Exhibit 2
STOCK PURCHASE AGREEMENT
between
PLD TELEKOM INC.
and
CABLE AND WIRELESS PLC
Dated April 19, 1998
TABLE OF CONTENTS
Page
ARTICLE I
SALE OF STOCK; CONSIDERATION
1.1. Sale by C&W . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.2. Consideration for the Sale by C&W. . . . . . . . . . . . . . . . 2
ARTICLE II
THE CLOSING
2.1. Time and Place of Closing . . . . . . . . . . . . . . . . . . . . 2
2.2. Deliveries by C&W . . . . . . . . . . . . . . . . . . . . . . . . 3
2.3. Deliveries by Buyer . . . . . . . . . . . . . . . . . . . . . . . 3
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF C&W
3.1. Organization . . . . . . . . . . . . . . . . . . . . . . . . . . 3
3.2. Authority Relative to this Agreement . . . . . . . . . . . . . . 4
3.3. Title. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
3.4. Consents and Approvals; No Violation . . . . . . . . . . . . . . 5
3.5. Financial Statements; Undisclosed Liabilities . . . . . . . . . . 5
3.6. Fees and Commissions. . . . . . . . . . . . . . . . . . . . . . . 5
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BUYER
4.1. Organization . . . . . . . . . . . . . . . . . . . . . . . . . . 6
4.2. Authority Relative to this Agreement . . . . . . . . . . . . . . 6
4.4. Consents and Approvals; No Violation; Receipt of Information . . 6
4.5. Fees and Commissions. . . . . . . . . . . . . . . . . . . . . . . 7
ARTICLE V
COVENANTS OF THE PARTIES
5.1. Conduct of Business of CIBBV. . . . . . . . . . . . . . . . . . . 7
5.2. Expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
5.3. Further Assurances . . . . . . . . . . . . . . . . . . . . . . . 8
5.4. Public Statements . . . . . . . . . . . . . . . . . . . . . . . . 8
5.5. Consents and Approvals. . . . . . . . . . . . . . . . . . . . . . 9
5.7. Supplements to Schedules. . . . . . . . . . . . . . . . . . . . . 10
5.8. Xxxx-Xxxxx-Xxxxxx. . . . . . . . . . . . . . . . . . . . . . . . 10
5.9. Termination of Intercompany Agreements; Settlement of
Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . 10
5.10. Maintenance of Guarantee . . . . . . . . . . . . . . . . . . . . 11
5.11. Secondment . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
ARTICLE VI
CLOSING CONDITIONS
6.1. Conditions to Each Party's Obligations to Effect the
Transactions Contemplated Hereby. . . . . . . . . . . . . . . 11
6.2. Conditions to Obligations of Buyer . . . . . . . . . . . . . . . 12
6.3. Conditions to Obligations of C&W . . . . . . . . . . . . . . . . 12
ARTICLE VII
TERMINATION AND ABANDONMENT
7.1. Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
7.2. Procedure and Effect of Termination . . . . . . . . . . . . . . . 14
ARTICLE VIII
SURVIVAL OF REPRESENTATIONS; INDEMNIFICATION
8.1. Survival of Representations . . . . . . . . . . . . . . . . . . . 14
8.2. C&W's Indemnification of Buyer . . . . . . . . . . . . . . . . . 14
8.3. Buyer's Indemnification of C&W . . . . . . . . . . . . . . . . . 15
8.4. Conditions of Indemnification. . . . . . . . . . . . . . . . . . 15
8.5. Cushion. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
8.6. Limitation of Liability. . . . . . . . . . . . . . . . . . . . . 16
8.7. Remedies Cumulative. . . . . . . . . . . . . . . . . . . . . . . 17
ARTICLE IX
MISCELLANEOUS PROVISIONS
9.1. Amendment and Modification. . . . . . . . . . . . . . . . . . . 17
9.2. Waiver of Compliance; Consents . . . . . . . . . . . . . . . . . 17
9.3. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
9.4. Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
9.5. Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . 19
9.6. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . 20
9.7. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . 20
9.8. Interpretation . . . . . . . . . . . . . . . . . . . . . . . . . 20
9.9. Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . 20
STOCK PURCHASE AGREEMENT
STOCK PURCHASE AGREEMENT (this "Agreement"), dated April 19,
1998, by and between:
PLD TELEKOM INC., a company incorporated under the laws of the
State of Delaware ("Buyer"), with an address at 000 Xxxxx Xxxxxx, 00xx
Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, and
CABLE AND WIRELESS PLC, a company registered under the laws of
England under the number 238525 ("C&W"), with an address at 000 Xxxxxxxxx
Xxxx, Xxxxxx XX0X 0XX.
W I T N E S S E T H:
WHEREAS, C&W owns directly 100 shares of common stock, par value
NLG 400 per share, of CommStruct International Byelorussia BV, a company
organized under the laws of The Netherlands ("CIBBV"), constituting 100% of
the issued and outstanding capital stock of CIBBV (the "CIBBV Shares"),
which is the owner of (i) fifty percent (50%) of the outstanding common
equity interests (the "Belcel Shares") in Belarus-Netherlands Belcel Joint
Venture ("Belcel") and (ii) one hundred percent (100%) of the outstanding
common equity interests (the "Baltic Operations Shares") in Baltic Opera-
tions Ltd. - Latvia ("Baltic Operations", and together with CIBBV and
Belcel, the "CIBBV Group"); and
WHEREAS, C&W desires to sell and transfer, or to cause the sale
and transfer, to Buyer, and Buyer desires to purchase, the CIBBV Shares, as
more specifically provided herein;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements hereinafter set forth, the parties, intending to
be legally bound, hereby agree as follows:
ARTICLE I
SALE OF STOCK; CONSIDERATION
1.1. Sale by C&W. Upon the terms and subject to the satisfac-
tion of the conditions contained in this Agreement, C&W agrees to sell,
assign, transfer and deliver to Buyer, and Buyer agrees to purchase and
acquire, all of the right, title and interest of C&W in and to the CIBBV
Shares. In addition, C&W will assign to Buyer or its designee the benefit
of the Loan Agreement, dated November 28, 1995, between C&W and CIBBV, as
amended (the "Loan Agreement").
