Exhibit 10ddd
EXECUTION COPY
SHARE PURCHASE AGREEMENT
among
Discount Investment Communications B.V.
and
Discount Investment Corporation Ltd.
and
BellSouth Holdings B.V.
and,
for purposes of Article XII only,
BellSouth Corporation
Dated as of May 13, 2005
SHARE PURCHASE AGREEMENT
THIS SHARE PURCHASE AGREEMENT (this "Agreement") dated as of May 13, 2005, is
executed among:
(1) Discount Investment Communications B.V., a corporation duly organized
under the Laws of The Netherlands, having its registered office at Xxxxx 00, XX
Xxxxxxxxx 0000, Xxx Xxxxxxxxxxx ("Purchaser"); and
(2) Discount Investment Corporation Ltd., a limited liability company duly
organized under the Laws of Israel, having its registered office at 3 Azrieli
Center, Xxxxxxxxxx Xxxxx, 00xx Xxxxx, Xxx Xxxx 00000 Israel, ("DIC", and, except
as otherwise expressly referred to or set forth in this Agreement, together with
Purchaser, the "DIC Parties", it being understood that DIC shall be jointly and
severally liable in accordance with Section 13.3 for all obligations and
agreements of Purchaser under this Agreement); and
(3) BellSouth Holdings B.V., a corporation duly organized under the Laws of
The Netherlands, having its legal domicile at c/o ING Management (Nederland)
X.X., Xxxxxxxxxxxxxxxxx 000, 0000 XX, Xxxxxxxxx, X.X. Xxx 0000, 0000 XX
Xxxxxxxxx, Xxx Xxxxxxxxxxx ("Seller" and, together with the DIC Parties, the
"Parties"); and
(4) for purposes of Article XII only, BellSouth Corporation, a corporation
duly organized under the laws of the State of Georgia, having its principal
office at Campanile Building 0000 Xxxxxxxxx Xx., XX, Xxxxxxx, XX 00000, and the
ultimate parent entity of Seller ("Seller Parent").
W I T N E S S E T H:
WHEREAS, Seller owns 20,000 Class A shares of Tele-Man Netherlands B.V.
(the "Company") representing, as of the date hereof, 50% of the total issued and
outstanding share capital and voting rights of the Company (the "Subject
Shares");
WHEREAS, the Company, in turn, owns (i) approximately 69.5% of the
total issued and outstanding share capital and voting rights of Cellcom Israel
Ltd., a company duly organized under the Laws of Israel ("Cellcom") and (ii) 51%
of the total issued and outstanding share capital and voting rights of Support
Net Holding B.V., a company duly organized under the Laws of the Netherlands
(which entity shall be renamed Support Net B.V. prior to the Closing Date)
("Support Net"); and
WHEREAS, under the terms and conditions provided for in this Agreement,
Seller desires to sell to Purchaser and Purchaser desires to purchase from
Seller all, but not less than all, of the Subject Shares.
NOW, THEREFORE, in consideration of the respective conditions,
representations, warranties, covenants, indemnifications and agreements
contained in this Agreement, the Parties agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1 Certain Defined Terms. As used in this Agreement, the
following capitalized terms shall have the meanings set forth below.
"Acceptable Investment Bank" means an investment bank of international
standing selected and jointly engaged by the DIC Parties and Seller from among
the following and whose fees and expenses shall be borne equally by the DIC
Parties and Seller: Citigroup, UBS, HSBC, Xxxxxx Xxxxxxx, X.X. Xxxxxx Xxxxx,
Xxxxxx Brothers or Xxxxxxx Sachs.
"Action" means any claim, action, suit, arbitration, inquiry,
proceeding or investigation by or before any arbitration panel or Governmental
Authority.
"Acquisition Documents" means, collectively, this Agreement and any
other documents delivered pursuant to this Agreement and in connection with the
transactions contemplated by this Agreement.
"Additional Subsequent Sale Transaction Payment Amount" has the meaning
specified in Section 2.5(a).
"Affiliate" means, with respect to any specified Person, any other
Person that (a) directly, or indirectly through one or more intermediaries,
controls, is controlled by, or is under common control with, such specified
Person or (b) directly, or indirectly through one or more intermediaries, either
(i) is acting in concert with or (ii) has authority, power or ability to direct
decisions in respect of acquisitions and/or dispositions of securities or
investments, in each case, with respect to such specified Person or any Person
referenced in clause (a) in relation to such specified Person. For purposes of
this Agreement, "control" with respect to the relationship between or among two
or more Persons means the possession, directly or indirectly, or as trustee or
executor, of the power to direct or cause the direction of the affairs or
management of a Person, whether through the ownership of voting securities, as
trustee or executor, by contract or otherwise, including, without limitation,
the ownership, directly or indirectly, of securities having the power to elect a
majority of the board of directors or similar body governing the affairs of such
Person. For the avoidance of doubt, the Parties agree that for purposes of this
Agreement other than with respect to Section 2.5 and the related definitions, no
Party shall be deemed an Affiliate of any of the Company, Support Net or
Cellcom.
"Agreement" or "this Agreement" means this Share Purchase Agreement
among Seller, the DIC Parties and Seller Parent (for purposes of Article XII
only) and all amendments hereto made in accordance with the provisions of
Section 13.15.
"Allocation Percentage" means with respect to any claim for
indemnification pursuant to Section 9.2, with respect to (i) the Company, 50%,
(ii) Cellcom, 34.75%, and (iii) Support Net, 25.5%.
"Articles" means the Articles of Association of the Company and all
amendments thereto.
"Assignment Agreement" has the meaning specified in Section 8.2(g).
"Business Day" means any day other than (a) a Friday, Saturday or
Sunday, or (b) any other day on which banks located in (i) Amsterdam, The
Netherlands, (ii) New York, New York, or (iii) Tel Aviv, Israel, generally are
closed for business.
"Cellcom" has the meaning specified in the recitals to this Agreement.
"Cellcom JV Agreement" means the Joint Venture Agreement, dated as of
February 10, 1994, by and among Tele-Man Ltd., DIC Communication and Technology
Ltd. and DIC, as amended as of March 31, 1997 (such amendment, among other
things, added the Company (as successor to Tele-Man Ltd.) as a party thereto).
"Cellcom Purchase Price Per Share" means, for purposes of Section
2.5(a), $15,777.
"Closing" has the meaning specified in Section 8.1.
"Closing Date" has the meaning specified in Section 8.1.
"Closing Legal Prohibition" has the meaning specified in Section
7.1(a).
"Closing Required Equity Holder Approvals" has the meaning specified in
Section 7.1(c).
"Commercially Reasonable Efforts" means the efforts that a reasonable
businessperson would make in like circumstances, provided, however, that under
no circumstances shall Seller or the DIC Parties be obligated by the term
"Commercially Reasonable Efforts" to (a) make any payment to any Person
(including in connection with the obtaining of any Required Equity Holder
Approvals), other than ministerial payments required by Law, or (b) file,
initiate or prosecute any lawsuit, litigation, arbitration or other claim.
"Company" has the meaning specified in the recitals to this Agreement.
"Company Board" has the meaning specified in Section 6.10.
"Confidential Information" has the same meaning as specified for the
term "Information" in the Confidentiality Agreement.
"Confidentiality Agreement" has the meaning specified in Section
6.4(a).
"Contract" means any contract, agreement, lease, license, sales or work
order or other legally binding commitment, obligation, undertaking or
arrangement, whether oral or written, express or implied (including any mortgage
or indenture).
"DIC Parties" has the meaning specified in the second paragraph of this
Agreement.
"Equity Rights Agreements" has the meaning specified in Section 3.1(a),
and, for the avoidance of doubt, includes the Articles.
"Exchange Rate" means with respect to any currency, notwithstanding any
other rates announced as official exchange rates or reflected in foreign
exchange or currency markets, the average of the applicable exchange rate as
published by The Wall Street Journal, Eastern Edition, or if such rate is not
available for any jurisdiction, the average of the exchange rate published by
Bloomberg for such jurisdiction, during the five (5) Business Day period
immediately preceding the applicable date of payment.
"General Shareholder Approval" means the approval of the shareholders
of the Company pursuant to Article 13 of the Articles of Association of the
Company and Sections 7(H) and 7(K)(2) of the Shareholders' Agreement of the
transfer of the Subject Shares pursuant to this Agreement.
"Governmental Authority" means the government of The Netherlands, the
United States, the State of Israel, the European Union or any other country or
any state, province or other political subdivision thereof or any entity, body,
regulatory or administrative authority, agency, commission, court, tribunal,
arbitral body or judicial body exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government, including
any quasi-governmental entity established to perform such functions.
"Governmental Order" means any order, writ, judgment, injunction,
decree, stipulation, determination, award, approval, consent, authorization or
agreement entered by or with any Governmental Authority.
"IDB Affiliate" means any Affiliate of IDB Holding Corporation Ltd.
"Indemnified Person" means the Person or Persons entitled to, or
claiming a right to, indemnification under Article IX.
"Indemnifying Person" means the Person or Persons claimed by the
Indemnified Person to be obligated to provide indemnification under Article IX.
"Indemnity Deductible" has the meaning specified in Section 9.4(a).
"Law" or "Laws" shall mean all federal, state, local or foreign
statutes (including EU laws), rules, codes, regulations, ordinances, orders,
decrees, rules of laws (including common laws), or governmental requirements
enacted, promulgated or imposed by all Governmental Authorities, binding on or
applicable to the DIC Parties, Seller or the Company and their respective
Affiliates.
"Liens" means all trusts, liens, mortgages, charges, attachments,
judgments, conditional sale agreements, pledges, rights of usufruct, options,
rights of first refusal, rights of possession, restrictions on transfer, voting
agreements, sale/leasebacks or similar arrangements, security interests or other
rights or claims of others or restrictions or encumbrances of any character
whatsoever.
"Loss" or "Losses" means any and all losses, liabilities, obligations,
costs (including reasonable costs of investigation), claims, damages, awards,
judgments and expenses (including reasonable legal fees and expenses and
reasonable litigation costs), provided, that such fees,
expenses and costs will not include the compensation of any officers, directors
or employees of the DIC Parties or Seller or any other Indemnified Party or any
overhead allocable to them that is incurred in investigating, defending,
settling or resolving any indemnification claim for which losses are determined.
"Majority-Owned" means any Person of which another Person, whether
directly or indirectly, (a) owns a majority of its capital stock or (b) has
control over or the ability to elect or designate a majority of its board of
directors.
"Material Cellcom Consents" has the meaning specified in Section 6.2.
"Mutual Release" has the meaning specified in Section 8.2(d).
"NAI Rules" has the meaning specified in Section 10.1(c).
"Notarial Deed" has the meaning specified in Section 8.4.
"Option Agreement" means the Tele-Man Netherlands B.V. Share Purchase
Option granted by the Company to Seller, the form of which is attached as
Exhibit 7(K)(9) to the Shareholders' Agreement.
"Other Equity Holders" means, at any time and from time to time, all
shareholders of the Company, other than Seller.
"Other Equity Holders Shares" has the meaning specified in Section
3.1(c).
"Other Equity Holders Transactions" has the meaning specified in
Section 3.1(c).
"Parties" has the meaning specified in the first paragraph of this
Agreement.
"Permitted Liens" means (a) Liens arising under the Equity Rights
Agreements; and (b) extensions, renewals and replacements of Liens referred to
in the foregoing clause (a).
"Permitted Transferee" means any Person that is a Majority-Owned IDB
Affiliate, so long as (a) such Person remains a Majority-Owned IDB Affiliate
through the expiration of the twenty-four (24) month period described in Section
2.5(a), (b) such Person executes a joinder to this Agreement for purposes of
making such Person a party to this Agreement, (c) DIC guarantees the payment and
performance by such Person of all obligations of the DIC Parties under Section
2.5 of this Agreement, and (d) DIC remains fully obligated and liable under this
Agreement.
"Person" means and includes an individual, a company, a firm, a
partnership, a joint venture, a corporation, a limited liability company, a
trust, an estate, an unincorporated association or any other organization of any
kind.
"Purchase Price" has the meaning specified in Section 2.2.
"Purchase Price Per Share" means, for purposes of Section 2.5(a),
$31,250.
"Purchaser" has the meaning specified in the first paragraph of this
Agreement.
"Purchaser Board Designee" has the meaning specified in Section 6.10.
"Purchaser Indemnified Person" means any Affiliate of the DIC Parties
or any of their or their Affiliates' respective officers, directors, employees,
agents and representatives each of whom shall be an Indemnified Person under
Article IX.
"Reimbursement Fee" has the meaning specified in Section 3.2(b).
"Representatives" means, collectively, with respect to any Person, such
Person's officers, directors, employees, agents, advisors (including financial
advisors, counsel and accountants) and representatives, and with respect to
Seller, any officer or director of the Company, Cellcom or Support Net or any of
their Majority-Owned Affiliates who has been appointed or designated to serve in
such position by Seller.
"Required Equity Holder Approvals" has the meaning specified in Section
3.1(b).
"Required Regulatory Approvals" means all necessary antitrust,
competition, telecommunications or other regulatory consents, authorizations or
approvals of, or filings or registrations with, any Governmental Authority or
which are otherwise required by Law (including the Laws of the State of Israel)
in connection with the execution, delivery or performance by the DIC Parties or
Seller of this Agreement or any of the Acquisition Documents or the consummation
by the DIC Parties or Seller of the transactions contemplated hereby or thereby.
"Right of First Refusal Shares" has the meaning specified in Section
3.2.
"Rights of First Refusal" has the meaning specified in Section 3.2.
"Sale Event" means with respect to the Company (so long as it controls
Cellcom) or Cellcom, a Transfer to a Third Party, so that, after such Transfer,
such Third Party (taking into account Transfers by all Persons to such Third
Party) owns or controls, directly or indirectly, more than 50% of the then
outstanding share capital of the Company or of Cellcom or more than 50% of the
voting power in the general meetings or in the respective boards of directors of
the Company or of Cellcom.
"Seller" has the meaning specified in the first paragraph of this
Agreement.
