a) of the Securities Act or Rule 134 under the Securities Act, (ii) the Preliminary Prospectus, (iii) the Prospectus, (iv) the documents listed on Annex A hereto, including the Pricing Term Sheet substantially in the form of Annex B hereto, which constitute part of the Time of Sale Information, and (v) any electronic road show or other written communications, in each case approved in writing in advance by the Representatives. Each such Issuer Free Writing Prospectus complies in all material respects with the Securities Act, has been or will be (within the time period specified in Rule 433) filed in accordance with the Securities Act (to the extent required thereby) and, when taken together with the Preliminary Prospectus accompanying, or delivered prior to delivery of, or filed prior to the first use of such Issuer Free Writing Prospectus, at the Time of Sale, did not, and at the Closing Date will not, contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that the Company makes no representation or warranty with respect to any statements or omissions made in each such Issuer Free Writing Prospectus in reliance upon and in conformity with Underwriter Supplied Information.
(e) Incorporated Documents. The documents incorporated by reference in the Registration Statement, the Prospectus or the Time of Sale Information, when filed with the Commission, conformed or will conform, as the case may be, in all material respects with the requirements of the Exchange Act, and did not and will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.
(f) Financial Statements. The financial statements and the related notes thereto included or incorporated by reference in the Registration Statement, the Time of Sale Information and the Prospectus comply in all material respects with the applicable requirements of the Securities Act and the Exchange Act, as applicable, and present fairly in all material respects the financial position of the Company and
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its subsidiaries as of the dates indicated and the results of their operations and the changes in their cash flows for the periods specified; such financial statements have been prepared in conformity with applicable international financial reporting standards (“IFRS”) as adopted by the international accounting standards board (“IASB”) applied on a consistent basis throughout the periods covered thereby, and the supporting schedules included or incorporated by reference in the Registration Statement, the Prospectus and the Time of Sale Information present fairly, in all material respects, the information required to be stated therein; and the other financial information included or incorporated by reference in the Registration Statement, the Time of Sale Information and the Prospectus has been derived from the accounting records of the Company and its subsidiaries and presents fairly, in all material respects, the information shown thereby. The interactive data in extensible Business Reporting Language included or incorporated by reference in the Registration Statement, the Prospectus and the Time of Sale Information fairly presents the information called for in all material respects and is prepared in accordance with the Commission’s rules and guidelines applicable thereto.
(g) No Material Adverse Change. Since the date of the most recent financial statements of the Company included or incorporated by reference in each of the Registration Statement, the Time of Sale Information and the Prospectus, (i) there has not been any material adverse change in or affecting the business, financial position, results of operations or prospects of the Company and its subsidiaries taken as a whole; and (ii) neither the Company nor any of its subsidiaries has sustained any material loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor disturbance or dispute or any action, order or decree of any court or arbitrator or governmental or regulatory authority, except in each case as otherwise disclosed in each of the Registration Statement, the Time of Sale Information and the Prospectus.
(h) Organization, Valid Existence and Good Standing. The Company and each of its principal subsidiaries have been duly organized and are validly existing and in good standing under the laws of their respective jurisdictions of organization.
(i) Due Authorization. The Company has full right, power and authority to execute and deliver this Agreement, the Securities and the Indenture (collectively, the “Transaction Documents”) and to perform its obligations hereunder and thereunder; and all action required to be taken for the due and proper authorization, execution and delivery of each of the Transaction Documents and the consummation of the transactions contemplated thereby has been duly and validly taken.
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(j) The Indenture. The Base Indenture has been duly authorized, executed and delivered by the Company and has been duly qualified under the Trust Indenture Act. The Second Supplemental Indenture has been duly authorized by the Company and on the Closing Date will be duly executed and delivered by the Company. The Indenture constitutes a valid and legally binding agreement of the Company enforceable against the Company in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency or similar laws affecting the enforcement of creditors’ rights generally or by equitable principles relating to enforceability (collectively, the “Enforceability Exceptions”); and on the Closing Date the Indenture will conform in all material respects to the requirements of the Trust Indenture Act.
(k) The Securities. The Securities have been duly authorized by the Company and, when duly executed, authenticated, issued and delivered as provided in the Indenture and paid for as provided herein, will be duly and validly issued and outstanding and will constitute valid and legally binding obligations of the Company enforceable against the Company in accordance with their terms, subject to the Enforceability Exceptions, and will be entitled to the benefits of the Indenture.
(l) Underwriting Agreement. This Agreement has been duly authorized, executed and delivered by the Company.
(m) No Violation or Default. Neither the Company nor any of its principal subsidiaries is (i) in violation of its memorandum and articles of association, charter, by-laws or similar organizational documents; (ii) in default, and no event has occurred that, with notice or lapse of time or both, would constitute such a default, in the due performance or observance of any term, covenant or condition contained in any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or any of its principal subsidiaries is a party or by which the Company or any of its principal subsidiaries is bound or to which any of the property or assets of the Company or any of its principal subsidiaries is subject; or (iii) in violation of any law or statute or any judgment, order, rule or regulation of any United States or United Kingdom court or arbitrator or governmental or regulatory authority in the United States or the United Kingdom, except, in the case of clauses (ii) and (iii) above, for any such default or violation that would not, individually or in the aggregate, have a material adverse effect on the business, financial position, results of operations or prospects of the Company and its subsidiaries taken as a whole or on the performance by the Company of its obligations under this Agreement and the Securities (a “Material Adverse Effect”)
(n) No Conflicts. The execution, delivery and performance by the Company of each of the Transaction Documents, the issuance and sale of the Securities and compliance by the Company with the terms thereof and the consummation of the transactions contemplated by the Transaction Documents will not (i) conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or any of its
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principal subsidiaries is a party or by which the Company or any of its principal subsidiaries is bound or to which any of the property or assets of the Company or any of its principal subsidiaries is subject, (ii) result in any violation of the provisions of the memorandum and articles of association, by-laws or similar organizational documents of the Company or (iii) result in the violation of any law or statute or any judgment, order, rule or regulation of any court or arbitrator or governmental or regulatory authority in the United States or the United Kingdom, except, in the case of clauses (i) and (iii) above, for any such conflict, breach or violation that would not, individually or in the aggregate, have a Material Adverse Effect.
(o) No Consents Required. No consent, approval, authorization, order, registration or qualification of or with any court or arbitrator or governmental or regulatory authority in the United States or the United Kingdom is required for the execution, delivery and performance by the Company of each of the Transaction Documents, the issuance and sale of the Securities and compliance by the Company with the terms thereof and the consummation of the transactions contemplated by the Transaction Documents, except for such consents, approvals, authorizations, orders and registrations or qualifications (i) as have been obtained under the Securities Act and the Trust Indenture Act and (ii) as may be required under applicable United States state securities laws in connection with the purchase and distribution of the Securities by the Underwriters.
(p) Legal Proceedings. Except as described or provided for in the Registration Statement, the Time of Sale Information and the Prospectus, there are no legal, governmental or regulatory investigations, actions, demands, claims, suits, arbitration, inquiries or proceedings (“Actions”) pending to which the Company or any of its subsidiaries is a party or to which any property of the Company or any of its subsidiaries is the subject that, individually or in the aggregate, if determined adversely to the Company or any of its subsidiaries, would reasonably be expected to have a Material Adverse Effect; no such Actions are threatened or, to the knowledge of the Company, contemplated by any governmental or regulatory authority or threatened by others.
(q) Independent Accountants. Deloitte, LLP, who have certified certain consolidated financial statements of the Company, are an independent registered public accounting firm with respect to the Company and its subsidiaries within the applicable rules and regulations adopted by the Commission and the Public Company Accounting Oversight Board (United States) and as required by the Securities Act.
(r) Investment Company Act. The Company is not and, after giving effect to the offering and sale of the Securities and the application of the proceeds thereof as described in the Registration Statement, the Time of Sale Information and the Prospectus, will not be an “investment company” or an entity “controlled” by an “investment company” within the meaning of the Investment Company Act of 1940, as amended, and the rules and regulations of the Commission thereunder.
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(s) Status under the Securities Act. The Company is not an ineligible issuer and is a well-known seasoned issuer, in each case as defined under the Securities Act, in each case at the times specified in the Securities Act in connection with the offering of the Securities.
(t) Licenses and Permits. The Company and its subsidiaries possess all licenses, certificates, permits and other authorizations issued by the appropriate federal, state, local or foreign governmental or regulatory authorities that are necessary for the conduct of their respective businesses as described in the Registration Statement, the Time of Sale Information and the Prospectus, except where the failure to possess or make the same would not, individually or in the aggregate, have a Material Adverse Effect; and except as described in the Registration Statement, the Time of Sale Information and the Prospectus, neither the Company nor any of its subsidiaries has received written notice of any revocation or modification of any such license, certificate, permit or authorization or has any reason to believe that any such license, certificate, permit or authorization will not be renewed in the ordinary course, except where such revocation or modification or non-renewal would not have a Material Adverse Effect.
(u) Disclosure Controls. The Company and its subsidiaries maintain an effective system of “disclosure controls and procedures” (as defined in Rule 13a-15(e) of the Exchange Act) that complies with the requirements of the Exchange Act and that has been designed to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Commission’s rules and forms, including controls and procedures designed to ensure that such information is accumulated and communicated to the Company’s management as appropriate to allow timely decisions regarding required disclosure.
(v) Accounting Controls. The Company and its subsidiaries maintain systems of “internal control over financial reporting” (as defined in Rule 13a-15(f) of the Exchange Act) that comply with the requirements of the Exchange Act and have been designed by, or under the supervision of, their respective principal executive and principal financial officers, or persons performing similar functions, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with IFRS. The Company and its subsidiaries maintain internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management’s general or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with IFRS and to maintain asset accountability; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; (iv) the recorded accountability for
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assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences; and (v) interactive data in extensible Business Reporting Language included or incorporated by reference in the Registration Statement, the Prospectus and the Time of Sale Information is prepared in accordance with the Commission’s rules and guidelines applicable thereto. Except as disclosed in each of the Registration Statement, the Time of Sale Information and the Prospectus, there are no material weaknesses in the Company’s internal controls.
