EXHIBIT 4.10
DATED FEBRUARY 28, 2006
(1) GOLD FROST LTD
AND
(2) X. XXXXX-FOOD INTERNATIONAL LTD
AND
(3) OTHERS
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RELATIONSHIP AGREEMENT
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Mishcon de Reya
Xxxxxx Xxxxx
00 Xxx Xxxx Xxxxxx
Xxxxxx XX0X 0XX
Tel: 000 0000 0000
Fax: 000 0000 0000
Ref: RJT/SCM/00000-0-0
THIS DEED is made on FEBRUARY 28, 2006
BETWEEN:
(1) GOLD FROST LTD a company incorporated in the State of Israel with company
number 00-000000-0 and whose registered office is situated at 0 Xxxxx Xxxx
Xxxxxx, Xxxxx 00000, Xxxxxx (the "COMPANY"); and
(2) X. XXXXX-FOOD INTERNATIONAL LTD a company incorporated in the State of
Israel with number 00-000000-0 and whose registered office is situated at 0
Xxxxx Xxxx Xxxxxx, Xxxxx 00000, Xxxxxx (the "SHAREHOLDER"); and
(3) THOSE PARTIES whose names and addresses are set out in schedule 1 hereto
(together, the "CONTROLLING PARTIES").
WHEREAS:
(A) It is proposed that application be made for the Company's entire ordinary
issued share capital to be admitted to trading on AIM, the market operated
by the London Stock Exchange plc.
(B) On Admission the Shareholder will hold 40,000,000 Ordinary shares
representing 75.7 per cent. of the issued share capital of the Company and
as such will be a Substantial Shareholder (as defined below).
(C) The Shareholder, the Controlling Parties and the Company consider it
necessary and desirable for the success of the Company and the maintenance
of market confidence in it that (i) the Company be capable at all times of
carrying on its business independently of the Shareholder, the Controlling
Parties (and/or their Associates) and (ii) all transactions and
relationships in the future between the Company and the Shareholder or the
Controlling Parties (and/or their Associates) must be at arm's length and
on a normal commercial basis (subject to clause 3.4). Where potential
conflicts exist between the interests of the Company and those of any
controlling shareholder, it is considered desirable to demonstrate that
arrangements are in place to avoid detriment to the general body of
shareholders of the Company and that decisions as to enforcement of those
contractual arrangements are taken independently of the controlling
shareholder.
(D) Accordingly, the parties have agreed to enter into this Agreement to
regulate the relationship between them.
IT IS AGREED as follows:
1. DEFINITIONS AND INTERPRETATION
1.1 In this Agreement (including the Recitals) the following words and
expressions have the following meanings, except as otherwise provided or
where the context otherwise requires:
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"ADMISSION" means the admission of the entire issued share capital of the
Company to trading on AIM becoming effective as provided in rule 6 of the
AIM Rules;
"AIM RULES" means the London Stock Exchange plc's rules relating to AIM as
in force at the date of this agreement or, where the context requires, as
amended or modified after the date of this agreement;
"ASSOCIATE" means:
1.1.1 in relation to an individual:
(a) that individual's spouse or child (together the "INDIVIDUAL'S
FAMILY")
(b) the trustees (acting as such) of any trust of which the
individual or any of the individual's family is a beneficiary or
discretionary object;
(c) any company in whose equity shares the individual or any member
or members (taken together of the individual's family) or the
individual and any such member or members (taken together) are
directly or indirectly interested (or have a conditional or
contingent entitlement to become interested) so that they are or
would on the fulfilment of the condition or the occurrence of the
contingency be) able:
(i) to exercise or control the exercise of 30 per cent. or more
of the votes able to be cast at general meetings on all, or
substantially all, matters; or
(ii) to appoint or remove directors holding a majority of voting
rights at board meetings on all, or substantially all,
matters; and
1.1.2 in relation to a company:
(a) any other company which is its subsidiary undertaking or parent
undertaking or fellow subsidiary undertaking of the parent
undertaking;
(b) any company whose directors are accustomed to act in accordance
with the directions or instructions of the relevant company;
(c) any company in the capital of which the relevant company and any
other company under (a) and (b) taken together, is (or would on
the fulfilment of a condition or the occurrence of a contingency
would be) interested in the manner described in paragraph .1.1.1
(c) above.
