Exhibit 3.05
MEMORANDUM OF UNDERSTANDING
REGARDING SHAREHOLDERS AGREEMENT
By this private instrument and in the best legal form, the contracting parties:
I - ODEBRECHT QUIMICA S.A., hereinafter named ODEBRECHT; a joint stock company,
duly organized and existing under the Laws of the Federal Republic of Brazil,
with registered offices in the City of Camacari, at Rua Hidrogenio, Xx. 0000,
Xxxxx 00, enrolled before CNPJ/MF under number 57.015.018/000-84, herein
represented by its legal representative and;
II - PETROQUIMICA DA BAHIA S.A., hereinafter simply named PQBA, a joint stock
company, duly organized and existing under the Laws of the Federal Republic of
Brazil, with offices in the City of Salvador, at Xxxxxxx Xxxxxxxx Xxxxx, Xx.
0.000, 0xx xxxxx (xxxx) enrolled before CNPJ/MF under number 13.943.667/0001-70,
herein represented by its legal representative;
Companies jointly or severely named CONTROLLING COMPANY, by itself or any
controlling, affiliate or under common control company, and;
III - PETROS - FUNDACAO PETROBRAS DE SEGURIDADE SOCIAL, a private security
closed company, duly organized and existing under the Laws of the Federal
Republic of Brazil, enrolled before CNPJ/MF under No. 034.053.942/0001-50, with
offices at Rua do Ouvidor, 98, in the City of Rio de Janeiro, State of Rio de
Janeiro, herein represented under the form of its Bylaws, hereinafter simply
named PETROS;
IV - PREVI - CAIXA DE PREVIDENCIA DOS FUNCIONARIOS DO BANCO DO BRASIL, a private
security closed company, duly organized and existing under the Laws of the
Federal Republic of Brazil, enrolled before CNPJ/MF under No.
33.754.482/0001-24, with offices at Xxxxx xx Xxxxxxxx, Xx. 000 - 3rd and 4th
floors, in the City of Rio de Janeiro, State of Rio de Janeiro, herein
represented under the form of its Bylaws, hereinafter simply named PREVI;
Hereinafter jointly named the "Parties",
WHEREAS:
1) The CONTROLLING COMPANY intends to acquire the stockholding at Norquisa
S.A. (hereinafter named "NORQUISA") and at Copene Petroquimica do Nordeste
S.A. (hereinafter named "COPENE" or "Company"), which shall confer to the
CONTROLLING COMPANY, severely or under agreement with the other
shareholders, the direct or indirect control of COPENE;
2) Petrobras Quimica S.A. - Petroquisa entered, with the CONTROLLING COMPANY,
a Memorandum of Understandings, on 07/03/01, setting forth the
terms and conditions to govern the future COPENE's Shareholders Agreement;
3) PETROS holds today the stockholding with COPENE, corresponding to 5.72%
(five point seventy two percent) of the Company's voting capital;
4) PREVI holds today, the stockholding at COPENE, corresponding to 5.82% (five
point eighty two percent) of the Company's voting capital;
5) Once the acquisition of the direct or indirect control of COPENE by the
CONTROLLING COMPANY is completed, the Parties intend to consolidate its
adjustments through the entering of a shareholders agreement between
PETROS, PREVI, Petroquisa and the direct controller of COPENE (hereinafter
named "COPENE's Shareholders Agreement");
6) The parties, hereby, intend to set forth the basic terms and conditions to
govern the future COPENE's Shareholders Agreement.
The parties decide to formalize this Memorandum of Understandings, with the
objective to set forth the basic terms and conditions governing the future
COPENE's Shareholders Agreement.
FIRST CLAUSE - OBJECT
1.1. Through this Memorandum of Understandings, the Parties, from now on, agree
that, in the event the CONTROLLING COMPANY acquires COPENE's direct or
indirect stockholding, the CONTROLLING COMPANY shall enter or shall cause
the companies holding the COPENE'S direct stockholding to enter the
Shareholders Agreement with Petroquisa, PETROS and PREVI, which shall
include, among others, the basic terms and conditions established under
this Memorandum of Understandings.
