Exhibit 10.11
THIS AGREEMENT is signed on November 8, 2001 and is notarised on , 2001
BETWEEN: THE PERSONS LISTED IN SCHEDULE 1
WHEREAS:
(A) The Shareholders and a third party entered into an Association
Agreement dated 28th April 2000 (the "ASSOCIATION AGREEMENT")
concerning the establishment of the Licensee as their joint venture
vehicle for the purposes of participating in the Auction.
(B) The Shareholders entered into a shareholders' agreement on August 23,
2000 relating to their shareholdings in "Marabu" Vermogensverwaltung
GmbH. ("Licensee"). Licensee was subsequently renamed to Group 3G UMTS
GmbH.
(C) The Shareholders have contributed their shareholdings in Licensee to
ORLA Siebzehnte Vermogensverwaltungs GmbH, subsequently renamed to
Group 3G UMTS Holding GmbH ("the Company") which now owns all shares in
Licensee. The Parties shall by signing this Shareholders Agreement
replacing the current Shareholders Agreement dated August 23, 2000.
Subsequently, the Shareholders' Agreement dated August 16, 2000
relating to the Licensee is no longer needed and shall, for the
avoidance of doubt, be terminated with immediate effect.
(D) The Shareholders agreed on August 23, 2000 (public deed no. 129/2000 of
Notary Dr. Wamister, Basle, Switzerland) to conclude a Shareholders
Agreement in relation to the Company in the same terms and conditions
as agreed by the Shareholders in the shareholders agreement concerning
the Licensee. The Shareholders therefore enter into this Shareholders
Agreement ("the Agreement").
(E) Licensee obtained a License to operate a UMTS/IMT-2000 network in
Germany from the Regulatory Authority for Telecommunications and Posts
(RegTP) dated September 6, 2000.
(F) The Parties acknowledge that TICSA is currently involved in a procedure
of merging with Telefonica Moviles Espana, S.A., a wholly owned
subsidiary of Telefonica Moviles, S.A. This situation was expressly
notified by TICSA to Sonera by letter dated on 20 June, 2001.
(G) Sonera Corporation (herein referred as "Guarantor") has agreed to
guarantee the obligations of its Guaranteed Shareholder under this
agreement.
(H) The Shareholders are signing simultaneously a Shareholders Support
Deed, which is attached as Schedule 3 herein.
IT IS AGREED as follows:
It is clearly understood and agreed among the Parties that any consolidation
transaction in Germany involving any company belonging to Telefonica Moviles
Group will not be affected by any provision of this Agreement, as far Sonera's
participation in the Company is exchanged for a direct or indirect participation
in a wireless operator in Germany and the value of such participation is equal
or higher than the value of the foregone stake in the Company as appraised by an
independent valuation from a world wide recognised investment bank.
1. DEFINITIONS AND INTERPRETATION
1.1 DEFINITIONS
In this Agreement:
"ACCOUNTING PERIOD" means, unless otherwise agreed, the
period commencing on January 1st in any
year and ending on December 31 in the
same year or such other accounting
period as may be adopted by the Company;
"ADVISORY BOARD" means the advisory board of the Company
to be established pursuant to the
Articles of Association;
"ADVISORY BOARD MEMBER" means those persons at the relevant time
who were appointed by the Shareholders
in accordance with the Articles of
Association to the Advisory Board;
"AFFILIATE" Has the meaning as defined in Section
15 of the German Stock Corporation Act
(whereby a 50% participation qualifies
as being majority owned);
"AGREED FORM" in relation to any document means that
document in a form agreed by the
Shareholders and initialled for the
purposes of identification by or on
behalf of the Shareholders;
"AGREEMENT" means this Shareholders Agreement;
"ARTICLES OF ASSOCIATION" means the Articles of Association of the
Company, in the Agreed Form, adopted by
the Company in accordance with clause
2.1(B);
"AUCTION" means the Auction for third generation
mobile telephony spectrum licences
pursuant to section 11 (4) of the German
Telecommunications Act and as described
in the Rulings;
"BUDGET" means from time to time the budget for
the Company and its Subsidiaries for
each Accounting Period adopted by the
Company in accordance with this
Agreement;
"BUSINESS" means the business of the Company, as
more particularly described in Clause
2.1
"BUSINESS DAY" means a day (other than a Saturday or
Sunday) on which banks are open for
business (other than solely for trading
and settlement in euro) at the seat of
the Company;
"BUSINESS PLAN" means the business plan of the Company
reflecting the business plans of
Licensee and all other Subsidiaries for
the period up to and including twenty
years, in the Agreed Form and any
subsequent or amended business plan for
these companies prepared in accordance
with clause 6 and adopted by the Company
in accordance with this Agreement;
"COMPANY" means Group 3G UMTS Holding GmbH, , a
German limited company registered under
HRB 138 838 at the Commercial Register
of the local court of Munich with its
registered seat in Munich;
"COMPULSORY OFFER" has the meaning set out in clause
4.2(A);
"COMPULSORY TRANSFER NOTICE" has the meaning set out in clause 4.2(B)
"CONTROL" in relation to a corporate body means
the ability of a person to ensure that
the activities and business of that
corporate body are conducted in
accordance with the wishes of that
person, and a person shall be deemed to
have Control of a corporate body if that
person possesses or is entitled to
acquire the majority of the share
capital issued or the voting rights in
that corporate body or the right to
receive the majority of the income of
that corporate body on any distribution
by it of all of its income or the
majority of its assets on a winding up;
"COSTS" has the meaning set out in clause
2.6(A);
"DIRECT COMPETITOR" means any entity which operates
telecommunication networks or which
provides telecommunication services;
"EURIBOR" shall be set in reference to Telerate
page 248 (or any applicable substitute
page).
"FAIR MARKET VALUE" in relation to any Shares means the
value of those Shares determined in
accordance with Schedule 2 (Fair Market
Value);
"GERMAN GAAP" means sound accounting practice
according to the German Commercial Code;
"GROUP" in relation to any person (the "relevant
person"), means (i) the Ultimate Parent
Company and Subsidiaries for the time
being of the relevant person, and (ii)
any Subsidiary of any such Ultimate
Parent Company, provided that where used
in connection with the Company the term
"Group" shall mean the Company and its
Subsidiaries;
"GUARANTEED SHAREHOLDER" means, in respect of a Guarantor, the
Shareholder listed in Schedule 1 (Part
B) set opposite the name of that
Guarantor or any permitted transferee of
the Shares held by such Shareholder in
accordance with the terms of this
agreement or the Articles of
Association;
"GUARANTORS" means the persons listed in Column 1 of
Schedule 1 (Part B);
"LICENCE FEE" means the amount paid by the Licensee at
the request of RegTP after the end of
the Auction and before the Licence is
granted.
"LICENCE" means a licence for the operation of
transmission paths for the offer of
publicly available third generation (3G)
mobile radio (UMTS/IMT-2000) services in
the territory of the Federal Republic of
Germany issued in accordance with the
Rulings;
"LICENSEE" means Group 3G UMTS GmbH, a 100%
subsidiary of the Company, a German
limited company registered under HRB
138839 at the Commercial Register of the
Local Court of Munich with its
registered seat in Munich.