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"BOARD" means the board of directors of the Company or any duly authorised
committee thereof;
"GROUP" shall mean the Company and any other body corporate which is from
time to time its subsidiary undertaking and for this purpose "SUBSIDIARY
UNDERTAKING" shall have the same meaning as in section 258 of the Companies
Xxx 0000;
"RELATED PARTY TRANSACTION" means any transaction, agreements or
arrangements between a Relevant Party and/or any of their Associates on the
one hand and any member of the Group on the other hand (or the enforcement,
implementation or amendment thereof);
"RELEVANT PARTY" means any of the Shareholder and the Controlling Parties,
and a reference to the "RELEVANT PARTIES" is a reference to each of them
jointly and severally; and
"SUBSTANTIAL SHAREHOLDER" means any person (or persons acting jointly by
agreement whether formal or otherwise) who is:
(a) entitled to exercise, or to control the exercise of, more than 30
per cent. of the rights to vote at general meetings of the
Company; or
(b) able to control the appointment of directors who are able to
exercise a majority of votes at board meetings of the Company;
1.2 In this Agreement (including the Recitals):
1.2.1 references to Clauses, or Recitals are to the clauses of this
Agreement and to the recitals to this Agreement, unless otherwise
stated;
1.2.2 words and expression defined in the Companies Xxx 0000 shall have the
same meaning herein;
1.2.3 unless otherwise stated, time shall be of the essence of this
agreement;
1.2.4 any reference to an individual shall, if the context so permits,
extend to his personal representatives and be enforceable accordingly;
and
1.2.5 words denoting the singular include the plural and vice versa, words
importing any gender shall include all genders and words denoting
persons only shall include corporations, unincorporated associations
and partnerships and vice versa.
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2. CONDITION
2.1 This Agreement is conditional upon Admission occurring by not later than
the close of business on 9 March 2006 or such later date as the parties may
agree.
3. UNDERTAKING
3.1 Each of the Relevant Parties jointly and severally undertakes to the
Company that they will exercise all their powers and will procure (so far
as each is able to do so) that each of their Associates will exercise all
their respective powers with a view to ensuring that:
3.1.1 the Company is capable at all times of carrying on its business
independently of the Relevant Parties and their Associates;
3.1.2 any Related Party Transaction entered into or proposed to be entered
into is at arm's length and on a normal commercial basis or otherwise
approved in accordance with the laws of Israel in force from time to
time regulating transactions amongst related parties;
3.1.3 each proposed Related Party Transaction shall be considered on behalf
of the Company by the Board as a whole (or if by committee of the
Board, such committee to have one or more non-executive directors
present throughout) and none of the Relevant Parties nor any of their
Associates shall seek to influence the consideration of such matter by
the Board (or that committee, if relevant) in such a way as to further
the interests which are or are potentially in conflict with the
interests of the relevant Group member;
3.1.4 in the event that a conflict of interest or potential conflict of
interest exists or is likely to arise between on the one hand a
Relevant Party and/or any of their Associates and on the other hand
the interests of any member of the Group, disclosure of the
circumstances of such conflict or potential conflict shall be made to
the Board and that any decision by the Board in relation thereto shall
be taken by the Board but excluding any director who is a Relevant
Party or who is an Associate of a Relevant Party or appointed by a
Relevant Party;
3.1.5 save as permitted by the Board voting unanimously in favour, and save
for any interests existing at the date of this Agreement and which are
disclosed in the admission document issued by the Company in
connection with Admission, no Relevant Party nor any of their
Associates shall have any interests or other duties or
responsibilities which could give rise to a conflict or potential
conflict of interest between on the one hand a Relevant Party and/or
any of their Associates and on the other hand the interests of any
member of the Group;
3.1.6 the independence of the Board is maintained so as to enable decisions
as to the enforcement of this Agreement to be taken independently of
such Relevant Party or any of their Associates and otherwise in
accordance with the requirements from time to time of the London Stock
Exchange plc;
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3.1.7 no variations are made to the Company's articles of association which
would be contrary to the maintenance of the Company's independence;
and
3.1.8 the provisions of this Agreement are observed.