(w) No Unlawful Payments. Neither the Company nor any of its subsidiaries, nor any director or officer of the Company or any of its subsidiaries nor, to the knowledge of the Company, any employee, agent, affiliate or other person associated with or acting on behalf of the Company or any of its subsidiaries has (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expense relating to political activity; (ii) made or taken an act in furtherance of an offer, promise or authorization of any direct or indirect unlawful payment or benefit to any foreign or domestic government official or employee, including of any government-owned or controlled entity or of a public international organization, or any person acting in an official capacity for or on behalf of any of the foregoing, or any political party or party official or candidate for political office; (iii) violated or is in violation of any provision of the Foreign Corrupt Practices Act of 1977, as amended, or any applicable law or regulation implementing the Organization for Economic Co-operation and Development Convention on Combating Bribery of Foreign Public Officials in International Business Transactions, or committed an offence under the Bribery Act 2010 of the United Kingdom, or any other applicable anti-bribery or anti-corruption law; or (iv) made, offered, agreed, requested or taken an act in furtherance of any unlawful bribe or other unlawful benefit, including, without limitation, any rebate, payoff, influence payment, kickback or other unlawful or improper payment or benefit. The Company and its subsidiaries have instituted, maintain and enforce, and will continue to maintain and enforce, policies and procedures designed to promote and ensure compliance with all applicable anti-bribery and anti-corruption laws.
(x) Compliance with Anti-Money Laundering Laws. The operations of the Company and its subsidiaries are and have been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements, the applicable money laundering statutes of all jurisdictions where the Company or any of its subsidiaries conducts business, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the “Anti-Money Laundering Laws”), and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any of its subsidiaries with respect to the Anti-Money Laundering Laws is pending or, to the knowledge of the Company, threatened.
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(y) No Conflicts with Sanctions Laws. Neither the Company nor any of its subsidiaries, directors or officers, nor, to the knowledge of the Company, any employee, agent, affiliate or other person associated with or acting on behalf of the Company or any of its subsidiaries is currently the subject or the target of any sanctions administered or enforced by the U.S. government, (including, without limitation, the Office of Foreign Assets Control of the U.S. Department of the Treasury or the U.S. Department of State and including, without limitation, the designation as a “specially designated national” or “blocked person”), the United Nations Security Council, the European Union, His Majesty’s Treasury, or other relevant sanctions authority (collectively, “Sanctions”), nor is the Company or any of its subsidiaries located, organized or resident in a country or territory that is the subject or target of Sanctions, including, without limitation, the so-called Donetsk People’s Republic, the so-called Luhansk People’s Republic, the Crimea region of Ukraine, the Kherson region of Ukraine, the Zaporizhzhia region of Ukraine, Cuba, Iran, North Korea and Syria, (each, a “Sanctioned Country”); and the Company will not directly or indirectly use the proceeds of the offering of the Securities hereunder, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity (i) to fund or facilitate any activities of or business with any person that, at the time of such funding or facilitation, is the subject or target of Sanctions, (ii) to fund or facilitate any activities of or business in any Sanctioned Country or (iii) in any other manner that will result in a violation by any person (including any person participating in the transaction, whether as underwriter, initial purchaser, advisor, investor or otherwise) of Sanctions. For the past five years, the Company and its subsidiaries have not engaged in, and are not now engaged in any dealings or transactions with any person that at the time of the dealing or transaction is or was the subject or the target of Sanctions or with any Sanctioned Country.
(z) Cybersecurity; Data Protection. The Company and its subsidiaries’ information technology assets and equipment, computers, systems, networks, hardware, software, websites, applications, and databases (collectively, “IT Systems”) are adequate for, and operate and perform in all material respects as required in connection with the operation of the business of the Company and its subsidiaries as currently conducted, free and clear of all material bugs, errors, defects, Trojan horses, time bombs, malware and other corruptants. The Company and its subsidiaries have implemented and maintained commercially reasonable controls, policies, procedures, and safeguards to maintain and protect their material confidential information and the integrity, continuous operation, redundancy and security of all IT Systems and data (including all personal, personally identifiable, sensitive, confidential or regulated data (“Personal Data”)) used in connection with their businesses, and there have been no breaches, violations, outages or unauthorized uses of or accesses to same, except for those that have been remedied without material cost or liability or the duty to notify any other person, nor any incidents under internal review or investigations relating to the same. The Company and its subsidiaries are presently in material compliance with all applicable laws or statutes and all judgments, orders, rules and regulations of any court or arbitrator or governmental or regulatory authority, internal policies and contractual obligations relating to the privacy and security of IT Systems and Personal Data and to the protection of such IT Systems and Personal Data from unauthorized use, access, misappropriation or modification.
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(aa) Stamp Taxes. There are no stamp duty, stamp duty reserve tax or other issuance or transfer taxes or duties or other similar fees or charges required to be paid by or on behalf of the Underwriters in the United Kingdom or any political subdivision or taxing authority thereof in connection with the execution and delivery of the Transaction Documents or the offer or sale of the Securities.
(bb) No Withholding Tax. All payments to be made by the Company on or by virtue of the execution, delivery, performance or enforcement of the Transaction Documents and all interest, principal, premium, if any, additional amounts, if any, and other payments under the Transaction Documents, under the current laws and regulations of the United Kingdom (or any other jurisdiction in which the Company is resident for tax purposes), or any political subdivision thereof (each, a “Taxing Jurisdiction”), will not, while the Securities are and continue to be listed on the New York Stock Exchange and carry a right to interest, be subject to withholding, duties, levies, deductions, charges or other similar taxes under the current laws and regulations of the Taxing Jurisdiction and are otherwise payable free and clear of any other withholding, duty, levy, deduction, charge or other similar tax in the Taxing Jurisdiction and without the necessity of obtaining any governmental authorization in the Taxing Jurisdiction.
4. Further Agreements of the Company. The Company covenants and agrees with each Underwriter that:
(a) Filings with the Commission. The Company will (i) pay the registration fees for this offering within the time period required by Rule 456(b)(i) under the Securities Act prior to the Closing Date (ii) file the Prospectus in a form approved by the Underwriters with the Commission pursuant to Rule 424 under the Securities Act not later than the close of business on the second business day following the date of determination of the public offering price of the Securities or, if applicable, such earlier time as may be required by Rule 424(b) and Rule 430A, 430B or 430C under the Securities Act. The Company will file any Issuer Free Writing Prospectus (including the Pricing Term Sheet referred to in Annex B hereto) to the extent required by Rule 433 under the Securities Act; and the Company will furnish copies of the Prospectus and each Issuer Free Writing Prospectus (to the extent not previously delivered) to the Underwriters in New York City prior to_____, New York City time, on the business day next succeeding the date of this Agreement in such quantities as the Representatives may reasonably request.
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(b) Delivery of Copies. The Company will deliver, without charge, to each Underwriter during the Prospectus Delivery Period (as defined below), as many copies of the Prospectus (including all amendments and supplements thereto and documents incorporated by reference therein) and each Issuer Free Writing Prospectus (if applicable) as the Representatives may reasonably request. As used herein, the term “Prospectus Delivery Period” means such period of time after the first date of the public offering of the Securities as in the opinion of counsel for the Underwriters a prospectus relating to the Securities is required by law to be delivered (or required to be delivered but for Rule 172 under the Securities Act) in connection with sales of the Securities by any Underwriter or dealer.
(c) Amendments or Supplements; Issuer Free Writing Prospectuses. Before preparing, using, authorizing, approving, referring to or filing any Issuer Free Writing Prospectus, and before filing any amendment or supplement to the Registration Statement or the Prospectus, the Company will furnish to the Representatives and counsel for the Underwriters a copy of the proposed Issuer Free Writing Prospectus, amendment or supplement for review and will not prepare, use, authorize, approve, refer to or file any such Issuer Free Writing Prospectus or file any such proposed amendment or supplement to which the Representatives reasonably objects unless, in the case of a filing, the Company is required by law to make such filing.
(d) Notice to the Representatives. The Company will advise the Representatives promptly, and confirm such advice in writing, (i) when any amendment to the Registration Statement has been filed or becomes effective; (ii) when any supplement to the Prospectus or any Issuer Free Writing Prospectus or any amendment to the Prospectus or any Issuer Free Writing Prospectus has been filed; (iii) of any request by the Commission for any amendment to the Registration Statement or any amendment or supplement to the Prospectus or the receipt of any comments from the Commission relating to the Registration Statement or any other request by the Commission for any additional information; (iv) of the issuance by the Commission of any order suspending the effectiveness of the Registration Statement or preventing or suspending the use of any Preliminary Prospectus or the Prospectus, any Time of Sale Information or any Issuer Free Writing Prospectus or the initiation or threatening of any proceeding for that purpose or pursuant to Section 8A of the Securities Act; (v) of the occurrence of any event within the Prospectus Delivery Period as a result of which the Prospectus, the Time of Sale Information or any Issuer Free Writing Prospectus as then amended or supplemented would include any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances existing when the Prospectus, the Time of Sale Information or any such Issuer Free Writing Prospectus is delivered to a purchaser, not misleading; (vi) of the receipt by the Company of any notice of objection of the Commission to the use of the Registration Statement or any post-effective amendment thereto pursuant
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to Rule 401(g)(2) under the Securities Act; and (vii) of the receipt by the Company of any notice with respect to any suspension of the qualification of the Securities for offer and sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; and the Company will use its reasonable best efforts to prevent the issuance of any such order suspending the effectiveness of the Registration Statement, preventing or suspending the use of any Preliminary Prospectus, any of the Time of Sale Information, Issuer Free Writing Prospectus or the Prospectus or suspending any such qualification of the Securities and, if any such order is issued, will obtain as soon as possible the withdrawal thereof.