"Seller Director" has the meaning specified in Section 6.10.
"Seller Indemnified Person" means any Affiliate of Seller or any of its
or its Affiliates' respective officers, directors, employees, agents and
representatives, and any officer or director of the Company, Cellcom or Support
Net or any of their Majority-Owned Affiliates who has been appointed or
designated to serve in such position by Seller, each of whom shall be an
Indemnified Person under Article IX.
"Seller Liabilities" has the meaning set forth in Section 12.1(a).
"Seller Parent" has the meaning specified in the first paragraph of
this Agreement.
"Shareholders' Agreement" means the Shareholders' Agreement of the
Company, dated as of March 31, 1997, by and between Seller, Amaralis Holding
S.A., Amaralis Holding B.V. and the Company.
"Subject Shares" has the meaning specified in the recitals to this
Agreement.
"Subsequent Sale Transaction" means in any one or a series of
transactions, directly or indirectly, any (i) Transfer to any Third Party of all
or a material part of the business, assets, properties or rights of the Company
(so long as the Company controls Cellcom) and/or Cellcom, (ii) Transfer to any
Third Party of any of the shares of capital stock of the Company (so long as the
Company controls Cellcom) (including any of the Subject Shares or shares that
were Tag Along Shares) and/or Cellcom (including, without limitation, any rights
or interests in such shares, including any securities convertible into or
exercisable for such shares, and any shares issued in connection with any
distribution, dividend, liquidation, issuer tender offer or repurchase,
exchange, stock split, recapitalization, reorganization, spin-off, split-off,
merger or consolidation, or any transaction or business combination having a
similar effect as the foregoing), (iii) Transfer to any Third Party pursuant to
an issuer tender offer or repurchase, redemption or other repurchase or
recapitalization transaction effected by the Company or Cellcom, or (iv) similar
business combination and any other contract, instrument, arrangement or
transaction or series of transactions having a similar effect or result as any
of the foregoing clauses (i) through (iii) or that otherwise provides
consideration or value, directly or indirectly, to the DIC Parties or any of
their Affiliates or any other IDB Affiliate; provided, however, that there shall
be excluded from a Subsequent Sale Transaction (x) any Transfers or transactions
that do not result in or constitute a Sale Event, and (y) any Transfers by the
DIC Parties to any Person that is a Permitted Transferee. For the avoidance of
doubt, for purposes of Section 2.5(a), any securities convertible or exercisable
for shares of the Company or Cellcom shall be deemed to have been converted or
exercised by any Person that is the holder thereof.
"Subsequent Sale Transaction Event" has the meaning specified in
Section 2.5(a).
"Subsidiary Share Permitted Liens" means (a) Liens arising under
contractual obligations of the Company, Cellcom and/or Support Net disclosed on
Schedule 4.2(c) that relate to the purchase, sale, issuance, repurchase,
redemption, acquisition, transfer, disposition, holding or voting of any equity
interests of Cellcom and/or Support Net; and (b) extensions, renewals and
replacements of Liens referred to in the foregoing clause (a).
"Subsidiary Shares" has the meaning specified in Section 4.2(b).
"Support Net" has the meaning specified in the recitals to this
Agreement.
"Tag Along Rights" has the meaning specified in Section 3.3.
"Tag Along Shares" has the meaning specified in Section 3.3.
"Taxes" means all taxes, charges, fees, duties, levies or other
assessments (including income, capital gains, gross receipts, net proceeds, ad
valorem, turnover, real and personal
property (tangible and intangible), sales, use, franchise, excise, goods and
services, value added, stamp, lease, user, transfer, fuel, excess profits,
occupational, environmental, capital stock, interest equalization, windfall
profits, license, severance, payroll, employee's income withholding, other
withholding, unemployment and social security taxes) which are imposed by any
Governmental Authority, and such term shall include any interest, penalties or
additions to tax attributable thereto. For purposes of this Agreement, "Dutch
Taxes" shall be understood to mean Taxes which are imposed by any Governmental
Authority of The Netherlands and "Israeli Taxes" shall be understood to mean
Taxes which are imposed by any Governmental Authority of the State of Israel.
"Tax Ruling" means the tax exemption ruling relating to Israeli Taxes
received by Seller in connection with the transactions contemplated by this
Agreement attached in Hebrew, with the English translation, as Exhibit 2.4
hereto.
"Termination Date" has the meaning specified in Section 11.1(b).
"Third Party" means any Person (including such Person's Affiliates) who
is not the DIC Parties or any Other Equity Holder or who is not a Majority-Owned
Affiliate of IDB or of any Other Equity Holder.
"Transfer" means with respect to any shares of the Company and/or
Cellcom, in any transaction or series of transactions, any direct or indirect
sale, transfer, assignment, exchange or other disposition, including pursuant to
the transfer of any rights or interests therein or relating thereto (including
pursuant to any issuance or grant of any securities convertible into or
exercisable for shares of the Company and/or Cellcom).
"Transfer Notice" has the meaning specified in Section 3.2.
"U.S. Dollars" and the symbol "US$" mean lawful currency of the United
States of America.
Section 1.2 Interpretation. The headings preceding the text of
Articles and Sections included in this Agreement and the headings to Schedules
attached to this Agreement are for convenience only and shall not be deemed part
of this Agreement or be given any effect in interpreting this Agreement. The
use of the masculine, feminine or neuter gender or the singular or plural form
of words herein shall not limit any provision of this Agreement. The use of the
terms "including" or "include" shall in all cases herein mean "including,
without limitation" or "include, without limitation," respectively. Reference
to any Person includes such Person's successors and assigns to the extent such
successors and assigns are permitted by the terms of any applicable agreement,
and reference to a Person in a particular capacity excludes such Person in any
other capacity or individually. Reference to any agreement (including this
Agreement), document or instrument means such agreement, document or instrument
as amended or modified and in effect from time to time in accordance with the
terms thereof and, if applicable, the terms hereof. Underscored references to
Articles, Sections, clauses, Exhibits or Schedules shall refer to those portions
of this Agreement. The use of the terms "hereunder," "hereof," "hereto" and
words of similar import shall refer to this Agreement as a whole and not to any
particular Article, Section or clause of, or Exhibit or Schedule to, this
Agreement.
ARTICLE II
PURCHASE AND SALE
Section 2.1 Purchase and Sale of Subject Shares. Upon the terms and
subject to the conditions of this Agreement, on the Closing Date, Seller shall
sell, assign and transfer to Purchaser, free and clear of all Liens other than
Permitted Liens, and Purchaser shall purchase and assume from Seller, free and
clear of all Liens other than Permitted Liens, all, but not less than all, of
the Subject Shares (as appropriately adjusted for any stock splits, stock
dividends, recapitalizations or similar events), and all of the voting,
financial and ownership rights, liabilities and obligations in Seller's capacity
as a shareholder of the Company or owner of the Subject Shares, including but
not limited to (i) any preferential rights pertaining to the Subject Shares,
(ii) any retained earnings and any rights to declared and unpaid dividends in
shares, kind or cash pertaining to the Subject Shares, stock premiums and
reserves, as well as all the rights and actions arising from the capitalization
of stock premiums, reserves, revaluations, capital adjustments, capital
contributions and/or contributions of any kind that remain pending or accrued on
or before the Closing Date for any cause or reason whatsoever, and (iii) any and
all liabilities and obligations of Seller and/or any Affiliate of Seller to
contribute capital to the Company, guarantee any Company loans, make loans to
the Company or any other financial accommodations to the Company and any other
rights, obligations, responsibilities or liabilities of Seller arising under the
Equity Rights Agreements or in Seller's capacity as a shareholder of the Company
or owner of the Subject Shares.
Section 2.2 Purchase Price. The aggregate purchase price for the
Subject Shares shall be an amount equal to the total of: (a) Six Hundred and
Twenty Five Million U.S. Dollars (US$625,000,000), plus (b) all amounts payable
to or on behalf of Seller (if any) pursuant to Section 2.4 or 2.5(a), minus (c)
the amount of any cash dividends or distributions of shares of capital stock of
Cellcom declared in respect of the Subject Shares and actually paid or
distributed to Seller following the date hereof and prior to the Closing Date,
with such total amount further adjusted (increased or decreased) as a result of
any successful claim for indemnification under Section 9.2 or 9.3 (such
aggregate amount, including all adjustments referenced in this Section 2.2, the
"Purchase Price").
Section 2.3 Payment of the Purchase Price. On the Closing Date, the
Purchaser shall pay the portion of the Purchase Price referenced in Section
2.2(a) subject to reduction thereof pursuant to Section 2.2(c) to Seller by wire
transfer in immediately available funds to the bank account designated and
notified in accordance with Section 13.6 by Seller to the DIC Parties' at least
three (3) Business Days prior to the Closing. The Purchase Price shall be paid
without any set-off or counterclaim, free and clear of all commissions or
expenses of any nature whatsoever, including transfer and banking fees. For the
avoidance of doubt, subject to Section 2.4, Seller shall be responsible for the
payment of all Taxes applicable to the sale of the Subject Shares to Purchaser,
including any Dutch Taxes (but not including any transfer taxes or stamp taxes
if and to the extent that such taxes are imposed on the sale of the Subject
Shares and/or this Agreement and the Acquisition Documents pursuant to the Laws
of The Netherlands, or solely with respect to stamp taxes, the Laws of the State
of Israel, which shall be the responsibility of the DIC Parties).
Section 2.4 Payment of Israeli Taxes. The Parties agree and
acknowledge that they are entering into this Agreement in reliance upon the Tax
Ruling, and its validity for all purposes, which Tax Ruling exempts Seller from
the payment of any Israeli Tax on the transactions contemplated by this
Agreement, and in accordance with the Tax Ruling, Purchaser shall not deduct or
withhold any Israeli Taxes from the payment of the Purchase Price. Accordingly,
Seller agrees that it shall be responsible for the payment of any and all
Israeli Taxes (other than any stamp taxes imposed upon the sale of the Subject
Shares and/or this Agreement and the Acquisition Documents pursuant to the Laws
of the State of Israel) that are imposed on Seller pursuant to Israeli Law in
connection with the transactions contemplated by this Agreement; provided,
however, that in the event that the Tax Ruling is revoked or is otherwise not
given effect for any reason whatsoever, Purchaser shall be responsible for any
Israeli Taxes that are required to be paid by, or withheld from any payment
hereunder to, Seller or any of its Affiliates in connection with the
transactions contemplated hereby, and shall, within five (5) days after
receiving written notice thereof from Seller, pay, reimburse and gross-up Seller
for the full amount of all such Israeli Tax payments or withholdings, or other
amounts (including any penalties, fees and interest, together with any costs and
expenses relating to any tax investigation or audit, including all reasonable
accountants' fees and reasonable attorneys' fees) payable in connection
therewith and any amounts payable pursuant to this Section 2.4, so that after
receiving such Israeli Tax payments or withholdings the amount that Seller shall
have received shall equal what the Seller would have received had the Tax Ruling
been given proper effect. Seller's right to payment pursuant to this Section
2.4 shall be absolute and unconditional and shall not be subject to any
limitation, setoff or counterclaim of any nature whatsoever. The parties agree
that payments to Seller pursuant to this Section 2.4 will be treated as a
portion of the Purchase Price.
Section 2.5 Post-Closing Sale Adjustment.
(a) In the event that during the period beginning on the date hereof
and ending twenty-four (24) months following the Closing Date, any Person
announces, enters into or becomes subject to any agreement, commitment or
understanding or closes or consummates a Subsequent Sale Transaction (any such
event, a "Subsequent Sale Transaction Event"), the DIC Parties shall promptly
provide written notice thereof to Seller in accordance with the provisions of
this Agreement. Such notice will specify all of the parties and material terms,
agreements and commitments relating to the Subsequent Sale Transaction and will
include a certificate signed by an officer of the DIC Parties stating that there
are no further agreements, commitments or understandings relating thereto, and
the DIC Parties will, if requested by Seller, promptly provide Seller with
copies of all such agreements, and commitments and any other related information
reasonably requested by Seller. Upon the closing of a Subsequent Sale
Transaction Event (whether during or after the foregoing period), the DIC
Parties shall pay to Seller (or for Seller's account to any designee thereof) by
wire transfer of immediately available funds to a bank account designated and
notified by Seller to the DIC Parties in writing in accordance with Section
13.6, at least three (3) Business Days in advance, an amount (the "Additional
Subsequent Sale Transaction Payment Amount") equal to fifty percent (50%) of the
product of (x) the number of Subject Shares or, if applicable, the number of
shares of Cellcom indirectly transferred to the DIC Parties pursuant to this
Agreement (in each case, as appropriately adjusted for any stock splits, stock
dividends, recapitalizations or similar events), multiplied by (y) the
difference between (A) the fair market value of the aggregate consideration,
value or benefit paid
or provided by the Subsequent Sale Transaction to which Seller would have been
entitled were such Subsequent Sale Transaction consummated on the date hereof,
determined on a per share basis (regardless of how actually paid) and (B) the
Purchase Price per share (as appropriately adjusted for any stock splits, stock
dividends, recapitalizations or similar events) or the Cellcom Price Per Share
(as appropriately adjusted for any stock splits, stock dividends,
recapitalizations or similar events), as applicable. For purposes of
determining the "Additional Subsequent Sale Transaction Payment Amount," the
fair market value of any non-cash consideration paid in connection with the
Subsequent Company Share Purchase shall be determined by an Acceptable
Investment Bank. The Parties agree that consummation of any Subsequent Sale
Transaction Event will be subject to and conditioned upon the parties thereto
agreeing to be bound by, perform and make the payments required by this Section
2.5(a); provided, however, that following the satisfaction in full of all
obligations under this Section 2.5(a) in connection with such Subsequent Sale
Transaction, the provisions of this Section 2.5(a) shall be deemed to be
terminated and of no further force and effect.
(b) The Parties agree that any payments pursuant to this Section 2.5
will be treated as a portion of the Purchase Price, and acknowledge that they
are entering into this Agreement in reliance thereupon.