3.2 Each of the Relevant Parties jointly and severally undertakes to the
Company that they will exercise all their powers and will procure (so far
as each is able to do so) that each of their Associates will exercise all
their respective powers with a view to ensuring that any new opportunity of
which any Relevant Party becomes aware to enhance or further the business
interests of the Group shall be promptly disclosed to the Board as a whole,
so as to enable the Board to give proper consideration as to whether the
Group is commercially able to exploit such opportunity.
3.3 The Company undertakes to the Shareholder that any new opportunity of which
the Company becomes aware to enhance or further the business interests of
the Shareholder shall be promptly disclosed to the Shareholder, so as to
enable the Shareholder to give proper consideration as to whether the
Shareholder is commercially able to exploit such opportunity.
3.4 Notwithstanding anything to the contrary, any Related Party Transaction
entered into or proposed to be entered into, which may not be deemed to be
at arm's length and on a normal commercial basis, providing that the
transaction does not harm the Company's welfare, may be approved by the
Company but shall require the approval, according to the provisions of the
Israeli Law, of the Audit Committee, which will make a recommendation to
the Board of Directors and then the transaction will be subject to
subsequent approval by a General Meeting of the Company.
4. TERMINATION
4.1 This Agreement shall continue in full force and effect from the date of
Admission until such time as:
4.1.1 each of the Relevant Parties ceases to be a Substantial Shareholder;
4.1.2 each of the Relevant Parties ceases to have any Associate who is a
Substantial Shareholder, and
4.1.3 each of the Relevant Parties and their Associates cease to have any
other direct or indirect ownership or control interest (whether legal,
beneficial, contingent or otherwise) in 30 per cent or more of the
issued ordinary share capital of the Company (or the proceeds or other
rights derived therefrom)
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whereupon this Agreement shall cease and determine without prejudice to any
rights and obligations which have already accrued under it as regards any
party before such termination.
5. THIRD PARTIES
5.1 Each Relevant Party agrees to procure that any Associate of theirs to whom
any shares in the Company are transferred or issued after the date hereof
shall enter into a deed agreeing to be bound by the terms of this Agreement
as if they were themselves a Relevant Party.
6. ACKNOWLEDGMENT AND CONFIRMATION
6.1 The parties acknowledge that the restrictions set out in this Agreement are
fair and reasonable and are no greater than is reasonable and necessary for
the protection of the interests of the Company and its shareholders as a
whole, but if any such restriction shall be held to be void but would be
valid if deleted in part or reduced in application, such restriction shall
apply with such deletion or modification as may be necessary to make it
valid and enforceable.
6.2 The parties agree that damages may not be an adequate remedy for any breach
of the covenants and agreements contained in this Agreement and the Company
shall be entitled to the remedies of injunction, specific performance and
other equitable relief for any threatened or actual breach of those
covenants or agreements.
6.3 The Relevant Parties acknowledge and agree that details of this agreement
require disclosure in the admission document to be prepared in connection
with the Admission.
6.4 Each party warrants and represents to the others that it has the power to
enter into this Agreement and to exercise its rights and perform its
obligations under this Agreement, and all corporate and other action
required to authorise the execution of this Agreement and performance of
its obligations under this Agreement have been duly taken.
7. WAIVER, AMENDMENT
7.1 No waiver of any term, provision or condition of this Agreement shall be
effective unless such waiver is evidenced in writing and signed by the
waiving party.
7.2 No omission or delay on the part of either party hereto in exercising any
right, power or privilege hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any such right, power or privilege
preclude any other or further exercise thereof or of any other right, power
or privilege.
7.3 No variation of this Agreement shall be effective unless made in writing
and signed by both parties.