1.2. Consideration for the Sale by C&W. On the Closing Date (as
hereinafter defined) and upon the terms and subject to the satisfaction of
the conditions contained in this Agreement, Buyer will issue and deliver to
C&W an aggregate of 500,000 newly-issued, fully paid and non-assessable
shares of Common Stock (the "Buyer Shares"), par value $0.01 per share, of
Buyer, registered in the name of C&W or its designee or nominee, allocated
as follows :
(a) an aggregate of 200,000 shares of Common Stock of Buyer
in consideration of the aforesaid sale, assignment, transfer and delivery
of the CIBBV Shares
(b) an aggregate of 300,000 shares of Common Stock of Buyer
in consideration of the aforesaid assignment of the Loan Agreement.
ARTICLE II
THE CLOSING
2.1. Time and Place of Closing. Subject to the terms and
conditions of this Agreement, the consummation of the transaction contem-
plated hereby (the "Closing") shall take place at the offices of Skadden,
Arps, Slate, Xxxxxxx & Xxxx LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000-0000 on the third Business Day (as defined herein) after Buyer shall
have delivered to C&W written notice that the conditions set forth in
Section 6.2 hereof have been satisfied (the "Closing Date") or at such
other time and place as shall be determined by mutual agreement of the
parties.
2.2. Deliveries by C&W. At the Closing, C&W will deliver or
cause to be delivered the following to Buyer:
(a) duly certified evidence, acceptable to Buyer, of one or
more entries in the share registry of CIBBV evidencing the transfer of
title to the CIBBV Shares to Buyer, together with any other documents that
are necessary to transfer to Buyer good and marketable title to the CIBBV
Shares;
(b) duly executed documentation, in form and substance
reasonably acceptable to Buyer, evidencing the assignment of the benefit of
the Loan Agreement to Buyer or its designee;
(c) the Officer's Certificate referred to in Section 6.2(e)
hereof; and
(d) such other documents, instruments and writings as are
reasonably required to be delivered by C&W at or prior to the Closing Date
pursuant to this Agreement or otherwise reasonably required in connection
herewith.
2.3. Deliveries by Buyer. At the Closing, Buyer will deliver
the following to C&W:
(a) one or more stock certificates, registered in the name
of C&W or its nominee or designee, representing the Buyer Shares;
(b) the Officer's Certificate referred to in Section 6.3(c)
hereof; and
(c) such other documents, instruments and writings as are
reasonably required to be delivered by Buyer at or prior to the Closing
Date pursuant to this Agreement or otherwise reasonably required in
connection herewith.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF C&W
C&W represents and warrants to Buyer as follows:
3.1. Organization.
(a) C&W is a public limited company duly organized and
validly existing under the laws of England and has all requisite power to
enter into this Agreement and to dispose of the CIBBV Shares in accordance
with this Agreement and to perform the transactions contemplated hereby.
(b) CIBBV is a company duly organized and validly existing
under the laws of The Netherlands. C&W has heretofore delivered to Buyer
complete and correct copies of the organizational documents of CIBBV as
currently in effect.
3.2. Authority Relative to this Agreement. C&W has full
corporate power and authority to execute, deliver and perform its
obligations under this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been duly and
validly authorized by C&W, and no other corporate proceedings on the part
of C&W are necessary to authorize this Agreement or to consummate the
transactions contemplated hereby. This Agreement has been duly and validly
executed and delivered by C&W, and assuming that this Agreement constitutes
a valid and binding agreement of Buyer, constitutes a valid and binding
agreement of C&W, enforceable against C&W in accordance with its terms,
except that such enforceability may be limited by applicable bankruptcy,
insolvency, moratorium or other similar laws affecting or relating to
enforcement of creditors' rights generally or general principles of equity.
3.3. Title.
(a) C&W directly owns the CIBBV Shares that are the subject
of this Agreement free and clear of all pledges, security interests, liens,
charges, encumbrances, claims, options or limitations affecting its ability
to vote such shares or to transfer such shares to Buyer or to exercise any
other rights appurtenant thereto. The CIBBV Shares that are the subject of
this Agreement are the only shares or other equity interests in, or
agreements, contracts, instruments, arrangements or understandings enabling
a party upon exercise or conversion to acquire shares or other equity
interests in, CIBBV. At the Closing, Buyer will acquire good title to the
CIBBV Shares, free and clear of all pledges, security interests, liens,
charges, encumbrances, claims, options or limitations of any nature
whatsoever. There is no subscription, option, warrant, call, right,
agreement or understanding for the sale, delivery, assignment or transfer
by C&W of the CIBBV Shares.
(b) Subject, in the case of the Belcel Shares, to the
provisions of the charter of Belcel, CIBBV owns the Belcel Shares and the
Baltic Operations Shares free and clear of all pledges, security interests,
liens, charges, encumbrances, claims, options or limitations affecting its
ability to vote such shares or to exercise any other rights appurtenant
thereto.
3.4. Consents and Approvals; No Violation.
(a) Except as set forth in Schedule 3.4, neither the
execution and delivery of this Agreement by C&W, nor the sale by C&W of the
CIBBV Shares pursuant to this Agreement, will (i) conflict with or result
in any breach of any provision of the Articles of Incorporation or Bylaws,
or similar charter documents, of C&W or Belcel or (ii) require any consent,
approval, authorization or permit of, or filing with or notification to,
any governmental or regulatory authority to be made or obtained by C&W or
CIBBV.