Section 2.6 Payments in Dollars. Except as otherwise provided herein
or in an Acquisition Document, all payments pursuant hereto or contemplated
hereby shall be made by wire transfer in U.S. Dollars in same day or immediately
available funds (with all such payment amounts being calculated using the then
applicable Exchange Rate if originally denominated in a currency other than U.S.
Dollars).
ARTICLE III
OTHER SHAREHOLDER RIGHTS
Section 3.1 Company Equity Agreements. (a) Schedule 3.1 sets forth a
list of all Contracts with Other Equity Holders to which Seller or the Company
is a party, that relate to the purchase, sale, issuance, repurchase, redemption,
acquisition, transfer, disposition, holding or voting of any equity interests in
the Company or management of the Company, and any shareholder resolutions
relating to the powers of the board of managing directors of the Company to
approve the transactions contemplated herein (collectively, and as may be
amended after the date hereof in accordance with Section 6.11, the "Equity
Rights Agreements").
(b) From the date of this Agreement until the Closing Date, Seller
shall use its Commercially Reasonable Efforts to obtain, or cause to be
obtained, all of the necessary consents, waivers, modifications, approvals,
certificates and other documents required to be obtained pursuant to the Equity
Rights Agreements in connection with the transactions contemplated herein
(collectively, the "Required Equity Holder Approvals"). Notwithstanding anything
to the contrary set forth in this Article III or otherwise, none of the DIC
Parties, any of their Affiliates or any of their respective Representatives
shall, directly or indirectly, engage in any communications, negotiations,
solicitations or other discussions with Other Equity Holders with respect to
obtaining the Required Equity Holder Approvals without obtaining the prior
written consent of Seller, not to be unreasonably withheld or delayed. The DIC
Parties agree to use their Commercially Reasonable Efforts to take any actions
reasonably necessary at such
times and in such manner as reasonably requested in good faith and in a manner
consistent with this Agreement by Seller in order to aid Seller in obtaining the
Required Equity Holder Approvals and to aid Seller in complying with the terms
and conditions of the Equity Rights Agreements, including providing Seller with
all information reasonably requested by the Other Equity Holder, to the extent
that such information applies to the DIC Parties or any of their Affiliates.
(c) Following the execution of this Agreement, the DIC Parties shall
be permitted to communicate, negotiate, solicit or hold discussions with any
Other Equity Holder relating to any proposals, offers or transactions whatsoever
related to the purchase of the shares of the capital stock of the Company (the
"Other Equity Holders Shares") owned by such Other Equity Holder or to any other
Transfer relating to the Company or Cellcom (such transactions are referred to
herein collectively as the "Other Equity Holders Transactions") as it desires in
a manner consistent with this Agreement, provided, that the DIC Parties will
promptly (but in any event within seventy-two (72) hours) provide Seller with
(i) copies of any agreements, communications, inquiries, proposals or offers
provided to any Other Equity Holder, or, to the extent that any such agreements,
communications, inquiries, proposals or offers have been made orally, a written
summary thereof, and any (ii) other information as reasonably requested by
Seller relating to any such Other Equity Holders Transactions.
(d) Seller and the DIC Parties agree that at the Closing, Seller will
assign, and Purchaser will assume, all of Seller's rights, obligations,
responsibilities and liabilities under the Equity Rights Agreements. Seller and
the DIC Parties shall take any and all other actions necessary in connection
with the assignment and assumption of such Equity Rights Agreements, including,
in the case of Purchaser, furnishing the Company or any Other Equity Holders
with any letters of acceptance or other documents necessary to effect such
assignment pursuant to the Equity Rights Agreements.
Section 3.2 Sale of Shares Pursuant to Rights of First Refusal;
Reimbursement Fee. (a) The Equity Rights Agreements provide for, among other
things, rights of first refusal to the Other Equity Holders to purchase the
Subject Shares ("Rights of First Refusal") that become exercisable as a result
of the transactions contemplated by this Agreement. In connection with its
compliance with such Rights of First Refusal, Seller shall provide a notice to
the Other Equity Holders (a "Transfer Notice") in accordance with the provisions
of the Equity Rights Agreements, which Transfer Notice shall incorporate all of
the terms and conditions of this Agreement, including the Purchase Price as
provided herein. Seller shall be entitled to provide the Other Equity Holders
with a copy of this Agreement and such other relevant information as the Other
Equity Holders may request in connection with their potential exercise of the
Rights of First Refusal, and the DIC Parties will cooperate with Seller in
providing such information to the extent available to the DIC Parties. In the
event that, prior to the Closing, any one or more of such Other Equity Holders
makes a bona fide election to exercise its Rights of First Refusal with respect
to the Subject Shares in accordance with the provisions of the Equity Rights
Agreements (the "Right of First Refusal Shares"), then, (i) until the closing of
the sale of such Right of First Refusal Shares, Seller's obligations to perform
this Agreement with respect to the Right of First Refusal Shares shall be
suspended, (ii) if the closing of the sale of such Right of First Refusal Shares
has occurred, this Agreement shall automatically terminate as to the Parties
hereto as of the date hereof (and any of their respective permitted successors
and assigns) (except as to
Sections 3.2(b), 6.4, 13.1 and 13.10, which shall survive such termination), and
(iii) if the closing of the sale of such Right of First Refusal Shares has not
occurred by December 31, 2005, the DIC Parties shall have the right to terminate
this Agreement pursuant to Section 11.1(b) (and Seller shall have no right to
extend the termination date as otherwise provided in the first proviso of such
Section 11.1(b)).
(b) In the event that one or more Other Equity Holders makes a bona
fide election to exercise its Rights of First Refusal with respect to all of the
Subject Shares (such that all of the Subject Shares are deemed Right of First
Refusal Shares), Seller hereby agrees to pay to the DIC Parties by wire transfer
of immediately available funds the amount of $18,000,000 (the "Reimbursement
Fee") upon the closing of the sale of the Right of First Refusal Shares in order
to reimburse the DIC Parties for incurring costs and expenses, committing funds
and financial resources, and foregoing opportunities in connection with
pursuing, negotiating and entering into this Agreement and complying with and
performing under this Agreement. The Seller shall pay the Reimbursement Fee to
an account designated by the DIC Parties to Seller in writing in accordance with
Section 13.6 at least three (3) Business Days in advance. Notwithstanding the
foregoing, in the event that, during the eighteen (18) month period following
the closing of the sale of the Right of First Refusal Shares, the DIC Parties or
any IDB Affiliates engage in a Subsequent Sale Transaction (disregarding, for
this specific purpose, whether a Sale Event occurs), then the DIC Parties shall
promptly return the Reimbursement Fee to Seller. For the avoidance of doubt,
upon payment by Seller of the Reimbursement Fee pursuant to this Section 3.2(b),
notwithstanding any provision to the contrary contained herein, other than the
obligations of the DIC Parties pursuant to this Section 3.2(b), no Party shall
have any obligation or liability of any kind whatsoever to any other Party under
this Agreement or otherwise in connection with the transactions contemplated by
this Agreement.
Section 3.3 Purchase of Shares Pursuant to Tag Along Rights. The
Shareholders' Agreement provides for, among other things, tag along rights to
the Other Equity Holders to sell the Other Equity Holders Shares ("Tag Along
Rights") that become exercisable as a result of the transactions contemplated by
this Agreement. In the event that, prior to the Closing, any one or more of
such Other Equity Holders makes a bona fide election to exercise its Tag Along
Rights at the same price per share (i.e., the Purchase Price Per Share (as
appropriately adjusted for any stock splits, stock dividends, recapitalizations
or similar events)) as is being paid pursuant to Section 2.2 with respect to
some or all of the Other Equity Holders Shares (the "Tag Along Shares"), the DIC
Parties hereby agree to take all actions requested by Seller in its reasonable
discretion at the times and in the manner necessary in order to ensure
compliance with the terms and conditions of the Shareholders' Agreement relating
to the Tag Along Rights and to purchase the Tag Along Shares in accordance with
the terms and conditions set forth in the Shareholders' Agreement (which in any
event shall require that the purchase of the Tag Along Shares be subject to the
same terms and conditions as set forth in this Agreement). Seller shall be
entitled to provide the Other Equity Holders with a copy of this Agreement and
such other information as the Other Equity Holders may request in connection
with their potential exercise of the Tag Along Rights, and the DIC Parties will
cooperate with Seller in providing such information to the extent available to
it. In the event that any Other Equity Holder exercises its Tag Along Rights,
the DIC Parties shall use Commercially Reasonable Efforts to cause the closing
with respect to the Tag Along Shares to occur on the same day as the Closing.
For the avoidance of doubt, the DIC Parties hereby acknowledge that, in the
event of the exercise of the Tag Along Rights of the
Other Equity Holders under the Shareholders' Agreement, DIC may be required to
cause Purchaser to purchase all of the issued and outstanding shares of the
Company.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF SELLER
As an inducement to the DIC Parties to enter into this Agreement,
Seller hereby represents and warrants to the DIC Parties with effect on the date
hereof and on the Closing Date as follows. Solely as to the representations and
warranties contained in Sections 4.3 and 4.5 through 4.10 below (i) the phrase
"material to the Company" shall be understood to mean in an aggregate amount or
having an aggregate value in excess of 2 million Euros, and (ii) the phrase
"material adverse effect on the Company" shall be understood to refer to an
adverse effect on the Company that could be reasonably expected to result in an
aggregate Loss of more than 2 million Euros. For the avoidance of doubt, unless
otherwise expressly stated herein, the representations and warranties contained
in this Article IV are being made solely with respect to the Company, and in no
event is any representation or warranty being made, directly or indirectly, with
respect to Cellcom or Support Net.
Section 4.1 Organization and Authority. Seller is duly organized and
validly existing under the laws of its jurisdiction of organization and has all
necessary company power and authority to enter into this Agreement, to carry out
its obligations hereunder and to consummate the transactions contemplated
hereby. The execution and delivery of this Agreement by Seller, the performance
by Seller of its obligations hereunder and the consummation by Seller of the
transactions contemplated hereby have been duly authorized by all requisite
action on the part of Seller. This Agreement has been duly executed and
delivered by Seller, and (assuming due authorization, execution and delivery by
the DIC Parties) this Agreement constitutes a legal, valid and binding
obligation of Seller enforceable against Seller in accordance with its terms,
except as such enforceability may be limited by applicable bankruptcy,
insolvency, moratorium, reorganization or similar laws in effect that affect the
enforcement of creditors' rights generally, and by equitable limitations on the
availability of specific remedies and by principles of equity.
Section 4.2 Capitalization.
(a) Schedule 4.2(a) hereto is a true and accurate description of
Seller's direct and indirect ownership interests in the Company, Cellcom and
Support Net.
(b) Seller owns all of the Subject Shares. The Subject Shares are
validly issued, fully paid and nonassessable. Seller has good and valid title
to, and sole record and beneficial ownership of, the Subject Shares. The
Subject Shares are held by Seller free and clear of all Liens, other than
Permitted Liens. With respect to each of Cellcom and Support Net, the Company
owns the number and type of issued and outstanding equity and voting interests
set forth on Schedule 4.2(a) (the "Subsidiary Shares"). The Subsidiary Shares
are validly issued, fully paid and, in the case of Support Net, nonassessable.
The Company has good and valid title to, and sole record and beneficial
ownership, of the Subsidiary Shares. The Subsidiary Shares are held by the
Company free and clear of all Liens, other than Subsidiary Share Permitted
Liens.
(c) Except as set forth in Schedule 4.2(c) there are no equity
interests issued or outstanding or any subscriptions, options, warrants, calls,
rights, convertible securities or other agreements or commitments of any
character that are binding on Seller obligating Seller or the Company to
purchase, transfer, sell, hold or vote or cause the issuance, transfer, sale,
holding or voting of, any equity interests of the Company and/or Support Net.
Except as set forth on Schedule 4.2(c), to Seller's knowledge, there are no
outstanding contractual obligations of the Company that relate to the purchase,
sale, issuance, repurchase, redemption, acquisition, transfer, disposition,
holding or voting of any equity interests in the Company and/or Support Net.
(d) Except as set forth in Schedule 4.2(c) and/or in the Equity Rights
Agreements, to Seller's knowledge, there are no voting trusts or other
agreements or understandings to which Seller, the Company or Support Net is a
party with respect to the voting of the capital stock of any of the Company,
Cellcom or Support Net.
Section 4.3 No Conflict. The execution, delivery and performance of
this Agreement by Seller does not and will not (a) violate, conflict with or
result in the breach of any provision of the deed of incorporation or other
organizational documents of Seller, (b) assuming that all Required Regulatory
Approvals have been obtained, violate any material Law or Governmental Order
applicable to Seller and/or the Company (but not applicable to Cellcom or
Support Net), or (c) except as set forth in the Equity Rights Agreements,
violate, conflict with, result in any breach of, constitute a default (or event
which with the giving of notice or lapse of time, or both, would become a
default) under, require any consent under, or give to others any rights of
termination, amendment, acceleration, suspension, revocation or cancellation of
any note, bond, mortgage or indenture, Contract, agreement, lease, sublease,
license, permit, franchise or other instrument or arrangement of Seller and/or
the Company (or result in the creation of any Lien, other than Permitted Liens,
on any of the Subject Shares sold by Seller or on any of the assets or
properties of Seller or the Company (excluding the Company's investment in
Cellcom and Support Net), or result in or constitute a circumstance which, with
or without notice or lapse of time or both, would constitute any of the
foregoing, to which Seller or the Company is a party or by which any of the
Subject Shares sold by Seller or any of such assets or properties (excluding the
Company's investment in Cellcom and Support Net) is bound or affected (other
than as set forth in Schedule 4.2(c)), in the case of the foregoing clause (c),
which could materially and adversely affect such Seller's ability to perform its
obligations hereunder or, as applicable, which would have a material adverse
effect on the Company.