"MANAGING DIRECTORS means the managing director(s) of the
(GESCHAFTSFUHRER)" Company appointed pursuant to German
law;
"MVNO AGREEMENT" means any agreement entered into between
the Company and any MVNO;
"MVNO OPERATIONS" the business proposed to be carried on
by a MVNO utilising the spectrum granted
to the Company pursuant to any Licence;
"MVNO" means a mobile virtual network operator
utilising or proposing to utilise the
Network;
"NETWORK" means the Germany third generation
mobile telephony network to be built,
operated and developed by the Company in
order to exploit the bandwidth covered
by the Licence;
"OPCO" means OpCo Mobile Services GmbH, a
German limited company registered under
HRB 13 90 71 at the local court of
Munich with its registered seat in
Munich, a 100%
subsidiary of the Company;
"PERCENTAGE INTEREST" means the number of Shares held by a
Shareholder, expressed as a percentage
of the total number of Shares;
"REGTP" means "REGULIERUNGSBEHORDE FUR
TELEKOMMUNIKATION UND POST" (the German
Regulatory Authority for
Telecommunications and Posts);
"RESERVED MATTERS" means in any matter designated as such
in this Agreement;
"RULINGS" means the general administrative orders
("ALLGEMEINVERFUGUNGEN") set forth in
Ruling 13/2000 (BK-1b-98/005-1) and
Ruling 14/2000 (BK-1b-98/005-2) by the
President's Chamber of the RegTP dated
18th February, 2000, published in the
Official Journal of the RegTP No. 4/2000
of 23rd February, 2000;
"SHAREHOLDER AND/OR PARTY" means the persons listed as such in
Schedule 1 (Part A) and any other person
to whom the benefit and burden of this
agreement is extended pursuant to the
Articles of Association;
"SHAREHOLDER CONTRACT" means any contract or arrangement
between any Shareholder (or any member
of a Shareholder's Group) and the
Company (or a member of its Group) and
any variations or amendments to any such
contracts or arrangements;
"SHARES" The shareholders' equity interests in
the Company, each 50,00 Euro granting
one vote;
"SUBSIDIARY" means a company which is under the
Control of another company;
"ULTIMATE PARENT COMPANY" in relation to a Shareholder means the
person (if any) which is not itself
subject to Control but which has Control
of that Shareholder, either directly or
through a chain of persons each of which
has Control over the next person in the
chain. In relation with Sonera 3G
Holding, it is understood that the
Ultimate Parent Company is Sonera
Corporation.
1.2 INTERPRETATION
In construing this Agreement, unless otherwise specified:
(A) references to clauses and schedules are to clauses of, and schedules
to, this Agreement;
(B) use of any gender includes the other genders;
(C) references to a "PERSON" shall be construed so as to include any
individual, firm, company or other body corporate, government, state or
agency of a state, local or municipal authority or government body or
any joint venture, association or partnership (whether or not having
separate legal personality);
(D) a reference to any statute or statutory provision shall be construed as
a reference to the same as it may have been, or may from time to time
be, amended, modified or re-enacted except to the extent that any
amendment or modification made after the date of this agreement would
increase or alter the liability of any of the Shareholders under the
Warranties;
(E) references to times are to Germany times;
(F) a reference to any other document referred to in this Agreement is a
reference to that other document as amended, varied, novated or
supplemented (other than in breach of the provisions of this Agreement)
at any time;
(G) headings and titles are for convenience only and do not affect the
interpretation of this Agreement;
(H) references to this Agreement are to the Agreement as amended from time
to time in accordance with its provisions;
(I) references to "EURO" or "E" shall be construed as the official EMU
single currency; and
(J) references herein to a Shareholder being obliged to procure that
another person shall do something or shall not do something shall,
where that Shareholder is able to exercise voting rights and other
powers of control in relation to that person, be deemed to require that
such Shareholder does so exercise such rights and powers so as to
procure that such person does or does not do such thing, as
appropriate.
1.3 SCHEDULES
The schedules form part of this Agreement and shall have the same force
and effect as if expressly set out in the body of this Agreement, and
any reference to this Agreement shall include the schedules.
2. STRUCTURE
2.1 STRUCTURE AND BUSINESS OF THE GROUP
(A) The business of the Company shall be the holding of shares in
Licensee, OpCo and other companies involved in the GSM/GPRS
and UMTS business in Germany.
(B) The Shareholders commit to amend the Articles of Association
of the Company so as to meet the requirements of this
Agreement, before December 31, 2001.
(C) Percentage interests
As at the date hereof the Percentage Interest of each Shareholder is as
identified in Column (vii) of Part (A) of Schedule 1.
2.2 GSM/GPRS SERVICES
The Shareholders agree to do their best efforts to launch,
through the Company and its subsidiaries, GSM/GPRS services in
the German market before January 1st, 2002. For these
purposes, a MVNO may be established either as a business unit
of Licensee or as a separate legal entity to be acquired or
incorporated by the Company or Licensee. In such a case, the
MVNO shall be named and branded in accordance with clause 2.3
herein.
2.3 BRANDING
On October 4th, 2001 the Advisory Board of the Company
resolved the adoption of the brand "▇▇▇▇" as commercial brand
and trademark for the Company's services in Germany. The
Parties will negotiate on the terms and conditions regarding
the authorisation to the Company and its subsidiaries to use
the above referred brand and trademark within the territory of
Germany and internet, either by way of licensing the use of
such a brand in favour of the Company or by way of
transferring the Company the ownership of the above referred
brand.
In any case, any further modification regarding the brand will
be approved by the Advisory Board by simple majority of all
its members.
2.4. IPO
It is the current intention of the Shareholders that there should be
initial public offering (an "IPO") of the Company 5 years after the
date of the award of the Licence, subject to market conditions and
commercial and technical viability. The Shareholders will use their
respective best efforts to ensure that the right of TICSA to propose
the CEO of the Company (so long as TICSA has at the time of the IPO the
right to nominate the CEO pursuant to clause 3) and certain technical
decisions, shall be preserved following an IPO (to the maximum extent
permissible in accordance with all relevant laws and listing
regulations), provided that the TICSA 's Percentage Interest is not
diluted vis-a-vis Sonera to any material extent as part of the IPO and
to the extent that it is permitted by the applicable laws and
regulations.
In case IPO cannot be executed within the period stated above, then
Sonera and Telefonica Moviles, S.A., as agreed under the Letter of
Agreement dated on 3rd October, 2001, shall use their best efforts to
make Sonera's shares in the Company tradable or exchange them into
tradable shares.
2.5 RESTRICTIONS TO TRANSFER THE SHARES
From the date of execution of this Agreement and up to 17th August
2002, each of the Shareholders is free to transfer its shares to a
third party subject to the prior written approval from the Advisory
Board, which can not be unreasonable withheld or delayed. From the
above referred date, each of the Shareholders shall be entitled to
transfer its shares to a third party. In any case, any transfer of
shares to a third party will be subject to the third party adhering to
this shareholders agreement and assumes all the obligations and
liabilities of the transferring Shareholder. In case a third party
becomes a shareholder of the Company, the Parties will previously amend
this Agreement in order to eliminate the Put Option provision (as
defined in Clause 4.3 hereof), preserving, in any case and as far as
practicable, the rights of each of the Parties as agreed herein.
The transfers are subject to the pre-emption right of the non
transferring Shareholder. The Articles of Association shall be amended
accordingly.
In any case, as a general principle, any transfer of Company' shares
will be subject to any and all regulatory approvals, as the case may be
required.
