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Dated, February 21, 2000
SHARE PURCHASE
A G R E E M E N T
between
SBS Magyarorszagi Befektetesi Kft as purchaser
and
CME Hungary BV
as selling shareholder
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LIST OF ANNEXES AND SCHEDULES
TO THE
SHARE PURCHASE AGREEMENT
Annex 1 Closing Balance Sheet (Clause 2.2.2)
Annex 2 Resolution of the Board of Directors of BK Rt
(Clause 3.2 (e))
Annex 3/a/b Seller's certificate (Clause 5.3.2) and
Purchaser's Certificate (Clause 5.2.1)
Annex 4 Purchaser's declaration (Clause 5.2.3)
Annex 5 Letters of Assignment of CME Claims (Clause 3.1.d)
Annex 6 List of equipment
Annex 7 Copies of MKB Pledge Agreement and Hitelgarancia
Guarantee Agreements
Annex 8/a IRISZ's withdrawal of the review proceeding
(Clause 3.2 a(i))
Annex 8/b CME Companies Declaration(Clause 3.2.a(ii))8/c
Annex 8/c CLT-UFA Companies'Declaration (Clause 3.1.e))
Annex 8/d SBS Companies Declaration (Clause 3.3.d))
Annex 8/I. CME Guarantee
Annex 8/II. SBS Guarantee
Annex 9 List of lawsuits (Schedule 1, 1.10.1)
Annex 10 List of employees (Schedule 1, 1.11.2)
Annex 11 Purchase Price Certificate (2.2.1)
Annex 12 List of Documents included in the Information
Binder
Annex 13 Escrow Agreement (Clause 3.1.(f))
Annex 14 Text of the Indemnification Letters for the
Directors of Bk Rt.
Schedule 1 Seller's warranties
Schedule 2 Purchaser's warranties
Schedule 3 Material contracts
Schedule 4 Insurance contract
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SHARE PURCHASE AGREEMENT
T H I S A G R E E M E N T is made on February 21, 2000, BETWEEN:
(1) SBS Magyarorszagi Befektetesi Kft , a limited liability company
registered in Hungary, whose registered office is located at
Budapest, Havas u. 6. H-1056("Purchaser" or "SBS Hungary");
(2) CME Hungary B.V., a limited liability company registered in The Netherlands,
whose registered office is located at Xxxxxxxxxxxxx 0, 0000 XX Xxxxxxxxx
ZuidOost, the Netherlands ("Seller"), together with the Purchaser, the
"Parties".
and becomes effective on the date of successful completion of Closing.
WHEREAS:
(A) Budapesti Kommunikacios Rt ("BK Rt") is a company organized and
existing under the laws of the Republic of Hungary. BK Rt is engaged in the
television broadcasting business.
(B) The registered capital of BK Rt is HUF 165,127,140 consisting of
11,460, ordinary registered shares, each with a nominal value of HUF 14,409 (the
"Shares"). The Seller is the registered owner of 11,460 number of Shares,
comprising 100% of the registered capital of BK Rt
(C) With the approval of the Board of Directors of BK Rt the Seller has
agreed to sell and the Purchaser has agreed to purchase 11,460 number of shares
of BK Rt held by the Seller ("Sale Shares"). Following the consummation of the
above transactions the Purchaser will hold 100% of the issued capital of BK Rt
IT IS AGREED as follows:
1. INTERPRETATION
In this Agreement, including its Schedules, unless the context otherwise
requires:
1.1 Definitions
"Affiliate" means, with regard to any person, any other person who,
individually or as part of a "group" controls, is controlled by or is
under common control with, such person;
"Agreement" means this Share Purchase Agreement;
"Closing" means the completion of the sale and purchase of the Sale
Shares, pursuant to Clause 5, subject to the fulfillment of all conditions
precedent to Closing as set forth in Clause 3;
"Closing Date" means the date on which the Closing takes place
pursuant to Clause 5.1;
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"CLT-UFA" means CLT UFA SA, Luxembourg, a 49% shareholder of
RTL Klub;
"Confidential Information" has the meaning set forth in Clause
7.3;
"Company Act" means Act No CXLIV of 1997 on Business organizations,
accepted by the Hungarian Parliament on December 9, 1997;
"Competition Act" means Act No LVII of 1996 on the prohibition of unfair
and restrictive market practices;
"CME" means collectively CME Media Enterprises BV, CME Hungary BV, CME
Development Corporation, CME Programming Services Inc. and CME Programming
Services BV;
"CME Programming Assets" means the programming agreements
referred to in the Programming Assignment Agreement;
