Exhibit 2
AGREEMENT BETWEEN PARTNERS
--------------------------
Between PIRELLI S.p.A. (joint-stock company, based in Milan, viale
Sarca 222, having 1,042,775,333.08 Euros in stock capital, inscribed in the
Milan Registry of Businesses, fiscal code and value-added tax number 0086890151,
in the person of Chairman of the Board of Directors Xx. Xxxxx Xxxxxxxxxx
Provera, who was granted the necessary powers through a resolution by the Board
of Directors on July 28, 2001 (hereafter referred to as "Pirelli")
- as one party -
and EDIZIONE HOLDING S.P.A., based in Treviso, Calmaggiore 23, with
90,692,800,000 lire in stock capital, inscribed in the Treviso Registry of
Businesses under number 13945, fiscal code and value-added tax number
00778430264, in the person of Managing Director Xx. Xxxxxx Xxxx, who was granted
the necessary powers through a resolution of the Board of Directors on July 27,
2001 (hereafter referred to as "Edizione")
- as the other party -
whereas
(a) on the date of July 30, 2001, Pirelli and Edizione signed an
offer to acquire, directly or through a subsidiary company to be named by the
execution date as provided for therein, Olivetti Stock and Olivetti Warrants (as
defined in paragraphs 1.01 and 1.23, respectively), from XXXX X.X. (Spanish
abbreviation for "company")
(b) the offer by Pirelli and Edizione was accepted on the same date
by XXXX X.X. and the Contract (as defined in paragraph 1.04) was then drawn up;
(c) the Parties (as defined in paragraph 1.15) intend to designate a
common assignee company to proceed with the acquisition of Olivetti Stock and
Olivetti Warrants;
(d) to achieve the objectives indicated in the preceding premise, the
Parties constituted the Company (as defined in paragraph 1.18) on the date of
August 3, 2001, and Edizione shall have 20% (twenty percent) participation in it
and Pirelli shall have 80% (eighty percent) participation;
(e) in executing separate agreements between the Parties and XXXX
X.X. and G.P.P. INTERNATIONAL S.A., on the date of July 30, 2001, Pirelli
acquired, acting also on behalf of Edizione, through a wholly subsidiary
company, Kallithea S.p.A. (formerly S.r.l.) (limited-responsibility
partnership), the Remaining Olivetti Stock (as defined in paragraph 1.16), which
on the same date paid the Price (as defined in paragraph 1.16), using the
liquidity made available to it by Pirelli through Financing (as defined in
paragraph 1.08);
(f) the Parties intend to ensure that the Remaining Olivetti Stock
are transferred to the Company as soon as possible and in any case no later than
August 30, 2001, against payment augmented by financial obligations related to
the Financing, to be made on August 30, 2001, of the value as of that date;
(g) Pirelli owns Pirelli Participations and Edizione owns Edizione
Participations (as defined in paragraphs 1.13 and 1.14, respectively), which
both Parties intend to transfer and cause to be transferred to the Company for
the respective unitary prices of 2,1734 (check original) and 2,172 Euros
(representing their respective average prices);
(h) upon completion of the preceding transactions, especially once
the conditions contained in the Contract are fulfilled, the Company shall be the
owner of the Participations (as defined in paragraph 1.12);
(i) Pirelli and Edizione intend to invoke the same conditions
relative to the agreements made between them on the date of July 30, 2001, with
respect to their reciprocal relationships as partners in the Company;
all these premises being stated,
and being an integral part of the agreement, the following is stipulated and
agreed upon:
2
ARTICLE I
DEFINITIONS
In addition to the terms defined in other clauses of the Agreement (as defined
in paragraph 1.06), for the purposes of the same, each of the terms listed below
shall have the stated meaning:
1.01 "Olivetti Stock": 1,552,662,120 ordinary shares of Olivetti S.p.A., which
is the subject of the Contract.
1.02 "Company Stock": 20% of the Company's capital stock.