(e) Ongoing Compliance. (1) If during the Prospectus Delivery Period (i) any event shall occur or condition shall exist as a result of which the Prospectus as then amended or supplemented would include any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances existing when the Prospectus is delivered to a purchaser, not misleading or (ii) it is necessary to amend or supplement the Prospectus to comply with law, the Company will immediately notify the Underwriters thereof and forthwith prepare and, subject to paragraph (c) above, file with the Commission and furnish to the Underwriters and to such dealers as the Representatives may designate, such amendments or supplements to the Prospectus as may be necessary so that the statements in the Prospectus as so amended or supplemented will not, in the light of the circumstances existing when the Prospectus is delivered to a purchaser, be misleading or so that the Prospectus will comply with law and (2) if at any time prior to the Closing Date (i) any event shall occur or condition shall exist as a result of which the Time of Sale Information as then amended or supplemented would include any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances, not misleading or (ii) it is necessary to amend or supplement the Time of Sale Information to comply with law, the Company will immediately notify the Underwriters thereof and forthwith prepare and, subject to paragraph (c) above, file with the Commission (to the extent required) and furnish to the Underwriters and to such dealers as the Representatives may designate, such amendments or supplements to the Time of Sale Information as may be necessary so that the statements in the Time of Sale Information as so amended or supplemented will not, in the light of the circumstances, be misleading or so that the Time of Sale Information will comply with law.
(f) Blue Sky Compliance. The Company will qualify the Securities for offer and sale under the securities or Blue Sky laws of such jurisdictions as the Representatives shall reasonably request and will continue such qualifications in effect so long as required for distribution of the Securities; provided that the Company shall not be required to (i) qualify as a foreign corporation or other entity or as a dealer in securities in any such jurisdiction where it would not otherwise be required to so qualify, (ii) file any general consent to service of process in any such jurisdiction or (iii) subject itself to taxation in any such jurisdiction if it is not otherwise so subject.
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(g) Restriction on Issuances. During the period from the date hereof through and including the Closing Date, the Company will not, without the prior written consent of the Representatives, offer, sell, contract to sell or otherwise dispose of, in the United States, any U.S. dollar-denominated debt securities issued or guaranteed by the Company and having a tenor of more than one year.
(h) Use of Proceeds. The Company will apply the net proceeds from the sale of the Securities as described in the Registration Statement, the Time of Sale Information and the Prospectus under the heading “Use of Proceeds”.
(i) No Stabilization. The Company will not take, directly or indirectly, any action designed to or that could reasonably be expected to cause or result in any stabilization in violation of applicable laws or manipulation of the price of the Securities; provided, that no representation or warranty is made with respect to the Underwriters.
(j) Filing of Exchange Act Documents. The Company will file promptly all reports and any definitive proxy or information statements required to be filed by the Company with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act during the Prospectus Delivery Period.
(k) Exchange Listing. The Company will use its reasonable best efforts to list, subject to notice of issuance, the Securities on the New York Stock Exchange (the “Exchange”).
(l) Record Retention. The Company will, pursuant to reasonable procedures developed in good faith, retain copies of each Issuer Free Writing Prospectus that is not filed with the Commission in accordance with Rule 433 under the Securities Act.
(m) Tax Indemnities. The Company agrees with each of the Underwriters to make all payments under this Agreement without withholding or deduction for or on account of any present or future taxes, duties or governmental charges whatsoever imposed by any Taxing Jurisdiction, unless the Company is compelled by law to deduct or withhold such taxes, duties or charges. In that event, the Company shall pay such additional amounts as may be necessary in order that the net amounts received after such withholding or deduction will equal the amounts that would have been received if no withholding or deduction had been made, except to the extent that such taxes, duties or charges (a) were imposed due to some connection of an Underwriter with the Taxing Jurisdiction other than the mere entering into of this Agreement or receipt of payments hereunder or (b) would not have been imposed but for the failure of such Underwriter to comply with any reasonable certification, identification or other reporting requirements concerning the
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nationality, residence, identity or connection with the Taxing Jurisdiction of the Underwriter if such compliance is required or imposed by law as a precondition to an exemption from, or reduction in, such taxes, duties or other charges. The Company further agrees to indemnify and hold harmless the Underwriter against any documentary, stamp duty, stamp duty reserve tax, sales, transaction or similar issue tax, including any interest and penalties, on the creation, issue and sale of the Securities, and on the execution, delivery, performance and enforcement of this Agreement, except to the extent already paid by the Company under clause 2(d) or clause 11(a) of this Agreement.
5. Certain Agreements of the Underwriters. Each Underwriter, severally and not jointly, hereby represents and agrees that:
(a) It has not and will not use, authorize use of, refer to, or participate in the planning for use of, any “free writing prospectus”, as defined in Rule 405 under the Securities Act (which term includes use of any written information furnished to the Commission by the Company and not incorporated by reference into the Registration Statement and any press release issued by the Company) other than (i) a free writing prospectus that, solely as a result of use by such Underwriter, would not trigger an obligation to file such free writing prospectus with the Commission pursuant to Rule 433, (ii) any Issuer Free Writing Prospectus listed on Annex A or prepared pursuant to Section 3(c) or Section 4(c) above (including any electronic road show), or (iii) any free writing prospectus prepared by such Underwriter and approved by the Company in advance in writing (each such free writing prospectus referred to in clauses (i) or (iii), an “Underwriter Free Writing Prospectus”). Notwithstanding the foregoing, the Underwriters may use the Pricing Term Sheet referred to in Annex B hereto without the consent of the Company.
(b) Other than in the United States, no action has been or will be taken by the Company in any jurisdiction that would permit a public offering of the Securities or possession or distribution of any Issuer Free Writing Prospectus, any Underwriter Free Writing Prospectus, the Time of Sale Information or the Prospectus or any amendment or supplement thereto or any other offering material relating to the Securities in any country or jurisdiction where action for that purpose is required.
(c) It is not subject to any pending proceeding under Section 8A of the Securities Act with respect to the offering (and will promptly notify the Company if any such proceeding against it is initiated during the Prospectus Delivery Period).
(d) Financial Promotion. It has only communicated or caused to be communicated and will only communicate or cause to be communicated any invitation or inducement to engage in investment activity (within the meaning of section 21 of the Financial Services and Markets Act 2000 (the “FSMA”) of Great Britain) received by it in connection with the issue or sale of such Securities or any investments representing the Securities (including without limitation the Registration Statement registering the Securities, the Time of Sale Information and the Prospectus) in circumstances in which section 21(1) of the FSMA does not apply to the Company.
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(e) General Compliance. (1) It has complied and will comply with all the applicable provisions of the FSMA with respect to anything done by it in relation to any Securities in, from or otherwise involving the United Kingdom.
(2) It has not offered, sold or otherwise made available and will not offer, sell or otherwise make available any Securities to any retail investor in the United Kingdom. For the purposes of this provision:
(A) the expression “retail investor” means a person who is one (or more) of the following:
(i) a retail client, as defined in point (8) of Article 2 of Regulation (EU) No 2017/565 as it forms part of domestic law by virtue of the European Union (Withdrawal) Act 2018, as amended (“EUWA”); or
(ii) a customer within the meaning of the provisions of the FSMA and any rules or regulations made under the FSMA to implement Directive (EU) 2016/97, where that customer would not qualify as a professional client, as defined in point (8) of Article 2(1) of Regulation (EU) No 600/2014 as it forms part of domestic law by virtue of the EUWA; or
(iii) not a qualified investor as defined in Article 2 of Regulation (EU) 2017/1129 as it forms part of domestic law by virtue of the EUWA ; and
(B) the expression “offer” includes the communication in any form and by any means of sufficient information on the terms of the offer and the Notes to be offered so as to enable an investor to decide to purchase or subscribe for the Securities.
(3) It has not offered, sold or otherwise made available and will not offer, sell or otherwise make available any Securities to any retail investor in the European Economic Area. For the purposes of this provision:
(A) the expression “retail investor” means a person who is one (or more) of the following:
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(i) a retail client as defined in point (11) of Article 4(1) of Directive 2014/65/EU (as amended, “MiFID II”); or
(ii) a customer within the meaning of Directive (EU) 2016/97 (the “Insurance Distribution Directive”), where that customer would not qualify as a professional client as defined in point (10) of Article 4(1) of MiFID II; or
(iii) not a qualified investor as defined in Regulation (EU) 2017/1129 (the “Prospectus Regulation”); and
(B) the expression “offer” includes the communication in any form and by any means of sufficient information on the terms of the offer and the Securities to be offered so as to enable an investor to decide to purchase or subscribe for the Securities.
6. Conditions of Underwriters’ Obligations. The obligation of each Underwriter to purchase Securities on the Closing Date as provided herein is subject to the performance by the Company of its covenants and other obligations hereunder and to the following additional conditions:
(a) Registration Compliance; No Stop Order. No order suspending the effectiveness of the Registration Statement shall be in effect, and no proceeding for such purpose, pursuant to Rule 401(g)(2) or pursuant to Section 8A under the Securities Act shall be pending before or threatened by the Commission; the Prospectus and each Issuer Free Writing Prospectus shall have been timely filed with the Commission under the Securities Act (in the case of an Issuer Free Writing Prospectus, to the extent required by Rule 433 under the Securities Act) and in accordance with Section 4(a) hereof; and all requests by the Commission for additional information shall have been complied with to the reasonable satisfaction of the Representatives.
(b) Representations and Warranties. The representations and warranties of the Company contained herein shall be true and correct on the date hereof and on and as of the Closing Date; and the statements of the Company and its officers made in any certificates delivered pursuant to this Agreement shall be true and correct on and as of the Closing Date.
(c) No Downgrade. Subsequent to the earlier of (A) the Time of Sale and (B) the execution and delivery of this Agreement, (i) no downgrading shall have occurred in the long-term credit rating accorded the Securities or any other senior debt securities of or guaranteed by the Company or any of its subsidiaries by any “nationally recognized statistical rating organization”, as such term is defined under Section 3(a)(62) under the Exchange Act and (ii) no such organization shall have publicly announced that it has under surveillance or review, or has changed its outlook with respect to, its rating of the Securities or any other senior debt securities of or guaranteed by the Company or any of its subsidiaries (other than an announcement with positive implications of a possible upgrading).