"CME Guarantee" means the Deed of Guarantee to be entered into between the
Seller's Parent Company and the Purchaser guaranteeing the Seller's
performance pursuant to this Agreement;
"CME Liabilities" means all liabilities that are payable to CME by BK Rt
(whether for principal, or interest or otherwise) under any loan,
management services and programming services agreement;
"Deed of Foundation" means the May 31, 1999 amended and consolidated text
of the Deed of Foundation of BK Rt;
"Escrow Agent" means ING Bank, Budapest, Hungary;
"Escrow Account" means the bank account of the Purchaser held
with the Escrow Agent;
"Grundy" means Grundy International Holdings No.1. B.V, a 17%
shareholder of RTL Klub;
"HUF" means Hungarian Forint, the lawful currency of the
Republic of Hungary;
"Hungary" means the Republic of Hungary and the territory of
the Republic of Hungary as the case may be;
"ING" means ING Bank Rt Budapest;
"IRISZ Lawsuit" means the lawsuit initiated by IRISZ TV Rt in 1997
against, XXXX, MTM-SBS Rt and Magyar RTL Klub, challenging the award of
national licenses in the Television Tender;
"IRISZ TV Rt" means Irisz TV Televizios Musorkeszito Rt, the wholly owned
Hungarian subsidiary of CME Hungary BV, which was formed on April 1, 1997
by a consortia led by CME Hungary BV for the purposes of submitting a bid
in the Television Tender;
"IRISZ TV Withdrawal" means the withdrawal of all legal claims asserted
by IRISZ TV against XXXX, MTM-SBS Rt and Magyar RTL Rt in connection with
the Television Tender ;
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"Magyar RTL Rt" or "RTL Klub" means Magyar RTL Rt, a subsidiary of CLT-UFA
SA, Luxembourg, which has been awarded a television license in the
Television Tender, and which has been Defendant 3 in the IRISZ Lawsuit;
"MTM" means MTM Kommunikacios Rt, a shareholder of TV2 with
38.5% voting rights;
"MTM-SBS Rt" or "TV2" means MTM-SBS Rt, an affiliate of the Purchaser
which has been awarded a television license in the Television Tender, and
which has been Defendant 2 in the IRISZ Lawsuit;
"XXXX" means the National Radio and Television Council of Hungary, which
has been Defendant 1 in the IRISZ Lawsuit;
"Pearson" means Pearson Asia Pacific Limited, a 17% shareholder
of RTL Klub;
"Person" means an individual, partnership, corporation, company, trust,
unincorporated organisation, or a government or agency or political
sub-division thereof.
"Programming Assignment Agreement" means an agreement to be
entered into between CME Media Enterprises B.V., CME Hungary
B.V., CME Development Corporation, CME Programming Services
Inc., CME Programming Services B.V. and SBS on or before the
Closing for the assignment, sublicense or transfer of
substantially all of CME's program library for the territory of
Hungary to SBS;
"Purchaser's Parent Company" means SBS Broadcasting SA, the
majority owner of the Purchaser;
"Purchaser's Warranties" means the warranties of the Purchaser
set out in Clause 6.2 and Schedule 2;
"Sale Shares" means all of the Shares as set forth in Paragraph (C) of the
preambles to this Agreement;
"Seller's Parent Company" means CME Media Enterprises BV, the
sole owner of the Seller;
"Seller's Warranties" means the warranties of the Seller set
out in Clause 6.1 and Schedule 1;
"SBS" means SBS Broadcasting SA, the parent company of the Purchaser and a
shareholder of TV2 with 61.5% economic and 49% voting rights;
"SBS Guarantee" means the Deed of Guarantee to be entered into between
the Purchaser's Parent Company and the Seller guaranteeing the Purchaser's
performance pursuant to this Agreement;
"Shares" has the meaning set forth in Paragraph (B) of the
preambles of this Agreement;
"Summary Term Sheet" means the Summary Terms Sheet signed by SBS
Broadcasting SA and Central European Media Enterprises Ltd. on
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February 18, 2000 summarizing the parties understanding of three
inter-related transactions between their respective subsidiaries in
Poland, in Hungary and in Slovenia;
"Television Tender" means a tender announced in 1997 by the XXXX for
national terrestrial television licenses in Hungary;
"US$ or US Dollars" means United States Dollars, the lawful currency of
the United States of America.