(b) Except as set forth in Schedule 3.4, C&W is not
required to make or obtain any declaration, filing or registration with, or
notice to, or authorization, consent or approval of any governmental or
regulatory body or authority for the consummation by C&W of the
transactions contemplated hereby.
3.5. Financial Statements; Undisclosed Liabilities.
(a) C&W has previously furnished to Buyer copies of CIBBV's
unaudited (i) balance sheets as of December 31, 1997 and (ii) related
unaudited statements of income and retained earnings and changes in
financial position of CIBBV for the fiscal year then ended. To the
knowledge of C&W, such financial report presents fairly the financial
information purported to be set forth therein as of the dates, or for the
periods, described therein, all in conformity with the accounting
principles described therein. Notwithstanding the foregoing, C&W is making
no representation as to whether the receivables set out in the financial
statements are or will be collectible.
(b) Except as set forth in Schedule 3.5, to the knowledge
of C&W, CIBBV has not incurred any material liability or obligation,
secured or unsecured (whether absolute, accrued, contingent or otherwise,
and whether due or to become due), of a nature required by generally
accepted accounting principles to be reflected in a corporate balance sheet
or disclosed in the notes thereto, which are not accrued or reserved
against in the financial reports referred to in Section 3.5(a) hereof or
disclosed in the notes thereto in accordance with generally accepted
accounting principles whether at or after the date of the financial report
referred to in Section 3.5(a) hereof, except those which were incurred in
the ordinary course of business in line with past practice.
3.6. Fees and Commissions. No broker, finder or other person is
entitled to any brokerage fees, commissions or finder's fees in connection
with the transaction contemplated hereby by reason of any action taken by
C&W. C&W hereby covenants that it will pay to Buyer or otherwise
discharge, and will indemnify and hold Buyer harmless from and against, any
and all claims or liabilities for all brokerage fees, commissions and
finder's fees (other than as described above) incurred by reason of any
action taken by C&W.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to C&W as follows:
4.1. Organization. Buyer is a corporation duly organized,
validly existing and in good standing under the laws of the State of
Delaware. Buyer has heretofore delivered to C&W complete and correct
copies of its Certificate of Incorporation and Bylaws as currently in
effect.
4.2. Authority Relative to this Agreement. Buyer has full power
and authority to execute, deliver and perform all obligations under this
Agreement and to consummate the transactions contemplated hereby. The
execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby have been duly and validly authorized by
Buyer and no other proceedings on the part of Buyer are necessary to
authorize this Agreement or to consummate the transactions contemplated
hereby. This Agreement has been duly and validly executed and delivered by
Buyer, and assuming that this Agreement constitutes a valid and binding
agreement of C&W, constitutes a valid and binding agreement of Buyer,
enforceable against Buyer in accordance with its terms, except that such
enforceability may be limited by applicable bankruptcy, insolvency,
moratorium or other similar laws affecting or relating to enforcement of
creditors' rights generally or general principles of equity.
4.3. Buyer Shares. The Buyer Shares, when issued in accordance
with the terms and conditions of this Agreement, will be validly issued,
fully paid and non-assessable shares of Common Stock of Buyer, free and
clear of all pledges, security interests, liens, charges, encumbrances,
claims, options or limitations affecting C&W's ability to vote such shares
or to exercise any other rights appurtenant thereto
4.4. Consents and Approvals; No Violation; Receipt of
Information.
(a) Except as set forth in Schedule 4.4, neither the
execution and delivery of this Agreement by Buyer nor the purchase by Buyer
of the CIBBV Shares pursuant to this Agreement will (i) conflict with or
result in any breach of any provision of the organizational documents of
Buyer, (ii) require any consent, approval, authorization or permit of, or
filing with or notification to, any governmental or regulatory authority,
or (iii) result in a default (or give rise to any right of termination,
cancellation or acceleration) under any of the terms, conditions or
provisions of any note, bond, mortgage, indenture, agreement, lease or
other instrument or obligation to which Buyer or any of its subsidiaries
are a party or by which any of their respective assets may be bound, except
for such defaults (or rights of termination, cancellation or acceleration)
as to which requisite waivers or consents have been obtained.
(b) No declaration, filing or registration with, or notice
to, or authorization, consent or approval of any governmental or regulatory
body or authority is necessary for the consummation by Buyer of the
transactions contemplated hereby.
(c) Buyer or its counsel, accountants or other advisers
have requested, received, reviewed and considered all information deemed
relevant by them, including, without limitation, information regarding
currency and taxation issues, in making the decision to enter into this
Agreement and to acquire the CIBBV Shares on the terms and conditions set
forth herein.
4.5. Fees and Commissions. No broker, finder or other person is
entitled to any brokerage fees, commissions or finder's fees in connection
with the transaction contemplated hereby by reason of any action taken by
Buyer making such representation. Buyer hereby covenants that it will pay
to C&W or otherwise discharge, and will indemnify and hold C&W harmless
from and against, any and all claims or liabilities for all brokerage fees,
commissions and finder's fees (other than as described above) incurred by
reason of any action taken by Buyer.