SECOND CLAUSE - DECISIONS OF GENERAL MEETING
2.1. According to the provisions under item 8.5 below, the CONTROLLING COMPANY
agrees, hereunder, to confer to PETROS and PREVI, from the date of
acquisition of COPENE's stockholding, the direct right to veto power, to be
jointly exercised by PETROS and PREVI, at the decisions taken during
shareholders general meetings, whenever any of the subject matters below
are discussed. The right to veto power now foreseen shall be included in
the future Shareholders Agreement, when PETROS and PREVI, together with
PETROQUISA shall exercise it.
a) modification to the rights conferred to the shares existing under the
bylaws, negatively effecting the value of COPENE's common or preferred
shares.
b) alteration, increasing or decreasing of the company's objects, except
those which may be required to allow COPENE to operate as an
integrated petrochemical company;
c) increase of the number of members of COPENE's Administration Council.
d) decrease of the number of members of COPENE's Administration Council,
currently elected upon nomination by PETROS and PREVI, that is to say,
two councilors, provided the stockholding defined under article 8.5
below is maintained;
e) increase of COPENE's capital, upon payment through the assets or
rights, unless said assets or rights are related to COPENE's object
and the evaluation of said assets or rights is done, under the terms
of the 8th Article of Law number 6.404/76, by an investment bank
selected by the CONTROLLING COMPANY, from a list of five prime banks
appointed by Petroquisa, PETROS and PREVI;
f) merger, split up, incorporation of COPENE into another company or of
another company into COPENE, which may imply the unjustified dilution
of PETROS' and/or PREVI's shareholding , with the integration of the
second-generation companies into COPENE understood as justified; among
which are included the second-generation companies controlled by the
CONTROLLING COMPANY, provided it is performed based on the procedures
foreseen under the previous item;
g) COPENE's dissolution or liquidation.
First Paragraph - Notwithstanding the provisions under items (e) and (f) of this
clause, it is understood that the Parties shall make, under the same criteria,
the evaluation of the second-generation companies of which they are
shareholders, direct or indirectly, with the purpose of integration to COPENE.
Second Paragraph - Whenever the process of integration of companies to COPENE
imply in capital increase, the Parties shall be ensured the preemptive right to
the acquisition or subscription of new shares, in such way that the opportunity
for the maintenance of the percentile of the respective shareholding previous to
the integration is ensured, provided the CONTROLLING COMPANY have ensured
COPENE's control in the general meetings and the majority of members of the
respective administration council.
THIRD CLAUSE - DECISIONS OF THE ADMINISTRATION COUNCIL
3.1 Observed the provisions under the Second Clause and under the item 8.5
below, the CONTROLLING COMPANY agrees, hereunder, to confer to PETROS and
PREVI, from the acquisition of COPENE's control, the right to
veto power, to be jointly exercised by PETROS and PREVI, in the decisions
taken in COPENE's Administration Council's meetings, whenever any of
subject matter established below are discussed. The right to veto power
foreseen hereunder shall be included in the future Shareholders Agreement,
when PETROS and PREVI, together with PETROQUISA shall exercise it.
a) acquisition, disposition or burden of goods of the permanent assets or
the execution of contracts under whatever nature, in operations
contemplating values above 30% (thirty percent) of COPENE's net
equity, except, in any case, those operations inherent to the
performance of COPENE's object, requiring PETROS' and PREVI's
approval;
b) the entering of juridical business with companies directly or
indirectly controlled, controlling, controlled by the controlling
companies, of any of the Parties and, further, affiliated companies,
including of acquisition of interest in said companies, unless the
evaluation according to the terms under item 2.1, sub-item "e" above
is effected;
c) whatever motion or proposal causing COPENE not to comply with any of
the financial indexes below:
(i) indebtedness index (Projected Net Debt/EBITDA) under 3.5;
(ii) projected profits coverage index (EBITDA/Total profits) above
3.0;
(iii)debt service coverage index, except the trade finance lines
(EBITDA/{Profits + Amortization}) higher than 1.75;
All indexes are obtained in consideration to the recent history and
projections. The market and prices projections shall be performed by
internationally known companies under said specialties, while the
projections of floating interest rate shall be performed through
Investment Banks.