2.6 COSTS
(A) For the purposes of this clause "COSTS" means all actual
out-of-pocket costs and expenses of whatsoever nature
(excluding executive or management time, hotel, travel,
subsistence and other related costs which shall be borne by
each party) incurred by or on behalf of the Company or its
Subsidiaries (duly justified) in connection with, the
acquisition of the Licence and the start up of the German UMTS
activities, including, without limitation, the fees of its
legal, financial and technical consultants and/or advisers
together with any rents and/or other office expenses incurred
by or on behalf of the Company and/or its subsidiaries.
(B) Subject to clause 13 the Costs shall be borne and, after
incorporation of the Licensee, Opco and the Company and up to
31 December 2000, paid on behalf of the relevant entity, by
each Shareholder in accordance with its Percentage Interest.
If the Percentage Interests of the Shareholders vary, the
Costs shall be borne by each Shareholder in accordance with
its Percentage Interest as of the accrual date (Provided that
if a Shareholder ceases to be Shareholder, it shall remain
liable to bear an amount of the Costs incurred up to the date
of its ceasing to be a Shareholder pro rata its original
Percentage Interest).
(C) The initial Costs incurred by or on behalf of the Company,
Licensee or OpCo and paid by the Shareholders on behalf of the
respective entity up to Dec. 31, 2000 shall be determined by
the Advisory Board. All Costs incurred by the Company,
Licensee or OpCo after Dec. 31, 2000 shall be born and paid by
the Company, Licensee or OpCo, as the case may be.
3. CORPORATE GOVERNANCE
3.1 ISSUES IN ADDITION TO THE ARTICLES OF ASSOCIATION, I.E. APPOINTMENT OF
MANAGING DIRECTOR, ADVISORY BOARD MEMBER, ETC.
(A) The Company will be managed on a day-to-day basis by one or
more Managing Directors (as the Advisory Board may unanimously
agree from time to time, and which may, without limitation
include, a chief financial officer and chief technical
officer, as set forth in subsections (E) and (F) below). If
the Company has more than one Managing Director, one Managing
Director shall be the chairman of the management board
(VORSITZENDER DER GESCHAFTSFUHRUNG - referred to herein as
"CEO") and shall have the special rights set forth in
subsection (D) below. The Advisory Board shall appoint the
Managing Director nominated by TICSA by simple majority of all
members of the Advisory Board (if the Company has only one
Managing Director) or the CEO nominated by TICSA (if the
Company has more than one Managing Director).
(B) The appointment, term of office, powers, duties and
remuneration of the Managing Directors and the CEO, as well as
any rules of procedure for the management (GESCHAFTSORDNUNG
FUR DIE GESCHAFTSFUHRUNG) will be determined by the Advisory
Board by simple majority of all members of the Advisory Board
(C) The sole Managing Director or the CEO (as the case may be)
will have to the maximum extent permitted by German Law the
powers and responsibilities conferred to him under applicable
law, the Articles of Association of the Company and any rules
of procedure for the management as resolved from time to time
by the Advisory Board by simple majority of the Advisory
Board. However, it is hereby agreed in principle that he will
be responsible for:
(i) the management of all activities of the Company and
its subsidiaries and subsidiary undertakings in the
conduct of the Business in accordance with the
Business Plan;
(ii) the general administration of the Company and its
subsidiaries and subsidiary undertakings;
(iii) implementation of the Business Plan; and
(iv) provision to the Advisory Board of information
relating to all major activities of the Company and
its subsidiaries and subsidiary undertakings.
(D) The sole Managing Director or the CEO of the Company, as the
case may be, shall be entitled to exercise all shareholder
rights in any controlled subsidiaries (convening shareholders'
meetings, appointment of managing director etc.). The
Shareholders agree that the Articles of Association of any
controlled subsidiaries shall provide for a list of approval
requirements in order to reserve the Subsidiaries' corporate
governance to the Company in the form set in Schedule 4.
(E) The Advisory Board may appoint by simple majority of all
members of the Board a chief financial officer as a further
Managing Director who:
(i) will be responsible for the day-to-day management of
the financial affairs of the Company and the
supervision of the financial affairs of its
subsidiaries; and
(ii) will be proposed by the sole Managing Director or by
the CEO, as the case may be.
(F) The Advisory Board may appoint by simple majority of all
members of the Board a chief technical officer as further
Managing Director who:
(i) will, subject to clause 3.1(H), be responsible for the
day-to-day management of the technical affairs of the
Company and the supervision of the technical affairs
of its subsidiaries and the implementation of the
technology policies of the Company; and
(ii) will be proposed by the sole Managing Director or by
the CEO, as the case may be.
(G) If the Company has more than one Managing Director, the
following provisions shall apply:
(i) subject to the provisions contained in this clause
3.1, the Managing Directors shall be jointly
responsible for the management of the Company;
(ii) each Managing Director shall be responsible for the
matters assigned to him by the Advisory Board;
(iii) the CEO shall in any event be responsible for the
general strategic planning and development and the
personnel matters of the Company and all other
matters which have not been specifically assigned by
the Advisory Board to any of the other Managing
Directors;
(iv) the CEO shall have the right to propose other senior
employees of the Company and its subsidiaries subject
to simple majority decision of all members of the
Advisory Board; and
(v) all Managing Directors (other than the CEO) and other
senior employees shall report to the CEO.
(H) TICSA will have the right to propose the Chairman of the
Advisory Board, to be approved by simple majority of all of
the members of the Advisory Board.
(I) Concerning technical decisions, the following provisions shall
apply:
(i) TICSA shall be entitled to propose all technical
decisions to be made by the Company, the Licensee
and/or any subsidiaries in respect of 3G
infrastructure platforms and systems which shall be
decided by simple majority of all members of the
Advisory Board.
(ii) the Advisory Board shall procure that a technical
working group comprising a representative of each
Shareholder is constituted to assist the technical
decisions made pursuant to this clause
3.2 Advisory Board and Shareholders' Resolutions
(A) The Advisory Board and the Shareholders Assembly shall take
their respective decisions by simple majority, except with
respect to Shareholders Assembly as per clause 3.2 D) below..
The members of the Advisory Board/Shareholders (as the case
may be) will take all necessary steps in order to pass any
shareholders' resolution on any subject, even if any other
supermajority requirements under German company law are
required, expressly stated in Clause 3.2 (D) below.
(B) The Company shall have an Advisory Board consisting of up to
five members.
As long as TICSA and SONERA remain a sole shareholder
in the Company and unless otherwise agreed between the
Parties, each 20% stake will determine the right to
appoint one member in the Company's Advisory Board,
according to the following rule:Each 20% stake will be
fully attributed to each Party up to their respective
percentages in the Company. The remaining 20% stake
not being totally attributable to any Shareholder,
will be attributed in favour of the Party holding a
higher outstanding shareholder interest within the
above mentioned 20% remaining stake.
In addition to what is required under the German law the Advisory Board
shall receive Management reports, the frequency of which it shall
decide by simple majority of the members of the Advisory Board.
(D) The following matters which shall be subject to a
supermajority decision of 75% in the Shareholders Meeting :
(i) Capital reductions, unless expressly required by
applicable law;
(ii) Distribution of profits and dividends;
(iii) Liquidation ;
(iv) Mergers, provided however that if the value of
Sonera's shares in the resulting entity is greater or
equal to the value of its stake in the Company, as
appraised by an independent valuation from a
world-wide recognised investment bank, Sonera's
consent shall not be withheld;
(v) Capital increases (excluding contributions in kind),
provided however that Sonera shall consent to any capital
increase which is required by the Business Plan (as stated
under Sec. 5.2. (A) herein) and /or required due to conversion
into equity of any shareholders' loans] Capital increases
shall happen at Fair Market Value. Sonera shall be obligated
to participate and vote in favour of any capital increase or
other corporate decision-making of the Company, which may be
necessary from time to time to formalise such a capital
increase. Further Sonera may, at its sole discretion, elect to
participate in capital increases different of the ones caused
by the conversion of shareholders loans, in compliance with
the applicable law and in the best business interest of the
Company.