Section 4.4 Consents and Approvals. Other than the Required
Regulatory Approvals and the Required Equity Holder Approvals, the execution,
delivery and performance of this Agreement by Seller, including the sale of the
Subject Shares by Seller to Purchaser in the manner contemplated in this
Agreement does not and will not require any consent, approval, authorization or
other order of, action by, filing with or notification to any Governmental
Authority or, with respect to Seller, any other Person. To Seller's knowledge,
there are no Laws, conditions or other matters with respect to Cellcom that
would render it unlikely that the DIC Parties and/or Seller would be able to
obtain a Required Regulatory Approval or Material Cellcom Consent.
Section 4.5 Material Assets and Liabilities. (a) Attached hereto as
Schedule 4.5(a) is a copy of the unconsolidated and unaudited balance sheet of
the Company as of March 31, 2005.
Except as set forth on Schedule 4.5(a), the Company has no assets, obligations,
guarantees or liabilities that are material to the Company.
(b) Support Net has no obligations or liabilities of any kind or
nature to which the Company would become obligated, responsible or liable that
are material to the Company. The Company has no obligation to make any payments
to Support Net that are material to the Company.
(c) Notwithstanding any provision to the contrary contained in this
Agreement, no representation or warranty is made in this Agreement with respect
to (i) Cellcom, including, but not limited to, its financial statements, assets
or liabilities, other than as set forth in Section 4.2(a) or 4.2(b) or 4.2(d),
or (ii) Support Net, including, but not limited to, its financial statements,
assets or liabilities, other than as set forth in Sections 4.5(b).
Section 4.6 Brokers. No broker, finder or investment banker is
entitled to any brokerage, finder's fees or other fee in connection with the
transactions contemplated by this Agreement based upon arrangements made by or
on behalf of Seller for which the DIC Parties or the Company shall be liable.
Section 4.7 Litigation. No Action, is pending or, to Seller's
knowledge, threatened against the Company or any of its properties or business
(excluding Cellcom and Support Net), before any arbitration board or
Governmental Authority, which would reasonably be expected to have a material
adverse effect on the Company. The Company is not a party to or subject to the
provisions of any Governmental Order which would materially and adversely affect
the Sellers' ability to perform its obligations hereunder. There is no
judgment, decree or order against Seller and no Action is pending, or, to
Seller's knowledge, threatened against Seller that could prevent, enjoin, or
materially alter or delay any of the transactions contemplated by this
Agreement. Notwithstanding anything to the contrary contained herein, no
representation or warranty is being made herein with respect to any Action of
any kind whatsoever involving any Other Equity Holder, including in connection
with the obtaining of any Required Equity Holder Approvals, other than that
Seller is not aware of any such Action as of the date of this Agreement.
Section 4.8 Taxes. The Company has accurately prepared and timely
filed all tax returns and reports in respect of Dutch Taxes and any other
non-Israeli Taxes that are material to the Company and are required to be filed
by it under applicable law which, if not filed, would reasonably be expected to
have a material adverse effect on the Company. All tax returns and reports of
the Company in respect of Dutch Taxes and any other non-Israeli Taxes are true
and correct in all material respects and the Company has paid on time all Dutch
Taxes and other non-Israeli Taxes and other assessments due where the failure to
pay would have a material adverse effect on the Company. No deficiency
assessment or proposed adjustment for Dutch Taxes and any other non-Israeli
Taxes relating to the income or payroll of the Company is pending that is
material to the Company.
Section 4.9 Material Agreements. Schedule 4.9 contains a true and
complete list of all material contracts and agreements (oral or written) to
which the Company is a party or by which its property (other than Cellcom or
Support Net) is bound that are material to the Company.
Section 4.10 Related-Party Transactions. Except as contemplated by
the Equity Rights Agreements, none of Seller or its Affiliates has (a) a direct
or indirect interest in any Person or entity which (i) furnishes or sells goods
or services which are furnished or sold or are proposed to be furnished or sold
to the Company in an amount that is material to the Company, or (ii) purchases
from the Company any goods or services in consideration of an amount that is
material to the Company, or (b) a direct or indirect beneficial interest in any
Contract or agreement to which the Company is a party or by which it may be
bound or affected that is material to the Company.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF DIC PARTIES
As an inducement to Seller to enter into this Agreement, the DIC
Parties hereby represent and warrant to Seller with effect on the date hereof
and on the Closing Date as follows. For the avoidance of doubt, all
representations and warranties contained in this Article V are made jointly and
severally by each of DIC and Purchaser.
Section 5.1 Organization and Authority. DIC is a limited liability
company duly organized and validly existing under the Laws of its jurisdiction
of organization and Purchaser is a corporation duly organized and validly
existing under the Laws of its jurisdiction of organization, and each of DIC and
Purchaser has all necessary company power and authority to enter into this
Agreement, to carry out its obligations hereunder and to consummate the
transactions contemplated hereby. The execution and delivery of this Agreement
by the DIC Parties, the performance by the DIC Parties of their obligations
hereunder and the consummation by the DIC Parties of the transactions
contemplated hereby have been duly authorized by all requisite action on the
part of the DIC Parties. This Agreement has been duly executed and delivered by
the DIC Parties, and (assuming due authorization, execution and delivery by
Seller and Seller Parent) this Agreement constitutes a legal, valid and binding
obligation of the DIC Parties enforceable against the DIC Parties in accordance
with its terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, moratorium, reorganization or similar laws in effect
that affect the enforcement of creditors' rights generally, by equitable
limitations on the availability of specific remedies, by principles of equity or
by the terms hereof.
Section 5.2 No Conflict. The execution, delivery and performance of
this Agreement by the DIC Parties do not and will not (a) violate, conflict with
or result in the breach of any provision of the certificate of formation and
incorporation or other organizational documents of the DIC Parties, (b) assuming
that all Required Regulatory Approvals have been obtained, conflict with or
violate any material Law or Governmental Order applicable to the DIC Parties, or
(c) conflict with, result in any breach of, constitute a default (or event which
with the giving of notice or lapse of time, or both, would become a default)
under, require any consent under, or give to others any rights of termination,
amendment, acceleration, suspension, revocation or cancellation of, any note,
bond, mortgage or indenture, Contract, agreement, lease, sublease, license,
permit, franchise or other instrument or arrangement to which either of the DIC
Parties is a party or by which any of their respective assets or properties is
bound or affected, in the case of the foregoing clause (c), which could
materially and adversely affect the ability of either of the DIC Parties to
perform its obligations hereunder.
Section 5.3 Consents and Approvals. Other than any Required
Regulatory Approvals, the execution, delivery and performance of this Agreement
by the DIC Parties do not and will not require any consent, approval,
authorization or other order of, action by, filing with or notification to any
Governmental Authority or, with respect to the DIC Parties, any other Person.
To the DIC Parties' knowledge, there are no Laws, conditions or other matters
with respect to Cellcom that would render it unlikely that the DIC Parties
and/or Seller would be able to obtain a Required Regulatory Approval or Material
Cellcom Consent.
Section 5.4 Financing. The DIC Parties have, and at the Closing will
have, sufficient cash resources and binding financing commitments in each case
reasonably satisfactory to Seller that provide sufficient funds in the aggregate
to pay in cash any and all amounts necessary to consummate the payments and
transactions contemplated hereby and in the Acquisition Documents, including the
purchase of the Subject Shares as well as the Tag Along Shares, if the purchase
of the Tag Along Shares shall be required. Consistent with the foregoing, the
DIC Parties will have delivered to Seller on or prior to the date hereof (i) the
balance sheet of DIC as of December 31, 2004, prepared in accordance with
Israeli generally accepted accounting principles, (ii) a Hebrew copy of the
draft prospectus or similar document intended to be filed with the securities
authority of the State of Israel, together with a letter from DIC addressed to
Seller Parent, evidencing the intention of DIC to conduct a rights offering in
May 2005 (the "DIC Rights Offering"), and (iii) a letter from IDB Development
Corporation Ltd. addressed to DIC evidencing its irrevocable commitment to
exercise its right to participate in the DIC Rights Offering with the
expectation of investing approximately NIS1,500,000,000. The draft prospectus
has been provided by the DIC Parties to Seller on a confidential basis and
Seller is hereby made aware that at the date hereof the draft is a non-public
document. The DIC Parties shall provide Seller with any amendments to the
prospectus evidencing the DIC Rights Offering filed with the securities
authority of the State of Israel after the date hereof.
Section 5.5 Condition of the Company. Notwithstanding anything
contained in this Agreement to the contrary, the DIC Parties acknowledge and
agree that neither Seller nor the Company or any of their respective Affiliates,
nor any of Seller's, the Company's or any of their Affiliates' respective
Representatives, is making any representations or warranties whatsoever, express
or implied, beyond those expressly given by Seller in Article IV (as modified by
the Schedules hereto), including as to projections, forecasts or forward-looking
statements provided to the DIC Parties or the accuracy or completeness of any
memoranda, charts, summaries or schedules heretofore made available by Seller,
the Company, their Affiliates or their Representatives to the DIC Parties, any
of their Affiliates or their Representatives or any information that is not
included in this Agreement or any Schedule hereto.
Section 5.6 Acknowledgment. Each of the DIC Parties acknowledges that
it has voluntarily decided to enter into this Agreement, to purchase the Subject
Shares from Seller and to consummate the transactions contemplated herein.
Each of the DIC Parties hereby confirms that (i) it has had adequate opportunity
to select and consult with its financial, tax, accounting and legal advisors
regarding the terms, conditions, rights and obligations set forth in this
Agreement, (ii) it and its Representatives have had full access to and received
all material information (legal, financial and otherwise) concerning the
business and financial condition of the Company, Cellcom and Support Net, and
have had all requests for information satisfied, prior to the date of this
Agreement, (iii) it and its Representatives have had full opportunity to
discuss with, and ask questions of, any Person authorized to act on behalf of
any other party hereto regarding this Agreement and the transactions
contemplated herein, (iv) it is aware of and has had full access to and has
received all material information regarding any Contracts, transactions or other
arrangements relating to Cellcom, and (v) it understands the terms of the
transactions contemplated hereby, including, without limitation, the basis for
determination of the Purchase Price Per Share and the Cellcom Purchase Price Per
Share. Each of the DIC Parties acknowledges that neither Seller nor the Company
or any of their respective Affiliates, nor any of Seller's, the Company's or any
of their Affiliates' respective Representatives, has given it any investment
advice, credit information, or opinion on whether the purchase of the Subject
Shares and whether the assumption of the related obligations by the DIC Parties
is prudent, nor any advice as to the legal financial, accounting or tax
implications of the transactions contemplated in this Agreement. Each of the
DIC Parties further acknowledges and agrees that in entering into this Agreement
and any Acquisition Document, the DIC Parties do not rely on, and shall have no
remedy in respect of, any statement, representation, warranty or understanding
of any person (whether party to this Agreement or not) other than as expressly
set forth in Article IV of this Agreement.
Section 5.7 Brokers. No broker, finder or investment banker is
entitled to any brokerage, finder's fees or other fee in connection with the
transactions contemplated by this Agreement based upon arrangements made by or
on behalf of the DIC Parties for which Seller shall be liable.
ARTICLE VI
COVENANTS
Section 6.1 Implementing Agreement. Subject to the terms and
conditions hereof, each of the DIC Parties and Seller shall take all action
required of it to fulfill its obligations under the terms of this Agreement and
shall otherwise use Commercially Reasonable Efforts to consummate the
transactions contemplated hereby. Each of the DIC Parties and Seller shall
promptly give written notice to the other Party upon becoming aware of the
occurrence, or impending or threatened occurrence, of any event which could
cause or constitute a breach of any of its representations, warranties or
covenants contained or referenced in this Agreement and will use its
Commercially Reasonable Efforts to prevent or promptly remedy the same.
Section 6.2 Consents and Approvals. From the date of this Agreement
until the Closing Date, Seller and the DIC Parties shall each use Commercially
Reasonable Efforts to cause the Company and/or Cellcom to, obtain (i) all
consents, approvals, certificates and other documents required in connection
with the performance of this Agreement and the Acquisition Documents and the
consummation of the transactions contemplated hereby and thereby (other than the
Required Equity Holder Approvals, which shall be treated as set forth in Article
III), and (ii) all consents under Contracts of Cellcom required in connection
with the consummation of the transactions contemplated by this Agreement the
absence of which in Seller's reasonable judgment would have a material adverse
effect on the business of Cellcom (such consents, other than any consent
relating to any indebtedness of Cellcom, are defined as the "Material Cellcom
Consents"). The DIC Parties will cooperate with Seller in obtaining such
Material Cellcom Consents. Seller and the DIC Parties shall, subject to
applicable Law and the rights of the Other Equity Holders pursuant to the Equity
Rights Agreements, each use Commercially Reasonable
Efforts to cause the Company and/or Cellcom to, promptly make all filings,
applications, statements and reports to all Governmental Authorities and other
Persons that are required to be made prior to the Closing Date with respect to
the Company and/or Cellcom by or on behalf of Seller or the DIC Parties,
respectively, or the Company pursuant to any applicable Law in connection with
this Agreement, the Acquisition Documents and the transactions contemplated
hereby and thereby or any Material Cellcom Consent. The DIC Parties (A) shall
promptly (but in no event later than ten (10) days after the execution of this
Agreement) notify Seller of all filings, applications, statements and reports to
all Governmental Authorities and other Persons that are required to be made
prior to the Closing Date by or on behalf of the DIC Parties or any of their
Affiliates pursuant to any applicable Law or Contract in connection with this
Agreement, the Acquisition Documents and the transactions contemplated hereby
and thereby, and (B) shall promptly make, or cause their Affiliates to make, all
such filings, applications, statements and reports. The DIC Parties and Seller
shall each keep the other Party informed as to the status and timing of
obtaining any of the consents, approvals, filings, applications, statement and
reports described in this Section 6.2 for which it responsible, including any
Material Cellcom Consents.
Section 6.3 Preservation of Books and Records; Access.