ARTICLE V
COVENANTS OF THE PARTIES
5.1. Conduct of Business of CIBBV. Except as described in
Schedule 5.1, during the period from the date of this Agreement to the
Closing Date, C&W covenants that CIBBV will conduct its business and
operations according to its ordinary and usual course of business
consistent with past practice. Without limiting the generality of the
foregoing, and, except as contemplated in this Agreement or as described in
Schedule 5.1, prior to the Closing Date, without the prior written consent
of Buyer, C&W will not permit CIBBV to:
(a) (i) create, incur or assume any amount of indebtedness
for money borrowed, other than in the ordinary course of business in line
with past practice, or (ii) assume, guarantee, endorse or otherwise become
liable or responsible (whether directly, contingently or otherwise) for the
obligations of any other person except in the ordinary course of business
in line with past practice; provided, CIBBV may endorse negotiable
instruments in the ordinary course of business and may enter into the
proposed guarantee set forth on Schedule 3.5;
(b) declare, set aside or pay any dividend or other
distribution (whether in cash, stock or property or any combination
thereof) in respect of its capital stock, or redeem or otherwise acquire
any shares of its capital stock;
(c) enter into any agreement, commitment or transaction
(including without limitation any borrowing, capital expenditure or capital
financing), except agreements, commitments or transactions in the ordinary
course of business in line with past practice or as contemplated herein; or
(d) enter into any contract, agreement, commitment or
arrangement, whether written or oral, with respect to any of the
transactions set forth in the foregoing paragraphs (a) through (c).
5.2. Expenses. Whether or not the transactions contemplated
hereby are consummated, all costs and expenses incurred in connection with
this Agreement and the transactions contemplated hereby shall be borne by
the party incurring such costs and expenses.
5.3. Further Assurances. Subject to the terms and conditions
of this Agreement, each of the parties hereto will use all reasonable
efforts to take, or cause to be taken, all action, and to do, or cause to
be done, all things reasonably necessary, proper or advisable under
applicable laws and regulations to consummate and make effective the sale,
assignment, transfer and delivery of the CIBBV Shares to Buyer and the
issuance and delivery of the Buyer Shares to C&W pursuant to this
Agreement. From time to time after the date hereof, without further
consideration, C&W will, at its own expense, execute and deliver such
documents to Buyer as Buyer may reasonably request in order more
effectively to vest in Buyer good title to the CIBBV Shares and to assign
the benefit of the Loan Agreement (and any other liabilities to be assigned
to Buyer or its designee pursuant to Section 5.9 hereof) to Buyer or its
designee. From time to time after the date hereof, without further
consideration, Buyer will, at its own expense, execute and deliver such
documents to C&W as C&W may reasonably request in order more effectively to
consummate the issuance and delivery of the Buyer Shares pursuant to this
Agreement.
5.4. Public Statements. The parties shall consult with each
other prior to issuing any public announcement, statement or other
disclosure with respect to this Agreement or the transactions contemplated
hereby and shall not issue any such public announcement, statement or other
disclosure prior to such consultation, unless legally compelled (by
deposition, interrogatory, request for documents, subpoena, civil
investigative demand or similar process, or by order of a court or tribunal
of competent jurisdiction), or in order to comply with applicable rules or
requirements of any stock exchange, government department or agency or
other regulatory authority, or by requirements of any securities law or
regulation or other legal requirement in circumstances where such
consultation would not be practicable.
5.5. Consents and Approvals.
(a) C&W and Buyer shall (i) promptly prepare and file all
necessary documentation, (ii) effect all necessary applications, notices,
petitions and filings and execute all agreements and documents, (iii) use
all reasonable efforts to obtain all necessary permits, consents, approvals
and authorizations of all governmental bodies and (iv) use all reasonable
efforts to obtain all necessary permits, consents, approvals and
authorizations of all other parties, in the case of C&W, as specified on
Schedule 3.4 and, in the case of Buyer, as specified on Schedule 4.4
(including without limitation any approval required from the shareholders
of Buyer and the holders of the debt of the Buyer), together with any other
approvals or consents identified by the parties after the signing of this
Agreement as being required in order, respectively, for C&W to sell, and
for Buyer to acquire, the CIBBV Shares, and, respectively, for Buyer to
issue to C&W, and for C&W to acquire, the Buyer Shares. Each of Buyer and
C&W shall provide reasonable assistance to the other in order to obtain the
consents and approvals referred to herein. Each of C&W and Buyer shall
have the right to review and be consulted in advance as to all
characterizations of the information relating to the transactions
contemplated by this Agreement which appear in any filing made in
connection with the transactions contemplated hereby. The parties hereto
agree that they will consult with each other with respect to the obtaining
of all such necessary permits, consents, approvals and authorizations of
all third parties and governmental bodies.
(b) The parties hereto shall consult with each other prior
to proposing or entering into any stipulation or agreement with any foreign
or United States governmental authority or agency or any third party in
connection with any foreign or United States governmental consents and
approvals legally required for the consummation of the transactions
contemplated hereby and shall not propose or enter into any such
stipulation or agreement without the other party's prior written consent,
which consent shall not be unreasonably withheld.
5.6. Completion of Ancillary Agreements. Subject to the terms
and conditions of this Agreement, each party will use all reasonable
efforts to take or cause to be taken, all action, and do or cause to be
done all things reasonably necessary, proper or advisable to ensure the
completion of, in the case of C&W, the Share Purchase Agreement, and in the
case of Buyer, the Asset Exchange Agreement, dated the date hereof, between
Buyer and News America (the "Asset Exchange Agreement") and the Directors
Nomination Agreement, between Buyer and News America, each in the form as
executed on the date hereof, and to perform all of their respective
obligations thereunder.
5.7. Supplements to Schedules. C&W, on the one hand, and Buyer,
on the other hand, shall have the right from time to time prior to the
Closing to supplement or amend its Schedules with respect to any matter
hereafter arising which if existing or known at the date of this Agreement
would have been required to be set forth or described in such Schedules.
Any such supplemental or amended disclosure shall be deemed to have cured
any breach of any representation or warranty made in this Agreement for
purposes of this Agreement, but will not be deemed to have cured any such
breach made in this Agreement and to have been disclosed as of the date of
this Agreement for purposes of determining whether or not the conditions
set forth in Article VI hereof have been satisfied.