It is the Shareholders' intention to get vendor or other long-term
third party' financing.
4 CHANGE OF CONTROL AND ITS CONSEQUENCES
4.1 CHANGE OF CONTROL
(A) Subject to sub-clauses (B) and (C) below, a change of Control
(a "CHANGE EVENT") shall occur for the purposes of this
agreement where:
(i) a person acquires Control of a Shareholder where no
person previously had Control of that Shareholder; or
(ii) the Ultimate Parent Company of a Shareholder ceases
to have Control of that Shareholder; or
(iii) a person acquires Control of the Ultimate Parent
Company of a Shareholder; or
(iv) a person who is not under the Control of the Ultimate
Parent Company of a Shareholder acquires Control of
that Shareholder; or
(v) a Shareholder or the Ultimate Parent Company of a
Shareholder merges with any company or other entity
(other than with another Shareholder or member of its
Group) and, as a result of such merger, the
Shareholder or Ultimate Parent Company (as the case
may be) lose its control;
in each case where the person who becomes in Control, or in
case of subsection (v) the other company or entity, is a
Direct Competitor of the other Shareholder, the Company and/or
Licensee.
(B) A body corporate (the "ACQUIRING COMPANY") is not to be
treated as acquiring Control of another body corporate (the
"TARGET COMPANY") where the acquiring company issues shares in
itself to the shareholders of the target company in exchange
for the shares in the target company and, after such exchange:
(i) each person who immediately before the exchange was a
shareholder of the target company is a shareholder of
the acquiring company; and
(ii) the shares in the acquiring company are of the same
classes as were the shares in the target company
immediately before the exchange; and
(iii) the number of shares of any particular class in the
acquiring company bears the same proportion to all
the shares in the acquiring company as the number of
shares of that class in the target company bore to
all the shares in the target company immediately
before the exchange; and
(iv) the proportion of shares of any particular class in
the acquiring company held by any particular
shareholder is the same as the proportion of shares
of that class in the target company held by him
immediately before the exchange.
(C) The provisions of this clause 4 shall not apply where the
acquiring company is a Shareholder or a member of such
Shareholder's Group or the Shareholders transfer the Shares to
a wholly owned holding company for tax or strategic purposes.
(D) A Change Event shall be deemed to have occurred when a
binding agreement has been signed in relation to any of the
transactions listed under 4.1 (A), provided that all
regulatory approvals for such agreement have been obtained
and all conditions to closing have been met.
4.2 CALL OPTION
(A) If a Change Event occurs in relation to any Shareholder (the
"OFFERING SHAREHOLDER"), the Offering Shareholder shall be
deemed to have offered all of its Shares (the "SPECIFIED
SHARES") to the other Shareholder, provided the
other shareholder holds an interest exceeding 50% of the
shares in the Company (the "RECIPIENT"), on the terms and
subject to the provisions of this clause 4.2 (the "COMPULSORY
OFFER"). Such Compulsory Offer shall be legally binding on the
Offering Shareholder, which shall be obliged to use its best
efforts to assure this commitment under any appropriate legal
procedure as stated under German law.
(B) The Recipient may give notice to the Offering Shareholder
("COMPULSORY TRANSFER NOTICE") requiring a determination of
the Fair Market Value of the Specified Shares.
(C) The Shareholders shall determine or procure the determination
of the Fair Market Value of the Specified Shares as at the
closest practicable date immediately prior to the date of the
Compulsory Transfer Notice (as the case may be) without undue
delay after the giving of the Compulsory Transfer Notice.
(D) Within ten Business Days after the date on which the Fair
Market Value of the Specified Shares is determined, the
Recipient may indicate by written notice (the "ACCEPTANCE
NOTICE") to the Offering Shareholder that it is willing to
accept the Compulsory Offer pursuant to clause 4.2(A) at the
Fair Market Value ("Call Option").
(E) If the Recipient so accepts the Compulsory Offer it shall be
obliged to formally accept the Compulsory Offer, in notarial
form, and the Offering Shareholder and the Recipient shall be
obliged to complete the purchase and transfer of the Specified
Shares free from encumbrances and with the rights attaching to
them as at or subsequent to the closest practicable date
immediately prior to the date of the Compulsory Transfer
Notice within ten Business Days after the date of the
Acceptance Notice, in each case in accordance with the
Acceptance Notice and the provisions of clause 4.
(F) Without prejudice to the above, the Recipient shall have the
right to designate a third party (hereinafter referred to as
"Third Party") of its choice, which is entitled to accept the
Compulsory Offer instead of the Recipient and to purchase the
Specified Shares subject to the terms and conditions set forth
in this clause 4. For the avoidance of doubt, the Third Party
shall assume all rights and obligations of the Recipient under
this clause 4 and shall be solely liable for the payment of
the purchase price as determined under clause 4. (C). The
Recipient shall notify the Offering Shareholder in writing of
such Third Party when making the Compulsory Transfer Notice.
(G) The Fair Market Value of the Specified Shares will be
determined according to what is stated in Clause 4.3 (B)
below.
4.3 CALL AND PUT OPTION DUE TO REGULATORY IMPLICATIONS OF A
CHANGE EVENT
(A) In the event that:
(i) a Change Event occurs in respect of a Shareholder or
its Ultimate Parent Company, where the person
acquiring Control following such Change Event (or in
the case of subsection 4.1(A)(v) the other company or
entity) already holds an UMTS and/or GSM licence in
Germany and will maintain such licence after the
Change Event; and
(ii) the Company has received written information,
requirement or recommendation from RegTP that RegTP
will revoke the License granted to the Company (the
"RegTP-Letter") unless the Offering Shareholder
ceases to be a shareholder of the Company or an
Affiliate of a Shareholder ceases to be an Affiliate
of such Shareholder
then the following shall apply:
(a) the Recipient shall have a Call Option
regardless of the seize of its interest in
the Company and shall have the right to
acquire the Specified Shares at a price
determined pursuant to the terms and
conditions set forth in clause 4.3 (B)
below;
(b) the Offering Shareholder, provided he was a
Shareholder of the Company as of September 1, 2000
and further provided his interest in the Company is
smaller than 51%, shall have the right to sell all
the Specified Shares to the Recipient, which will
have the obligation to acquire such shares or to
cause a Third Party to acquire them pursuant to the
terms and conditions set forth in clause 4.3 (B)
below (the "Put Option"). As long as Sonera has a
Company's interest below 51%, the exercising of the
Put Option will be subject to Sonera's fulfilment of
its obligations under the Shareholders Support Deed
(attached as Schedule XX).
(B) In cases 4.3 (A)(a) and 4.3 (A)(b) the considerations
payable for the Specified Shares shall be determined as
follows:
The total price to be paid for the Specified Shares shall be
equal to the Fair Market Value of the Company ("Enterprise
Value"), as appraised by an independent valuation as described
in the Attached Schedule 2), less any outstanding indebtedness
(including shareholders' loans) of the Company (the "Net
Equity"), multiplied by the Offering Shareholder's Percentage
Interest at the time of the exercise of the Put Option. If the
Company's Net Equity is below zero, the Offering Shareholder
will be transferring the Specified Shares to the Recipient at
a price of EURO 0,00 with no further liabilities.