"Videovox Quota Purchase Agreement" means the Quota Purchase Agreement to
be entered into between and by SBS Hungary as purchaser and CME Hungary BV
as seller for the sale of the quota representing 100% of the equity of
Videovox Studio Kft; and
"Videovox Transfer Notice" means a document signed by the Seller and the
Purchaser evidencing that the Purchaser acquired full ownership over
Videovox.
1.2 References
1.2.1 References to "this Agreement" shall include any
Schedule and Annex to it, and references to Clauses and
Schedules are references to Clauses ofand Schedules to,
this Agreement;
1.2.2 Unless the context otherwise requires, any
reference to a legislative act or provision
shall include such act or provision as from
time to time modified or re-enacted or
consolidated so far as such modification or
re-enactment or consolidation applies or is
capable of applying to any transactions
entered into hereunder;
1.2.3 Headings are used for convenience only and
shall not affect the interpretation of this
Agreement.
2. AGREEMENT TO PURCHASE THE SALE SHARES AND CONSIDERATION
Upon the terms and subject to the conditions of this Agreement:
2.1 Purchase of the Sale Shares
Seller hereby agrees to sell, and the Purchaser hereby agrees to
purchase, the Sale Shares, on the Closing Date. Notwithstanding
anything to the contrary, the Purchaser shall have no obligation to
purchase any number of Shares which is less than the Sale Shares.
2.2 Consideration and Adjustment
Purchase Price
2.2.1 The purchase price shall be equal to USD 1,000,000 plus
current assets and less current liabilities - excluding programming
and all CME related liabilities - stated in the Closing Balance
Sheet and less the Severance Payment Compensation ("Purchase
Price"). The Parties jointly established the Purchase Price in
accordance with the above
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described calculation and included it in a certificate attached
hereto as Annex 11.
Adjustment
2.2.2 The Parties agree, that the Seller shall cause BK Rt to
prepare, prior to Closing and in conformity with the rules of the
Generally Accepted Accounting Principles of United States ("US
GAAP"), an estimated, unaudited December 31, 1999 Balance Sheet of
BK Rt ("Closing Balance Sheet"), attached in Annex 1.
2.2.3 The Parties further agree, that BK Rt shall prepare, by
no later than March 15, 2000 and in conformity with US GAAP, a
balance sheet of BK Rt as of the Closing Date audited by Xxxxxx
Xxxxxxxx, Budapest ("Audited Balance Sheet"). The costs of such
audit shall be borne 50-50% by the Parties.
2.2.4 The Parties , agree that in the event that the total net
current liabilities stated in the Audited Balance Sheet are 0.3%
more than stated in the Closing Balance Sheet, Purchaser shall be
entitled to claim from the Seller the repayment of the difference
(,,Purchaser's Adjustment"). Within no later than 15 working days
after the receipt of the Audited Balance Sheet, Purchaser shall
notify the Seller in writing ("Purchaser's Notice") on the amount of
Adjustment, if any. If the Seller shall not have received Notice
within 15 working days after Purchaser's receipt of the Closing
Balance Sheet, it shall be deemed that Purchaser has waived its
right to claim Purchaser's Adjustment in respect thereof. If the
Purchaser's Notice shall have been delivered in a timely manner, the
Seller shall transfer the Purchaser's Adjustment to the Purchaser's
bank account specified in Clause 7.13 within 5 working days after
the receipt of the Purchaser's Notice.
2.2.5 The Parties agree that in the event that the total net
current liabilities stated in the Audited Balance Sheet are 0.3%
less than stated in the Closing Balance Sheet, Seller shall be
entitled to claim from the Purchaser the payment of the difference
("Seller's Adjustment"). Within no later than 15 working days after
the receipt of the Audited Balance Sheet, Seller shall notify the
Purchaser in writing ("Seller's Notice") on the amount of
Adjustment, if any. If the Purchaser shall not have received Notice
within 15 working days after Seller's receipt of the Closing Balance
Sheet, it shall be deemed that Seller has waived its right to claim
Seller's Adjustment in respect thereof. If the Seller's Notice shall
have been delivered in a timely manner, the Purchaser shall transfer
the Seller's Adjustment to the Seller's bank account specified in
Clause 7.13 within 5 working days after the receipt of the Notice.
Payment
2.2.6 Upon Seller's delivery to the Escrow Agent of the documents
set out in Clause 3.2, and the Sale Shares with
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blank endorsment, the Escrow Agent shall wire the Purchase Price
from the Escrow Account to the Seller's bank account specified in
Clause 7.13.
2.2.7 Within 5 working days after Seller's receipt of the
Purchaser's Notice, the Seller shall transfer in immediately
available funds the Purchaser's Adjustment to the account of the
Purchaser as specified in Clause 7.13.