FORTH CLAUSE - PRIOR MEETINGS
4.1. In order to previously deliberate the subject matters established under
Clauses Second and Third above and therefore, ensure the exercise of the
right of veto power provided hereunder, the Parties, hereby, establish the
holding of the Meetings Previously to COPENE's General Meetings and
Administration Council Meetings called to deliberate about said subject
matters.
4.2. The decisions taken in Prior Meetings shall comprise voting agreements and
shall bind the vote of the Parties in the respective General Meeting and
the voting guidance to the Councilors in the respective Administration
Council's Meetings of COPENE and, shall be rigorously observed by the
Company.
FIFTH CLAUSE - ACQUISITION OF THE OPERATIONAL NORDESTE ASSETS
5.1. The CONTROLLING COMPANY intends to acquire within the Auction foreseen to
take place on July 25, 2001, the assets of Banco Economico S.A., in
extrajudicial liquidation, in the Camacari Petrochemical Pole.
5.2. The Parties understand that the Operational Nordeste Assets, which may be
acquired by the CONTROLLING COMPANY in said Auction, are according to
COPENE's interests, with its acquisition by the same being therefore
recommended.
5.3. The Operational Nordeste Assets, for the effects hereunder, comprise the
direct or indirect equity holdings below:
(i) 100% of the shares representing the corporate stocks of Conepar -
Companhia Nordeste de Participacoes (hereinafter named "Conepar"),
that, in turn, is the holder, among other assets, of 35% of the voting
capital and 30.99% of the total capital of Politeno Industria e
Comercio S.A. and 66.67% of the voting capital and 42.64% of the total
capital of Polialden Petroquimica S.A. (hereinafter named
"Polialden"); and
(ii) 100% of the issued shares of Proppet S.A. (hereinafter named
"Proppet").
5.3.1 The interest of Conepar's capital to be acquired may not be 100% of
the capital, in the event BNDES does not exercise the joint sale right
of its stockholding (Class "B" preferred shares) foreseen under
Conepar's Shareholders Agreement.
5.4 The price to be paid by COPENE for the Operational Nordeste Assets shall
be, observing the corporate uncrossing, equal to the value (i) of the
higher offer among the offers of third parties, others than the buyer of
Nordeste Assets, object of the Auction or, (ii) in the event no valid
offers from third parties exist, the value of the minimum price of the
Operational Nordeste Assets for the purposes of the Auction, and, in
whatever case, the price to be paid by COPENE for the Operational Nordeste
Assets shall not be above US$ 750,000,000.00 (seven hundred and fifty
million US dollars). "Binding Price" used in the auction held on December
2000.
5.4.1. In up to 90 (ninety) days after the acquisition of the Operational
Nordeste Assets by COPENE, a complete evaluation of said assets shall be
performed by a financial institution named according to the terms under
item 5.4.2. The evaluation work will use the prices projections of resins
and raw materials and the macroeconomic data contained within the formation
of the discount rates used in the evaluations attached hereto (Annex I and
annex II), hereinafter named "Attached Evaluations". Under the hypothesis
the evaluation concludes that the price of the assets are lower than the
amount
effectively paid by COPENE, the balance shall be returned by the
CONTROLLING COMPANY to COPENE, according to the Item 5.4.3. below.
5.4.2The financial institution effecting the evaluation provided under item
5.4.1. shall be selected by COPENE's Councilors, except those elected under
the CONTROLLING COMPANY's indication, among the five prime banks suggested
by the CONTROLLING COMPANY. The CONTROLLING COMPANY shall not include,
among the five prime banks to be suggested for the evaluation, the
following institutions, due to impediment caused by conflict of interests,
CS First Boston Garantia, UBS Warburg and Xxxxxx Xxxxxxx. In the event the
difference of the value of the evaluation performed by the selected
financial institution is above 10% (ten percent) of the average of Attached
Evaluations, another financial institution shall be selected by PETROS and
PREVI, among the four remaining banks, to arbitrate the value between the
Attached Evaluations and the evaluation made in the form hereunder.