In case the shareholders loans provided by the Shareholders
(direct or indirectly) for the payment of the License fee are
not converted into equity at
the time of Sonera exercising the Put Option, then those loans
shall be taken into consideration as if they had been
converted into equity at the same rate as the initial equity
contribution for the License, for the purposes of determining
the Fair Market Value of the equity.
4.4 EFFECT OF TRANSFER
A person who has ceased to be a Shareholder, pursuant to the operation
of this clause 4, shall cease to be a party to this Agreement, save
where stated to the contrary, but shall remain liable to the Company
and other Shareholders for all amounts payable under this agreement and
accrued at the date of such transfer. In any case, in the event of a
Shareholder withdrawing from this Agreement in accordance with the
foregoing clauses, the provisions regarding Costs (clause 2.6), ,
announcements (clause 12 (F)), confidentiality (clause 12 (A), (B),
(C), (D) (E)), governing law (clause 20) and disputes (clause 19) shall
survive such termination or withdrawal.
5. FUNDING
5.1 PAYMENT FOR LICENSE
The Shareholders shall make the payment of their respective pro-rata
portion of the License fee by way of equity and/or shareholders' loans.
These shareholders' loans will be considered as a permanent funding to
the Company and shall be converted into equity in compliance with the
applicable law. The Parties will use their best efforts to find a
suitable solution as soon as practicable regarding such a conversion
into equity.
5.2 BUSINESS PLAN FUNDING
(A) The Shareholders will from time to time, but shall be under no
obligation to, provide funding to the Company in the
proportion equal to their respective Percentage Interest if
requested by the Advisory Board from time to time Such request
by the Advisory Board shall be:
(i) in accordance with the Business Plan or Budget (as the case
may be); and
(ii) made in writing specifying the amount requested and
the timing of such payment.
(B) Amounts requested pursuant to clause 5.2 (A) may (in the
absence of an unanimous agreement of the Shareholders
otherwise) be funded (i) by way of equity contributions
(payment into the capital reserves pursuant to Sec. 272
para. 2 no. 4 German Commercial Code) or capital increases
observing the principles adopted for capital increases and/or
(ii) by way of Shareholder loans.
5.3 CONSEQUENCES OF FAILURE TO PROVIDE THE BUSINESS PLAN FUNDING
(A) If a Shareholder elects not to provide funds pursuant to
clause 5.2 (a "NON-FUNDING SHAREHOLDER"), substitute funding
may be provided by the other Shareholder, by way of
shareholder loan or equity.
(B) If after written notice in addition to the notice according to
Section 5.3 (A)(ii) to the Non Funding Shareholder the Company
has not received the entire amount payable by the Non Funding
Shareholder within ten Business Days, then
(i) the other Shareholder may at its sole discretion
contribute the outstanding amount of that Non Funding
Shareholder, within 10 Business Days of the date of
such demand (or such shorter period as is necessary
in order that the Company may meet its payment); and
(ii) if the other Shareholder ("Substitute Funding
Shareholder") contributes the amount outstanding from
the Non Funding Shareholder and, in case of funding
through shareholder loans, if the Substitute Funding
Shareholder elects to convert the shareholder loan
into equity of the Company, then the Percentage
Interest of the Non Funding Shareholder shall be
diluted in favour of the Percentage Interest of the
Substitute Funding Shareholder based on the following
formula (the "Dilution Formula"):
(a) The registered share capital of the Company shall be
increased pro rata to the quotient of the Fair Market
Value of the equity (to be determined according to
the attached Schedule 2 at the time the funding is
made and, in case of shareholder loans, at the time
of the conversion of the shareholder loan into
equity) plus the total amount of the funding
contributed by the Substitute Funding Shareholder
divided by the Fair Market Value of the equity.
[Example: If the Fair Market Value of the equity is
10 bn, share capital is 250 Mill. and the funding
contributed by the Substitute Funding Shareholder 1
bn, then the existing registered capital will be
increased from 250 Mill. to 275 Mill, from 100 Mill
to 110 Mill, if the share capital would be 100
Mill.].
(b) All shares issued in such capital increase
[Example: 25 Mill] shall be subscribed by the
Substitute Funding Shareholder, the Non Funding
Shareholder hereby waiving its subscription rights.
As a result of the capital increase, the Percentage
Interest of the Substitute Funding Shareholder
[Example: 57,2%] shall be increased to an amount
equal to the quotient of the current share capital of
the Substitute Funding Shareholder [Example: 143 Mill
or if share capital is 100 Mill, 57.8 Mill] plus the
additional shares subscribed in the capital increase
[143+25=168 Mill. or 57.8+10=67,8 ] divided by the
increased total share capital [Example: 168:275/or
67,8:110= ca. 61%] ("Increased Percentage Interest").
Such Increased Percentage Interest shall then replace
the Percentage Interest of the Substitute Funding
Shareholder where applicable throughout this
Agreement, being reduced the Non Funding Shareholder
Percentage Interest accordingly.
(c) In case the Dilution Formula, as defined in sections
(a) and (b) above, cannot be implemented due to any
negative tax and/or legal implications, the relevant
shareholder loan will be taken into consideration at
its book value in order to asses the relevant
dilution of the Non Funding Shareholder. For these
purposes, the Shareholders will do their best efforts
in order to achieve an effective and suitable
solution, assessing the relevant dilution of the Non
Funding Shareholder. In any case, the Substitute
Funding Shareholder may elect at its free discretion,
by giving written notice to the Non Funding
Shareholder, either to acquire, at nominal value, as
many of the existing shares of the Non Funding
Shareholder [Example: 10 Mill. of 250 Mill.] as
necessary to achieve the Increased Percentage
Interest in the Company or any other alternative
suitable for the Substitute Funding Shareholder.
If the dilution mechanism described above triggers
the dilution of the Non Funding Shareholder's
interest below a minimum of 10%, then the Substitute
Funding Shareholder shall have a call option to
acquire all of the remaining Non Funding
Shareholder's shares at a price equal to the Fair
Market Value of those remaining shares.
Regardless of its existing interest or its rights under the
Articles of Association, the Non Funding Shareholder shall be
obligated to participate and vote in favour of any capital
increase or other corporate decision-making of the Company,
which may be necessary from time to time to achieve the
corporate structure as contemplated by the provisions of this
Agreement.
The rights and remedies described in sections (A) or (B) above shall be
the sole rights and remedies of a shareholders in case the other
shareholder decides not to contribute funds to the Company.
6 PREPARATION AND ADOPTION OF BUSINESS PLANS AND BUDGETS
(A) As soon as practicable, the Advisory Board shall adopt the
Business Plan and the Budget
(B) The CEO will submit to the Advisory Board, for its approval by
simple majority of all of its members, a reviewed business
plan at least thirty Business Days prior to the end of each
Accounting Period, such draft business plan covering the
three-year period commencing at the end of such Accounting
Period. Each draft business plan shall include:
(i) business forecasts;
(ii) appropriate explanations of the CEOs' proposed
strategy;
(iii) details of the assumptions used; and
(iv) financial resources fulfilling the funding
requirements of the business plan.