2.2.8 Within 5 working days after Purchaser's receipt of the
Seller's Notice, the Purchaser shall transfer in immediately
available funds the Sellers Adjustment to the account of the Seller
as specified in Clause 7.13.
Severance Payment Compensation
2.2.9.1 As part of the Closing the Seller will have passed
a resolution effectively closing BK Rt's operations by midnight of
the day of Closing. Therefore, the Parties agree, that the Seller
shall compensate the Purchaser for certain costs of termination of
the contracts with employees and freelancers set out in Annex 10.
The Purchaser shall reduce the Purchase Price with USD 83,744 as a
compensation of certain termination costs("Severance Payment
Compensation").
2.2.9.2 It is expressly understood and agreed that, with
exception of the Severance Payment Compensation set forth in Clause
2.2.9.1 above, Purchaser is not entitled to any reimbursment for any
costs, expensenses, or the like in connection with the closing of
the operation of BK Rt.
3. CONDITIONS PRECEDENT TO CLOSING
3.1 Conditions Precedent to the Obligations of All Parties.
The respective obligations of each Party under this Agreement are
subject to the satisfaction or written waiver by the Seller or by
the Purchaser (as the case may be), at or prior to Closing, of each
of the following conditions:
(a) The Polish Transaction
CME and SBS have entered into the Option Agreement for the
Polish Transaction as described in the Summary Term Sheet.
(b) Sale of Videovox
The Parties shall have executed the Videovox Quota Purchase
Agreement regarding the sale by the Seller of the quota
representing 100% of the equity of Videovox Studio Kft to the
Purchaser, and the Parties shall have signed and placed in
escrow the Videovox Transfer Notice.
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(c) Execution of Programming Assignment Agreement
CME and SBS shall have entered into the Programming Assignment
Agreement.
(d) Assignment of Shareholder's Loan, CME Management
Fees and CME Programming Liabilities
CME and SBS shall have executed assignment letters for the
assignment to SBS of all CME claims against BK Rt relating to
the obligation to make any further payments (whether for
principal, or interest or otherwise) under any loan,
management services and programming services agreement entered
into by CME with BK Rt
(e) CLT-UFA Companies Declaration
Purchaser shall have placed in escrow a duly signed
declaration of CLT-UFA and RTL Klub ("CLT-UFA Companies") in
the form set forth in Annex 8/c to this Agreement, addressed
to CME and IRISZ TV that each of the CLT-UFA Companies waives
and releases each of CME and IRISZ TV, and their respective
shareholders from any legal claims or causes of action in any
forum, whether known or unknown, fixed or contingent, directly
or indirectly, against such parties in connection with the
Television Tender.
(f) Escrow Agreement
The Parties shall have entered into an escrow agreement, in
the form set forth in Annex 13.
3.2 Conditions Precedent to Obligations of the Purchaser.
The obligations of the Purchaser are subject to the satisfaction or
waiver by the Purchaser at or prior to Closing of each of the
following conditions:
(a) Withdrawal of IRISZ TV Claim
The Seller shall have caused the execution
(i) of petitions by IRISZ TV Rt, in the form set forth in
Annex 8/a to this Agreement, addressed to the Supreme Court of
Hungary withdrawing all claims asserted by IRISZ TV Rt against
XXXX, MTM-SBS Rt and Magyar RTL Rt in the review procedure
pending before the Supreme Court of Hungary under the file no:
Gfv.X.30.197/2000.(earlier under file No.: 31.132/1999.)
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(ii) Seller shall have placed in escrow duly signed declarations of
CME and IRISZ TV Rt in the form set forth Annex 8/b to this
Agreement, addressed to CLT-UFA, and RTL Klub ("CLT-UFA
Companies") that each of CME and IRISZ TV waives and releases
each of the CLT-UFA Companies , and their respective
shareholders from any legal claims or causes of action in any
forum, whether known or unknown, fixed or contingent, directly
or indirectly, against such parties in connection with the
Television Tender.
(b) No Breach of Representations and Warranties.
The representations and warranties of the Seller referred to
in Schedule 1 shall be true and correct in all material
respects at and as of Closing.
(c) Share Registry
Seller shall have delivered to Purchaser a certified copy of
the relevant page from BK Rt's shareholder register evidencing
that the Seller has been duly recorded as the holder of the
Sale Shares.
(d) CME Guarantee
Seller shall have delivered to Purchaser the CME Guarantee
executed by the Purchaser's Parent Company in the form set
forth in Annex 8/I.