(a) For a period of seven (7) years after the Closing Date or such
other period required by applicable Law, the DIC Parties shall preserve and
retain, and use Commercially Reasonable Efforts to cause the Company to preserve
and retain, all corporate, accounting, legal, auditing, human resources and
other books and records of the Company, Cellcom and Support Net (including any
documents relating to any governmental or non-governmental claims, actions,
suits, proceedings or investigations) relating to the conduct of the business
and operations of the Company, Cellcom and Support Net prior to the Closing Date
which are in the possession of the Company on the Closing Date. Notwithstanding
the foregoing, during such seven (7) year period, the DIC Parties may, and may
permit the Company to, dispose of any such books and records which are offered
to, but not accepted by, Seller. If at any time after such seven (7) year period
the DIC Parties intend to dispose, or permit the Company to dispose, of any such
books and records, the DIC Parties shall not do so without first offering such
books and records to Seller. The provisions of this Section 6.3(a) shall cease
to apply in the event of a subsequent sale or disposition of the Company,
Cellcom and/or Support Net by the DIC Parties; provided, however, that the DIC
Parties shall cause the subsequent owner(s) of the Company, Cellcom and/or
Support Net, as the case may be, to assume the obligations of the DIC Parties
set forth in this Section 6.3.
(b) After the Closing Date, subject to any confidentiality provisions
in the Equity Rights Agreements and the Cellcom JV Agreement that continue in
existence following the Closing Date, the DIC Parties shall use Commercially
Reasonable Efforts to cause the Company and/or Cellcom to permit Seller and its
Representatives to have reasonable access to, and to inspect at Seller's
expense, all books and records referred to in Section 6.3(a) in the event of any
litigation, arbitration or dispute or any threatened litigation, arbitration or
dispute, or in connection with insurance matters, tax filings, accounting and
financial reporting of Seller and its Affiliates, and to meet with officers and
employees of the DIC Parties, the Company and Cellcom as may reasonably be
requested by Seller on a mutually convenient basis in order to obtain
explanations with respect to such books and records and to obtain additional
information and to call such officers and employees as witnesses (or shall
otherwise provide such information
and use Commercially Reasonable Efforts to arrange such meetings under a
separate confidentiality agreement).
(c) Seller and the DIC Parties agree and confirm that to the extent
the books and records described in this Section 6.3 relate to Seller, such books
and records shall be deemed the Confidential Information of Seller, so long as
they do not fall within any of the exceptions to Confidential Information.
Section 6.4 Confidentiality.
(a) The DIC Parties acknowledge and agree that the access and
information provided to the DIC Parties in connection with the transactions
contemplated by this Agreement are subject to the terms of the Non-Disclosure
Agreement, dated March 18, 2005, between Seller Parent and DIC attached as
Exhibit 6.4(a) hereto (the "Confidentiality Agreement"), the terms of which are
incorporated herein by reference.
(b) Effective upon, and only upon, the Closing, the Confidentiality
Agreement shall terminate with respect to information relating solely to the
Company, Cellcom or Support Net; provided, however, that the DIC Parties
acknowledge that any and all other information provided to it by Seller or its
Representatives concerning Seller and its Affiliates shall remain subject to the
terms and conditions of the Confidentiality Agreement after the Closing.
(c) In the event that this Agreement is duly terminated for any
reason, notwithstanding anything to the contrary contained in the
Confidentiality Agreement, promptly (but in any event no later than ten (10)
Business Days) following such termination, the DIC Parties shall, and shall
cause its Representatives to, (i) return to Seller all Confidential Information
(and all copies, reproductions or extracts of Confidential Information)
furnished to the DIC Parties and the DIC Parties' Representatives by or on
behalf of Seller or the Company or have an executive officer of the DIC Parties
certify to Seller that all copies, reproductions or extracts have been destroyed
and (ii) destroy all Confidential Information prepared by the DIC Parties or the
DIC Parties' Representatives that contains, or reflects or is based upon, in
whole or in part, information furnished to the DIC Parties or the DIC Parties'
Representatives by or on behalf of Seller or the Company; provided, however,
that copies of such information may be maintained solely to the extent
reasonably required to support the basis for such termination. Such destruction
shall be certified in writing to Seller by each of an executive officer of the
DIC Parties and an authorized officer of the DIC Parties supervising such
destruction. Notwithstanding the return or destruction of the Confidential
Information, the DIC Parties and the DIC Parties' Representatives will continue
to be bound by the obligations of confidentiality and other obligations under
this Agreement and the Confidentiality Agreement.
Section 6.5 Compliance with Laws. The DIC Parties and Seller each
agree that, in seeking to comply with this Agreement, including obtaining the
Required Equity Holder Approvals, the DIC Parties and Seller and each of their
respective Representatives shall comply with all applicable Laws and shall not
in any manner, directly or indirectly, induce, solicit, encourage (or permit the
encouragement of), instruct or in any manner direct any Representative of the
Company or Cellcom to take or omit to take any actions that could violate
applicable Law or the policies of the Company or Cellcom. For the avoidance of
doubt, nothing in this Section
shall permit either the DIC Parties or Seller to derogate from such Party's
obligations under this Agreement, including the DIC Parties' obligations under
Section 2.4.
Section 6.6 Tax Matters.
(a) The DIC Parties will not make an election under Section 338 of the
United States Internal Revenue Code of 1986, as amended, with respect to the
Company.
(b) Prior to the first day of the first calendar year following the
Closing Date: (i) the DIC Parties will not permit or take any action to cause
the Company to sell or otherwise dispose of any of the shares or other interests
in Cellcom currently owned by the Company, (ii) except as required by applicable
Law the DIC Parties will take all actions necessary to cause Cellcom not to take
any action or enter into any transaction outside the ordinary course of
business, consistent with past practices, and to continue to be engaged in the
active conduct of its current business, and (iii) the DIC Parties will not
liquidate the Company, merge the Company into another entity, cause there to
occur a split-off or spin-off transaction involving the Company or cause the
Company to acquire more than an insignificant amount of assets other than shares
of Cellcom; provided, however, that notwithstanding the foregoing, nothing
contained herein shall prevent the DIC Parties from causing the liquidation of
the Company, so long as at such time, the Company is wholly-owned by the DIC
Parties or by another IDB Affiliate that is organized under the Laws of The
Netherlands and that is treated as a corporation for U.S. federal income tax
purposes.
(c) After the Closing Date, to the extent reasonably required by
Seller, the DIC Parties shall use Commercially Reasonable Efforts to cause the
Company to provide to Seller, without delay, such information of the Company and
access to, and copies of, the corporate books and records of the Company,
including such information relating to SupportNet or Cellcom and Purchaser, and
shall use Commercially Reasonable Efforts to provide such other assistance
(e.g., by making available employees to provide additional information and
explanation of any materials so provided) as may reasonably be requested by
Seller, as being necessary or incidental to Seller in properly fulfilling its
obligations pursuant to Tax Laws and regulations or otherwise dealing with Tax
affairs in respect of the period prior to the Closing.
(d) If, after the Closing, the Company is notified of a Tax audit, or
receives an assessment or other correspondence from the Tax authorities with
respect to the period prior to the Closing, the DIC Parties shall (and the DIC
Parties shall use Commercially Reasonable Efforts to cause the Company to)
promptly inform Seller, and Seller and the DIC Parties shall consult with each
other and with the Company and seek agreement on the appropriate course of
action, taking into account the best interests of Seller.
Section 6.7 Conduct of the Business of the Company. From the date of
this Agreement until the Closing Date, Seller shall, subject to applicable Law
and the rights of the Other Equity Holders pursuant to the Equity Rights
Agreements, use Commercially Reasonable Efforts to cause (i) the Company to
operate in the ordinary course of business consistent with the past practices of
the Company, and (ii) the Company not to acquire a significant equity interest
in any other Person or commit to provide Cellcom or Support Net with any
additional financing.
Section 6.8 Audited Financial Information. Prior to the Closing Date,
Seller shall, subject to applicable Law and the rights of the Other Equity
Holders pursuant to the Equity Rights Agreements, use Commercially Reasonable
Efforts to provide to the DIC Parties audited financial statements of the
Company with accompanying notes, prepared in accordance with generally accepted
accounting principles for the fiscal year ended March 31, 2005. The DIC Parties
understand that such financial statements shall not be available for
distribution to the DIC Parties prior to July 31, 2005.
Section 6.9 Waiver of Claims. Seller shall use Commercially
Reasonable Efforts to obtain and deliver to the DIC Parties a waiver of any and
all claims against the Company, Cellcom and Support Net from each Seller
Director concurrently with the resignation and replacement of the Seller
Directors, in substantially the form attached hereto as Exhibit 6.9(a). At such
time as the DIC Parties or any IDB Affiliate, or any of their respective
Affiliates, has sufficient power to cause the Company, Cellcom or Support Net to
do so, the DIC Parties shall cause each of the Company, Cellcom and Support Net
to deliver to each Seller Director a waiver of any and all claims that the
Company, Cellcom and Support Net may have against each such Seller Director, in
substantially the form attached hereto as Exhibit 6.9(b).
Section 6.10 Replacement of Seller Directors. (a) Seller shall call a
general meeting of the shareholders of the Company, which meeting shall take
place on or prior to the Closing Date and/or arrange for the execution of a
written shareholders' resolution for the purpose of appointing to the board of
managing directors of the Company (the "Company Board") the managing director(s)
that the Purchaser shall be entitled to designate upon the consummation of the
transactions contemplated by this Agreement (each such managing director, a
"Purchaser Board Designee"). In the event that the Purchaser Board Designee(s)
are not appointed to the Company Board as of the Closing Date, then, until such
time as the Purchaser Board Designee(s) are appointed to the Company Board, and
so long as the DIC Parties have entered into a director indemnification
agreement in the form attached hereto as Exhibit 6.10 with each Seller Director,
Seller shall, insofar as it is able under applicable law, use Commercially
Reasonable Efforts to cause each of its designees (and each of their respective
alternates, if any) to the Company Board and the board of managing directors of
Support Net and the board of directors of Cellcom (each such designee or
alternate, a "Seller Director") to continue to serve as members of the Company
Board and/or the board of directors of Cellcom and/or the board of managing
directors of Support Net and/or the board of directors of any other entity on
which such person serves at the request of the Company, Cellcom or Support Net
as if designated by the DIC Parties; provided, however, that in no event shall
Seller or any Seller Director be (i) obligated to undertake any act or omission
that may result in a breach of applicable law (including, without limitation,
breaches of any of such Seller Director's duties as a director, officer,
trustee, agent, or fiduciary of the Company, Support Net, Cellcom, or any other
corporation, partnership, joint venture, employee benefit plan, trust, entity,
or enterprise of any kind whatsoever, as applicable) or the licenses held by
Cellcom, or (ii) be precluded from appointing any alternate director to be
designated by the DIC Parties from time to time, and any replacement or
termination of such alternate shall not constitute a breach by Seller of the
provisions of this Section 6.10(a).
(b) At any time following the date hereof the DIC Parties may request
that any Seller Director that is a member of the board of directors of Cellcom
tender his resignation from such board of directors, such resignation to be
effective immediately following the Closing, it being
understood that notwithstanding the provisions of paragraph (a) above, upon any
such requested resignation Seller shall take all reasonable actions to appoint a
Purchaser Board Designee to the board of directors of Cellcom as a replacement
for such director.
Section 6.11 Equity Right Agreements. From the date of this Agreement
until the Closing Date, Seller shall not amend or agree to amend any provision
of any of the Equity Rights Agreements in any manner that would reasonably be
expected to be materially adverse to Purchaser following the consummation of the
transactions contemplated hereby without the DIC Parties' prior written consent.
ARTICLE VII
CONDITIONS PRECEDENT TO CLOSING
Section 7.1 Mutual Conditions to Closing. Subject to the terms and
conditions of this Agreement, the obligations of each party to this Agreement to
consummate the transactions contemplated by this Agreement shall be subject to
the satisfaction on or prior to the Closing Date of each of the following
conditions:
(a) No Governmental Order shall have been enacted, entered,
promulgated or enforced by any Governmental Authority of competent
jurisdiction that prohibits, restrains, enjoins, or restricts the
consummation of the transactions contemplated by this Agreement and the
Acquisition Documents, unless such Governmental Order would not result
in the operation of the business of the Company following the Closing
Date (assuming the Closing Date occurs) in a manner that is materially
adverse or detrimental to the conduct of the business of the Company
and the business of Cellcom, taken as a whole, as compared to the
conduct of the business of the Company and the business of Cellcom,
taken as a whole, on the date hereof (a "Closing Legal Prohibition").
(b) The Parties shall have obtained all Required Regulatory
Approvals that are necessary in order to permit the consummation of the
transactions contemplated by this Agreement and the Acquisition
Documents and to permit the operation of the business of the Company
and Cellcom, taken as a whole, following the Closing Date in a manner
that is not materially adverse or detrimental as compared to the
conduct of the business of the Company and Cellcom, taken as a whole,
as of the date hereof.
(c) The Parties shall have obtained all Required Equity Holder
Approvals the absence of which, in Seller's reasonable judgment, would
reasonably be expected to have a material adverse effect on the ability
of the DIC Parties and Seller to consummate the transactions
contemplated by this Agreement ("Closing Required Equity Holder
Approvals").
(d) All Material Cellcom Consents shall have been obtained.
(e) The General Shareholder Approval shall have been obtained.
Section 7.2 Conditions Precedent to Obligations of the DIC Parties on
the Closing Date. The obligation of the DIC Parties to consummate the
transactions contemplated by this
Agreement on the Closing Date shall be subject to the satisfaction (or waiver by
the DIC Parties), on or prior to the Closing Date, of the following conditions
precedent:
(a) Representations and Warranties of Seller. All
representations and warranties of Seller set forth in this Agreement
shall be true and correct in all material respects as of the date of
this Agreement; provided, however, that notwithstanding anything to the
contrary contained in this Agreement (but solely for purposes of this
Section 7.2(a)), the representations and warranties of Seller contained
in Sections 4.1 through 4.4 shall also be true and correct in all
material respects on the Closing Date as though made by Seller as of
the Closing Date (it being understood that Seller shall be permitted to
update Schedule 4.2(c) to reflect any amendments to the Equity Rights
Agreements permitted by Section 6.11, and that any such updates shall
be taken into account for purposes of satisfying the closing condition
contained in this Section 7.2(a)); provided, however, further, that for
purposes of this Section 7.2(a), the phrase "in all material respects"
shall be understood to take into account the investment by the Company
in Cellcom and Support Net.