1.03 "Conditions": conditions for suspension of the transfer of Olivetti Stock
and Olivetti Warrants (as defined in paragraph 1.23) with regard to obtaining
the Authorizations as provided for and required by the Contract.
1.04 "Contract": the offer dated July 30, 2001, made by Pirelli and Edizione to
XXXX X.X., accepted on the same date with regard to the contract of sale of
Olivetti Stock and Olivetti Warrants.
1.05 "Strategic Subsidiaries": companies controlled by the Olivetti Group (as
defined in paragraph 1.10 below), non quoted and operating in these sectors:
infrastructures and services including the Internet, advertising collections,
telephone annuities, television.
1.06 "Agreement": this agreement between Partners stipulated on this date
between Pirelli and Edizione.
1.07 "Execution Date": the second Business Day (as defined in paragraph 1.09)
preceding (stet) the execution date of the Contract.
1.08 "Financing": the interest-bearing financing granted by Pirelli to Kallithea
S.p.A. on July 30, 2001, with interest tied to the Euribor rate at 0.25% per
month on an annualized basis.
1.09 "Business Day": every calendar day, except for Saturdays, Sundays and days
when banks are closed for normal business in the Milan market.
1.10 "Olivetti Group": the companies of Olivetti S.p.A., Telecom Italia S.p.A.,
Telecom Italia Mobile S.p.A. and Seat-Pagine Gialle S.p.A..
3
1.11 "Olivetti": the company Olivetti S.p.A., based in Ivrea, Xxx Xxxxxx, xx.
00.
1.12 "Participation": Participation Pirelli, Participation Edizione, Olivetti
Stock, Olivetti Warrants and the Remaining Olivetti Stock.
1.13 "Participation Edizione": the 134,322,250 ordinary Olivetti Stock belonging
to Edizione.
1.14 "Participations Pirelli": the 130,980,000 ordinary Olivetti Stock owned by
Pirelli.
1.15 "Party"/"Parties": Edizione and Pirelli, together or separately.
1.16 "Price": the sum of 4.175 (four point one seven five) Euros for each
Olivetti share.
1.17 "Seat": the company Seat-Pagine Gialle S.p.A., based in Turin, Via X. Xxxxx
no. 18.
1.18 "Company": the limited-responsibility company that the Parties constituted
on August 3, 2001, and which will be turned into a stock company by August 30,
2001, for the acquisition of the Participations.
1.19 "Statute": the company statute that the Parties shall adopt by August 30,
2001, a copy of which is attached here under number 1.19.
1.20 "Telecom Italia": the company Telecom Italia S.p.A., based in Turin, Xxx
Xxxxxxx xx. 00.
1.21 "XXX": the company Telecom Italia Mobile S.p.A., based in Turin, Xxx
Xxxxxxx xx. 00.
1.22 "Remaining Olivetti Stock": 147,337,880 ordinary Olivetti Stock already
acquired by Kallithea S.p.A.
1.23 "Olivetti Warrants": 68,409,125 Olivetti warrants for 2001-2002, which are
the subject of the Contract.
ARTICLE II
CAPITALIZATION OF THE COMPANY
The Parties hereby agree, by August 30, 2001 to adopt the text of the
Corporate By-laws and to endow the Company with the means sufficient to enable
4
the Company to acquire additional Olivetti Stock, the Pirelli Participation and
the Edizione Participation, in an amount not less than 5,200,000,000 Euros,
participating in Edizione, in the amount of no less than 20% (twenty percent),
and in Pirelli, in the amount of no less than 80% (eighty percent).