At least thirty Business Days prior to the end of each
Accounting Period, and in conjunction with the submission of
the related Business Plan, the CEO shall submit to the
Advisory Board a draft budget for the next following
Accounting Period. Each draft budget shall include a detailed
breakdown of the following together with details of the
material assumptions used:
(i) monthly revenue, operating expenses, operating results and
net interest expenses;
(ii) quarterly capital expenditures and cash flow;
(iii) balance sheet as at the end of the relevant Accounting
Period and a profit and loss account for that Accounting
Period;
(iv) expected funding requirements and the proposed methods of
meeting those requirements; and
(v) cash flow return on investment and other metrics agreed by
the Advisory Board.
7 NON-COMPETE COVENANT
(A) Subject to Clause 7 (B) or otherwise approved by the Advisory Board, each
Shareholder undertakes with the other Shareholder that it will not and that it
will procure that no member of its group will either alone or in conjunction
with or on behalf of any other person, do any of the following things:
(i) whilst its Percentage Interest is at least 10 per
cent. (a "NON COMPETE INTEREST"), establish, be
engaged or (except as the holder of securities in a
corporate body if such securities are listed on a
recognised investment exchange and confer not more
than one per cent of the votes which could normally
be cast at a general meeting of the corporate body)
be directly or indirectly interested in carrying on
any other 3G business operating in Germany which
requires access to a national or local network;
(ii) whilst it holds a Non-Compete Interest, directly or
indirectly solicit, in relation to any person to
which goods or services are or have been sold by the
Company or its subsidiaries in the course of the
Business, the custom of that person in respect of
similar goods or services;
(iii) whilst it holds a Non-Compete Interest, directly or
indirectly solicit or entice away from the employment
of the Company any of its employees; nor
(iv) assist any other person to do any of the foregoing
things.
(B) Shareholder or any member of its Group may operate any
particular service without breaching clause 7 (A) provided
that:
(i) the Shareholder in question has first offered the
Company and/or the Licensee and its subsidiaries (as
appropriate) reasonable opportunity to agree to act
as the network operator and/or service provider for
such service (which offer must have been on arm's
length commercial terms); and
the Company and/or the Licensee and its subsidiaries
(as appropriate) shall have declined so to act as the
network operator and/or service provider for such
service (and provided always that the offering
Shareholder shall not be entitled to exercise any of
its voting rights in this respect); and
(ii) the relevant service is not in direct competition
with any service carried on by the Company and/or the
Licensee and its subsidiaries,
taking into account in any case that the Rulings prohibit a
Licensee or its shareholders to act as service provider for
another UMTS-Licensee.
(C) Without prejudice to the above, it is understood and agreed by
the Shareholders that, for so long as the Shareholders hold
any shares, the Shareholders shall treat the Company as their
sole vehicle for the operation, development and provision, in
Germany, of telecommunication mobile services, particularly
third generation services (UMTS), and any kind of future
enhancement of this technology.
The restriction contained herein shall not affect or prohibit any
Shareholder to establish, direct or indirectly, any mobile internet
portal, provided that, as long as the exploitation of such internet
portal implies the access to a UMTS network, the related contracts will
be entered into by any such Shareholder with the Company or its
subsidiaries on a priority basis, according to paragraph (B) (i) of
this clause.
For the purposes of this Clause, it is understood that any reference
made to any member of a Shareholder Group, being TICSA such a
Shareholder, refers to any company belonging to Telefonica Moviles
Group.
8 EU-MERGER-CLEARANCE
The Shareholders notified the establishment of the Company with the Commission
of the European Communities on October 2000. With letter dated November 17,
2000, the Commission informed the Shareholders that it did not oppose to the
notified operation and declared it compatible with the common market and with
the EEA Agreement.
9 DURATION OF SHAREHOLDERS' AGREEMENT
(A) This Agreement shall terminate in respect of a Shareholder upon
that Shareholder ceasing to hold Shares but without prejudice to
accrued rights and liabilities. Clauses 2.6, 12, 19 and 20 shall
continue to apply notwithstanding any such termination within a
period of one year from the termination date.
(B) This Agreement shall terminate in respect of all Shareholders on
the expiry of the Licence granted to Licensee (which is
currently stated to be 30 years from issuance of the Licence).
10 INTELLECTUAL PROPERTY RIGHTS
Each Shareholder undertakes with each other Shareholder that it shall
provide or procure that the applicable member of its Group shall
provide to the Company and/or the Licensee and OpCo such intellectual
property rights exclusively owned by that Shareholder or any member of
its Group as may be required by the Company and/or the Licensee and
OpCo (as the case may be), as far as they need it to develop their own
activities, provided that appropriate intellectual property right
agreements are negotiated on an arms-length commercial basis in respect
of such intellectual property rights.
11 DIVIDEND DISTRIBUTION POLICY
No dividends shall be declared or paid:
(A) unless there are sufficient distributable reserves and cash
following repayment of all shareholder loans;
(B) if to do so would be contrary to (i) any direction made by the
Advisory Board; or (ii) the Business Plan;
(C) unless (i) the Company has been the subject of an IPO; or (ii)
five years have elapsed since the award of the Licence to the
Company, whichever is the first to occur; and/or
(D) if such declaration or payment will breach any applicable law
or regulation then in force and binding on the Company.
12 CONFIDENTIALITY AND PUBLIC ANNOUNCEMENTS
(A) Without limiting the generality of any other provision of this
Agreement, each Shareholder to this Agreement shall comply
with the provisions of the Rulings relating to confidential
information.
(B) Each party shall treat as confidential all information
obtained as a result of negotiating and entering into this
Agreement or, in the case of a Shareholder, through its
interest in the Company or its Business or assets and which
relates to:
(i) the provisions of this Agreement;
(ii) the negotiations relating to this Agreement;
(iii) the Company, Licensee and OpCo or their Business or
assets including, without limitation, their conduct
of the Auction and information relating to the terms
of the proposed exploitation of any Licence granted
to them; or
(iv) any Shareholder or a member of its Group or their
respective businesses or assets.
(C) Each Shareholder shall:
(i) not disclose any such confidential information to any
person other than:
(a) an Advisory Board Member by it or a member
of its Group, or any of its directors or
employees or directors or employees of any
such member whose duties include the
management or monitoring of the business of
the Company and who needs to know such
information in order to discharge his
duties;
(b) a member of the Shareholder's Group to whom
any Share is to be transferred pursuant to
this Agreement;
(c) after any Licence has been granted to the
Company, to any existing or prospective
shareholder of the Shareholder or of any
member of its Group provided each other
Shareholder has provided its prior written
consent to such disclosure;
(d) not use any such confidential information
other than for the purposes of managing or
monitoring its investment in the Company;
and
(e) procure that any person to whom such
confidential information is disclosed by it
complies with the restrictions set out in
this clause 12 as if such person were a
party to this Agreement.
(D) Notwithstanding the previous provisions of this clause 12, any
Shareholder may disclose such confidential information:
(i) if and to the extent required by law or for the
purpose of any judicial proceedings;
(ii) if and to the extent required by any securities
exchange or regulatory or governmental body to which
that party or any member of its Group is subject,
wherever situated whether or not the requirement for
information has the force of law;
(iii) to its professional advisers, auditors and bankers;
or
(iv) if and to the extent the information has come into
the public domain through no fault of that party.
(E) The restrictions contained in this clause 12 shall continue to
apply to each Shareholder (including any Shareholder who has
ceased to hold Shares) for a period of one year.
(F) No announcement concerning this Agreement, the Licensee's
participation in the Auction or any Shareholder's membership
in the Company shall be made by any Shareholder without the
prior written approval of the Shareholders (such consent,
after the grant of a Licence to the Company, not to be
unreasonably withheld or delayed) and no announcement shall
refer to any Shareholder (or any member of its Connected
Group) without the prior written approval of that Shareholder.