5.4.3In the event the difference appointed under the terms of this Clause
is (i) equal or less than 5% (five percent) of the price effectively paid
by COPENE, the value shall be returned, in cash, to COPENE by ODEBRECHT,
within the term of 30 (thirty) days; and (ii) if it is higher than 5% (five
percent) of the price effectively paid by COPENE, the value shall be
returned, in cash, to COPENE, by ODEBRECHT, within the term of 01 (one)
year, remunerated at the same cost of the debt assumed by COPENE at the
acquisition of the Operational Nordeste Assets.
5.4.3.1. Once the difference between the price effectively paid by COPENE
and the price of the evaluations made in the form under the item 5.4.2.
above is indicated by the named financial institution, ODEBRECHT shall
offer a guarantee at the value of the difference verified within the term
of 05 (five) working days. The guarantees may be offered under the form of
credit insurance granted by a prime insurance company, banking bail bond
issued by a prime financial institution or real guarantee, duly attached to
the evaluation of a prime international audit company. In the event the
guarantee is not presented within the term established hereunder, except in
the events of force majeure, ODEBRECHT shall be incurred under a daily fine
of 0.5% on the value of the difference verified, until the presentation of
the guarantees or return of the difference. After 30 (thirty) days have
elapsed with no presentation of guarantees, the advance maturity of the
debt shall occur, with the value being considered net and correct, and the
debt may be executed.
5.4.3.2. The difference referred to under item 5.4.3. (ii) above shall be
compensated within the term of 01 (one) year, in the context of integration
of the second-generation companies, controlled by the CONTROLLING COMPANY
to COPENE.
5.4.4. The CONTROLLING COMPANY shall transfer the guarantees of the seller
of said assets at the Auction, in whole and by the time of the acquisition
of Operational Nordeste Assets by COPENE.
SIXTH CLAUSE - THE COMPANY'S BASIC PRINCIPLES
6.1. The Parties commit themselves to adopt the following basic directions for
COPENE's management:
i) COPENE's Board of Directors shall be constituted by competent
professionals with the responsibility to reach high competition and
international productivity standards;
ii) the dividend politics shall have the distribution of results as
objective, which shall not be under 50% (fifty percent) of the year's
available net profit, provided the required and sufficient internal
reserves are maintained for the effective operation and development of
COPENE's businesses; and
iii) the adoption of commercial politics ensuring the regular and
continuous supply of raw material and utilities under competitive
bases, compatible to the national and international market, so as to
comply with COPENE's interests.
SEVENTH CLAUSE - DURATION
7.1. This Memorandum of Understandings shall be effective on this date, with the
Second, Third and Forth Clauses effective from the date of acquisition of
the control over COPENE by the CONTROLLING COMPANY, severely or upon
agreement with other shareholders, and remaining in force (i) for 20
(twenty) years or (ii) until the entering of the future COPENE's
shareholders agreement, by the CONTROLLING COMPANY or its owned companies,
and, PETROS and PREVI what happens first.
7.2. During the term of duration hereof and the future Shareholders Agreement,
the Parties shall abstain to vote over whatever issues which may place them
under conflict of interests situation before COPENE, under the legal form.
7.3. This Memorandum of Understandings shall be considered automatically
revoked, with no burden to any of the Parties, in the event the CONTROLLING
COMPANY does not acquire COPENE's (direct or indirect) control until
12/30/2001.
EIGHTH CLAUSE - GENERAL PROVISIONS
8.1. No common association, partnership or any other kind of organization or
corporate entity between PETROS and PREVI and the CONTROLLING COMPANY is
established under this Memorandum of Understandings.
8.2. This Memorandum of Understandings represents the complete understanding
between the Parties, in respect to the object hereunder and substitutes in
full, any and all rights and/or obligations arising from other instruments
and/or verbal agreements, relative to the purchase and sale of shares
issued by COPENE or to the exercise of the right to vote in the General
Meeting and COPENE's Administration Council Meeting.
8.3. It is ensured hereunder, to PETROS and/or PREVI, the right to regulate,
among themselves, and/or with other closed private security entities, the
preemptive right for the alienation and transfer of the shares issued by
COPENE and held by said entities, as well as the right to vote for the
election of the Fiscal and Administration Councils of the Company.