5.8. Xxxx-Xxxxx-Xxxxxx. Buyer shall use its best efforts to
assist News America Incorporated ("News America") in the prompt preparation
and filing of the filing required to be made by News America under Title II
of the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended
(the "HSR Act"), with respect to the transactions contemplated by the share
purchase agreement, dated as of the date hereof, between C&W and News
America (the "Share Purchase Agreement"), and Buyer shall promptly, and in
any event within five (5) Business Days (as defined herein) from the date
of this Agreement, make the filing required to be made by Buyer under the
HSR Act with respect to the transactions contemplated by the Share Purchase
Agreement.
5.9. Termination of Intercompany Agreements; Settlement of
Liabilities. At the Closing Date, the benefit of the Loan Agreement shall
be assigned to Buyer or its designee pursuant to the terms of this
Agreement. In addition, at or prior to the Closing Date, all intercompany
agreements relating to loans or other indebtedness for money borrowed
(including, for the avoidance of doubt, on a "current account" basis),
between C&W or its subsidiaries or affiliates controlled by C&W (other than
the CIBBV Group), on the one hand, and and CIBBV, Belcel or Baltic
Operations, on the other hand, other than the Loan Agreement, shall have
either been terminated or assigned to Buyer or its designee, in either case
without any residual liability on the part of CIBBV, Belcel or Baltic
Operations thereunder to C&W or any of its subsidiaries or affiliates
controlled by C&W outside of the CIBBV Group as of the Closing Date, and
vice versa. For the avoidance of doubt, this provision does not apply to
any amounts that might be required to be paid by Belcel to any of C&W's
subsidiaries or affiliates controlled by C&W in relation to lines leased
through the Ministry of Transport of Belarus, Beltelekom or the Republican
Exchange.
5.10. Maintenance of Guarantee. Following completion of the
transactions contemplated hereby, C&W shall maintain, in full force and
effect, its corporate guarantee (the "Guarantee") in relation to the
obligations of Belcel under the Loan Agreement, dated February 21, 1995,
between Belcel and Nordbanken until the earlier of the expiration of its
obligations under the Loan Agreement or until another guarantee is put in
place, provided that in no event shall C&W be required to increase or
extend its liabilities under the existing form of the Guarantee. To the
extent that C&W is called to perform its obligations under the Guarantee in
full or in part, Buyer shall indemnify C&W for the full amount actually
paid by C&W under the Guarantee. In addition, Buyer shall not, and shall
ensure that Belcel does not, make further drawdowns under such Loan
Agreement and shall use best efforts to put a substitute guarantee in
place.
5.11. Secondment. C&W shall use its best efforts to second
Xxxxxxx Xxxxxxxx and Xxx Xxxxx to Buyer under the terms of the existing
Agreement for the Provision of Support Services, dated November 27, 1996,
between C&W and Buyer, at cost plus 7.2%, for a period of six months from
the Closing Date.
ARTICLE VI
CLOSING CONDITIONS
6.1. Conditions to Each Party's Obligations to Effect the
Transactions Contemplated Hereby. The respective obligations of each party
to effect the transactions contemplated hereby shall be subject to the
fulfillment at or prior to the Closing Date of the following conditions:
(a) No preliminary or permanent injunction or other order
or decree by any federal, state, local or foreign court which prevents the
consummation of the transactions contemplated hereby shall have been issued
and remain in effect (each party agreeing to use its reasonable best
efforts to have any such injunction, order or decree lifted) and no
statute, rule or regulation shall have been enacted by any federal, state,
local, or foreign government or governmental agency which prohibits the
consummation of the transactions contemplated hereby;
(b) All foreign and United States federal, state and local
government consents and approvals required for the consummation of the
transactions contemplated hereby shall have become Final Orders (a "Final
Order" means a final order after all opportunities for rehearing are
exhausted (whether or not any appeal thereof is pending)) and shall not be
subject to terms and conditions; and-
(c) All approvals and consents specified on Schedules 3.4
and 4.4 hereto, together with any necessary approvals or consents
identified by the parties hereto following the date of this Agreement as
being required in order for C&W to sell, and for Buyer to acquire, the
CIBBV Shares, and for Buyer to issue to C&W, and for C&W to acquire, the
Buyer Shares shall have been obtained.
6.2. Conditions to Obligations of Buyer. The obligation of
Buyer to effect the transactions contemplated by this Agreement shall be
subject to the fulfillment at or prior to the Closing Date of the following
additional conditions:
(a) C&W shall have performed and complied with in all
material respects the covenants and agreements contained in this Agreement
required to be performed and complied with by it at or prior to the Closing
Date, and the representations and warranties of C&W set forth in this
Agreement, giving effect to the amendment or supplement of any schedule
pursuant to Section 5.6 hereof, shall be true and correct in all material
respects as of the date of this Agreement and as of the Closing Date as
though made at and as of the Closing Date;
(b) the transactions contemplated hereby shall have been
approved by all necessary corporate actions by CIBBV;
(c) the conditions to the closing of the Share Purchase
Agreement (other than the issuance of the Buyer Shares to C&W pursuant to
this Agreement) shall have been met, and C&W and News America shall be
prepared to close the transactions contemplated by the Share Purchase
Agreement immediately after the closing of the transactions contemplated
hereby;
(d) Buyer shall have received duly certified evidence,
acceptable to Buyer, of one or more entries in the share registry of CIBBV
evidencing the transfer of title to the CIBBV Shares to Buyer, together
with any other documents that are necessary to transfer to Buyer good and
marketable title to the CIBBV Shares; and
(e) Buyer shall have received a certificate from an
authorized officer of C&W, dated the Closing Date, to the effect that to
the officer's knowledge, the conditions set forth in Section 6.2(a) and (b)
have been satisfied.