ARTICLE III
DESIGNATION OF THIRD PARTIES
(a) The rights and obligations of the Parties deriving from this
Agreement shall be understood to be assumed by the Parties unto themselves
and/or by the person to be named by these parties by the Execution Date, in
accordance and in observance with the terms established in Articles 1401 et sig.
of the Civil Code and in accordance with the following conditions:
(i) the designation may be made to only one person;
(ii) the person named must be a company controlled by the nominating
Party or must have 100% control over the nominating Party;
(b) The nomination of the third party as established above and the
respective acceptance thereof (when necessary) may occur through simple written
statements, even arriving separately, as long as they are delivered to the other
Party by the Execution Date, without any other restrictions in terms of the form
(or any other nature), with a tacit understanding that the terms and
stipulations of Article 1403 of the Civil Code are hereby waived;
(c) each Party shall remain fully responsible for the person
designated in accordance with the aforementioned stipulations;
(d) to all effects of Article III herein, Edizione shall name its own
100% controlled company Edizione Finance International S.A..
5
ARTICLE IV
CORPORATE GOVERNANCE BODIES OF THE COMPANY
4.01 Composition of the Board of Directors. For the entire term of the present
Agreement, the Parties hereby agree to do everything in their power, within the
limits permitted by law so that:
(i) The Board of Directors of the Companies is composed of 10
(ten) members;
(ii) 2 (two) Board Members out of 10 (ten) are named by Edizione;
(iii) in the event that a Executive Committee is name, 1 (one) of
its members shall be elected from the 2 (two) board members
named by Edizione;
(iv) The Vice-President of the Board of Directors is named by
Edizione from the 2 (two) board members named by Edizione;
this person shall have the powers of vice-legal representative
of the company.
4.02 Transfer of Duties. In the event that, for any reason whatsoever, including
death, termination of the work agreement, or revocation on the part of the
assembly of shareholders, one of the members of the board of directors named in
accordance with the stipulations established herein should cease to perform the
duties inherent in the position of board member, the Parties hereby agree to do
everything in their power so that, within the limits established by law, the
board member to replace the outgoing one should be named by the Assembly of
shareholders of the company (and before that meeting during the preparatory
meeting of the Board of Directors of company), in the person named by the Party
who had named the person to be replaced.
4.03 The Board of Auditors. For the entire term of this Agreement, the Parties
hereby agree to do everything in their power so that, in the limits established
by law, one actual board member and one alternate board member shall be named by
Edizione.
6
4.04 Confidential Material. Pirelli hereby agrees to do everything in its power,
within the limits of law, so that no decision should be made by the Board of
Directors of the Company without the favorable vote of at least one of the board
members named by Edizione (if present) in application of section 4.01 on the
following points of business:
- an indication of the vote to be made by the Ordinary and
Extraordinary Assemblies of Olivetti;
- the purchase, sale, or arrangement in any manner of shares with a
total value greater than 100,000,000 Euros per transaction;
- decisions relating to the relations between the holdings of the
Company and the holdings of third parties and the methods, terms, and conditions
for sources of external financing;
- proposals for decisions to be placed before the Extraordinary
Assembly of shareholders of the Company.
ARTICLE V
THE ENTRANCE OF NEW PARTNERS
5.01 Pledges Made by the Parties. Waiving the stipulations of the Corporate
By-laws, in particular in reference to the clauses relating to the Right of
Pre-Emption and the Right of Co-sale, the Parties hereby agree that Pirelli,
possibly in the period between the date in which the Company shall be
constituted and the Execution Date, but even subsequent to that date, shall have
the right to transfer shares of the Company to one or more parties up to the
total of 20% (twenty percent) of the corporate capital of the Company, as longer
as the buyers found by Pirelli for those purposes have received prior approval
by Edizione, it remaining understood that this approval cannot be denied without
valid reasons and motives if these companies are, in fact, financial partners,
and in the event of entrance into the corporate capital of the Societa di
Unicredito S.p.A. and/or Banca Intesa BCI S.p.A., which is under discussion,
Edizione gives it assent from this moment forward.
7
5.02 Formalities. (a) For the purposes of the application of section 5.01 of
this Agreement, Pirelli shall send Edizione a communication in the form
established in section 14.02, including an indication of the number of shares
reserved for sale to parties in accordance with section 5.01 above.
