SECTION B
EXECUTIVE SUMMARY
This Executive Summary highlights the legal and commercial matters we regard as being of particular
relevance from our due diligence investigations into CCG in the context of the Merger. We stress that,
whilst we have identified in the Executive Summary key issues based on your instructions, there may
nevertheless be other issues raised in the remainder of the Report which are of importance to you. The
Executive Summary should be read in conjunction with the full Report.
The headings of this Executive Summary follow the headings in the Questionnaire.
At the beginning of each section in this Executive Summary, we highlight key points from the detailed
Information Section of our Report (Section C) which in our view, in the context of the Merger, should be
highlighted in this Report and which should be considered by you prior to the Merger.
In so highlighting matters, we may be unaware of information about your activities or information from
other due diligence sources about CCG, such that your assessment of the significance of an issue may
differ. We shall have no liability to you for any failure to highlight information in this Executive Summary,
which should be read in conjunction with the full Report.
1. MATERIAL CONTRACTS
1.1 Material Commercial Contracts (Non-IT)
We have not identified any material obstacles to the Merger in the context of our review of
commercial contracts. We note that one contract which was forwarded for review is due to
expire before the Merger is effected. This is the Skillseekers / Modern Apprenticeship contract
with the Skills Development Company Limited. We recommend some consideration is given to
whether it will be appropriate to put in place a new or renewed contract following its expiry and
how a renewed contract might sit post Merger with contracts of a similar nature held by GMC.
Please refer to Clause 1.1.1 of Section C of the Report for further information.
For any contracts which you wish to continue post Merger, these will need to be individually
novated or assigned to GMC, which will require the consent of the contract counterparty, unless
the specific provisions of a particular contract provide otherwise. A key issue will be for the
colleges to agree which contractual arrangements it wishes to continue post Merger and which it
wishes to seek early termination of consistent with rationalisation. The fact that the merged
college will continue to operate across the various campuses in the short term will influence this
decision.
Worthy of note are the partnership arrangements with Mechanex (UK) Limited and Alex Shanks
Limited which are being externally funded through Knowledge Transfer Partnership grants to
CCG from Technology Strategy Board, a non-departmental public body (the "TS Board"). The
offers for award of the relevant grants both state that the TS Board shall be under no
obligation to pay any grant, and any grant already paid may be reclaimed in whole or in
part at the sole discretion of the TS Board if any of the events listed in clause 20 of said offers
occur, which events include if CCG is merged with or taken over by another body within the
period commencing on the date of the offer letter and ending 3 years after the date on
which the final payment of the grant is made. This clause could be invoked by the TS Board
once the Merger takes place, therefore if CCG has not already done so, it should enter into
dialogue with the Board about the Merger to determine whether the TS Board will be inclined to
claw back any grants already made or refuse payment of any grants still to be received. Please
refer to Clauses 1.1.9 and 1.1.10 of Section C of the Report for further detail.
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Appendix 5: Due Diligence Executive Summaries