6.3. Conditions to Obligations of C&W. The obligations of C&W
to effect the transaction contemplated by this Agreement shall be subject
to the fulfillment at or prior to the Closing Date of the following
additional conditions:
(a) one or more stock certificates representing the Buyer
Shares shall have been delivered to C&W or its nominee or designee;
(b) Buyer shall have performed and complied with in all
material respects the covenants and agreements contained in this Agreement
required to be performed and complied with by it at or prior to the Closing
Date, and the representations and warranties of Buyer set forth in this
Agreement, giving effect to the amendment or supplement of any schedule
pursuant to Section 5.6 hereof, shall be true and correct in all material
respects as of the date of this Agreement and as of the Closing Date as
though made at and as of the Closing Date; and
(c) C&W shall have received a certificate from an
authorized officer of Buyer, dated the Closing Date, to the effect that to
the officer's knowledge, the conditions set forth in Section 6.3(b) have
been satisfied.
ARTICLE VII
TERMINATION AND ABANDONMENT
7.1. Termination.
(a) This Agreement may be terminated at any time prior to
the Closing Date, by mutual written consent of Buyer and C&W.
(b) This Agreement may be terminated by Buyer, on the one
hand, or C&W, on the other hand, if the transactions contemplated hereby
shall not have been consummated on or before June 30, 1998; provided,
however, that the right to terminate this Agreement pursuant to this
Section 7.1(b) shall not be available to any party whose failure to perform
any of its covenants or obligations under this Agreement has been the cause
of or resulting in the failure of the transactions contemplated by this
Agreement to occur on or prior to the aforesaid date.
(c) This Agreement may be terminated by either Buyer, on
the one hand, or C&W, on the other hand, if (i) any governmental or
regulatory body, the consent of which is a condition to the obligations of
C&W and Buyer to consummate the transactions contemplated hereby, shall
have determined not to grant its consent and all appeals of such
determination shall have been taken and have been unsuccessful, or (ii) any
court of competent jurisdiction shall have issued an order, judgment or
decree permanently restraining, enjoining or otherwise prohibiting the
transactions contemplated hereby and such order, judgment or decree shall
have become final and nonappealable.
(d) This Agreement may be terminated by Buyer, on the one
hand, or C&W, on the other hand, if there has been a material violation or
breach of any agreement, representation or warranty contained in this
Agreement which violation or breach has not been waived by the non-
breaching party or otherwise rectified. Without limiting the generality of
the foregoing, the failure by Buyer to file the HSR filing to be made by
Buyer, as set forth in Section 5.8 and within the time period set forth in
Section 5.8, shall constitute a material breach of this Agreement by Buyer.
7.2. Procedure and Effect of Termination. In the event of
termination of this Agreement and abandonment of the transactions
contemplated hereby by either or both of the parties pursuant to Section
7.1, written notice thereof shall forthwith be given by the terminating
party to the other party and this Agreement shall terminate and the
transactions contemplated hereby shall be abandoned, without further action
by any of the parties hereto, without prejudice to any claims of a party to
this Agreement arising prior to the date of such termination out of any
breach of any agreement, representation or warranty contained in this
Agreement and Article VIII shall continue in respect of such claims. In
addition, the obligations of the parties hereto under Section 5.4 and
Article IX shall survive termination of this Agreement. If this Agreement
is terminated as provided herein all filings, applications and other
submissions made pursuant to this Agreement, to the extent practicable,
shall be withdrawn from the agency or other person to which they were made.
ARTICLE VIII
SURVIVAL OF REPRESENTATIONS; INDEMNIFICATION
8.1. Survival of Representations. All representations and
warranties of the parties, being those in Articles III and IV, including
the schedules thereto, shall survive the Closing until one (1) year after
the Closing.
8.2. C&W's Indemnification of Buyer. Subject to the conditions
of this Article VIII, C&W hereby agrees that it shall indemnify, defend and
hold harmless Buyer and any parent, subsidiary and affiliate of Buyer
(collectively, the "Buyer Group") from and against all demands, claims,
actions or causes of action, assessments, losses, damages, liabilities,
costs and expenses, including, without limitation, interest, penalties and
reasonable attorneys' fees and expenses (collectively, "Damages"), asserted
against, resulting to, imposed upon or incurred by any of the Buyer Group,
directly or indirectly, arising out of or resulting from a breach of any
representation, warranty or agreement of C&W contained in or made pursuant
to this Agreement or any facts or circumstances constituting such a breach
(collectively, "Buyer's Indemnifiable Claims"); provided, however, that the
indemnification obligation of C&W with respect to any breach of any of the
representations or warranties made by C&W in this Agreement shall arise
only in the event that C&W had knowledge of such breach on or before the
Closing. For purposes of this Agreement, "knowledge" of C&W shall mean the
knowledge of Xxxxx Xxxxxxxx, Xxxxxx Xxxx and Xxxx Xxxxxxxxxx (collectively,
the "Designated Persons"). C&W represents and warrants that the Designated
Persons are the only current management personnel of C&W or CIBBV who have
substantial executive, management or financial responsibilities for CIBBV
who would be reasonably likely to be aware of facts or circumstances that
could cause a representation or warranty made by C&W in this Agreement to
be false in any material respect.
8.3. Buyer's Indemnification of C&W. Subject to the conditions
of this Article VIII, Buyer hereby agrees that it shall indemnify, defend
and hold harmless C&W and any parent, subsidiary and affiliate of C&W
(collectively, the "C&W Group") from and against all Damages asserted
against, resulting to, imposed upon or incurred by any of the C&W Group,
directly or indirectly, arising out of or resulting from a breach of any
representation, warranty or agreement of Buyer contained in or made
pursuant to this Agreement or any facts or circumstances constituting such
a breach ("C&W Indemnifiable Claims"; C&W's Indemnifiable Claims and
Buyer's Indemnifiable Claims are collectively referred to herein as the
"Indemnifiable Claims"); provided, however, that the indemnification
obligation of Buyer with respect to any breach of any of the
representations or warranties made by Buyer in this Agreement shall arise
only in the event that Buyer had knowledge of such breach on or before the
Closing. For purposes of this Agreement "knowledge" of Buyer shall mean
actual knowledge on the part of any member of management of Buyer or actual
knowledge of such circumstances that would lead a person not negligent to
investigate and, more likely than not, obtain actual knowledge.