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8. NOTICES
8.1 Save as specifically otherwise provided in this Agreement any notice, or
other communication to be given under, or in connection with the matters
contemplated by, this Agreement shall be in writing and in the English
language and signed by or on behalf of the party giving it and shall be
served by delivering it personally or sending it by pre-paid recorded
delivery or registered post (or registered airmail in the case of an
address for service outside Israel) or by facsimile to the address and for
the attention of the relevant party set out below (or as otherwise notified
by that party hereunder). Any such notice shall be deemed to have been
received:-
8.1.1 if delivered personally, at the time of delivery;
8.1.2 in the case of pre-paid recorded delivery or registered post, 48
hours from the date of posting; and
8.1.3 in the case of registered airmail, five days from the date of
posting; and
8.1.4 in the case of fax, at the time of transmission (subject to
production of proof of transmission of all pages);
Provided that if deemed receipt occurs before 9.00 am on a business day the
notice shall be deemed to have been received at 9.00 am on that day and if
deemed receipt occurs after 5.00 pm on a business day, or on a day which is
not a business day, the notice shall be deemed to have been received at
9.00 am on the next business day. For the purpose of this Clause 6,
"BUSINESS DAY" means any day which is not a Friday, a Saturday, or a public
holiday in the place at or to which the notice is left or sent.
8.2 The addresses and facsimile numbers of the parties for the purposes of this
Clause 8 are:
8.2.1 The Company
Address: The address of the Company set out at page 1 of this
Agreement
For the attention of: Gil Hochboim
Fax number: 000-0-0000000
8.2.2 The Shareholder
Address: The address of the Shareholder set out at page 1 of this
Agreement
For the attention of: Xxx Xxxxxxxx
Fax number: 000-0-0000000
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8.2.3 The Controlling Parties
Address: as per the contact details for each Controlling
Party set out in Schedule 1 of this Agreement
For the attention of: as per the contact details for each Controlling
Party set out in Schedule 1 of this Agreement
Fax number: as per the contact details for each Controlling
Party set out in Schedule 1 of this Agreement
or such other address or facsimile number as may be notified in writing
from time to time by the relevant party to the other parties.
8.3 For the avoidance of doubt notice given under this Agreement shall not be
validly served if sent by e-mail
9. COUNTERPARTS
This Agreement may be executed in any number of counterparts and by the
several parties hereto on separate counterparts, each of which when so
executed are delivered shall be an original, but all the counterparts shall
together constitute one and the same instrument.
10. GOVERNING LAW
This Agreement shall be governed by, and construed in all respects in
accordance with Israeli law, and the parties irrevocably agree to submit to
the exclusive jurisdiction of the Israeli Courts and waive any objection on
the ground of venue or on the ground that the proceedings have been brought
in an inconvenient forum.
IN WITNESS whereof this Agreement has been duly executed by the parties as a
Deed, on the date stated above.
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SCHEDULE 1
THE CONTROLLING PARTIES
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NAME CONTACT DETAILS
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Willi Food Investment Ltd Attention of: Xxxxxx Xxxxxxxx
Address: 0 Xxxxx Xxxx Xxxxxx, Xxxxx 00000, Xxxxxx
Fax Number: 000-0-0000000
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Xxx Xxxxxxxx Attention of: Xxx Xxxxxxxx
Address: 0 Xxxxx Xxxx Xxxxxx, Xxxxx 00000, Xxxxxx
Fax Number: 000-0-0000000
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Xxxxxx Xxxxxxxx Attention of: Xxxxxx Xxxxxxxx
Address: 0 Xxxxx Xxxx Xxxxxx, Xxxxx 00000, Xxxxxx
Fax Number: 000-0-0000000
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EXECUTED and DELIVERED as ) Director:
a DEED by GOLD FROST LTD. )
acting by: Xxx Xxxxxxxx ) Director/Secretary:
Gil Hochboim
EXECUTED and DELIVERED as ) Director:
a DEED by X. XXXXX-FOOD INTERNATIONAL LTD )
acting by: Xxx Xxxxxxxx ) Director/Secretary:
Gil Hochboim
EXECUTED and DELIVERED as ) Director:
a DEED by WILLI FOOD INVESTMENT LTD )
acting by: ) Director/Secretary:
Xxxxxx Xxxxxxxx
Xxx Hochboim
EXECUTED and DELIVERED as )
a DEED by XXX XXXXXXXX )
in the presence of: )
SIGNATURE OF WITNESS:
NAME OF WITNESS:
ADDRESS OF WITNESS:
OCCUPATION OF WITNESS:
EXECUTED and DELIVERED as )
a DEED by XXXXXX XXXXXXXX )
in the presence of: )
SIGNATURE OF WITNESS:
NAME OF WITNESS:
ADDRESS OF WITNESS:
OCCUPATION OF WITNESS:
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