(b) within a period of 5 (five) business days from the receipt of the
aforementioned communication, Edizione must give its consent, where necessary in
relation to the aforementioned matters, with a communication sent to Pirelli in
the form established in section 14.02. It is hereby understood that in the event
that Edizione fails to provide a communication within the aforementioned period,
Pirelli may sell the shares in the Company to the third parties that it has
found and communicated, as if Edizione had granted its consent, with the limit
of 20% (twenty percent) of the corporate capital discussed in section 5.01 above
remaining in effect in any case.
ARTICLE VI
OPA ON OLIVETTI SHARES
For the entire term of this Agreement, the Parties hereby agree that,
in the event that third parties should make a public offer of purchase with the
intention of acquiring the Olivetti shares, in accordance with Legislative
Decree 58/98, Edizione hereby agrees, from this time forward, when so requested
by Pirelli through communication sent in the form established in section 14.02,
and in accordance with the applicable stipulations of law, not to oppose, and to
do everything so that the members of the Board of Directors of the Company do
not oppose the acceptance of the public offer of purchase of the Company.
8
ARTICLE VII
CORPORATE BODIES OF THE OLIVETTI GROUP
7.01 Composition of the Board of Directors of Olivetti. For the entire term of
this Agreement, the Parties hereby agree to do everything in their power, within
the limits established by Law, that in the Board of Directors of Olivetti,
Telecom, XXX, and Seat (the "OLIVETTI COMPANIES"):
(i) one fifth of the components of the Board of Directors of
the Olivetti Companies (rounded off to the greater number
up to two (2) board members), after the specific
determination of the exact number of board members that
shall compose the board, whose designation is not reserved
by stipulations of law, by-laws, or regulations, to the
market or other parties, be named by Edizione.
(ii) the Vice-President of the Board of Directors of the
Olivetti Companies, with the powers of vice-legal
representative, be named from among the board members named
by Edizione in accordance with the terms established above.
(iii) in the event of the formation of an executive committee, 1
(one) of its members shall be elected from the board member
or board members named by Edizione.
7.02 Composition of the Board of Directors of the Strategic Controlled
Companies. For the entire term of this Agreement, the Parties hereby agree to do
everything in their power, within the limits established by Law, that in the
Board of Directors of the Strategic Controlled Companies:
(i) one fifth of the components of the Board of Directors of
the Strategic Controlled Companies, after the specific
determination of the exact number of board members that
shall compose the board, be named by Edizione.
(ii) the Vice-President of the Board of Directors of the
Strategic Controlled Companies, with the powers of
vice-legal representative, be named from among the board
9
members named by Edizione in accordance with the terms
established above.
7.03 For the entire term of this Agreement and notwithstanding the points
established in sections 7.01 and 7.02 above, Edizione hereby agrees not to
present opposition to the fact that the members of the Board of Directors of the
Olivetti Companies and the Strategic Controlled Companies not named by Edizione,
the Market, or Government Agencies, shall be named by Pirelli.
7.04 Termination of Duties. In the event that, for any reason whatsoever,
including death, termination of the work agreement, or revocation on the part of
the assembly of shareholders, one of the members of the board of directors named
in accordance with the stipulations established herein should cease to perform
the duties inherent in the position of board member, the Parties hereby agree to
do everything in their power so that, within the limits established by law, the
board member to replace the outgoing one should be named by the Assembly of
shareholders of the company (and before that meeting during the preparatory
meeting of the Board of Directors of company), in the person named by the Party
who had named the person to be replaced.