8.4. Conditions of Indemnification. The obligations and
liabilities of C&W under Section 8.2 or Buyer under Section 8.3,
respectively, with respect to Indemnifiable Claims resulting from the
assertion of liability by third parties shall be subject to the following
terms and conditions:
(a) The member of the C&W Group or the Buyer Group, as the
case may be, asserting the existence of an Indemnifiable Claim (the
"Indemnified Party") will give notice of any such Indemnifiable Claim to
the party from whom Indemnification is sought (the "Indemnifying Party"),
and the Indemnifying Party shall undertake the defense thereof by
representation of their choosing, and will consult with the Indemnified
Party concerning such defense during the course thereof.
(b) In the event that the Indemnifying Party within a
reasonable time after notice of any Indemnifiable Claim, fails to defend,
the Indemnified Party against which such Indemnifiable Claim has been
asserted will (upon further notice to the Indemnifying Party) have the
right to undertake the defense, compromise or settlement of such
Indemnifiable Claim on behalf of and for the account and risk of the
Indemnifying Party.
(c) Anything in this Section 8.4 to the contrary
notwithstanding, (i) if there is a reasonable probability that an
Indemnifiable Claim may materially and adversely affect the Indemnified
Party other than as a result of money damages or other money payments (for
example, as a result of injunctive or other equitable relief), the
Indemnified Party shall have the right to defend, compromise or settle such
Indemnifiable Claim, provided that the Indemnifying Party will not be bound
by any determination concerning any Indemnifiable Claim so defended or any
compromise or settlement effected without the consent of the Indemnifying
Party, such consent not to be unreasonably withheld, and (ii) the
Indemnifying Party not shall not, without the Indemnified Party's written
consent, settle or compromise any Indemnifiable Claim or consent to entry
of any judgment in respect thereof, unless (A) the Indemnifying Party
delivers to the Indemnified Party in advance its written agreement
satisfactory to the Indemnified Party which provides that amounts paid and
incurred or to be incurred by the Indemnified Party in connection with such
Indemnifiable Claim shall be repaid promptly by the Indemnifying Party to
the Indemnified Party (subject to the limitations of this Article VIII),
and (B) such settlement, compromise or consent includes as an unconditional
term thereof the giving by the claimant or the plaintiff to the Indemnified
Party, as the case may be, a release from all liability in respect to such
Indemnifiable Claim.
8.5. Cushion. The provisions for indemnity contained in Section
8.2 and Section 8.3 hereof shall only be effective with respect to an
Indemnifiable Claim (or, if more than one Indemnifiable Claim is asserted,
with respect to all Indemnifiable Claims) to the extent the amount (or
aggregate amount, in the case of more than one Indemnifiable Claim) of
damages sustained in connection therewith exceeds Three Hundred Thousand
dollars (USD$300,000), but to the extent that the amount or amounts of
damages in respect of Indemnifiable Claims exceeds $300,000, the indemnity
provisions hereunder shall apply to all such damages, without regard to the
$300,000 limit; provided, however, that no cushion shall apply under this
Agreement to the indemnification by Buyer of C&W pursuant to Section 5.10
hereof.
8.6. Limitation of Liability. Anything in this Agreement to the
contrary notwithstanding, the liability of either party in respect of any
breach of any representation, warranty or agreement under this Agreement
shall be limited to claims as to which written notice shall have been given
to the Indemnifying Party on or prior to the first anniversary date of the
Closing Date, whether or not the Indemnified Party has actually settled or
incurred any expense with respect to such Damages. Furthermore, anything
in this Agreement to the contrary notwithstanding, (a) the liability of C&W
pursuant to this Agreement shall be limited to the aggregate market value
on the Closing Date of the Buyer Shares received by C&W (calculated based
on the last sale price of the Common Stock of Buyer on The Nasdaq Stock
Market on the Closing Date (the "Market Value")), as reduced by any amounts
actually paid or required to be paid by C&W in respect of all liabilities
of C&W arising out of the transactions contemplated under the Share
Purchase Agreement,whether under Article VIII of such Agreement or
otherwise, and (b) the liability of Buyer pursuant to this Agreement shall
be limited to twenty-five percent (25%) of the Market Value of the Buyer
Shares; provided, however, that, such cap on the liability of Buyer shall
not apply to the indemnification by Buyer of C&W pursuant to Section 5.10
hereof.
8.7. Remedies Cumulative. The remedies provided herein shall be
cumulative and shall not preclude the assertion by Buyer of any other
rights or the seeking of any other remedies against the other party, as the
case may be; provided, however, all claims under this Agreement shall be
governed by this Article VIII and provided further that the cushion
provided in Section 8.6 hereof and the limitation of liability provided in
Section 8.7 hereof shall also apply to all liabilities arising out of the
transactions contemplated hereby but grounded in a legal or equitable
theory other than a breach of representation, warranty or agreement set
forth in this Agreement.
ARTICLE IX
MISCELLANEOUS PROVISIONS
9.1. Amendment and Modification. Subject to applicable law,
this Agreement may be amended, modified or supplemented only by written
agreement signed by all of the parties hereto.
9.2. Waiver of Compliance; Consents. Except as otherwise
provided in this Agreement, any failure of any of the parties to comply
with any obligation, covenant, agreement or condition herein may be waived
by the party entitled to the benefits thereof only by a written instrument
signed by the party granting such waiver, but such waiver shall not operate
as a waiver of, or estoppel with respect to, any subsequent or other
failure.
