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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 GCNS 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 GCNS, 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 COMMERCIAL 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.
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 deem otherwise. A key issue will be for the
colleges to agree which contractual arrangements they wish to continue post Merger and which
they wish 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.
The agreement with Catering Academy Limited in respect of catering services in GCNS' College
Refectory and Halls of Residence makes reference to an amount of investment paid to GCNS in
2007 in respect of a Costa Coffee/Deli Bar. Should the agreement be terminated (for whatever
reason) prior to the conclusion of its initial five year term, then GCNS may be liable to reimburse
some of the investment money received. Please refer to Clause 1.1.1 of Section C for further
information.
1.2 Property Contracts
We have not identified any material obstacles to the Merger in the context of our review of the
materials provided by GCNS which relate to property.
We note in Clause 1.2 of Section C details of a lease between Pacific Shelf 878 Limited and the
Board of Management of GCNS in respect of the lease of student accommodation to GCNS at St
Luke's Terrace, Glasgow, which expires on 3 September 2035. The landlord's consent must be
sought if GCNS wishes to assign this lease to GMC.
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Appendix 5: Due Diligence Executive Summaries