ARTICLE VIII
DECISIONS MADE BY THE BOARD OF DIRECTORS OF THE OLIVETTI COMPANIES
8.01 Confidential Material. Waiving any stipulation to the contrary in the
corporate by-laws, Pirelli hereby agrees to do everything in its power, within
the limits of law, so that no decision should be made by the Board of Directors
of the Company without the favorable vote of at least one of the board members
named by Edizione (if present) in application of section 7.01 on the following
points of business:
(i) individual investments greater than 250 million Euros;
10
(ii) purchase, sale and deeds of disposition for any reason
whatsoever of controlling and connecting shareholdings with
a unit value of more than 250 million Euros;
(iii) deeds of disposition for any reason whatsoever of firms or
branches thereof individually greater than 250 million
Euros;
(iv) proposals to call the Extraordinary Meeting
(v) Infragroup transactions between the Olivetti group and
the Pirelli group for amounts individually greater
than 50 million Euros;
(vi) Transactions with related parties.
ARTICLE IX
REGULATIONS GOVERNING A DEADLOCK SITUATION
9.01 Identification of Deadlock Situations. For the purposes of Article IX
herein, the following may be considered "DEADLOCK" situations:
(i) A deadlock situation may occur as a result of a
disagreement between the Parties such as to cause
reasonable prospects of the inability to pass resolutions
at the Extraordinary Assembly of the Company, or a decision
of the Board of Directors of the Company in the matters of
business discussed in section 4.04, or a decision of the
Board of Directors of the Olivetti Companies cannot be
validly made in accordance with the corporate by-laws of
the company or the stipulations of section 4.04 or the
situations discussed in section 8.01 of this Agreement; and
(ii) The situation was the subject of a meeting between the
parties in accordance with section 9.02 below.
9.02 Obligation of the parties to hold a meeting. The Parties hereby agree to
hold a meeting in the event that a Deadlock Situation should arise, as defined
in point (i) of section 9.01 above.
11
9.03 Procedure: (a) In order to fulfill the obligations assumed in accordance
with section 9.02 above, the Parties hereby agree to meet, that is to consult
with each other, through teleconference or video conference within and no later
than the third (3rd) day preceding the date established for the meeting of the
board of the Company, or the board of Olivetti, or, immediately, as soon as
notification has been received, in the event of the urgent convocation of a
meeting of the board of the Company, or the board of Olivetti, in accordance
with the applicable legal stipulations.
(b) During the meeting discussed in the above section, the Parties
will do everything in their power to reach an agreement and/or to identify a
common direction on the matters placed before them for examination, to these
effects, and to act in good faith in these matters.
(c) The unexcused absence of one of the Parties to the meeting or the
abstention from the decisions reached during these meetings shall imply the
acceptance of the decisions reached by the other Party and shall obligate the
absent or abstaining Party to accept these decisions.
9.04 Expression of Will. (a) In the event that during the meetings discussed in
sections 9.02 and 9.03 above, the Parties should reach an agreement in terms of
the matters which form the subject of the aforementioned meeting, the Parties
shall be obligated to express their will in applicable forums in accordance with
the following stipulations:
(i) by naming a common representative for participation in the
extraordinary assembly of the Company and to cast a vote in
this assembly, in a manner consistent with the points
agreed upon;
(ii) ensuring that their own representatives to the Board of
Directors of the Company and to the Board of Directors of
the Olivetti Companies participate in the board meeting and
cast their vote during this meeting in a manner consistent
with the points agreed upon.
12
(b) On the other hand, in the event that the Parties are not able to
come to an agreement on the matters which form the subject of the aforementioned
meeting, Edizione will be obligated to abstain from taking part in the meeting
of the board and from casting its vote or having its vote cast and/or to abstain
from expressing its wishes or taking a stand on the matters which form the
subject of the aforementioned meeting, in any meeting or in any manner,
notwithstanding the stipulations established in point (c) below.
(c) In the event that the situation discussed in point (b) above
should occur, Edizione shall have the right to send Pirelli a "NOTICE OF
DEADLOCK SITUATION" by telegram or registered letters, in accordance with the
terms of Section 14.02, within 15 (fifteen) days from the conclusion of the
meeting discussed in section 9.03.