(e) Resolution of the Board of Directors of BK Rt
BK Rt shall have delivered to Purchaser a resolution of the
Board of Directors of BK Rt in the form set forth in Annex 2
hereto dated the Closing Date, approving the transfer of the
Sale Shares as such approval is required in Section 43.1 of
the Deed of Foundation.
(f) Resignation of all officers of BK Rt; Indemnification
All members of the Board of Directors and the Supervisory
Board of BK Rt shall have tendered their resignation as of the
Closing Date and shall have received indemnification letters
from the Purchaser the text of which is attached as Annex 14.
3.3 Conditions Precedent to Obligations of the Seller
The obligations of the Seller are subject to the satisfaction or
waiver by the Seller at or prior to Closing of each of the following
conditions:
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(a) No Breach of Representations and Warranties
The representations and warranties of the Purchaser referred
to in Schedule 2 shall be true and correct in all material
respects at and as of Closing.
(b) SBS Guarantee
Purchaser shall have delivered to Seller the SBS Guarantee
executed by the Seller's Parent Company, in the form set forth
in Annex 8/II.
(c) Purchase Price placed in Escrow
SBS shall have placed in escrow an amount equal to the
Purchase Price with the Escrow Agent with the instruction to
release the Purchase Price to the Seller immediately upon
Seller's delivery of the documents set out in Clause 3.2 (a)
and the Sale shares with blank endorsement above and to wire
transfer the amount to the Seller's bank account specified in
Section 7.13 (i).
(d) SBS Companies' Declaration
Purchaser shall have placed in escrow a duly signed
declaration of SBS, MTM and TV2 ("SBS Companies") in the form
set forth in Annex 8/d to this Agreement, addressed to CME and
IRISZ TV Rt that each of the SBS Companies waives and releases
each of CME and IRISZ TV, and their respective shareholders
from any legal claims or causes of action in any forum,
whether known or unknown, fixed or contingent, directly or
indirectly, against such parties in connection with the
Television Tender.
4. COVENANTS
4.1 Covenants of Seller and Purchaser
(a) Reasonable efforts
The Parties shall use their reasonable efforts and fully
cooperate to bring about the fulfillment of all conditions
precedent to Closing on the earliest possible date.
(b) Resale of Hungary Assets
The Parties agree that in the event that Purchaser or SBS or
any of their affiliates sell, transfer, assigns or otherwise
receives an aggregate consideration for any of the Hungarian
Asset, as such term is defined in the Summary Term Sheet,
including the IRISZ Lawsuit, directly or indirectly, from
CLT-UFA, RTL Klub or any subsidiary or affiliate for the
greater of fair market
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value or actual consideration in excess of USD 9.0 million
plus interest on defered payment obligations, in one or more
transactions, SBS agrees to pay the entire amount of such
excess to CME in cash within 10 business days of receipt of
the excess cash or other consideration, including, without
limitation, any deferred payment obligation. Within five
business days of any sale or commitment to sell a Hungarian
Asset by SBS, SBS will notify CME in writing of the terms of
such sale or commitment.
(c) Coordinate the withdrawal of IRISZ Lawsuit
The parties agree to use their best efforts to coordinate the
withdrawal of the IRISZ Lawsuit with IRISZ TV, XXXX, RTL KLUB
and TV2.
5. CLOSING
5.1 Date and Place
The Closing shall take place at 9:00am, on February 21, 2000 at the
offices of ING Bank Rt in Budapest, or on such other date and at
such other time and place as the parties hereto may agree but in any
event, no later than 17:00 February 21, 2000.
5.2 Purchaser's Obligations
On the Closing Date, and against delivery or tender by the Seller of
the documents specified in Clause 5.3 below, the Purchaser shall:
5.2.1 deliver to Seller a certificate in the form set forth in
Annex 3/b, dated the Closing Date, stating that the representations
and warranties of the Purchaser referred to in Schedule 2 are true
and correct in all material respects at and as of Closing;
5.2.2 deliver to BK Rt a declaration in the form set forth
inAnnex 4, dated the Closing Date, stating that the Purchaser, in
accordance with Section 43.3 of the Deed of Foundation, has
familiarized itself with the Deed of Foundation and undertakes to be
bound by the terms and conditions contained therein;
5.2.3 deliver to the Seller the declarations specified in
Clauses 3.1 (e), and 3.3(d)
5.2.4 deliver to the Seller a certificate in a form reasonably
satisfactory to the Seller certifying that the Escrow
Agent has released and wired the Purchase Price to the
account of Seller specified in Clause 7.13 simultaneously
and in exchange for the delivery of the waiver and
declaration specified in Clause 3.2 (a) above and of the
Sale Shares.