(G) Notwithstanding the previous provisions of this clause 12, any
Shareholder may, whenever practicable after consultation with
the Advisory Board, make an announcement concerning this
agreement or the Licensee's participation in the Auction if:
(i) required by law or for the purpose of any judicial
proceedings;
(ii) required by the Rulings or the Regulator for any
purpose connected with the Auction or the Company's
Application; or
(iii) required by any securities exchange or regulatory or
governmental body to which that party or any member
of its Group is subject, wherever situated whether or
not the requirement has the force of law.
13. COSTS
Other than the Costs to be paid pursuant to clause 2.6 each Shareholder
shall bear its own costs and expenses in relation to the negotiation,
preparation, execution and carrying into effect of this Agreement and
any ancillary agreements. Any notarisation fees shall be borne equally
by the Shareholders.
14. GUARANTEES BY HOLDING COMPANIES OF THE SHAREHOLDERS
Each Guarantor hereby assumes the joint and several liability
(SCHULDBEITRITT) for all obligations of the Guaranteed Shareholder (or
any member of the Guaranteed Shareholder's Group to which Shares are
transferred).
15. SHAREHOLDER UNDERTAKING
Each Shareholder severally undertakes with each other Shareholder that
it has and will (where appropriate, for any relevant period stipulated
in the Rulings):
(A) exercise its voting rights and other rights as a member of the
Company in order (insofar as it is able to do so through the
exercise of such rights) to give full effect to the terms of
this Agreement, the Articles of Association and the rights and
obligations of the parties as set out in this agreement and
the Articles of Association;
(B) procure that each Advisory Board Member appointed by it from
time to time shall (subject to his fiduciary duties to the
Company) exercise his voting rights and other powers and
authorities in order (insofar as he is able to do so through
the exercise of such rights, powers and authorities) to give
full effect to the terms of this agreement, the Articles of
Association and the rights and obligations of the parties as
set out in this agreement and the Articles of Association;
(C) comply with each of the provisions of this agreement and the
Articles of Association applicable to it;
(D) comply with each of the provisions of the Rulings and
applicable German law;
(E) comply with each of the conditions of any Licence or any other
licence material to the Business, the terms of which have been
notified to Shareholders, granted to the Company or its
Subsidiaries to the extent applicable to it;
(F) procure, so far as it is able by virtue its holding of Shares
and representation on the Advisory Board, that the Company
complies with the terms of any Licence or any other licence
material to the Business, the terms of which have been
notified to Shareholders, granted to the Licensee;
(G) upon request, promptly provide the Company with all
information and assistance necessary for the Company and/or
the Licensee to comply with each of the provisions of the
Rulings and each of the conditions to any Licence granted to
the Licensee;
(I) promptly comply with all reasonable requests for information
by the Company for the purposes of compliance by the Company
and/or the Licensee with the conditions of any licence granted
to or applied for by the Licensee.
16. SHAREHOLDER CONTRACTS
(A) All the transactions between the Company (or its subsidiaries) and
the Shareholders (and/or any company belonging to the same group) shall
be performed under arm's length basis, assuming that they shall not
include or result in any value transfers out of the Company. All those
material agreements concluded/to be concluded between the Company (or
its subsidiaries) and any Shareholder (and/or any company belonging to
the same group) shall be recorded in the Advisory Board.
(B) Each Shareholder undertakes to each other Shareholder not to
exercise any rights of influence and to procure that none of its
Advisory Board Member use any Voting Rights so as to participate in
implementing any Shareholder Contract which is not on arm's length
terms.
17. MISCELLANEOUS
(A) In this Agreement, nothing shall be deemed to constitute a
partnership between the Shareholders nor constitute one the
agent of another in any manner or for any purpose whatsoever.
(B) This Agreement shall supersede the Shareholders Agreement
dated August 16, 2000, which shall be terminated with
immediate effect upon signing of this Agreement.
In the event of any ambiguity or conflict arising between the
terms of this Agreement or the Articles of Association, the
terms of this Agreement shall prevail as between the
Shareholders to the extent of that ambiguity or conflict. In
any case, the Parties agree that this Agreement shall
supersede the Letter of Agreement executed among Telefonica
Moviles S.A. and Sonera Corp. on October 3rd, 2001. So far as
not prohibited by law, each Shareholder undertakes to exercise
all voting and consent rights and powers of control available
to it in relation to the Company in good faith so as to give
full effect to the terms and conditions of this Agreement.
(C) No Shareholder shall assign or purport to assign or otherwise
deal with any of its rights and obligations hereunder, except
with the express prior written consent of the other
Shareholder
(D) Subject as set out below, if any provision or provisions of
this Agreement shall be found by any court, government body,
anti-trust authority or regulatory or administrative body of
competent jurisdiction to be invalid or unenforceable, the
invalidity or unenforceability of such provision(s) shall be
deemed to be deleted from this Agreement and the remaining
provisions shall remain in full force and effect. The
Shareholders hereby agree to substitute for any deleted
provision(s) a valid and enforceable provision(s) which
achieves to the greatest extent possible the economic, legal
and commercial objectives of this Agreement. For the avoidance
of any doubt, the Shareholders shall not be required by any
provision of this Agreement to do (or refrain from doing) any
act or thing where so doing (or so refraining) would
contravene the provisions of any applicable law or of any
applicable regulation issued by any competent authority; and
shall not be regarded as having breached this Agreement by
reason of not having done (or having refrained from doing)
such act or thing. Nothing contained in this Agreement shall
require any of the Shareholders to do anything or procure that
their Group members do anything that would conflict with any
regulatory licence or condition with which that Shareholder or
its Group Members must comply.
(E) The Shareholders shall at their own expense execute all such
documents as may reasonably be required for the purpose of
giving full effect to this Agreement.
(F) No failure or delay on the part of any Shareholder in
exercising any right, power or remedy hereunder shall operate
as a waiver thereof nor shall any single or partial exercise
of any right, power or remedy preclude any further exercise
thereof or the exercise of any other right, power or remedy.
No waiver shall be effective unless expressed in writing
signed by or on behalf of the Shareholder granting it.
(G) No variation of this Agreement shall be effective unless made
in writing and signed by each of the Shareholders.
(H) Any and all notices pursuant to this Agreement shall be in
writing and signed by (or by some person duly authorised by)
the Shareholder giving it and may be served by leaving it at,
or sending it by registered post, air mail or facsimile
(confirmed by registered post or air mail) or by hand to the
address of the relevant recipient Shareholder set out below
(or as otherwise notified from time to time hereunder). Any
notice so served by facsimile or by hand shall be deemed to
have been received on the next working day after the notice
has, respectively, been transmitted or received. Any notice so
served by registered or air mail shall be deemed to have been
received 3 working days after the notice has been posted. The
addresses of the Shareholders for the above purpose are as
follows:
TICSA
▇▇▇▇, ▇▇ ▇▇ ▇▇
▇▇▇▇▇▇
▇▇▇▇▇
For the attention of: ▇▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇/▇▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Bueno
Fax no: ▇▇ ▇▇ ▇▇▇▇▇▇▇
SONERA
▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
For the attention of: ▇▇. ▇▇▇▇ ▇▇▇▇▇▇▇
Fax no: ▇▇▇ ▇▇▇▇▇▇▇▇▇
(I) This Agreement (together with its Schedules and the documents
to be executed or adopted pursuant to it) constitutes the
entire and only agreement between the Shareholders in relation
to the subject matter and replaces and extinguishes all prior
agreements, undertakings, arrangements, understandings or
statements of any nature made by the Shareholders whether oral
or written (and, if written, whether or not in draft form)
with respect to such subject matter. Each of the Shareholders
acknowledges that it is not relying on any statements,
warranties or representations given or made by any of them in
relation to the subject matter of this Agreement, save those
expressly set out in this Agreement, and that it shall have no
rights or remedies with respect to such subject matter
otherwise than under this Agreement (and the documents
executed at the same time as it or referred to in it) save to
the extent that they arise out of the fraud or fraudulent
misrepresentation of any Shareholder.