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(d) No Material Adverse Change. No event or condition of a type described in Section 3(g) hereof shall have occurred or shall exist, which event or condition is not described in the Time of Sale Information (excluding any amendment or supplement thereto) and the Prospectus (excluding any amendment or supplement thereto) and the effect of which in the reasonable judgment of the Representatives (after consultations with the Company among officers) makes it impracticable or inadvisable to proceed with the offering, sale or delivery of the Securities on the terms and in the manner contemplated by this Agreement, the Time of Sale Information and the Prospectus.
(e) Officer’s Certificate. The Representatives shall have received on and as of the Closing Date a certificate of an executive officer, treasurer or controller of the Company who has specific knowledge of the Company’s financial matters and is satisfactory to the Representatives (i) confirming that such officer has carefully reviewed the Registration Statement, the Time of Sale Information and the Prospectus and, to the best knowledge of such officer, the representations set forth in Sections 3(b) and 3(c) hereof are true and correct, (ii) confirming that the other representations and warranties of the Company in this Agreement are true and correct and that the Company has complied with all agreements and satisfied all conditions on its part to be performed or satisfied hereunder at or prior to the Closing Date and (iii) to the effect set forth in paragraphs (a), (c) and (d) above.
(f) Comfort Letters. (i) On the date of this Agreement and on the Closing Date, Deloitte LLP shall have furnished to the Underwriters, at the request of the Company, (A) “SAS 72 comfort letters”, dated the respective dates of delivery thereof and addressed to the Underwriters and (B) “SAS 72 look-alike comfort letters”, dated the respective dates of delivery thereof and addressed to ______, as “Non-US Selling Agents” and affiliates of the Underwriters, in each case in form and substance reasonably satisfactory to the Representatives, containing statements and information of the type customarily included in accountants’ “SAS 72 comfort letters” to underwriters and “SAS 72 look-alike comfort letters” to their affiliates, as applicable, with respect to the financial statements and certain financial information contained or incorporated by reference in the Registration Statement, the Time of Sale Information (as applicable) and the Prospectus; provided that the letters delivered on the Closing Date shall use a “cut-off” date no more than three business days prior to the Closing Date, unless otherwise agreed; (ii) The Company shall have furnished to the Representatives a certificate, dated the Closing Date and addressed to the Representatives, of its chief financial officer with respect to certain data contained in the Registration Statement, the Time of Sale Information and the Prospectus, providing “management comfort” with respect to such information, in form and substance reasonably satisfactory to the Representatives, to the effect set forth in Annex C-1 hereto.
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(g) Opinion and 10b-5 Statement of Counsel for the Company. Linklaters LLP, U.S. counsel of the Company shall have furnished to the Representatives, at the request of the Company, their written opinion and 10b-5 statement, dated the Closing Date and addressed to the Underwriters, in form and substance reasonably satisfactory to the Representatives, to the effect set forth in Annex C-2 and Annex C-3, respectively, hereto.
(h) Opinion of United Kingdom Counsel for the Company. Linklaters LLP, United Kingdom counsel for the Company, shall have furnished to the Representatives, at the request of the Company, their written opinion, dated the Closing Date and addressed to the Underwriters, in form and substance reasonably satisfactory to the Representatives, to the effect set forth in Annex C-4, respectively, hereto.
(i) Opinion and 10b-5 Statement of Counsel for the Underwriters. The Representatives shall have received on and as of the Closing Date an opinion and 10b-5 statement of ______, counsel for the Underwriters, with respect to such matters as the Representatives may reasonably request, and such counsel shall have received such documents and information as they may reasonably request to enable them to pass upon such matters.
(j) No Legal Impediment to Issuance. No action shall have been taken and no statute, rule, regulation or order shall have been enacted, adopted or issued by any federal, state or foreign governmental or regulatory authority that would, as of the Closing Date, prevent the issuance or sale of the Securities; and no injunction or order of any U.S. federal, state or United Kingdom court shall have been issued that would, as of the Closing Date, prevent the issuance or sale of the Securities.
(k) Additional Documents. On or prior to the Closing Date, the Company shall have furnished to the Representatives such further certificates and documents as the Representatives may reasonably request.
All opinions, letters, certificates and evidence mentioned above or elsewhere in this Agreement shall be deemed to be in compliance with the provisions hereof only if they are in form and substance reasonably satisfactory to counsel for the Underwriters.
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7. Indemnification and Contribution.
(a) Indemnification of the Underwriters. The Company agrees to indemnify and hold harmless each Underwriter, its affiliates, directors and officers and each person, if any, who controls such Underwriter within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act, from and against any and all losses, claims, damages and liabilities (including, without limitation, legal fees and other expenses incurred in connection with any suit, action or proceeding or any claim asserted as such fees and expenses are incurred), joint or several, that arise out of, or are based upon, (i) any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement, or caused by any omission or alleged omission to state therein a material fact required to be stated therein or necessary in order to make the statements therein, not misleading, or (ii) any untrue statement or alleged untrue statement of a material fact contained in the Prospectus (or any amendment or supplement thereto), any Issuer Free Writing Prospectus or any Time of Sale Information, or caused by any omission or alleged omission to state therein a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading, in each case except insofar as such losses, claims, damages or liabilities arise out of, or are based upon, any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with any Underwriter Supplied Information.
(b) Indemnification of the Company. Each Underwriter agrees, severally and not jointly, to indemnify and hold harmless the Company, its directors, its officers who signed the Registration Statement and each person, if any, who controls the Company within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act to the same extent as the indemnity set forth in paragraph (a) above, but only with respect to any losses, claims, damages or liabilities that arise out of, or are based upon, any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with any information relating to any Underwriter furnished to the Company in writing by such Underwriter through the Representatives expressly for use in the Registration Statement, the Prospectus (or any amendment or supplement thereto), any Issuer Free Writing Prospectus or any Time of Sale Information (the “Underwriter Supplied Information”), it being understood and agreed that the only Underwriter Supplied Information consists of the following: a) the names of the underwriters on the front cover page of the Preliminary Prospectus and the Prospectus; b) the names set forth in the table of Underwriters in the list under the first paragraph of text under the caption “Underwriting” in the Preliminary Prospectus and the Prospectus; and c) the fourth, sixth and seventh paragraphs and the second sentence of the fifth paragraph of text under the caption “Underwriting” in the Preliminary Prospectus and the Prospectus relating to selling concession and reallowance and stabilization.
(c) Notice and Procedures. If any suit, action, proceeding (including any governmental or regulatory investigation), claim or demand shall be brought or asserted against any person in respect of which indemnification may be sought pursuant to either paragraph (a) or (b) above, such person (the “Indemnified Person”) shall promptly notify the person against whom such indemnification may be sought (the “Indemnifying Person”) in writing; provided that the failure to notify the Indemnifying Person shall not relieve it from any liability that it may have under this
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Section 7 except to the extent that it has been materially prejudiced (through the forfeiture of substantive rights or defenses) by such failure; and provided further, that the failure to notify the Indemnifying Person shall not relieve it from any liability that it may have to an Indemnified Person otherwise than under this Section 7. If any such proceeding shall be brought or asserted against an Indemnified Person and it shall have notified the Indemnifying Person thereof, the Indemnifying Person shall retain counsel reasonably satisfactory to the Indemnified Person to represent the Indemnified Person and any others entitled to indemnification pursuant to this Section 7 that the Indemnifying Person may designate in such proceeding and shall pay the fees and expenses of such counsel related to such proceeding as incurred. In any such proceeding, any Indemnified Person shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such Indemnified Person unless (i) the Indemnifying Person and the Indemnified Person shall have mutually agreed to the contrary; (ii) the Indemnifying Person has failed within a reasonable time to retain counsel reasonably satisfactory to the Indemnified Person; (iii) the Indemnified Person shall have reasonably concluded that there may be legal defenses available to it that are different from or in addition to those available to the Indemnifying Person; or (iv) the named parties in any such proceeding (including any impleaded parties) include both the Indemnifying Person and the Indemnified Person and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between them. It is understood and agreed that the Indemnifying Person shall not, in connection with any proceeding or related proceeding in the same jurisdiction, be liable for the fees and expenses of more than one separate firm (in addition to any local counsel) for all Indemnified Persons, and that all such fees and expenses shall be reimbursed as they are incurred. Any such separate firm for any Underwriter, its affiliates, directors and officers and any control persons of such Underwriter shall be designated in writing by the Representatives and any such separate firm for the Company, its directors, its officers who signed the Registration Statement and any control persons of the Company shall be designated in writing by the Company. The Indemnifying Person shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, the Indemnifying Person agrees to indemnify each Indemnified Person from and against any loss or liability by reason of such settlement or judgment. Notwithstanding the foregoing sentence, if at any time an Indemnified Person shall have requested that an Indemnifying Person reimburse the Indemnified Person for fees and expenses of counsel as contemplated by this paragraph, the Indemnifying Person shall be liable for any settlement of any proceeding effected without its written consent if (i) such settlement is entered into more than 30 days after receipt by the Indemnifying Person of such request and (ii) the Indemnifying Person shall not have reimbursed the Indemnified Person in accordance with such request prior to the date of such settlement. No Indemnifying Person shall, without the written consent of the Indemnified Person, effect any settlement of any pending or threatened proceeding in respect of which any Indemnified Person is or could have been a party and
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indemnification could have been sought hereunder by such Indemnified Person, unless such settlement (x) includes an unconditional release of such Indemnified Person, in form and substance reasonably satisfactory to such Indemnified Person, from all liability on claims that are the subject matter of such proceeding and (y) does not include any statement as to or any admission of fault, culpability or a failure to act by or on behalf of any Indemnified Person.