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5.3 Seller's Obligations
On the Closing Date, and against delivery or tender by the Purchaser
of the documents specified in Clause 5.2 above, the Seller shall:
5.3.1 deliver to Purchaser the waiver and declaration specified
in Clause 3.2. (a) above and the Sale Shares duly endorsed in blank;
5.3.2 deliver to Purchaser a certificate in the form set forth
in Annex 3/a hereto, dated the Closing Date, stating that the
representations and warranties of the Seller referred to in Schedule
1 are true and correct in all material respects at and as of
Closing; and
6. WARRANTIES AND INDEMNITIES
6.1 Seller's Warranties
The Seller represents and warrants to the Purchaser as set forth in
Schedule 1.
6.2 Purchaser's Warranties
The Purchaser represents and warrants to the Seller as set forth in
Schedule 2.
6.3 Indemnification
6.3.1 Survival of Representations and warranties
The representations and warranties set forth in Schedule
1 and 2 the covenants set forth in Clause 4.1 b shall
survive the Closing until the first anniversary thereof;
provided that if written notice of a claim for
indemnification hereunder giving reasonable details of
the claim is delivered by a party seeking
indemnification hereunder to a party obligated to make
an indemnification payment hereunder prior to the
expiration of the above mentioned survival periods, then
such representation and warranty shall continue to
survive with respect to that particular claim only so
long as legal proceedings are instituted and served with
respect to the claim within twelve (12) months of such
written notice. Unless otherwise stated herein, the
covenants and agreements of the parties hereto shall
survive the Closing without limit.
6.3.2 Indemnification by the Seller
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Subject to the time limitation set forth in Clause
3.6.1, the Seller agrees to indemnify and hold harmless
the Purchaser, its officers, directors and agents from
and against any and all claims, damages, liabilities,
costs and expenses, including reasonable attorney's fees
("Losses")arising from or in connection with the breach
to any representation, warranty of the Seller set forth
in Schedule 1 except with respect to any Losses arising
from or relating to any action or failure to act due to
willful misconduct or gross negligence on the part of
the Purchaser or such other party suffering the Losses.
6.3.3 Indemnification by the Purchaser.
Subject to the time limitation set forth in Clause
6.3.1, the Purchaser shall indemnify and hold harmless
the Seller and its officers, directors and agents from
and against any and all Losses arising from or in
connection with the breach of any representation or
warranty of the Purchaser set forth in Schedule 2,
except with respect to any Losses arising from or
relating to any action or failure to act due to gross
negligence or willful misconduct on the part of the
Seller or such other party suffering the Losses.
6.3.4 Indemnity Procedures.
Except as expressly provided for otherwise in this Agreement:
(a) Whenever a claim for indemnification shall
arise under this Clause 6, the party entitled
to indemnification (the "Indemnified Party")
shall notify, in writing, the Party from whom
indemnification is sought (the "Indemnifying
Party") of such claim and, when known, the
facts constituting the basis for such claim
as soon as reasonably practicable and in any
event, as to any claim by a third party,
within 5 working days of the Indemnified
Party becoming notified in writing of the
assertion of such claim. The Indemnified
Party shall have a duty to mitigate the
Losses relating to any such claim.
(b) Third Party Claims
Without limiting of the foregoing, in the event of a
claim for indemnification hereunder resulting from or in
connection with any claim or legal proceeding by a third
party, including any tax audit or any proceeding for the
assessment of any tax or other mandatory payment by a
government authority of Hungary (a "Third Party Claim"),
the Indemnified Party shall give notice to the
Indemnifying Party no later than 20 working days prior
to the time any
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response to an asserted claim is required, if possible.
The Indemnifying Party may assume the defense of any
Third Party Claim, but no settlement shall be made
without the prior written consent of the Indemnified
Party, which consent shall not be unreasonably withheld.
If an Indemnifying Party assumes the defense of any such
claim or legal proceeding, the Indemnifying Party shall
be entitled to select counsel and take all steps
necessary in the settlement or defense thereof;
provided, that the Indemnified Party may, at its own
expense, participate in any such proceeding with the
counsel of its choice.
(c) In case of any claim that is not a Third Party Claim,
the Indemnifying Party shall have 30 days within which
it may respond to a notice of a claim for
indemnification given by an Indemnified Party pursuant
to Clause 6.3.4(a). If such claim is not contested, then
the Indemnifying Party shall as soon as practicable
proceed to take whatever action is required to carry out
its indemnification obligations.