(d) In the event that the Deadlock Situation discussed in section
9.01 should persist, and if the situation discussed in point (b) should occur,
and if Pirelli does not receive the Notice of Deadlock Situation in the term
established in point (c) above, Pirelli shall have the right to send Edizione,
by telegram or registered letter, and in accordance with the terms established
in section 14.02, a Notice of Deadlock Situation to be received by Edizione
within 15 (fifteen) days from the conclusion of the term established in point
(c) above.
9.05 Rights of the Parties. (a) In the event that one of the Parties should send
the other Party a Notice of Deadlock Situation in the terms established in
points (c) and (d) of section 9.04:
(i) Edizione shall have the right (which shall be considered to
be exercised with the receipt by Pirelli of the Notice of
Deadlock Situation, in the terms established in point (c)
of section 9.04 above) to sell to Pirelli, which will have
the corresponding obligation of purchasing, all, and not
part, of the Company shares at a price determined in
accordance with the stipulations established in point (b)
below; and
(ii) Pirelli shall have the right (which shall be considered to
be exercised with the receipt by Edizione of the Notice of
Deadlock Situation, in the terms established in point (d)
13
of section 9.04 above) to purchase from Edizione, which
will have the corresponding obligation of selling, all, and
not part, of the Company shares at a price determined in
accordance with the stipulations established in point (b)
below.
(b) For the purposes of point (a) above, the Parties hereby agree
that the object of the decision shall be (x) the price of the Company Shares,
taking into account the economic value thereof ("THE PRICE OF THE COMPANY
SHARES") and (y) a value which is the expression of the pro-quota of the
majority premium as if the Company Shares were the expression of Olivetti
control ("PREMIUM"). The Price of the Company Shares and the Premium shall be
determined through common agreement between Pirelli and Edizione within 10
business days from the date on which one of the Parties has received
notification from the other party, in accordance with the terms established in
point (a), or, if there is no agreement, by two investment banks of
international standing, one of which chosen by each of the Parties. In the event
of any disagreement between the two investment banks appointed as stated
hereinabove, and if they are unable to fix the price and establish the premium
within a period of 30 business days from the date on which they are named, the
two banks shall name a third investment bank [indicated at the time that the two
banks are named] of similar international standing which shall have the task of
determining, with a binding effect on the Parties within the framework of the
figures determined by the two banks, both the Price and the Premium . In case of
disagreement of the two investment banks about the designation of the
aforementioned third bank, the Chief of the Court of Milan shall name the bank.
The Chief of the Court of Milan shall also be authorized [in the order and in
the terms indicated above] to name the investment bank which one of the Parties
has failed to name or to replace it in the event that it no longer performs this
function.
(c) The figures reached in accordance with point (b) above, and thus
the Price of the Company shares and the Premium determined on this basis, shall
be definitively binding for the Parties, in accordance with Articles 1349 and
14
1473 of the Civil Code, for the buying and selling transactions discussed in
point (a) above.
(d) The sales transaction shall be made within 30 (thirty) business
days from the receipt of the communication to the Parties of the evaluation
discussed in point (b) above, and the price included therein shall be understood
as payable in cash at the time of the transfer of the Company Shares discussed
in section 9.06 below.
9.06 Transfers. In the event that the Company Shares are to be sold in
accordance with section 9.05 (a), the following stipulations shall be
applicable:
(i) the Company shares shall be understood as transferred for
regular use on the date established in point (iii) below;
(ii) the rights of ownership of the Shares sold shall be understood
as transferred to the buyer on the date established in point
(iii) below;
(iii) the transfer of the Shares and the payment of the price for
them shall take place at the offices of the Company, at 11:00
a.m. on the 5th (fifth) business day subsequent to the date on
which the sale was concluded, in accordance with section
9.04(d) above, respecting, when applicable, any authorizations
on the part of the competent authorities having jurisdiction
over the Parties in relation to the sale;
(iv) when the transfer and the payment established by point (iii)
above have been made, the Company shares shall be free of
restrictions or liens or third party rights of any nature.