(d) Contribution. If the indemnification provided for in paragraphs (a) and (b) above is unavailable to an Indemnified Person or insufficient in respect of any losses, claims, damages or liabilities referred to therein, then each Indemnifying Person under such paragraph, in lieu of indemnifying such Indemnified Person thereunder, shall contribute to the amount paid or payable by such Indemnified Person as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Underwriters on the other from the offering of the Securities or (ii) if the allocation provided by clause (i) is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) but also the relative fault of the Company on the one hand and the Underwriters on the other in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and the Underwriters on the other shall be deemed to be in the same respective proportions as the net proceeds (before deducting expenses) received by the Company from the sale of the Securities and the total underwriting discounts and commissions received by the Underwriters in connection therewith, in each case as set forth in the table on the cover of the Prospectus, bear to the aggregate offering price of the Securities. The relative fault of the Company on the one hand and the Underwriters on the other shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or by the Underwriters and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.
(e) Limitation on Liability. The Company and the Underwriters agree that it would not be just and equitable if contribution pursuant to this Section 7 were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation that does not take account of the equitable considerations referred to in paragraph (d) above. The amount paid or payable by an Indemnified Person as a result of the losses, claims, damages and liabilities referred to in paragraph (d) above shall be deemed to include, subject to the limitations set forth above, any legal or other expenses incurred by such Indemnified Person in connection with any such action or claim. Notwithstanding the provisions of this Section 7, in no event shall an Underwriter be required to contribute any amount in excess of the amount by which the total underwriting discounts and
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commissions received by such Underwriter with respect to the offering of the Securities exceeds the amount of any damages that such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The Underwriters’ obligations to contribute pursuant to this Section 7 are several in proportion to their respective purchase obligations hereunder and not joint.
(f) Non-Exclusive Remedies. The remedies provided for in this Section 7 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any Indemnified Person at law or in equity.
8. Effectiveness of Agreement. This Agreement shall become effective as of the date first written above.
9. Termination. This Agreement may be terminated in the discretion of the Representatives by notice to the Company, if after the execution and delivery of this Agreement and prior to the Closing Date (i) trading generally shall have been suspended or materially limited on the Exchange or the London Stock Exchange; (ii) trading of any securities issued or guaranteed by the Company shall have been suspended on any exchange; (iii) a general moratorium on commercial banking activities shall have been declared by U.S. federal or New York State authorities or authorities in the United Kingdom; (iv) there shall have occurred any outbreak or escalation of hostilities or any change in financial markets or any calamity or crisis, involving the United States or the United Kingdom, that, in the reasonable judgment of the Representatives (after consultations to the extent predictable with the Company), is so material and adverse as to make it impracticable or inadvisable to proceed with the offering, sale or delivery of the Securities on the terms and in the manner contemplated by this Agreement, the Time of Sale Information and the Prospectus.
10. Defaulting Underwriter.
(a) If, on the Closing Date, any Underwriter defaults on its obligation to purchase the Securities that it has agreed to purchase hereunder, the non-defaulting Underwriters may in their discretion arrange for the purchase of such Securities by other persons satisfactory to the Company on the terms contained in this Agreement. If, within 36 hours after any such default by any Underwriter, the non-defaulting Underwriters do not arrange for the purchase of such Securities, then the Company shall be entitled to a further period of 36 hours within which to procure other persons satisfactory to the non-defaulting Underwriters to purchase such Securities on such terms. If other persons become obligated or agree to purchase the Securities of a
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defaulting Underwriter, either the non-defaulting Underwriters or the Company may postpone the Closing Date for up to five full business days in order to effect any changes that in the opinion of counsel for the Company or counsel for the Underwriters may be necessary in the Registration Statement, the Time of Sale Information and the Prospectus or in any other document or arrangement, and the Company agrees to promptly prepare any amendment or supplement to the Registration Statement, the Time of Sale Information and the Prospectus that effects any such changes. As used in this Agreement, the term “Underwriter” includes, for all purposes of this Agreement unless the context otherwise requires, any person not listed in Schedule 1 hereto that, pursuant to this Section 10, purchases Securities that a defaulting Underwriter agreed but failed to purchase.
(b) If, after giving effect to any arrangements for the purchase of the Securities of a defaulting Underwriter or Underwriters by the non-defaulting Underwriters and the Company as provided in paragraph (a) above, the aggregate principal amount of such Securities that remains unpurchased does not exceed one-eleventh of the aggregate principal amount of all the Securities, then the Company shall have the right to require each non-defaulting Underwriter to purchase the principal amount of Securities that such Underwriter agreed to purchase hereunder plus such Underwriter’s pro rata share (based on the principal amount of Securities that such Underwriter agreed to purchase hereunder) of the Securities of such defaulting Underwriter or Underwriters for which such arrangements have not been made.
(c) If, after giving effect to any arrangements for the purchase of the Securities of a defaulting Underwriter or Underwriters by the non-defaulting Underwriters and the Company as provided in paragraph (a) above, the aggregate principal amount of such Securities that remains unpurchased exceeds one-eleventh of the aggregate principal amount of all the Securities, or if the Company shall not exercise the right described in paragraph (b) above, then this Agreement shall terminate without liability on the part of the non-defaulting Underwriters. Any termination of this Agreement pursuant to this Section 10 shall be without liability on the part of the Company, except that the Company will continue to be liable for the payment of expenses as set forth in Section 11 hereof and except that the provisions of Section 7 hereof shall not terminate and shall remain in effect.
(d) Nothing contained herein shall relieve a defaulting Underwriter of any liability it may have to the Company or any non-defaulting Underwriter for damages caused by its default.
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11. Payment of Expenses.
(a) Whether or not the transactions contemplated by this Agreement are consummated or this Agreement is terminated, the Company will pay or cause to be paid all costs and expenses incident to the performance of its obligations hereunder, including without limitation, (i) the costs incident to the authorization, issuance, sale, preparation and delivery of the Securities and any taxes payable in that connection; (ii) the costs incident to the preparation, printing and filing under the Securities Act of the Registration Statement, the Preliminary Prospectus, any Issuer Free Writing Prospectus, any Time of Sale Information and the Prospectus (including all exhibits, amendments and supplements thereto) and the distribution thereof; (iii) the costs of reproducing and distributing each of the Transaction Documents; (iv) the fees and expenses of the Company’s counsel and independent accountants; (v) the fees and expenses incurred in connection with the registration or qualification and determination of eligibility for investment of the Securities under the laws of such jurisdictions as the Representatives may designate; (vi) any fees charged by rating agencies for rating the Securities; (vii) the fees and expenses of the Trustee and any paying agent (including related fees and expenses of any counsel to such parties); (viii) all expenses incurred by the Company in connection with any “road show” presentation to potential investors and (ix) all expenses and application fees related to the listing of the Securities on the Exchange.
(b) If (i) this Agreement is terminated pursuant to Section 9, (ii) the Company for any reason fails to tender the Securities for delivery to the Underwriters or (iii) the Underwriters decline to purchase the Securities for any reason permitted under this Agreement, the Company agrees to reimburse the Underwriters for all out-of-pocket costs and expenses (including the fees and expenses of their counsel) reasonably incurred by the Underwriters in connection with this Agreement and the offering contemplated hereby.
12. Persons Entitled to Benefit of Agreement. This Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective successors and the officers and directors and any controlling persons referred to herein, and the affiliates of each Underwriter referred to in Section 7 hereof. Nothing in this Agreement is intended or shall be construed to give any other person any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision contained herein. No purchaser of Securities from any Underwriter shall be deemed to be a successor merely by reason of such purchase.
13. Survival. The respective indemnities, rights of contribution, representations, warranties and agreements of the Company and the Underwriters contained in this Agreement or made by or on behalf of the Company or the Underwriters pursuant to this Agreement or any certificate delivered pursuant hereto shall survive the delivery of and payment for the Securities and shall remain in full force and effect, regardless of any termination of this Agreement or any investigation made by or on behalf of the Company or the Underwriters.
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14. Certain Defined Terms. For purposes of this Agreement, (a) except where otherwise expressly provided, the term “affiliate” has the meaning set forth in Rule 405 under the Securities Act; (b) the term “business day” means any day other than a day on which banks are permitted or required to be closed in New York City or London; (c) the term “subsidiaries” has the meaning set forth in Rule 405 under the Securities Act; and (d) the term “principal subsidiaries” means National Grid Electricity Distribution Holdings plc, National Grid Electricity Transmission plc, National Grid USA, National Grid North America Inc., National Grid Holdings One plc and Niagara Mohawk Power Corporation.
15. Compliance with USA Patriot Act. In accordance with the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)), the Underwriters are required to obtain, verify and record information that identifies their respective clients, including the Company, which information may include the name and address of their respective clients, as well as other information that will allow the Underwriters to properly identify their respective clients.
16. Consent to Jurisdiction.
(a) The Company irrevocably consents and agrees, for the benefit of the Underwriters, that any legal action, suit or proceeding against it with respect to its obligations, liabilities or any other matter arising out of or in connection with this Agreement may be brought in the courts of the State of New York or the courts of the United States of America located in the Borough of Manhattan, The City of New York and hereby irrevocably consents and submits to the non-exclusive jurisdiction of each such court in personam, generally and unconditionally with respect to any action, suit or proceeding for itself and in respect of its properties, assets and revenues.