(b) Performance of Covenants. Seller shall have performed and
complied with all covenants and obligations required by this Agreement
to be performed or complied with by Seller prior to or on the Closing
Date except where the failure to so perform or comply would not
reasonably be expected to have a material adverse effect on the ability
of Seller to consummate the transactions contemplated by this
Agreement.
(c) Officer's Certificate. Seller shall have delivered to the
DIC Parties a certificate dated as of the Closing Date, signed by a
senior officer of Seller, certifying as to compliance with Sections
7.2(a) and 7.2(b).
Section 7.3 Conditions Precedent to Obligations of Seller on the
Closing Date. The obligations of Seller to consummate the transactions
contemplated by this Agreement shall be subject to the satisfaction (or waiver
by Seller) on or prior to the Closing Date of all of the following conditions
precedent:
(a) Representations and Warranties of the DIC Parties. All
representations and warranties of the DIC Parties set forth in this
Agreement shall be true and correct in all material respects as of the
date of this Agreement and on the Closing Date as though made by the
DIC Parties as of the Closing Date.
(b) Performance of Covenants. The DIC Parties shall have
performed and complied with all covenants, and obligations required by
this Agreement to be performed or complied with by the DIC Parties
prior to or on the Closing Date except where the failure to so perform
or comply would not reasonably be expected to have a material adverse
effect on the ability of the DIC Parties to consummate the transactions
contemplated by this Agreement.
(c) Officer's Certificate. The DIC Parties shall have
delivered to Seller a certificate dated as of the Closing Date, signed
by an officer of the DIC Parties, certifying as to compliance with
Sections 7.3(a) and 7.3(b).
ARTICLE VIII
CLOSING
Section 8.1 Closing. The closing of the transactions contemplated in
this Agreement (the "Closing") shall take place at the offices of Xxxxx &
XxXxxxxx Amsterdam N.V., Xxxxxxxxxxx 00, 0000 XX, Xxxxxxxxx, Xxx Xxxxxxxxxxx, at
12:00 P.M. on the third (3rd) Business Day after the date that Seller or the DIC
Parties notify the other Party, that the conditions precedent specified in
Article VII have been satisfied or waived by all of the Parties permitted to
waive such conditions (the "Closing Date") (other than conditions to be
satisfied or waived at the Closing); provided, however, that in no event shall
the Closing take place before the later of (x) the date that is 120 days
following the date of this Agreement or (y) in the event that any Other Equity
Holder makes a bona fide election to exercise its Tag Along Rights as described
in Section 3.3, the date that is 60 days following the date of such exercise.
Section 8.2 Deliveries of Seller. On the Closing Date, Seller
shall deliver to the DIC Parties:
(a) A receipt duly issued by Seller for the payment of the
portion of the Purchase Price referenced in Section 2.3, substantially
in the form attached hereto as Exhibit 8.2(a);
(b) Subject to Section 6.10, letters of resignation, effective
as of the Closing Date, of each Seller Director from each position each
such Seller Director occupies with respect to the Company or Cellcom,
and any such other writing that otherwise removes said directors from
such positions in accordance with the Cellcom JV Agreement, Cellcom's
articles of association and/or the Equity Rights Agreements;
(c) The documents required to be delivered pursuant to
Sections 7.2(a), (b) and (c);
(d) A mutual release pursuant to Section 13.18 ("Mutual
Release") duly executed by Seller;
(e) Copies of the Required Regulatory Approvals described in
Section 7.1(b) (to the extent deliverable);
(f) A certificate of the secretary or an assistant secretary
of each of Seller and Seller Parent dated as of the Closing Date
certifying resolutions of the board of directors of each of Seller and
Seller Parent approving and authorizing the execution, delivery and
performance by Seller and Seller Parent of this Agreement and the
Acquisition Documents, and, to the extent applicable, the consummation
of the transactions contemplated hereby and thereby and that such
resolutions were duly adopted and are in full force and effect
(together with an incumbency and signature certificate regarding the
officer(s) signing on behalf of Seller); and
(g) An assignment and assumption agreement, duly executed by
Seller validly assigning all of Seller's rights, interests, duties and
obligations under the Shareholders Agreement and the Option Agreement
to Purchaser (the "Assignment Agreement").
Section 8.3 Deliveries of the DIC Parties. On the Closing Date, the
DIC Parties shall deliver to Seller:
(a) The portion of the Purchase Price referenced in Section
2.3 by wire transfer in immediately available funds to the bank account
designated by Seller, in accordance with Section 2.3 of this Agreement;
(b) The documents required to be delivered pursuant to
Sections 7.3(a), (b) and (c);
(c) A Mutual Release duly executed by each of DIC and
Purchaser;
(d) Copies of the Required Regulatory Approvals (to the extent
deliverable);
(e) A certificate of an officer of each of DIC and Purchaser
dated as of the Closing Date certifying resolutions of the board of
directors of DIC and Purchaser approving and authorizing the execution,
delivery and performance by DIC and Purchaser of this Agreement and the
Acquisition Documents, and the consummation of the transactions
contemplated hereby and thereby and that such resolutions were duly
adopted and are in full force and effect (together with an incumbency
and signature certificate regarding the Persons signing on behalf of
DIC and Purchaser);
(f) An assignment and assumption letter pursuant to which
Purchaser shall become a party to the Shareholders Agreement; and
(g) The Assignment Agreement duly executed by Purchaser.
Section 8.4 Notarial Deed. The notarial deed of transfer (the
"Notarial Deed"), a form of which is attached hereto as Exhibit 8.4, will be
executed upon the Closing before one of the civil law notaries of Xxxxx &
XxXxxxxx Amsterdam N.V.
Section 8.5 Share Registry. Promptly upon the execution of the
Notarial Deed, Purchaser shall cause a notation to be made in the shareholder
registry of the Company regarding the transfer of the Subject Shares.
Section 8.6 Shareholders' Meeting. The DIC Parties undertake to cause
(i) the Company and (ii) each of Cellcom and Support Net, to hold an ordinary
shareholders' meeting at the Closing or, if Purchaser acquires only the Subject
Shares at Closing, then at such time as DIC Parties or any IDB Affiliate has
sufficient power to cause the Company, Support Net or Cellcom to do so, to
approve the duties discharged by the members of the Company Board and the board
of managing directors of Support Net and the board of directors of Cellcom and
of any board of directors of any other Majority-Owned Affiliate of the Company,
Support Net or Cellcom, in each case appointed by Seller, and, subject to the
delivery of a Waiver of Claims in the form attached as Exhibit 6.9(a) hereto by
each such managing director or director, release them from any liability
vis-a-vis the Company, Cellcom or Support Net, as the case may be, under
applicable Law.
ARTICLE IX
INDEMNIFICATION
Section 9.1 Survival. All representations and warranties of the
parties hereto contained herein (other than those contained in Sections 4.1, 4.2
and 4.8 and Sections 5.1 and 5.2) shall survive for a period of eighteen (18)
months after the Closing Date. The representations and warranties contained in
Sections 4.1, 4.2 and 4.8 and Sections 5.1 and 5.2 shall survive for a period of
seven (7) years after the Closing Date. All covenants, agreements and
obligations contained in this Agreement shall survive until performed or
complied with in full, other than the right of the DIC Parties to make a claim
for indemnification pursuant to Section 9.2(c), which shall survive for seven
(7) years.
Section 9.2 Indemnification by Seller. Subject to Section 9.4, from
and after the Closing Date Seller shall indemnify the DIC Parties and the
Purchaser Indemnified Persons against, and agrees to hold the DIC Parties and
the Purchaser Indemnified Persons harmless from, any and all Losses incurred or
suffered by the DIC Parties and Purchaser Indemnified Persons arising out of any
of the following:
(a) any breach of or any inaccuracy in any representation or
warranty made by Seller in this Agreement (other than, for the
avoidance of doubt, (i) any breach or inaccuracy of the representations
and warranties contained in Section 4.2 to the extent arising from any
amendment to any Equity Rights Agreement permitted by Section 6.11, or
(ii) any breach or inaccuracy of the representations and warranties
contained in Section 4.7 to the extent that the subject matter of such
claim relates to any Other Equity Holder, including, without
limitation, the obtaining of any Required Equity Holder Approvals);
(b) any breach of or failure by Seller to perform any covenant
or obligation of Seller set forth in this Agreement; and
(c) any Taxes of the Company other than Israeli Taxes in
respect of Tax periods or portions of Tax periods ending on or before
March 31, 2005, except for any such Taxes paid prior to the Closing
Date.
Section 9.3 Indemnification by the DIC Parties. From and after the
Closing Date, the DIC Parties shall indemnify Seller and the Seller Indemnified
Persons against, and agrees to hold Seller and the Seller Indemnified Persons
harmless from, any and all Losses incurred or suffered by Seller and Seller
Indemnified Persons arising out of any of the following:
(a) any breach of or any inaccuracy in any representation or
warranty made by the DIC Parties in this Agreement;
(b) any breach of or failure by the DIC Parties to perform any
covenant or obligation of the DIC Parties set forth in this Agreement;
(c) any occurrence, event, act or omission of or involving the
Company, Cellcom, Support Net or the DIC Parties after the Closing
Date, including, without limitation, any claims, lawsuits or Losses
relating, or with respect, to (i) any liabilities under or with respect
to any other agreement or arrangement assumed by the Company,
Cellcom, Support Net or the DIC Parties and (ii) any indebtedness of
the Company, Cellcom or Support Net; and
(d) any and all Taxes of the Company, Cellcom or Support Net
in respect of Tax periods or portions of Tax periods ending after March
31, 2005; provided, however, that the DIC Parties shall in no event be
required to indemnify Seller for any Taxes imposed upon the Transfer of
the Subject Shares pursuant hereto other than pursuant to Section 2.4.
Section 9.4 Limitations on Liability of Seller. (a) Notwithstanding
any other provision of this Agreement, Seller shall not have any liability under
or in connection with this Agreement or the transactions contemplated hereby
(including under Section 9.2), or otherwise for any breach of or inaccuracy in
any representation or warranty or for any breach of any covenant or obligation
or for any other reason unless, and in each case only to the extent that, the
DIC Parties and Purchaser Indemnified Parties shall have incurred or suffered,
as to all inaccuracies and breaches and liability for indemnification hereunder,
aggregate indemnifiable Losses in excess of Six Million U.S. Dollars
(US$6,000,000) (the "Indemnity Deductible"), and then only for the amount of
such excess.
(b) Notwithstanding any other provision of this Agreement, (i) Seller
shall not have any liability under or in connection with this Agreement or the
transactions contemplated hereby (including under Section 9.2 or otherwise for
any breach of or inaccuracy in any representation or warranty or for any breach
of any covenant or obligation or for any other reason) in excess of, as to all
representations, warranties, covenants, obligations and other reasons the
Purchase Price (as adjusted as described in Section 2.2 but without taking
account any payments made in respect of any successful indemnification claims
made pursuant to Sections 9.2 or 9.3), and (ii) subject to the limitations set
forth in this Article IX, Seller shall not be responsible for any particular
indemnification claim pursuant to Section 9.2 insofar as such claim relates to
Losses in respect of the Company, Cellcom or Support Net for an amount that
exceeds the product of (i) the amount of such indemnification claim otherwise
payable pursuant to this Article IX and (ii) the applicable Allocation
Percentage.
(c) In no event shall Seller have any liability for any claims by or
with respect to any past, current or future employees of the Company (other than
any Seller Director (but except to the extent any such claims of a Seller
Director are subject to a director indemnification agreement with the DIC
Parties entered into pursuant to Section 6.10)), Cellcom or Support Net (or for
any Losses relating thereto) which are first made after the Closing Date,
including any claims that arise out of or in connection with (i) any injuries
to, or deaths or illnesses of, such employees or (ii) any severance or other
claims related to the termination of such employees.
(d) The sole and exclusive liability and responsibility of Seller to
the DIC Parties under or in connection with this Agreement or the transactions
contemplated hereby (including for any breach of or inaccuracy in any
representation or warranty or for any breach of any covenant or obligation or
for any other reason), and the sole and exclusive remedy of the DIC Parties with
respect to any of the foregoing, shall be as set forth in this Article IX (other
than with respect to fraud or willful misconduct) and as set forth in Sections
11.2 and 13.16. Other than pursuant to this Article IX and Sections 11.2 and
13.16, the DIC Parties on behalf of
themselves, their Affiliates, and each of their respective Representatives,
hereby waive and release, to the fullest extent permitted under applicable Law,
any and all rights (including any other right to indemnification, contribution
or recovery), claims and causes of action (including those of any nature, known
or unknown, or based on any legal theory, whether common law or any statute,
contract, tort or other legal theory) it may have against Seller, the Company,
Cellcom, Support Net, or any of their respective Affiliates, stockholders or
Representatives, arising from or relating to the negotiation or subject matter
of this Agreement, whether arising under or based upon any applicable Law, rule,
regulation, order, judgment or decree or otherwise.
(e) Each of Seller and the DIC Parties will only be liable for actual
Losses, and in no event shall either Party have any liability for special,
speculative, punitive, indirect, consequential or multiple-based damages or for
lost profits or lost business opportunities, with regard to indemnification or
other claims hereunder; provided, however, that nothing in this Section 9.4(e)
shall in any way derogate from the DIC Parties' obligations under Sections 2.4
or 2.5.
Section 9.5 Claims. As promptly as is reasonably practicable after
becoming aware of a claim for indemnification under this Agreement not involving
a claim, or the commencement of any suit, action or proceeding, of the type
described in Section 9.6, but in any event no later than twenty (20) days after
first becoming aware of such claim, the Indemnified Person shall give notice to
the Indemnifying Person of such claim, which notice shall be prepared and
presented in good faith, and shall specify the facts alleged to constitute the
basis for such claim, the representations, warranties, covenants and obligations
alleged to have been breached and the amount that the Indemnified Person seeks
hereunder from the Indemnifying Person, together with such information as may be
necessary for the Indemnifying Person to determine that the limitations in
Section 9.4 have been satisfied; provided, that the failure of the Indemnified
Person to give such notice shall not relieve the Indemnifying Person of its
obligations under this Article IX except to the extent (if any) that the
Indemnifying Person shall have been prejudiced thereby.