(v) the expenses, fees, or indirect taxes relating to the sale of
the Company Shares shall be paid by the buyer;
(vi) the taxes relating to capital gains made by the seller shall
be paid by the seller;
(vii) at the same time as the transfer of the Shares and the payment
of the respective price, the seller shall make sure that the
15
board members (actual and alternate) named by the Seller shall
retire from their position on the Boards of the Company and of
Olivetti.
ARTICLE X
COLLATERAL PURCHASES
10.01 Obligations of the Parties. (a) for the entire term of this Agreement the
Parties, unto themselves and through the companies controlled by them or the
companies that control them, in accordance with the terms of Article 2359,
section one of the Civil Code, may not purchase shares or bonds in Olivetti
and/or Warrants which give them the right to purchase shares or bonds which may
be converted into Olivetti shares, issued by Olivetti or Olivetti companies.
(b) The Company may not purchase the shares and bonds and the
financial instruments indicated in point (a) above in the amount exceeding the
opa threshold of 30% (thirty percent), including the shares actually held either
directly or indirectly.
ARTICLE XI
PENALTY FOR BREACH OF AGREEMENT
In the event of the non-performance of one or more of the commitments
assumed pursuant to the provisions set forth in this Agreement, the breaching
Party, without prejudice to any other right of the other Party (including the
right to compensation of the greater damage] shall be required to pay to the
other Party as a penalty, at the latter's simple written request, an amount
equal to 10% (ten per cent) of the principal amount invested by the
non-breaching Party in the capital of the Company at that date, less any
ordinary and/or special dividends that may have been received.
16
ARTICLE XII
TERM
12.01 Effective date. The effective date of this Agreement is subject to the
execution of the Contract and shall commence as of the purchase of the Olivetti
shares and Olivetti warrants as specified therein.
12.02 Term. (a) This Agreement shall run for three years as of its effective
date and shall be deemed to be tacitly renewed on each expiration date unless
notice of withdrawal has been given by one of the Parties, without prejudice to
the provisions of paragraph 12.03 below.
(b) Other than in the cases specified by law, the Parties shall have
the right to withdraw from this agreement on the expiration date: (i) as to
Edizione, subject to a notice sent 6 (six) months in advance; (ii) as to
Pirelli, subject to a notice sent 1 (one) month in advance.
12.03 Non-renewal. (a) In the event Pirelli gives Edizione by the deadline
specified in point (ii) of paragraph 12.02 (b) above and in the form specified
in paragraph 14.02, notice of withdrawal upon expiration of this Agreement,
Edizione shall have the right to sell to Pirelli, which shall have the
corresponding obligation to buy, all (but not part) of its shares of the
Company, on terms and conditions determined, mutatis mutandis, in accordance
with paragraph 9.05 (b) above, (and of the provisions set forth therein) giving
notice to Pirelli within 30 (thirty) working days. In that event, however, the
purchase shall be effected against payment of the price specified in art. 9.05
(plus an amount equal to 50% (fifty per cent) of the total of the Price of the
Company Shares and the Premium.
[b] Payment of the penalty shall be made immediately upon the simple
written request of Edizione, to be sent to Pirelli at the end of 30 (thirty)
days following communication given to the Parties of the determination made in
application of the procedure specified in paragraph 9.05 (b) above.
17
ARTICLE XIII
KEY EVENT
a) Whenever, during the term of this Agreement, following one or
several acts inter vivos carried out for any reason, for Edizione, Messrs.