(b) The Company hereby irrevocably designates, appoints, and empowers Corporation Service Company with offices at 19 West 44th Street, Suite 200, New York, NY 10036, as its designee, appointee and agent to receive, accept and acknowledge for and on its behalf, and its properties, assets and revenues, service of any and all legal process, summons, notices and documents which may be served in any such action, suit or proceeding brought in any such United States or state court which may be made on such designee, appointee and agent in accordance with legal procedures prescribed for such courts. If for any reason such designee, appointee and agent hereunder shall cease to be available to act as such, the Company agrees to designate a new designee, appointee and agent in The City of New York on the terms and for the purposes of this Section 16 satisfactory to the Representatives. The Company further hereby irrevocably consents and agrees to the service of any and all legal process, summons, notices and documents out of any of the aforesaid courts in any such action, suit or proceeding by serving a copy thereof upon the relevant agent for service of process referred to in this Section 16 (whether or not the
27
appointment of such agent shall for any reason prove to be ineffective or such agent shall accept or acknowledge such service) or by mailing copies thereof by registered or certified air mail, first class, postage prepaid, to each of them at their respective addresses specified in or designated pursuant to this Agreement. The Company agrees that the failure of any such designee, appointee and agent to give any notice of such service to it shall not impair or affect in any way the validity of such service or any judgment rendered in any action or proceeding based thereon. Nothing herein shall in any way be deemed to limit the ability of any Underwriter to serve any such legal process, summons, notices and documents in any other manner permitted by applicable law or to obtain jurisdiction over the undersigned or bring actions, suits or proceedings against the undersigned in any jurisdictions, and in any manner, as may be permitted by applicable law. The Company hereby irrevocably and unconditionally waives, to the fullest extent permitted by law, any objection which it may now or hereafter have to the laying of venue of any of the aforesaid actions, suits or proceedings arising out of or in connection with this Agreement brought in the United States federal courts or the courts of the State of New York located in the Borough of Manhattan, The City of New York and hereby further irrevocably and unconditionally waives and agrees not to plead or claim in any such court that any such action, suit or proceeding brought in any such court has been brought in an inconvenient forum.
17. Miscellaneous.
(a) Authority of the Representatives. Any action by the Underwriters hereunder may be taken by the Representatives on behalf of the Underwriters, and any such action taken by the Representatives shall be binding upon the Underwriters.
(b) Notices. All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given if mailed or transmitted and confirmed by any standard form of telecommunication. Notices to the Underwriters shall be given to the Representatives as follows:
[Name of the Representative: _____]
[Address: _____]
[City, State, Zip Code]
[Attention: _____]
[Email: ____]
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Notices to the Company shall be given to it at:
National Grid USA
2 Hanson Place
Brooklyn, NY 11217
United States of America
Email: treasurybackoffice@nationalgrid.com
Attention: Treasurer
With a copy to:
Linklaters LLP
1290 Avenue of the Americas
New York, NY 10104
United States of America
Email: ______
Attention: ______
(c) Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New York.
(d) Waiver of Jury Trial. Each of the parties hereto hereby waives any right to trial by jury in any suit or proceeding arising out of or relating to this Agreement.
(e) Recognition of the U.S. Special Resolution Regimes.
(i) In the event that any Underwriter that is a Covered Entity becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer from such Underwriter of this Agreement, and any interest and obligation in or under this Agreement, will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if this Agreement, and any such interest and obligation, were governed by the laws of the United States or a state of the United States.
(ii) In the event that any Underwriter that is a Covered Entity or a BHC Act Affiliate of such Underwriter becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under this Agreement that may be exercised against such Underwriter are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if this Agreement were governed by the laws of the United States or a state of the United States.
As used in this Section 17(e):
“BHC Act Affiliate” has the meaning assigned to the term “affiliate” in, and shall be interpreted in accordance with, 12 U.S.C. § 1841(k).
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“Covered Entity” means any of the following:
(i) a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b);
(ii) a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or
(iii) a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b).
“Default Right” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable.
“U.S. Special Resolution Regime” means each of (i) the Federal Deposit Insurance Act and the regulations promulgated thereunder and (ii) Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act and the regulations promulgated thereunder.
(f) Counterparts; Effectiveness. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which taken together shall constitute one and the same agreement, it being understood that all of the parties need not sign the same counterpart. Counterparts may be delivered via facsimile, electronic mail (including .pdf or any electronic signature complying with the U.S. federal ESIGN Act of 2000, e.g., www.docusign.com) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective as delivery of a manually executed counterpart of this Agreement. Each of the parties hereto represents that it has undertaken commercially reasonable steps to verify the identity of each individual person executing any such counterparts via electronic signature on behalf of such party and has and will maintain sufficient records of the same. This Agreement shall become effective when each party shall have received a counterpart hereof signed by all of the other parties hereto.
(g) Amendments or Waivers. No amendment or waiver of any provision of this Agreement, nor any consent or approval to any departure therefrom, shall in any event be effective unless the same shall be in writing and signed by the parties hereto.
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(h) Headings. The headings herein are included for convenience of reference only and are not intended to be part of, or to affect the meaning or interpretation of, this Agreement.
(i) Judgment Currency. The Company agrees to indemnify each Underwriter, its directors, officers, affiliates and each person, if any, who controls such Underwriter within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act, against any loss incurred by such Underwriter as a result of any judgment or order being given or made for any amount due hereunder and such judgment or order being expressed and paid in a currency (the “judgment currency”) other than U.S. dollars and as a result of any variation as between (i) the rate of exchange at which the U.S. dollar amount is converted into the judgment currency for the purpose of such judgment or order, and (ii) the rate of exchange at which such indemnified person is able to purchase U.S. dollars with the amount of the judgment currency actually received by the indemnified person. The foregoing indemnity shall constitute a separate and independent obligation of the Company and shall continue in full force and effect notwithstanding any such judgment or order as aforesaid. The term “rate of exchange” shall include any premiums and costs of exchange payable in connection with the purchase of, or conversion into, the relevant currency.
[Signature page follows]
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If the foregoing is in accordance with your understanding, please indicate your acceptance of this Agreement by signing in the space provided below.
| Very truly yours, | ||
| NATIONAL GRID PLC | ||
| By: |
| |
| Name: | ||
| Title: | ||
Accepted as of the date first written above:
| By: |
| |
| Name: | ||
| Title: | ||
| By: |
| |
| Name: | ||
| Title: | ||
| By: |
| |
| Name: | ||
| Title: | ||
| By: |
| |
| Name: | ||
| Title: | ||
For themselves and on behalf of the
several Underwriters listed
in Schedule 1 hereto.
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Exhibit 5.1
|
Linklaters LLP One Silk Street London EC2Y 8HQ Telephone (+44) 20 7456 2000 Facsimile (+44) 20 7456 2222 DX Box Number 10 CDE |
The Directors
National Grid plc
1-3 Strand
London WC2N 5EH
| 28 August 2024 | ||||
| Our Ref | L-345795 |
Shelf registration statement on Form F-3 filed with the United States Securities and Exchange Commission (the “SEC”) relating to the registration and proposed issuance of debt securities (the “Debt Securities”) by National Grid plc (the “Issuer”)
| 1 | We have acted as English legal advisers to the Issuer, a company incorporated under the laws of England and Wales, in connection with the automatic shelf registration statement on Form F-3 filed with the SEC on 28 August 2024 (the “Registration Statement”) relating to the registration under the United States Securities Act of 1933 (the “Securities Act”) of an indeterminate amount of the Issuer’s Debt Securities. The Debt Securities may be issued from time to time pursuant to the Indenture (as defined in the Schedule to this opinion). This opinion is furnished to you in connection with the Registration Statement. |
| 2 | This opinion is limited to English law as applied by the English courts and on the basis of our understanding of current United Kingdom HM Revenue and Customs (“HMRC”) practice (which may not be binding on HMRC), in each case in effect on the date of this opinion. It is given on the basis that it will be governed by, and construed in accordance with, English law. In particular we express no opinion on matters of federal law of the United States or the laws of any State of the United States or the laws of any other jurisdiction. |
| 3 | For the purpose of this opinion, we have examined the documents listed and, where appropriate, defined in the Schedule to this opinion. |
| 4 | We have assumed that: |
| 4.1 | (except in the case of the Issuer) all relevant documents are within the capacity and powers of, and (other than the Debt Securities) have been validly authorised by, each party; |
| 4.2 | (in the case of each party) all relevant documents have been or (in the case of the Debt Securities) will be validly executed and delivered by the relevant party; |
| 4.3 | each of the documents which are the subject of this opinion is valid and binding on each party under the law to which it is expressed to be subject where that is not English law and that words and phrases used in those documents have the same meaning and effect as they would if those documents were governed by English law; |
This communication is confidential and may be privileged or otherwise protected by work product immunity.
Linklaters LLP is a limited liability partnership registered in England and Wales with registered number OC326345. It is a law firm authorised and regulated by the Solicitors Regulation Authority. The term partner in relation to Linklaters LLP is used to refer to a member of Linklaters LLP or an employee or consultant of Linklaters LLP or any of its affiliated firms or entities with equivalent standing and qualifications. A list of the names of the members of Linklaters LLP together with a list of those non-members who are designated as partners and their professional qualifications is open to inspection at its registered office, One Silk Street, London EC2Y 8HQ or on www.linklaters.com and such persons are either solicitors, registered foreign lawyers or European lawyers.