6.3.5 Currency of Payment
All indemnification between the Parties to be paid under
this Agreement shall be paid in US dollars.
6.3.6 Limitation on Liability
No claims arising under or in connection with this
Agreement shall be allowed unless such claims,
individually or in the aggregate, exceed USD 10,000. For
the avoidance of doubt the preceding sentence does not
require the deduction of any amounts from a permitted
claim. The liability of any Party for all claims under
or in connection with this Agreement shall not exceed
USD 1,000,000.
7. OTHER PROVISIONS
7.1 Termination or Rescission
Notwithstanding anything stated to the contrary, this Agreement is
terminated with prejudice if any condition precedent to Closing has
not been fulfilled and the Closing did not occur by February 21,
2000.
7.2 Announcements
Without prejudice to the provisions of the Confidentiality
undertaking, until three months after the Closing, the Seller and
its Affiliates shall be required, to consult with the Purchaser as
to the terms of, the timetable for any manner of publication of, any
announcement to shareholders, employees, customers, suppliers,
distributors and sub-contractors and to
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the media which any of the Parties may desire or be obliged to make
regarding this Agreement.
7.3 Confidentiality
Each Party undertakes that it shall, together with its employees,
officers, advisors and other agents hold in strict confidence all
data and information regarding BK Rt obtained pursuant to this
Agreement or otherwise, including the terms of this Agreement
("Confidential Information") and will not, and will use its best
efforts to ensure that such other persons do not, disclose such
Confidential Information to others without the prior written consent
of the other party, except that the Purchaser may provide such
Confidential Information in response to legal process or applicable
governmental regulations, but only that portion of the Confidential
Information which, in the written opinion of counsel for the
Purchaser, is legally required to be furnished and further provided
that the Purchaser notifies in writing the Seller of its obligation
to provide such Confidential Information so far as it is
practicable. For purposes of this Clause, "Confidential Information"
shall not include any information that:
(i) is within the public domain other than as a
result of a breach of this Agreement;
(ii) becomes available within the public domain
other than (a) as a result of a breach of
this Agreement or (b) by means of other
unauthorized disclosure or use, provided,
however that if the unauthorized disclosure
is not attributable to the Purchaser, the
terms of further disclosure will remain
subject to this Clause;
(iii) is provided to the Purchaser by a person or entity
(other than the parties hereto) that is lawfully in
possession of such information and has the lawful right
to disclose or use it; or
(iv) following the 90th day after the Closing, relates
solely to the business of BK Rt (it being understood
that the terms of this Agreement and the information as
to the business or affairs of the Seller shall continue
to be Confidential Information).
7.4 Successors and Assigns
This Agreement shall be personal to the Parties and may not be
assigned by any Party without the prior written consent of the other
Party hereto. The Purchaser, upon notifying the Seller, may assign
its rights and transfer its obligations hereunder to any of its
Affiliates provided that the Purchaser guarantees the performance of
the obligations of such Affiliates set forth herein, in which case
such Affiliates shall assume the obligations of the Purchaser under
this Agreement and shall be bound by the terms hereof.
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7.5 Whole Agreement and Variation
This Agreement supersedes all prior agreements and understandings,
oral and written, between the Parties with respect to the subject
matter hereof and contains the whole agreement between the Parties
relating to the subject matter of this Agreement, including without
limitation the Summary Term Sheet, and no variation of this
Agreement shall be effective unless in writing and signed by or on
behalf of each of the Parties.
7.6 Costs
Each of the Parties shall separately bear all legal, accountancy,
financial advisor, consultant and other fees and costs and expenses
incurred by them in connection with this Agreement and the sale and
purchase of the Sale Shares. The Parties agree that the fee of the
Escrow Agent shall be borne equally by the Parties.
7.7 Notices
Any notice, claim or demand requiring to be served under or in
connection with this Agreement or with any arbitration or intended
arbitration under this Agreement shall be in writing in English and
shall be sufficiently given or served if delivered to:
(i) in the case of the Seller to:
CME Group,
Xxxx Xxxxx 00-00 Xxxxxx Xxxxxx,
Xxxxxx X0X 0XX,
Xxxxxx Xxxxxxx
Facsimile No.: 00-000-000-0000
For the attention of: Legal Department
(ii) in the case of the Purchaser to:
SBS Magyarorszagi Befektetesi Kft.