Section 9.6 Notice of Third Party Claims; Assumption of Defense. The
Indemnified Person shall give notice as promptly as is reasonably practicable,
but in any event no later than twenty (20) days after receiving notice thereof,
to the Indemnifying Person of the assertion of any claim, or the commencement of
any suit, action or proceeding, by any Person not a party hereto in respect of
which indemnity may be sought under this Agreement (which notice shall be
prepared and presented in good faith, and shall specify in reasonable detail the
nature and amount of such claim together with all documents delivered to the
Indemnified Person by or on behalf of such third party Person and such
information as may be necessary for the Indemnifying Person to determine that
the limitations in Section 9.4 have been satisfied); provided, that the failure
of the Indemnified Person to give such notice shall not relieve the Indemnifying
Person of its obligations under this Article IX except to the extent (if any)
that the Indemnifying Person shall have been prejudiced thereby. The
Indemnifying Person may, at its own expense, (a) participate in the defense of
any such claim, suit, action or proceeding and (b) upon notice to the
Indemnified Person, at any time during the course of any such claim, suit,
action or proceeding, assume the defense thereof with counsel of its own choice
and in the event of such assumption, shall have the exclusive right, subject to
Section 9.7, to settle or compromise such claim, suit,
action or proceeding. If the Indemnifying Person assumes such defense, the
Indemnified Person shall have the right (but not the duty) to participate in the
defense thereof and to employ counsel, at its own expense, separate from the
counsel employed by the Indemnifying Person, and such Indemnified Person will
refrain, subject to any applicable Law and the regulations of any applicable
stock exchange (provided, that the Indemnified Person will use best efforts to
provide the Indemnifying Person with no less than twenty-four hours' notice in
the event that it is required to make any public announcement or communication
with the news media) from making any public announcements in respect of such
claim, suit, action or proceeding or otherwise communicating with the news media
without the prior consent of the Indemnifying Person. Whether or not the
Indemnifying Person chooses to defend or prosecute any such claim, suit, action
or proceeding, all of the parties hereto shall cooperate in the defense or
prosecution thereof.
Section 9.7 Settlement or Compromise. Any settlement or compromise
made or caused to be made by the Indemnified Person or the Indemnifying Person,
as the case may be, of any such claim, suit, action or proceeding of the kind
referred to in Section 9.6 shall also be binding upon the Indemnifying Person or
the Indemnified Person, as the case may be, in the same manner as if a final
judgment or decree had been entered by a court of competent jurisdiction in the
amount of such settlement or compromise; provided, that (a) no obligation,
restriction or Loss shall be imposed on the Indemnified Person as a result of
such settlement or compromise without its prior written consent, which consent
shall not be unreasonably withheld, and (b) the Indemnified Person will not
compromise or settle any claim, suit, action or proceeding without the prior
written consent of the Indemnifying Person, which consent shall not be
unreasonably withheld.
Section 9.8 Time Limits. Any right to indemnification or other
recovery under this Article IX shall only apply to Losses with respect to which
the Indemnified Person shall have notified the Indemnifying Person within the
applicable time period set forth in Sections 9.1 and/or 9.5. If any claim for
indemnification or other recovery is timely asserted under Sections 9.1 and/or
9.5, the Indemnified Person shall have the right to bring an action, suit or
proceeding with respect to such claim within one year after first giving the
Indemnifying Person notice thereof, but may not bring any such action, suit or
proceeding thereafter.
Section 9.9 Net Losses and Subrogation; Offset. (a) Notwithstanding
anything contained herein to the contrary, the amount of any Losses incurred or
suffered by any Indemnified Person shall be based on actual Losses incurred and
shall be calculated after giving effect to (i) any insurance proceeds received
by the Indemnified Person from any insurance policy provided or maintained by or
on behalf of the Company, Cellcom, Support Net, Seller, the DIC Parties or any
of their respective Affiliates with respect to such Losses, (ii) any net Tax
benefit realized by the Indemnified Person arising from the facts or
circumstances giving rise to such Losses and (iii) any recoveries obtained by
the Indemnified Person (or any of its Affiliates) from any other third party.
Each Indemnified Person shall exercise Commercially Reasonable Efforts to obtain
such proceeds, benefits and recoveries, and to take all reasonable actions to
mitigate the amount of any Losses incurred or suffered by such Indemnified
Person. If any such proceeds, benefits or recoveries are received by an
Indemnified Person with respect to any Losses after an Indemnifying Person has
made a payment to the Indemnified Person with respect thereto, the Indemnified
Person shall promptly, but in any event no later than ten (10) Business
Days after the receipt, realization or recovery of such proceeds, benefits or
recoveries, pay to the Indemnifying Person the amount of such proceeds, benefits
or recoveries (up to the amount of the Indemnifying Person's payment).
(b) Upon making any payment to an Indemnified Person in respect of any
Losses, the Indemnifying Person will, to the extent of such payment, be
subrogated to all rights of the Indemnified Person against any third party in
respect of the Losses to which such payment relates. Such Indemnified Person
and Indemnifying Person will execute upon request all instruments reasonably
necessary to evidence or further perfect such subrogation rights.
ARTICLE X
ARBITRATION
Section 10.1 Arbitration. (a) In the event of any dispute between
the Parties arising out of or in relation to or in connection with this
Agreement or its validity, they shall use their Commercially Reasonable Efforts
to resolve the matter on an amicable basis.
(b) If either Party serves formal written notice on the other Party or
Parties, as the case may be, of a material dispute and such dispute is not
settled amicably within a period of thirty (30) days from the service of such
notice, then the dispute shall be referred in writing to the President of DIC
and to the Managing Director of Corporate Development-International Mergers &
Acquisitions of Seller Parent. No legal proceedings by one party against the
other under this Agreement will be brought unless and until such procedure has
been followed.
(c) If the President of DIC and the Managing Director of Corporate
Development-International Mergers & Acquisitions of Seller Parent shall have
been unable to resolve any such dispute referred to them as aforesaid within
sixty (60) days of the written referral described in Section 10.1(b), that
dispute shall be referred to any finally settled under the Arbitration Rules
(the "NAI Rules") of the Netherlands Arbitration Institute; provided, however
that the Parties agree that rather than the rules regarding the taking of
evidence imposed by the NAI Rules, the IBA Rules on the Taking of Evidence in
International Arbitration shall instead be applicable to all such disputes. The
arbitral procedure shall take place in Amsterdam and shall be conducted in the
English language. The arbitral tribunal shall be composed of three (3)
arbitrators to be appointed in accordance with the NAI Rules and will deliver
its decision in accordance with the rules of law.
(d) The arbitration award shall be final and binding upon the parties
to such arbitration and judgment thereon may be entered in any court having
jurisdiction.
(e) Notwithstanding the foregoing but subject to Section 13.13, the
Parties shall be entitled to seek any temporary, preliminary or conservatory
measures from any court before or pending resolution of the dispute by
arbitration.
ARTICLE XI
TERMINATION
Section 11.1 Termination. This Agreement may be terminated, and the
transactions contemplated herein may be abandoned, at any time on or prior to
the Closing Date:
(a) with the mutual consent of Seller and the DIC Parties;
(b) by Seller or the DIC Parties, if the Closing shall not have taken
place on or before December 31, 2005; provided, that if the Closing shall not
have occurred on or before December 31, 2005 solely due to (A) the imposition of
any Closing Legal Prohibition or (B) the pendency of any action or proceeding,
whether in arbitration or litigation, and whether brought by or against Seller
and/or any of its Affiliates, relating to the transactions contemplated hereby,
including the obtaining of any Closing Required Equity Holder Approvals and/or
the General Shareholder Approval, then the Closing Date will be automatically
extended, to the last day of each calendar month commencing with January 31,
2006, through December 31, 2006, unless either the DIC Parties or Seller provide
written notice at least ten (10) days prior to the commencement of such month to
the other that such automatic monthly extension should not occur, in which case,
such automatic extension in respect of that month and thereafter will not occur
(the "Termination Date"); provided, further, that the right to terminate this
Agreement under this Section 11.1(b) shall not be available to (i) Seller if the
failure of Seller to fulfill any of its obligations under this Agreement, or the
breach of or inaccuracy in any representation or warranty by Seller in this
Agreement, has been the cause of or resulted in the failure of the Closing to
occur on or before the Termination Date or (ii) the DIC Parties if the failure
of the DIC Parties to fulfill any of their obligations under this Agreement, or
the breach of or inaccuracy in any representation or warranty by the DIC Parties
in this Agreement, has been the cause of or resulted in the failure of the
Closing to occur on or before Termination Date;
(c) by either of Seller or the DIC Parties if the other Party makes a
general assignment for the benefit of creditors, or any proceeding shall be
instituted by or against such Party seeking to adjudicate such party as bankrupt
or insolvent, or seeking liquidation, winding up or reorganization, arrangement,
adjustment, protection, relief or composition of its debts under any law
relating to bankruptcy, insolvency or reorganization;
(d) by the DIC Parties, if there shall have been a material breach of
any representation or warranty or any covenant or obligation of Seller
hereunder, and the falsity, inaccuracy or incorrectness of any such
representation or warranty or the material breach of any such covenant or
obligation would cause the conditions to the Closing set forth in Sections
7.2(a) and/or 7.2(b) not to be satisfied by the Termination Date, and in any
case such breach shall not have been remedied within thirty (30) days after
receipt by Seller of a notice in writing from the DIC Parties specifying the
breach and requesting that such breach be remedied; or
(e) by Seller, if there shall have been a material breach of any
representation or warranty or any covenant or obligation of the DIC Parties
hereunder, and the falsity, inaccuracy or incorrectness of such representation
or warranty or the material breach of such covenant or obligation would cause
the conditions to the Closing set forth in Sections 7.3(a) and/or 7.3(b) not to
be satisfied by the Termination Date, and in any case such breach shall not have
been remedied within thirty (30) days after receipt by the DIC Parties of notice
in writing from Seller specifying the breach and requesting that such breach be
remedied.
In the event of termination by Seller or the DIC Parties pursuant to this
Section 11.1 (other than Section 11.1(a)), written notice thereof shall be given
to the other party.
Section 11.2 Effect of Termination. If this Agreement is duly
terminated pursuant to Section 11.1, there shall be no liability hereunder on
the part of Seller, the DIC Parties, or any of their respective Affiliates and
Representatives, and no party shall have any right to xxx for a breach of any
representation or warranty contained herein and all obligations of the parties
hereunder shall terminate except that (i) the obligations set forth in Sections
6.4 (Confidentiality), 13.1 (Expenses) and 13.10 (Publicity) shall survive the
termination of this Agreement, and (ii) any right or remedy which accrued
hereunder or under applicable Laws prior to or on account of such termination,
and the provisions of this Agreement shall survive such termination to the
extent required so that each Party may enforce all rights and remedies available
to such Party hereunder or under applicable Laws in respect of such termination
and so that any Party responsible for any intentional breach or nonperformance
of its obligations hereunder prior to termination shall remain liable for the
consequences thereof.
ARTICLE XII
OTHER AGREEMENTS
Section 12.1 Seller Parent Guaranty. (a) Seller Parent hereby
unconditionally and absolutely guarantees the due and punctual payment and
performance by Seller of all of its obligations and liabilities arising under
Section 9.2 of this Agreement, whether absolute or contingent, now or hereafter
existing, or due or to become due (collectively, the "Seller Liabilities"). The
guaranty provided by Seller Parent pursuant to this Section 12.1 constitutes a
guaranty of payment and performance when due and not of collection, and Seller
Parent specifically agrees that it shall not be necessary or required that any
Purchaser Indemnified Person exercise any right, assert any claim or demand or
enforce any remedy whatsoever against Seller or any other Person before or as a
condition to the obligations of Seller Parent hereunder. The DIC Parties agree
to provide Seller Parent with prompt notice of any breach or default with
respect to any of the Seller Liabilities, provided that any failure by the DIC
Parties to provide such notice shall in no way limit, waive, release, discharge
or otherwise affect in any manner whatsoever the obligations of Seller Parent
under this Section 12.1.
(b) Notwithstanding anything in this Agreement to the contrary, Seller
Parent shall be entitled to the benefit of and may assert as a defense against
any claim under this Agreement any limitation, defense, set off or counterclaim
that Seller could have asserted, other than defenses based upon or relating to
(i) Seller's insolvency, bankruptcy or similar inability to pay or perform or
(ii) the due authorization, execution, delivery, enforceability or validity of
this Agreement or any of the other Acquisition Documents by or against Seller.
Section 12.2 Mergers, Consolidations, Sales. (a) Seller Parent
covenants that if it dissolves or otherwise disposes of all or substantially all
its assets or consolidates with or merges into another Person or entity, then it
will cause the surviving or successor Person to assume in writing its
obligations under this Article XII.
(b) If a consolidation, merger or sale or other transfer is made as
permitted by this Section 12.2, the provisions of this Section 12.2 shall
continue in full force and effect and no further consolidation, merger or sale
or other transfer shall be made except in compliance with the provisions of this
Section 12.2.
ARTICLE XIII
MISCELLANEOUS
Section 13.1 Expenses. Except as otherwise expressly stated in
Section 3.2(b) and elsewhere in this Agreement, all costs and expenses,
including, without limitation, fees and disbursements of counsel, financial
advisors and accountants, incurred in connection with the Acquisition Documents
and the transactions contemplated thereby shall be paid by the Party incurring
such costs and expenses, whether or not the Closing Date shall have occurred.
Section 13.2 Entire Agreement. This Agreement, the Confidentiality
Agreement and the other Acquisition Documents, constitute the sole understanding
of the Parties with respect to the subject matter hereof and supersede all prior
agreements and understandings of the Parties hereto with respect to the
transactions contemplated by this Agreement.