Please refer to www.linklaters.com/regulation for important information on Linklaters LLP’s regulatory position.
| 4.4 | all documents furnished to us as copies are genuine, authentic and complete and conform to the original documents of which they are copies, all signatures thereon or on the original thereof are genuine, and the relevant documents have been executed in the forms reviewed by us and, where relevant, the Debt Securities will be completed, authenticated and issued as provided in the Indenture; |
| 4.5 | the Certificates and the Articles of Association (each as defined in the Schedule to this opinion) are up-to-date; |
| 4.6 | unless otherwise indicated herein, none of the documents examined by us have been amended, supplemented or terminated (whether by written agreement, course of dealings or otherwise); |
| 4.7 | the Minutes (as defined in the Schedule to this opinion) are a true and complete record of the proceedings described therein in duly convened, constituted and quorate meetings and the resolutions set out in the Minutes were validly passed and remain in full force and effect without modification; |
| 4.8 | the terms of the Debt Securities will not be inconsistent with the provisions of the Indenture and there will be no provision in any supplement to the Registration Statement or any other document which would affect the content of this opinion; and |
| 4.9 | each issue of Debt Securities will be duly authorised. |
| 5 | Based on the documents referred to, and assumptions made in, paragraphs 3 and 4 above and subject to the qualifications in paragraphs 7 to 10 below and to any matters not disclosed to us, we are of the following opinion: |
| 5.1 | The Issuer has been incorporated and is existing as a company with limited liability under the laws of England. |
| 5.2 | The Issuer has corporate power to enter into and to perform its obligations under the Indenture and to issue and deliver the Debt Securities. |
| 5.3 | The Issuer has taken all necessary corporate action to authorise the execution, delivery and performance of the Indenture and, provided that each Debt Security is executed as provided in the relevant resolutions authorising the relevant issue of Debt Securities and the Articles of Association, the Issuer will have validly executed and delivered the Debt Securities. |
| 5.4 | Assuming the Indenture constitutes valid, binding and enforceable obligations of the Issuer under New York law, insofar as English law is concerned, the obligations assumed by the Issuer under the Indenture constitutes valid and binding obligations of the Issuer. |
| 5.5 | The statements of law and HMRC practice contained in the Registration Statement under the heading “Material Tax Considerations – United Kingdom”, subject to the limitations and qualifications therein, represent a correct summary in all material respects of the matters set out therein as at the date of the Registration Statement. |
| 6 | The term “enforceable” as used above should not be construed to mean that the obligations assumed by the relevant party will necessarily be enforced in all circumstances in accordance with their terms. In particular: |
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| 6.1 | enforcement may be limited by (a) bankruptcy, insolvency, liquidation and moratorium laws (b) laws relating to reorganisation and (c) laws of general application relating to or affecting the rights of creditors; |
| 6.2 | enforcement may be limited by general principles of equity—for example, equitable remedies may not be available where damages are considered to be an adequate remedy; |
| 6.3 | claims may become barred under the Limitation Act 1980 or may be or become subject to set-off or counterclaim. |
| 7 | This opinion is subject to the following: |
| 7.1 | It should be understood that we have not been responsible for investigating or verifying the accuracy of the facts, including statements of foreign law, or the reasonableness of any statements of opinion, contained in the Registration Statement, or that no material facts have been omitted from it. |
| 7.2 | We express no opinion as to the compliance or otherwise with (i) the financial limitations on borrowings or covenants by the Issuer contained in the Articles of Association and (ii) the limitations on the maximum aggregate principal amount of Debt Securities which may be issued by the Issuer as contemplated by the Registration Statement. |
| 7.3 | Any amount referred to in provisions of the Debt Securities or the Indenture which provide for the payment by a person of additional interest or amounts upon a breach, default or similar occurrence by that person, may not be recoverable if it amounts to a penalty under English law. |
| 7.4 | An English court may refuse to give effect to any contractual provision concerning payment of the costs of enforcement or litigation brought before an English court. |
| 7.5 | To the extent it relates to United Kingdom stamp duties any undertaking or indemnity may be void under Section 117 of the Stamp Act 1891. |
| 7.6 | We express no opinion as to the effect of any sanctions or other similar restrictive measures in relation to any party to the Indenture or the Debt Securities or any transaction contemplated thereby. |
| 7.7 | A certificate, determination, notification, minute or opinion might be held by the English courts not to be conclusive if it could be shown to have an unreasonable or arbitrary basis or in the event of manifest error despite any provision in any document to the contrary. |
| 7.8 | Any contractual provision that purports to maintain the validity of the remainder of such contract despite the invalidity, illegality or unenforceability of one or more of its provisions may not be effective—it depends on the nature of the illegality, invalidity or unenforceability in question. |
| 7.9 | Any contractual provision that requires a variation to be made in writing or to comply with any other formality may not be enforceable. |
| 7.10 | Effect may be given to the overriding mandatory provisions of the law of the country where the obligations arising out of a contract have to be or have been performed, in so far as those provisions render the performance of the contract unlawful. In such circumstances, the relevant obligations may not be enforceable. |
| 7.11 | The English courts may have regard to the law of the country in which performance takes place in relation to the manner of performance and the steps to be taken in the event of defective performance. |
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| 7.12 | The English courts may not be restricted from applying overriding provisions of English law and if there is a provision of New York law that is manifestly incompatible with English public policy, it is possible that the English courts may not apply it. |
| 8 | Furthermore, the English courts may not accept jurisdiction to determine the matter or may stay or strike out proceedings in certain circumstances, including where there is some other forum with competent jurisdiction which is more appropriate for the trial of the action, where proceedings involving the same cause of action and between the same parties are pending in another jurisdiction or where merits of the issues in dispute have already been judicially determined or should have been raised in previous proceedings between the parties. |
| 9 | This opinion is given on the basis of English law in force (or, insofar as this opinion relates to tax, to United Kingdom taxation law), and as it affects the obligations under the Indenture and/or the Debt Securities, as at the date of this opinion. This opinion is given on the basis that there will be no amendment to or termination or replacement of the documents, authorisations and consents referred to in the Schedule to this opinion. This opinion is also given on the basis that we undertake no responsibility to notify you of any change in English law or United Kingdom taxation law after the date of this opinion. |
| 10 | This opinion is addressed to you solely for your benefit in connection with the filing of the Registration Statement. It is not to be transmitted to anyone else nor is it to be relied upon by anyone else or for any other purpose or quoted or referred to in any public document or filed with anyone without our express consent. |
| 11 | We hereby consent to the filing of this opinion with the SEC as an exhibit to, and the reference to us made under the captions “Legal Matters” and “Enforcement of Civil Liabilities under United States Federal Securities Laws” in, the Registration Statement. In giving this consent we do not admit that we are within the category of persons whose consent is required within Section 7 of the Securities Act or the rules and regulations of the SEC thereunder. |
Yours faithfully
Linklaters LLP
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SCHEDULE
| 1 | A copy of the articles of association of the Issuer in force as at the date of this opinion (the “Articles of Association”) |
| 2 | A copy of the certificate of incorporation of the Issuer, the certificates of incorporation on change of name and the certificate on re-registration (as a public company) of the Issuer (the “Certificates”) |
| 3 | An indenture dated 3 July 2006 between the Issuer and The Bank of New York (now The Bank of New York Mellon) as trustee, in the form filed with the SEC on 28 June 2006 (the “Indenture”), as amended and/or supplemented by any further amendments and/or supplements up to the date of this opinion |
| 4 | A copy of the certificate of the assistant secretary of the Issuer dated 24 July 2006 certifying that the Indenture was approved and signed by duly authorised persons on behalf of the Issuer |
| 5 | A certified copy of an extract from the minutes of a meeting of the finance committee of the board of the Issuer (the “ Finance Committee”) held on 24 April 2006 (the “2006 Finance Committee Minutes”) |
| 6 | A certified copy of an extract from the minutes of a meeting of the Board of Directors held on 27 June 2006 (together with the 2006 Finance Committee Minutes, the “2006 Minutes”) |
| 7 | A certified copy of an extract from the draft minutes of a meeting of the Finance Committee held on 26 June 2012 (the “2012 Minutes”) |
| 8 | A certified copy of an extract from the draft minutes of a meeting of the Finance Committee held on 23 June 2015 (the “2015 Finance Committee Minutes”) |
| 9 | A certified copy of an extract from the minutes of a meeting of the Board of Directors held on 24 June 2015 (together with the 2015 Finance Committee Minutes, the “2015 Minutes”) |
| 10 | A copy of the certificate of the Global Tax and Treasury Director of the Issuer dated 17 July 2015 certifying, inter alia, that the execution of the second supplemental indenture is permitted by the Indenture |
| 11 | A certified copy of an extract from the minutes of a meeting of the Board of Directors held on 18 April 2018 (the “2018 Minutes”) |
| 12 | A certified copy of an extract from the draft minutes of a meeting of the Finance Committee held on 22 January 2021 (the “January 2021 Finance Committee Minutes”) |
| 13 | A certified copy of an extract from the minutes of a meeting of the Board of Directors held on 24 March 2021 (together with the January 2021 Finance Committee Minutes, the “2021 Board of Directors Minutes”) |
| 14 | A certified copy of an extract from the draft minutes of a meeting of the Finance Committee held on 15 April 2021 (together with the January 2021 Finance Committee Minutes and the 2021 Board of Directors Minutes, the “2021 Minutes”) |
| 15 | A certified copy of an extract from the minutes of a meeting of the Finance Committee held on 22 March 2022 (the “March 2022 Finance Committee Minutes”) |
| 16 | A certified copy of an extract from the minutes of a meeting of the Board of Directors held on 23 March 2022 (together with the March 2022 Finance Committee Minutes, the “2022 Minutes”) |
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| 17 | A certified copy of an extract from the minutes of a meeting of the Finance Committee held on 21 March 2023 (the “March 2023 Finance Committee Minutes”) |
| 18 | A certified copy of an extract from the minutes of a meeting of the Board of Directors held on 22 March 2023 (the “2023 Board of Directors Minutes”) |
| 19 | A certified copy of an extract from the minutes of a meeting of the Finance Committee held on 10 July 2023 (together with the March 2023 Finance Committee Minutes, and the 2023 Board of Directors Minutes, the “2023 Minutes”) |
| 20 | A certified copy of an extract from the minutes of a meeting of the Finance Committee held on 15 March 2024 (the “March 2024 Finance Committee Minutes”) |
| 21 | A certified copy of an extract from the minutes of a meeting of the Board of Directors held on 10 May 2024 (together with the 2006 Minutes, the 2012 Minutes, the 2015 Minutes, the 2018 Minutes, the 2021 Minutes, the 2022 Minutes, the 2023 Minutes, and the March 2024 Finance Committee Minutes, the “Minutes”) |
| 22 | Copies of the terms of reference of the Finance Committee dated respectively 27 February 2004, May 2012, May 2014, January 2021, March 2022, March 2023 and March 2024 |
| 23 | The Registration Statement |
| 24 | A power of attorney granted by the Issuer dated 28 August 2024 |
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Exhibit 5.2
|
Linklaters LLP 1290 Avenue of the Americas New York, NY 10104 Telephone (+1) 212 903 9000 Facsimile (+1) 212 903 9100 |
National Grid plc
1-3 Strand
London WC2N 5EH
England
August 28, 2024
Ladies and Gentlemen,
National Grid plc (the “Issuer”) Registration Statement on Form F-3 in respect of debt securities (the “Debt Securities”)
We have acted as United States counsel to the Issuer in connection with the automatic shelf registration statement on Form F-3 (the “Registration Statement”) filed with the United States Securities and Exchange Commission on August 28, 2024 relating to the registration under the United States Securities Act of 1933 (the “Securities Act”) of an indeterminate amount of the Issuer’s Debt Securities. The Debt Securities may be issued from time to time pursuant to the indenture dated June 12, 2023 between the Issuer and The Bank of New York Mellon, London Branch (the “Trustee”) (as amended and/or supplemented from time to time, the “Indenture”).