18. DEADLOCK RESOLUTION MECHANISM
(A) If a proposal is made in respect of one of the matters
contained in Clause 3.2 (D) herein (Reserved Matters), any
Shareholder may give written notice to the other that it
regards a deadlock situation as having arisen ("DEADLOCK
NOTICE"). Only one Deadlock Notice may be served in respect of
any one proposal.
(B) Within seven days of the date of service of a Deadlock Notice,
each Shareholder shall each prepare and send to the others a
memorandum stating its understanding of the disagreement, its
position in relation to the disagreement, its reasons for
taking that position and any proposals for resolving the
disagreement.
(C) If within fourteen days from the date of service of a Deadlock
Notice the Shareholders shall have failed to resolve the
disagreement, the respective chief executive officers of each
Ultimate Parent Company shall be provided with copies of all
such memoranda and shall as soon as reasonably practicable
meet to discuss the disagreement and use all reasonable
endeavours to resolve it.
(D) If a deadlock relating to any proposal made in respect of one
of the Reserved Matters is not resolved after applying the
above procedure, the Party submitting the proposal shall be
entitled to withdraw such a proposal or to ask for an
arbitration procedure as regulated in Clause 19 below.
19. ARBITRATION
All disputes arising in connection with this Agreement shall be finally
settled under the Rules of Conciliation and Arbitration of the
International Chamber of Commerce ("ICC RULES"), as in effect from time
to time, by three arbitrators in accordance with the ICC Rules. The
place of arbitration shall be Berlin. The arbitration proceedings shall
be held in the English language provided that no party shall be under
any obligation to produce translations of documents prepared in the
German language. If there are more than three parties involved in the
arbitration, the Court (as defined in the ICC Rules) shall appoint all
three arbitrators, to the extent that the parties do not jointly
nominate one or more arbitrators within 30 days from the date when the
Claimant's
Request for Arbitration (as defined in the ICC Rules) has been
communicated to the other parties. The chairman of the arbitral
tribunal must be eligible for the office of a judge in the Federal
Republic of Germany. This arbitration clause does not affect each
party's right to seek injunctions or other temporary relief before the
competent state courts.
20. CHOICE OF LAW
This agreement is to be governed by and construed in accordance with
German law.
IN WITNESS whereof the Parties or their authorised representatives have set
their hands the day and year first above written.
Signed by ▇▇. ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
(Executive President)
for and on behalf of
TELEFONICA MOVILES
INTERCONTINENTAL S.A.
Signed by ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇
for and on behalf of
SONERA 3G HOLDING BV and
SONERA CORPORATION.
Signed by ▇▇. ▇▇▇ ▇▇▇▇▇▇▇▇
for and on behalf of
SONERA 3G HOLDING BV and
SONERA CORPORATION.
Shareholders Agreement
Page 29
SCHEDULES
SCHEDULE1
(PARTA)
DETAILS OF SHAREHOLDERS
(vii)
(i) (ii) (iii) PERCENTAGE
NAME OF SHAREHOLDER REGISTERED OFFICE AND NUMBER FACSIMILE NO. INTEREST
------------------- ---------------------------- ------------- ----------
Telefonica Moviles Goya 24, (00) 34 91 4234122 57.2%
Intercontinental ▇▇ ▇▇▇▇▇▇
("TICSA") ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 58, (00) 358 20 40 63 42.8%
Holding B.V. 2909 LC 570
("SONERA ") ▇▇▇▇▇▇▇ aan den Ijssel
The Netherlands
SCHEDULE1
(PARTB)
DETAILS OF GUARANTORS
(i) (II) (iii) (iv) (V)
NAME OF GUARANTOR REGISTERED OFFICE AND NUMBER FACSIMILE NO. E-MAIL ADDRESS GUARANTEED SHAREHOLDER
----------------- ---------------------------- ------------- -------------- ----------------------
Sonera Corporation Ltd. Teollisuuskatu 15 ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Sonera 3G Holding BV
("SONERA CORP") Helsinki,
Finland
SCHEDULE2
FAIR MARKET VALUE
(A) The "FAIR MARKET VALUE" of any Shares, other than where the
Shareholders agree the Fair Market Value, shall be determined
as follows:
(i) the Fair Market Value of any Shares shall be the fair
market value of those Shares (without implying any
discount for lack of control) [or, in the case of the
clause 5.3(A), of the Shares to be issued were they
to be issued to a third party subscriber], determined
on the basis of a sale between a willing seller and a
willing buyer on the assumption that the business of
the Company is and will remain for the foreseeable
future a going concern;
(ii) subject as provided below, shall be such price as is
the mean average of the prices certified in reasoned
certificates (each a "VALUATION CERTIFICATE")
provided by two international investment banks (each
an "EXPERT BANK"), one Expert Bank to be appointed by
the proposed transferor ("FIRST EXPERT BANK") and one
Expert Bank to be appointed by the proposed
transferee ("SECOND EXPERT BANK"), Provided That the
higher of the prices so certified by the Expert Banks
is within 10% of the lower of the prices so certified
by the Expert Banks. In the case that the transferor
doesn't comply (in time and form) with the
appointment of its Expert Bank as required above, the
Value shall be determined only by the transferee's
Expert Bank.
(iii) where the higher of the prices so certified by the
Expert Banks is not within 10% of the lower of the
prices so certified by the Expert Banks, the Expert
Banks shall agree upon a third international
investment bank ("THIRD EXPERT BANK" which shall also
be deemed to be an Expert Bank for the remaining
provisions of this Schedule) and the price certified
by the Third Expert Bank in a Valuation Certificate
shall be conclusive and binding on the Shareholders
provided that such price is within the prices
certified by the First Expert Bank and the Second
Expert Bank.
(iv) each Expert Bank shall be instructed to issue their
Valuation Certificates as soon as possible and in any
event within 20 Business Days of its appointment;
(v) the appointing Shareholders agree that they will not
unreasonably delay appointing the relevant Expert
Banks and that, in the event of unreasonable delay by
any Shareholder, the relevant Expert Bank may be
appointed by the Company (and in this respect the
delaying Shareholder shall not be entitled to
exercise any of its voting rights);
(vi) the Expert Banks shall act as experts and not as
arbitrators for all purposes under this clause (A)
(Fair Market Value);
(vii) the fees of the First Expert Bank and the Second
Expert Bank shall be borne by the Shareholder(s)
obliged to appoint them, except where the
determination of the Fair Market Value is consequent
upon a change of
control of one Shareholder in which case the
Shareholder subject to the change of control shall
bear the fees of both Expert Banks;
(B) the fees of the Third Expert Bank shall be borne equally by
the proposed transferor, on the one hand, and the proposed
transferees, on the other hand, except where the determination
of the Fair Market Value is consequent upon a change of
control of one Shareholder in which case the Shareholder
subject to the change of control shall bear the fees of the
Third Expert Bank.