8.4. The Parties hereby agree that COPENE's Shareholders Agreement shall provide
the foresight of the joint sale right ("Tag Along") of the stockholding,
severely considered, held by all the shareholders on COPENE's capital in
the event of sale and transfer of COPENE's direct or indirect control to
third parties, under the same conditions offered by the buying third
part(ies) to COPENE's controlling shareholders.
8.5. The right to veto power ensured hereunder to PETROS and PREVI shall be in
force while PETROS and PREVI hold, together with other private security
closed entities, at least 15% (fifteen percent) of COPENE's common shares.
In the event PETROS and PREVI have their stockholding diluted due to the
integration of second-generation companies controlled by ODEBRECHT and/or
by PQBA, the right to veto power shall be maintained for the term of 3
(three) years, with the right to rearrangement of their stockholding
protected within said period, so as to ensure the right to veto power
established hereunder.
8.6. So as to the right to veto power ensured hereunder to the shares under
PETROS and PREVI's title be transferred to third parties, PETROS and/or
PREVI, as the case may be, shall grant the preemptive right to the
CONTROLLING COMPANY, which shall be exercised within the term of 15
(fifteen) days from the date of the proposal, except when the transfer of
shares under PETROS and PREVI's title is done to (i) another closed private
security entity; or (ii) a company which is not a CONTROLLING COMPANY
competitor. The preemptive right shall be exercised under the same sale
price, term and conditions as to third parties. In the event the preemptive
right shall not be exercised, the CONTROLLING COMPANY shall authorize the
third party adhesion hereto.
NINTH CLAUSE - ARBITRATION
9.1. All questions arising or relative hereto, which are not solved under
specific execution, under the terms of the 118th Article, 3rd paragraph of
law no. 6.404/76 c/c articles 461, 632 and 639 and following of the Civil
Proceedings Code, shall be submitted and solved under definite form upon
arbitration. The arbitration shall be done in the city of Rio de Janeiro,
State of Rio de Janeiro and shall be conducted, in the Portuguese language,
by an arbitration court comprising 03 (three) arbitrators, indicated
according to the arbitration norms of UNCITRAL.
9.2. The arbitration judgment shall be announced within the term of 6 (six)
months, from the date of the institution of the arbitration or from the
replacement of any arbitrator and shall observe the provisions under
articles 26 and 32 of the Law number 9.307, of September 23, 1996. For the
purposes of execution of the arbitration judgment, if it is the case, the
courts of the city of Rio de Janeiro are hereby elected, with the
abdication of any other one, the most privileged it may be.
9.3. The Brazilian laws shall be applicable by the arbitration court, for the
solution of the litigation.
9.4. Each one of the Parties bears the right to access to court: (i) to oblige
the other Party to adopt the arbitration; (ii) in order to obtain the legal
measures focusing the protection of its rights previously to the
institution of the arbitration, with said measures not able to be
considered as a waiver to the arbitration solution; and (iii) so as to
execute whatever solution of the arbitrators, including the arbitration
judgment.
9.5. The provisions under the item 9.1 above do not apply to the questions
relative to interpolation, application or execution of the issues provided
hereunder, relative to rights and obligations susceptible to specific
execution, under the terms of the articles 118 of the Law 6.404/76 c/c 461,
632, 639 and following of the civil Proceedings Code, with the courts of
the county of the Capital of the State of Rio de Janeiro hereby elected,
with the abdication of any other one, the most privileged it may be.
And, being thus fair and agreed, the contracting Parties sign this Memorandum of
Understandings in 4 (four) counterparts of same tenor and form, before the
undersigned witnesses.
Rio de Janeiro, July 20, 2001.
(s.) illegible (s.) illegible
Odebrecht Quimica S.A. Petroquimica da Bahia S.A.
(s.) illegible (s.) illegible
Fundacao Petrobras de Caixa de Previdencia dos
Seguridade Social - PETROS Funcionarios do Banco do Brasil
PREVI
Witnesses:
(s.) illegible
Xxxxxx Xxxx
(s.) illegible
Xxxxxxx Xxxxxxxx Marcal