This opinion is limited to the federal law of the United States and the laws of the State of New York, and we express no opinion as to the effect of the laws of any other State of the United States or any other jurisdiction.
For the purpose of this opinion, we have examined the Indenture, such certificates and other documents, and such questions of law, as we have considered necessary or appropriate. We have assumed that the Issuer has the power to execute and deliver the Debt Securities and the Indenture, and perform its obligations thereunder, that the Indenture has been duly and validly authorized, executed and delivered under the laws of England and Wales by the Issuer, that the Debt Securities conform to the form examined by us and that the signatures on all documents examined by us are genuine, assumptions that we have not independently verified.
This communication is confidential and may be privileged or otherwise protected by work product immunity.
Linklaters LLP is a multinational limited liability partnership registered in England and Wales with registered number OC326345 including solicitors of the Senior Courts of England and Wales, members of the New York and District of Columbia Bars and foreign legal consultants in New York. It is a law firm authorised and regulated by the Solicitors Regulation Authority. The term partner in relation to Linklaters LLP is used to refer to a member of Linklaters LLP or an employee or consultant of Linklaters LLP or any of its affiliated firms or entities with equivalent standing and qualifications. A list of the names of the members of Linklaters LLP together with a list of those non-members who are designated as partners and their professional qualifications is open to inspection at its registered office, One Silk Street, London EC2Y 8HQ, England or on www.linklaters.com.
Please refer to www.linklaters.com/regulation for important information on Linklaters LLP’s regulatory position.
In our opinion:
| 1. | The Indenture has been duly executed and delivered by the Issuer and, assuming due authorization, execution and delivery thereof by the Trustee, constitutes a valid and legally binding agreement of the Issuer enforceable in accordance with its terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or similar laws of general applicability relating to or affecting creditors’ rights and to general equity principles. |
| 2. | The Debt Securities, when executed and delivered by the Issuer against payment therefor pursuant to the terms of the Indenture and when authenticated in accordance with the terms of the Indenture, will constitute valid and legally binding obligations of the Issuer, enforceable in accordance with their terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors’ rights and to general equity principles. |
We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the references to us under the heading “Legal Matters” in the prospectus included in the Registration Statement. In giving such consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act.
Very truly yours,
Linklaters LLP
Page 2 of 2
Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We consent to the incorporation by reference in this Registration Statement on Form F-3 of our reports dated 22 May 2024 relating to the consolidated financial statements of National Grid plc and the effectiveness of National Grid plc’s internal control over financial reporting, appearing in the Annual Report on Form 20-F of National Grid plc. for the year ended 31 March 2024. We also consent to the reference to us under the heading “Experts” in such Registration Statement.
| /s/ Deloitte LLP |
| London, United Kingdom |
| 28 August 2024 |
Exhibit 25.1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
| ☐ | CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) |
THE BANK OF NEW YORK MELLON
(Exact name of trustee as specified in its charter)
| New York | 13-5160382 | |
| (Jurisdiction of incorporation if not a U.S. national bank) |
(I.R.S. employer identification no.) | |
| 240 Greenwich Street, New York, N.Y. | 10286 | |
| (Address of principal executive offices) | (Zip code) | |
National Grid plc
(Exact name of obligor as specified in its charter)
| England and Wales | 98-0367158 | |
| (State or other jurisdiction of incorporation or organization) |
(I.R.S. employer identification no.) | |
| 1-3 Strand London WC2N 5EH England |
||
| (Address of principal executive offices) | (Zip code) | |
Debt Securities
(Title of the indenture securities)
| 1. | General information. Furnish the following information as to the Trustee: |
| (a) | Name and address of each examining or supervising authority to which it is subject. |
| Name |
Address | |
| Superintendent of the Department of Financial Services of the State of New York | One State Street, New York, N.Y. 10004-1417, and Albany, N.Y. 12223 | |
| Federal Reserve Bank of New York | 33 Liberty Street, New York, N.Y. 10045 | |
| Federal Deposit Insurance Corporation | 550 17th Street, NW Washington, D.C. 20429 | |
| The Clearing House Association L.L.C. | 100 Broad Street New York, N.Y. 10004 | |
| (b) | Whether it is authorized to exercise corporate trust powers. |
Yes.
| 2. | Affiliations with Obligor. |
If the obligor is an affiliate of the trustee, describe each such affiliation.
None.
| 16. | List of Exhibits. |
Exhibits identified in parentheses below, on file with the Commission, are incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-29 under the Trust Indenture Act of 1939 (the “Act”).
| 1. | A copy of the Organization Certificate of The Bank of New York Mellon (formerly known as The Bank of New York, itself formerly Irving Trust Company) as now in effect, which contains the authority to commence business and a grant of powers to exercise corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with Registration Statement No. 33-21672, Exhibit 1 to Form T-1 filed with Registration Statement No. 33-29637, Exhibit 1 to Form T-1 filed with Registration Statement No. 333-121195 and Exhibit 1 to Form T-1 filed with Registration Statement No. 333-152735). |
- 2 -
| 4. | A copy of the existing By-laws of the Trustee (Exhibit 4 to Form T-1 filed with Registration Statement No. 333-261533). |
| 6. | The consent of the Trustee required by Section 321(b) of the Act (Exhibit 6 to Form T-1 filed with Registration Statement No. 333-229519). |
| 7. | A copy of the latest report of condition of the Trustee published pursuant to law or to the requirements of its supervising or examining authority. |
- 3 -
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New York Mellon, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in the City of New York, and State of New York on the 9th day of August, 2024.
| THE BANK OF NEW YORK MELLON | ||
| By: | /s/ Francine Kincaid | |
| Name: Francine Kincaid | ||
| Title: Vice President | ||
- 4 -
EXHIBIT 7
Consolidated Report of Condition of
THE BANK OF NEW YORK MELLON
of 240 Greenwich Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business March 31, 2024, published in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act.
| Dollar amounts in thousands | ||||
| ASSETS |
||||
| Cash and balances due from depository institutions: |
||||
| Noninterest-bearing balances and currency and coin |
4,175,000 | |||
| Interest-bearing balances |
127,322,000 | |||
| Securities: |
||||
| Held-to-maturity securities |
48,404,000 | |||
| Available-for-sale debt securities |
89,763,000 | |||
| Equity securities with readily determinable fair values not held for trading |
0 | |||
| Federal funds sold and securities purchased under agreements to resell: |
||||
| Federal funds sold in domestic offices |
0 | |||
| Securities purchased under agreements to resell |
13,426,000 | |||
| Loans and lease financing receivables: |
||||
| Loans and leases held for sale |
0 | |||
| Loans and leases held for investment |
40,324,000 | |||
| LESS: Allowance for credit losses on loans and leases |
305,000 | |||
| Loans and leases held for investment, net of allowance |
40,019,000 | |||
| Trading assets |
5,233,000 | |||
| Premises and fixed assets (including capitalized leases) |
2,728,000 | |||
| Other real estate owned |
1,000 | |||
| Investments in unconsolidated subsidiaries and associated companies |
1,473,000 | |||
| Direct and indirect investments in real estate ventures |
0 | |||
| Intangible assets |
6,907,000 | |||
| Other assets |
18,026,000 | |||
|
|
|
|||
| Total assets |
357,477,000 | |||
|
|
|
|||
| LIABILITIES |
||||
| Deposits: |
||||
| In domestic offices |
212,250,000 | |||
| Noninterest-bearing |
61,642,000 | |||
| Interest-bearing |
150,608,000 | |||
| In foreign offices, Edge and Agreement subsidiaries, and IBFs |
100,510,000 | |||
| Noninterest-bearing |
4,973,000 | |||
| Interest-bearing |
95,537,000 | |||
| Federal funds purchased and securities sold under agreements to repurchase: |
||||
| Federal funds purchased in domestic offices |
0 | |||
| Securities sold under agreements to repurchase |
3,808,000 | |||
| Trading liabilities |
1,687,000 | |||
| Other borrowed money: (includes mortgage indebtedness and obligations under capitalized leases) |
3,030,000 | |||
| Not applicable |
||||
| Not applicable |
||||
| Subordinated notes and debentures |
0 | |||
| Other liabilities |
8,722,000 | |||
|
|
|
|||
| Total liabilities |
330,007,000 | |||
|
|
|
|||
| EQUITY CAPITAL |
||||
| Perpetual preferred stock and related surplus |
0 | |||
| Common stock |
1,135,000 | |||
| Surplus (exclude all surplus related to preferred stock) |
12,320,000 | |||
| Retained earnings |
17,372,000 | |||
| Accumulated other comprehensive income |
-3,357,000 | |||
| Other equity capital components |
0 | |||
| Total bank equity capital |
27,470,000 | |||
| Noncontrolling (minority) interests in consolidated subsidiaries |
0 | |||
| Total equity capital |
27,470,000 | |||
|
|
|
|||
| Total liabilities and equity capital |
357,477,000 | |||
|
|
|
I, Dermot McDonogh, Chief Financial Officer of the above-named bank do hereby declare that this Report of Condition is true and correct to the best of my knowledge and belief.
Dermot McDonogh
Chief Financial Officer
We, the undersigned directors, attest to the correctness of this statement of resources and liabilities. We declare that it has been examined by us, and to the best of our knowledge and belief has been prepared in conformance with the instructions and is true and correct.
| Robin A. Vince Jeffrey A. Goldstein Joseph J. Echevarria |
Directors |