Xxxxxxx, Xxxxxxxx, Carlo and Xxxxxxxx Xxxxxxxx, or their spouses or direct
descendants, stop designating the majority of the board of directors of
Edizione, and for Pirelli, Xx. Xxxxx Xxxxxxxxxx Provera stops, not by his own
volition, assuring the strategic-operational management of the Pirelli Group,
understood as Pirelli & C. Sapa and the companies directly and indirectly
controlled, a "KEY EVENT" takes place.
b) In the presence of the Key Event concerning one party, the other
Party will have the right to transfer all (but not part) of its Company shares
to the Party which incurred the Key Event, under terms and conditions determined
mutatis mutandis pursuant to the previous paragraph 9.05 (b) (and the provisions
mentioned therein) notifying such latter Party within 30 (thirty) Business Days
from the day the other Party declared in writing that it became aware of the Key
Event, or received written communication of such circumstance. However, in this
case, the purchase and sale will take place against payment of the price
referred to in article 9.05 (b) plus an amount equal to double the amount of the
price of the Company Shares and Premium.
ARTICLE XIV
GENERAL PROVISIONS
14.01 Modifications. No modification of this Agreement shall be valid and
binding until it is set forth in a written instrument signed by the Party
against which the modification is invoked.
14.02 Communications and Notices. Any communication requested or permitted by
18
the provisions of this Agreement shall be given in writing and shall be deemed
to be effectively and validly given upon receipt of same, if made by mail or
telegram, or upon acknowledgment of receipt by means of a specific declaration
(including by fax), if made by fax, provided it is addressed as follows:
(i) if to Edizione, at the following address:
Xxxxxxxxxxx 00
Xxxxxxx
Xxxxxxxxxx di: dott. Xxxxxx Xxxx
Telefax n. 0422-411118
(ii) if to Pirelli, at the following address:
Xxxxx Xxxxx 000
Xxxxxx
Xxxxxxxxxx di: dott. Carlo Buora
Telefax n. 02-64423454
or to another address that each of the Parties shall have the right to
communicate to the other, subject to the procedures set forth in this paragraph
14.02, on the understanding that the Parties elect domicile for all purposes
relative to this Agreement, including for any legal notices or notices involving
the arbitration proceeding referred to in Article XV below, at the addresses
indicated above or at any other addresses that may be communicated in the
future.
14.03 Tolerance. Tolerance of any behavior in violation of the provisions
contained in this Agreement does not constitute waiver of the rights arising
from the breached provisions nor the right to demand precise compliance with all
the terms and conditions specified herein.
14.04 Headings. The headings of the individual clauses have been provided only
to facilitate reading and therefore are not to be taken into account for the
purposes of interpreting this Agreement.
19
ARTICLE XV
DISPUTES
15.01 Arbitration. Any dispute arising from this Agreement or from any executor,
amending or supplementing instruments, shall be submitted to the unappealable
ruling of an Arbitration Panel consisting of three arbitrators, who shall decide
without any procedural formality other than respect for the principle of
cross-examination, but shall apply substantial Italian law. The arbitration
shall be customary in nature in accordance with the provisions of the code of
civil procedure and shall take place in Milan.
15.02 Designation of the arbitrators. (a) The Party requesting the arbitration
shall indicate, at least in general outline, the demands constituting the object
of the arbitration.
(b) The Party that initiates the arbitration procedure must at the
same time and under pain of nullification, designate its own arbitrator. The
Party called to arbitration shall have twenty (20) calendar days in which to
designate its own arbitrator. The two arbitrators of the Parties shall jointly
designate the third arbitrator who shall serve as chairman of the Arbitration
Panel. Should the arbitrators designated as indicated above not come to an
agreement on the designation of the third arbitrator within twenty (20) calendar
days of the designation of the second arbitrator, said third arbitrator shall be
designated by the Presiding Judge of the Court of Milan, who shall also be
called upon if the Party called to arbitration fails to name its own arbitrator
by the deadline indicated above.
15.03 Competent jurisdiction. Without prejudice to what is stipulated above, it
is agreed that any legal proceeding related in any way to this Agreement shall
be subject to the exclusive jurisdiction of the Courts of Milan.
Milan/Treviso August 7, 2001
20
Attachments
1.19: Bylaws of the Company
EDIZIONE HOLDING S.P.A.
----------------
PIRELLI S.P.A.
----------------
21