Address:Budapest, Havas u.6. Hungary H-1056
Facsimile No.: 235-7461
For the attention of: Managing Director
(iii) in the case of BK Rt to:
Budapesti Kommunikacios Rt.
Huvosvolgyi ut 64.
X-0000 Xxxxxxxx
Xxxxxxx
Facsimile No.: 391-2003
For the attention of: Legal Department
or such other address as may have subsequently to the execution of
this Agreement been notified to the other parties to this Agreement
for this purpose. Any such notice shall be delivered by hand, telex
or facsimile transmission
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or sent by pre-paid registered post and if delivered by hand shall
conclusively be deemed to have been given or served at the time of
delivery, if sent by facsimile shall conclusively be deemed to have
been given or served when confirmation is received at the end of the
transmission and if sent by registered post shall conclusively be
deemed to have been received on the date of delivery as evidenced by
the date of receipt returned to the sender.
7.8 Counterparts
This Agreement may be entered into in any number of counterparts and
by the parties to it on separate counterparts, each of which when so
executed and delivered shall be an original, but all the
counterparts shall together constitute one and the same instrument.
7.9 Language
This Agreement has been executed in English.
7.10 Governing Law
This Agreement and, save as expressly referred to therein, the
documents to be entered into pursuant to it shall be governed by and
construed in accordance with the laws of Hungary without regard to
its provisions relating to conflict of laws.
7.11 Settlement of Disputes
If the parties hereto are unable to resolve any dispute arising out
of or in connection with this Agreement by amicable settlement, such
dispute shall be finally settled under the Arbitration Rules of the
Hungarian Chamber of Industry and Commerce (the "Rules")by three
arbitrators. Each of the Seller and the Purchaser shall appoint one
arbitrator. The two arbitrators thus appointed shall choose the
third arbitrator. All three arbitrators shall be fluent in the
English language. The place of the arbitration shall be in Budapest.
The Parties each hereby irrevocably waive the right to submit such
disputes, or to appeal, to any court. The language of the
arbitration shall be Hungarian. Any award rendered by an arbitration
tribunal shall be final and binding on the Parties and the judgment
upon the award rendered may be entered in any court having
jurisdiction thereof.
7.12 Severability
Except as otherwise provided for in this Agreement, if any part of
this Agreement shall be invalid or unenforceable, such invalidity or
unenforceability shall not affect the validity and enforceability of
the remaining portions and the parties shall to the extent possible,
or necessary, replace the invalid or unenforceable part with a
provisions which achieves the original purpose of the invalid or
unenforceable part.
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7.13 Payment Account Details
The payment account details of the Parties as at the date of the Agreement
are as follows:
(i) Seller:
Bank: ING Bank NV, Amsterdam, The Netherlands
Account No:00.00.00.000
Account Name: CME Hungary BV
(ii) Purchaser:
Bank: ING Bank Rt, Budapest, Hungary
Account No: 00000000-00000000
Account Name: SBS Magyarorszagi Befektetesi Kft
7.14 Governmental Approvals.
7.14.1 All consents and authorizations of, and declarations and
filings with, any governmental authority required to be obtained or
made by the Purchaser in connection with the execution and delivery
of this Agreement or the consummation of the transactions
contemplated hereby shall be the sole responsibility of the
Purchaser. The refusal for any reason of any of the required consent
or approval of any authority will not affect the validity of this
Agreement and shall not give arise any claim by the Purchaser
against the Seller.
7.14.2 The Parties acknowledge that in accordance with Section
24 of the Competition Act the transaction contemplated in this
Agreement may be subject of the approval of the Competition Office.
Pursuant to the provisions of the Competition Act it is the sole
obligation of the Purchaser to seek such approval. Without limiting
the generality of Clause 7.14.1 and in accordance with Clause 7.12
above, the Parties agree that in case the Competition Office would
render this Agreement invalid, the Purchaser, in accordance with
Section 31 of the Competition Act will sell its interest in BK Rt or
do whatever action is required by the Competition Act and Purchaser
will not seek any remedy from the Seller other than those agreed in
Clause 6.3 above and will not seek any remedy from the Seller for
the loss incurred by it in connection with the invalidity of this
Agreement.
IN WITNESS WHEREOF this Agreement has been duly executed the day and year first
before-written.
On behalf of CME Hungary B.V: On behalf of SBS Magyarorszagi
Befektetesi Kft:
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/s/ Xxx Xxxxxxxx /s/ Xxxx Xxxxxxx
---------------- ----------------
NAME: Xxx Xxxxxxxx NAME: Xxxx Xxxxxxx