Section 13.3 Parties in Interest; Assignment. DIC and Purchaser shall
be jointly and severally liable for all obligations, liabilities or agreements
of the "DIC Parties" under this Agreement. This Agreement is binding upon and
is solely for the benefit of the Parties hereto and their respective successors,
legal representatives and permitted assigns. None of DIC, Purchaser or Seller
may assign this Agreement without the written consent of the other Party, which
consent shall not be unreasonably withheld; provided, however, that (i)(a)
Seller may at any time assign the rights and obligations hereunder to any
wholly-owned direct or indirect subsidiary of Seller Parent upon written notice
to the DIC Parties, provided that such transferee agrees in writing to be bound
by the provisions hereof as if such transferee were Seller hereunder, and (b)
Seller Parent shall remain liable pursuant to Section 12.1 as a guarantor of
such transferee, and (ii) each of DIC and Purchaser may at any time assign its
rights and obligations hereunder and/or delegate its obligations hereunder to
any IDB Affiliate so long as (x) any such IDB Affiliate agrees in writing to be
bound by all of the terms, conditions and provisions contained herein, (y) if
any such IDB Affiliate is to purchase the Subject Shares, then such entity is
organized under the Laws of The Netherlands, and (z) DIC shall remain liable for
all such assigned or delegated obligations under this Agreement. Any attempted
assignment not in compliance with the terms of this Agreement is null and void.
Section 13.4 No Third Party Beneficiary Rights. This Agreement is not
intended to and shall not be construed to give any Person or Governmental
Authority other than the Parties signatory hereto and their respective
successors and permitted assigns any benefit or rights (including without
limitation any third party beneficiary rights) with respect to or in connection
with any agreement or provision contained herein or contemplated hereby, nor is
anything in this Agreement intended to relieve or discharge the liability of any
third Person or Governmental Authority to any Party to this Agreement, nor shall
any provision give any third Person or Governmental Authority any right of
subrogation or action over or against any Party to this Agreement.
Section 13.5 Headings. The descriptive headings contained in this
Agreement are for convenience of reference only and shall not affect in any way
the meaning or interpretation of this Agreement.
Section 13.6 Notices. All notices or other communications under this
Agreement shall be in writing and shall be given (and shall be deemed to have
been given upon receipt) by delivery in person, by facsimile or other standard
form of telecommunication, including e-mail, or by registered or certified mail,
postage prepaid, return receipt requested, addressed as follows:
If to the DIC Parties:
Discount Investment Corporation Ltd.
3 Azrieli Center, 44th Xxxxx
Xxx Xxxxxxxxxx Xxxxx
Xxx-Xxxx 00000
Xxxxxx
Telephone: (000-0) 000-0000
Fax: (000-0) 000-0000
E-mail: xxx.xxxx@xxx.xx.xx
Attention: Xxx Xxxx
President and CEO
With a copy to:
Goldfarb, Levy, Eran & Co.
0 Xxxxxxxx Xxxxxx
Xxx Xxxx 00000
Xxxxxx
Telephone: (000-0) 000-0000
Fax: (000-0) 000-0000
E-mail: xxxx.xxxx@xxxxxx.xxx
Attention: Xxxx Xxxx
Advocate
If to Seller:
BellSouth Holdings B.V.
c/o BellSouth Enterprises, Inc.
0000 Xxxxxxxxx Xx. XX, Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Xxxxxx Xxxxxx of America
Telephone: (000) 000-0000
Fax: (000) 000-0000
E-mail: xxxxxxx.xxxxxxxxx@xxxxxxxxx.xxx
Attention: Xxxxxxx Xxxxxxxxx
Managing Director - Corporate Development
With copies to:
BellSouth Corporation
c/o BellSouth Enterprises, Inc.
0000 Xxxxxxxxx Xx. XX, Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Xxxxxx Xxxxxx of America
Telephone: (000) 000-0000
Fax: (000) 000-0000
E-mail: xxxx.xxxxxxxx@xxxxxxxxx.xxx
Attention: E. Xxxx Xxxxxxxx
Chief Finance Counsel
or to such other addresses as DIC, Purchaser or Seller, as the case may be, may
have furnished to the other Party in writing in accordance with this Section
13.6. Notwithstanding any provision to the contrary contained in this
Agreement, any notice properly given by Seller or Seller Parent to either DIC or
Purchaser shall be deemed to have been given concurrently to both DIC and
Purchaser in satisfaction of all applicable notice requirements.
Section 13.7 Waivers. The failure of a Party hereto at any time or
times to require performance of any provision hereof shall in no manner affect
its right at a later time to enforce the same. No waiver by a Party of any
condition or of any breach of any term, covenant, representation or warranty
contained in this Agreement shall be effective unless in writing, and no waiver
in any one or more instances shall be deemed to be a further or continuing
waiver of any such condition or breach in other instances or a waiver of any
other condition or breach of any other term, covenant, representation or
warranty. For the avoidance of doubt, no waiver by either Seller or Seller
Parent in respect of any obligations, liabilities or agreements of either DIC or
Purchaser shall also be deemed a waiver of any obligations, liabilities or
agreements in respect of the subject matter thereof of both DIC and Purchaser
unless so expressly stated.
Section 13.8 Counterparts. This Agreement may be executed in any
number of counterparts, provided at least one counterpart is given to each
Party, each of which shall be deemed to be an original but all of which together
shall constitute but one agreement.
Section 13.9 Severability. Any term or provision of this Agreement
which is invalid or unenforceable in any jurisdiction shall, as to that
jurisdiction, be ineffective to the extent of such invalidity or
unenforceability without rendering invalid or unenforceable the remaining terms
and provisions of this Agreement or affecting the validity or enforceability of
any of the terms or provisions of this Agreement in any other jurisdiction. If
any provision of this Agreement is so broad as to be unenforceable, the
provision shall be interpreted to be only so broad as to be enforceable.
Section 13.10 Publicity. Prior to the Closing Date, no public
announcement or other publicity regarding the existence of this Agreement or its
contents or the transactions contemplated hereby shall be made by the DIC
Parties, Seller or any of their respective Affiliates or Representatives,
without the prior written agreement of the DIC Parties and Seller, in any case,
as to form, content, timing and manner of distribution or publication, such
agreement not to
be unreasonably withheld. On and after the Closing Date, each of Seller and the
DIC Parties agree to hold confidential the terms and provisions of this
Agreement and the terms of the transactions contemplated hereby.
Notwithstanding the foregoing, nothing in this Section 13.10 shall prevent
either party from (a) making any public announcement or disclosure required by
Law or the rules of any stock exchange, upon one (1) Business Day's prior notice
of the proposed disclosure to the other Party (with a copy in English of the
proposed disclosure) (or such shorter period (provided, that such Party shall
use best efforts to provide at least twenty-four hours notice) as may be
required under any applicable Law or regulations of any applicable stock
exchange), (b) discussing this Agreement or its contents or the transactions
contemplated hereby with those Persons whose approval, agreement or opinion, as
the case may be, is required for consummation of such particular transaction or
transactions or (c) enforcing its rights hereunder, or (d) obtaining all
Required Regulatory Approvals.
Section 13.11 Further Assurances. From time to time after the
Closing, at the reasonable request of either of Seller or the DIC Parties, the
other Party shall promptly execute and deliver all other reasonable documents
and take all further reasonable actions in order to effectuate completely the
transfer and assignment to Purchaser of the Subject Shares, and to otherwise
carry out the purposes of this Agreement.
Section 13.12 Governing Law. This Agreement shall be governed by and
construed and enforced in accordance with the internal laws of the State of New
York without giving effect to the principles of conflicts of law thereof.
Section 13.13 Jurisdiction. For purposes of any dispute or claim
arising out of, relating to, or in connection with this Agreement, each of the
Parties hereby irrevocably submits and consents to the jurisdiction of any
competent court in Amsterdam, The Netherlands.
Section 13.14 Use of the English Language. This Agreement has been
prepared and signed in the English language. In the event of any conflict or
inconsistency between the English language version and any translation hereof
made for any purpose, the English language version shall govern the
interpretation and construction hereof and for any and all other purposes,
except as may be otherwise required by applicable Law.
Section 13.15 Amendments. This Agreement may not be modified or
amended except by an instrument in writing signed by, or on behalf of, each of
the Parties.
Section 13.16 Specific Performance. Each of the Parties acknowledges
and agrees that the DIC Parties and Seller would be damaged irreparably in the
event any of the provisions of this Agreement are not performed in accordance
with their specific terms or are otherwise breached. Accordingly,
notwithstanding the provisions of Article X (including the notice provisions of
Section 10.1(b) thereof) each of the Parties agrees that the DIC Parties and
Seller shall be entitled to an injunction or injunctions to prevent breaches of
the provisions of this Agreement and to enforce specifically this Agreement and
the terms and provisions hereof in any action instituted in any court or
arbitral body having jurisdiction over the Person or the property of the Person
against whom enforcement is sought, in addition to any other remedy to which it
may be entitled pursuant hereto.
Section 13.17 Schedules. Any information disclosed pursuant to any
Schedule hereto shall be deemed to be disclosed to the DIC Parties for all
purposes of this Agreement. Neither the specification of any dollar amount in
any representation or warranty contained in this Agreement nor the inclusion of
any specific item or matter in any Schedule hereto is intended to imply that
such amount, or higher or lower amounts, or the item or matter so included or
other items or matters, are or are not material, and no party shall use the fact
of the setting forth of any such amount or the inclusion of any such item or
matter in any dispute or controversy between the parties as to whether any
obligation, item or matter not described herein or included in any Schedule
hereto is or is not material for purposes of this Agreement.
Section 13.18 Mutual Release. (a) As of the Closing Date, the DIC
Parties shall voluntarily and unconditionally release and forever discharge
Seller and its parents, subsidiaries and associated companies and other
Affiliates, and each of their respective predecessors, successors and assigns
and current and former Representatives from any and all actions, causes of
action, claims, demands suits, debts, obligations, losses, liabilities or
whatsoever kind or nature, whether known or unknown and whether in law,
arbitration equity or otherwise, of the DIC Parties and each of their respective
predecessors, successors and assigns and current and former Representatives,
relating to the Company, Cellcom their subsidiaries or any of their respective
Affiliates, or their businesses (except for rights or obligations arising under
this Agreement or the Acquisition Documents, including, under Article IX, and
fraud and willful misconduct), that arise out of acts, events, conditions or
omissions occurring or existing from the time the Company (or any predecessor
thereof) or Cellcom was formed or otherwise organized to and including the
Closing Date.
(b) As of the Closing Date, Seller shall voluntarily and
unconditionally release and forever discharge the DIC Parties and its parents,
subsidiaries and associated companies and other Affiliates, and the Company,
Support Net and Cellcom, and each of their respective predecessors, successors
and assigns and current and former Representatives (other than any
Representatives that are also Representatives of any Other Equity Holder or any
officers or directors of the Company, Cellcom or Support Net that have been
designated by any Other Equity Holder) from any and all actions, causes of
action, claims, demands suits, debts, obligations, losses, liabilities or
whatsoever kind or nature, whether known or unknown and whether in law,
arbitration, equity or otherwise, of Seller and each of its respective
predecessors, successors and assigns and current and former Representatives,
relating to the Company, Cellcom, their subsidiaries or any of respective
Affiliates, or their businesses (except for rights or obligations arising under
this Agreement or the Acquisition Documents, including under Article IX and
fraud and willful misconduct) that arise out of acts, events, conditions or
omissions occurring or existing from the time the Company (or any predecessor
thereof) or Cellcom was formed or otherwise organized to and including the
Closing Date.
(c) At such time as the DIC Parties or any IDB Affiliate, or any of
their respective Affiliates, has sufficient power to cause the Company, Cellcom
or Support Net to do so, the DIC Parties shall cause the Company, Cellcom and
Support Net to voluntarily and unconditionally release and forever discharge
Seller and its parents, subsidiaries and associated companies and other
Affiliates, and each of their respective predecessors, successors and assigns
and current and former Representatives from any and all actions, causes of
action, claims, demands suits, debts, obligations, losses, liabilities or
whatsoever kind or nature, whether known or unknown and
whether in law, arbitration equity or otherwise, of the Company, Cellcom and
Support Net, and each of their respective predecessors, successors and assigns
and current and former Representatives (other than any Representatives that are
also Representatives of any Other Equity Holder or any officers or directors of
the Company, Cellcom or Support Net that have been designated by any Other
Equity Holder), relating to the Company, Cellcom, Support Net and each of their
respective subsidiaries or Affiliates, or their respective businesses (except
for rights or obligations arising under this Agreement or the Acquisition
Documents, including, under Article IX, and fraud and willful misconduct), that
arise out of acts, events, conditions or omissions occurring or existing from
the time the Company (or any predecessor thereof) or Cellcom was formed or
otherwise organized to and including the Closing Date.
[SIGNATURE PAGES FOLLOW]
IN WITNESS WHEREOF, each of the Parties hereto has duly executed or
caused this Agreement to be duly executed on its behalf as of the date first
above written.
THE DIC PARTIES:
DISCOUNT INVESTMENT COMMUNICATIONS B.V.
By: /s/ Xxxxxx Xxxxx /s/ Xxxxxx Xxxxx
Name: Xxxxxx Xxxxx Xxxxxx Xxxxx
Title: Managing Director Managing Director
DISCOUNT INVESTMENT CORPORATION LTD.
By: /s/ Xxxxxx Xxxxx /s/ Xxxxxx Xxxxx
Name: Xxxxxx Xxxxx Xxxxxx Xxxxx
Title: Vice President Comptroller
SELLER:
BELLSOUTH HOLDINGS B.V.
By: ING Management (Nederland) B.V.
By: /s/ L.J.M. Duysens
Name: L.J.M Duysens
Title: General Proxy Holder
By: /s/ X.X. Xxxxx van Huysduynen
Name: X.X. Xxxxx van Huysduynen
Title: General Proxy Holder
SELLER PARENT:
BELLSOUTH CORPORATION,
For purposes of Article XII only.
By: /s/ Xxxxxxx X. Xxxxxxxxx
Name: Xxxxxxx X. Xxxxxxxxx
Title: Authorized Signatory