9.3. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed effectively given upon personal
delivery to the party to be notified, on the next Business Day after
delivery to an internationally recognized overnight courier service, upon
confirmation of a facsimile transmission, or five days after deposit with
the United States Post Office or the Royal Mail, by registered or certified
mail (return receipt requested), postage prepaid, to the parties at the
following addresses (or at such other address for a party as shall be
specified by like notice; provided that notices of a change of address
shall be effective only upon receipt thereof):
If to C&W, to:
Cable and Wireless plc
000 Xxxxxxxxx Xxxx
Xxxxxx XX0X 0XX
Xxxxxx Xxxxxxx
Facsimile: (00) 000 000 0000
Attention: Company Secretary
(with a copy to:
Cleary, Gottlieb, Xxxxx & Xxxxxxxx
Xxxxx 0, Xxxx Xxxxx Xxxxx
00 Xxxxxxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Xxxxxx Xxxxxxx
Facsimile: (00) 000-000-0000
Attention: Xxxxxx X. Xxxxxx)
If to Buyer, to:
PLD Telekom Inc.
000 Xxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxx Xxxx
In the case of notices given to C&W or Buyer, a copy thereof shall
simultaneously be given to News America at:
News America Incorporated
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: General Counsel
(with a copy to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxx X. Xxxxxx, Esq.)
9.4. Assignment. This Agreement and all of the provisions
hereof shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and permitted assigns, but neither this
Agreement nor any of the rights, interests or obligations hereunder shall
be assigned by any party hereto, including by operation of law without the
prior written consent of the other party, nor is this Agreement intended to
confer upon any other person except the parties hereto any rights or
remedies hereunder.
9.5. Confidentiality. Each of the Parties hereto will hold, and
will use its reasonable, good faith efforts to cause its respective
shareholders, partners, members, directors, officers, employees,
accountants, counsel, consultants, agents and financial or other advisors
(collectively "Agents") to hold, in confidence all information (whether
oral or written), including this Agreement and the documents contemplated
herein, concerning the transactions contemplated by this Agreement
furnished to such Party by or on behalf of any other Party in connection
with such transactions, unless legally compelled (by deposition,
interrogatory, request for documents, subpoena, civil investigative demand
or similar process, or by order of a court or tribunal of competent
jurisdiction), or in order to comply with applicable rules or requirements
of any stock exchange, government department or agency or other regulatory
authority, or by requirements of any securities law or regulation or other
legal requirement to disclose any such information or documents, and except
to the extent that such information or documents can be shown to have been
(a) previously known on a nonconfidential basis by such Party, (b) in the
public domain through no fault of such Party or (c) acquired by such Party
on a nonconfidential basis from sources not known by such Party to be bound
by any obligation of confidentiality in relation thereto. Notwithstanding
the foregoing provisions of this Section 9.5, each Party may disclose such
information to its Agents in connection with the transactions contemplated
by this Agreement so long as such Agents are informed by such Party of the
confidential nature of such information and are required by such Party to
treat such information confidentially, and to certain governmental agencies
in connection with the procurement of the governmental authorizations
contemplated by this Agreement. The obligation of each Party to hold any
such information in confidence shall be satisfied if such Party exercises
the same care with respect to such information as it would take to preserve
the confidentiality of its own similar information. If this Agreement is
terminated, each Party will, and will use its reasonable, good faith
efforts to cause its respective Agents to, destroy or deliver to the other
Party, upon request, all documents and other materials, and all copies
thereof, obtained by such Party or on its behalf from the other Party
hereto in connection with this Agreement that are subject to such
confidence.
9.6. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York (regardless
of the laws that might otherwise govern under applicable New York
principles of conflicts of law) as to all matters, including but not
limited to matters of validity, construction, effect, performance and
remedies.
9.7. Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
9.8. Interpretation. The article and section headings contained
in this Agreement are solely for the purpose of reference, are not part of
the agreement of the parties and shall not in any way affect the meaning or
interpretation of this Agreement. As used in this Agreement, (a) the term
"person" shall mean and include an individual, a partnership, a joint
venture, a corporation, a trust, an unincorporated organization and a
governmental entity or any department or agency thereof, (b) the term
"subsidiary" when used in reference to any other person shall mean any
corporation of which outstanding securities having ordinary voting power to
elect a majority of the Board of Directors of such corporation are owned
directly or indirectly by such other person, (c) the terms "affiliate" and
"parent" shall have the meanings set forth in Rule 12b-2 of the Exchange
Act and (d) the term "Business Day" shall mean any day other than a
Saturday, Sunday or other day on which banks in the State of New York are
authorized or required to be closed..
9.9. Entire Agreement. Subject to the proviso in the final
sentence of this Section, this Agreement, including the documents,
schedules and certificates referred to herein, embody the entire agreement
and understanding of the parties hereto in respect of the transactions
contemplated by this Agreement. There are no restrictions, promises,
representations, warranties, covenants or undertakings, other than those
expressly set forth or referred to herein or therein. This Agreement
supersedes all prior agreements and understandings between the parties with
respect to such transactions; provided, that, notwithstanding the
foregoing, the Confidentiality and Non-Disclosure Agreement, dated
September 6, 1996, between the parties hereto shall survive, in full force
and effect, the execution and delivery of this Agreement.
IN WITNESS WHEREOF, C&W and Buyer have caused this agreement to
be signed by their respective duly authorized officers as of the date first
above written.
PLD TELEKOM INC.
By: /s/ XXXXX X.X. XXXX
-------------------------------
Name: XXXXX X.X. XXXX
Title: DIRECTOR
CABLE AND WIRELESS PLC
By: /s/ X. X. XXXXXXXX
-------------------------------
Name: X. X. XXXXXXXX
Title: DIRECTOR, GLOBAL
BUSINESS
