Share Acquisition Option Agreement That was prepared and signed in Tel Aviv on the 5th of the month of December, 2007
That
was prepared and signed in Tel Aviv
on
the 5th of the month of December, 2007
BETWEEN:
DCI
USA Inc.
a
corporation that is a registered in Delaware, USA -
3248228
(hereinafter:
the “Conferrer”
and/or
the “Conferrer
of the Option”)
of
the first part;
AND:
World
Group Shipping Ltd.
Israeli
Limited Liability Company, No. 00-000000-0
(hereinafter:
the “Recipient”
and/or
the “Recipient
of the Option”)
of
the second part;
| WHEREAS: |
The
Conferrer is the sole and only owner of the entire issued share
capital of
Xxxxxx Wind Energy Ltd., corporation No. 00-000000-0 (hereinafter:
the
“Company”),
all of which is according to the report from the Companies Registrar
which
is attached to this agreement as Appendix
A;
and
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| WHEREAS: |
It
is the desire of the Conferrer to grant to the Recipient, and it
is the
desire of the Recipient to receive from the Conferrer, an irrevocable
right to purchase from the Conferrer the entire 100% of the issued
and
fully paid-up share capital of the Company (hereinafter: the “shares”
and the “option”,
respectively); and
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| WHEREAS: |
The
parties have agreed between themselves concerning the option execution
terms as stated in this agreement;
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Therefore,
it has been agreed, stipulated and declared between the parties as
follows:
| 1. |
The
option
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|
1.1
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The
Conferrer hereby irrevocably undertakes to the Recipient that as
from the
date of fulfilling of the pending terms as stipulated in clause 2
below,
and for a period ending on February 28th,
2008 (hereinafter: the “execution
period”),
the Recipient shall be permitted, should he deem fit to do so, at
his sole
and complete discretion, to purchase the shares and all rights connected
to any shareholders' loan, from the Conferrer, at any time during
the
execution period, in their condition and in the condition of the
Company
as is stipulated in clause 4 below, in exchange for the payment of
a total
of NIS equal to 2,450,000 Million USD (hereinafter: the “Consideration
For the Shares”),
which is provided that the Recipient shall deliver a execution
notification to the Conferrer during the execution period as is defined
below.
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Without
derogating from any other provision or representation in this Agreement it
is
stressed, that the Consideration For the Shares is based on all other figures
in
the Balance Sheet and financial statement annexed to this agreement as
Appendix
B
which
shall be a representation by the Conferrer towards the Recipient. Therefore,
the
final Consideration For the Shares shall be adapted to the amended and updated
financial situation of the Company at the date of payments, according to a
new
and updated balance sheet audited and approved by an Israeli CPA of the
Recipient. Any discrepancy or change of any nature, between the figures in
the
Balance Sheet shall cause the relevant and proportional correction to the
Consideration For the Shares, but it is agreed between the Parties that no
correction shall be done to increase the said Consideration.
All
payments in USD shall be executed either in USD or in NIS (as Recipient
determines on its sole discretion), according to representative rate of the
USD
against the NIS as last determined by the Bank of Israel at the time of
execution of the payment order from Recipient's bank account in
Israel.
| 1.2 |
To
remove any doubt it is hereby clarified that the Recipient is entering
into an engagement with the Conferrer through this agreement which
relies
upon the correctness of the Conferrer’s
presentations.
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| 1.3 |
The
option is given to the Recipient without any consideration and the
Conferrer shall not be entitled to receive any kind of consideration
in
respect of granting said option.
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| 2. |
Omitted
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| 3. |
Option
execution
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| 3.1 |
The
execution of the option shall be undertaken by means of an irrevocable
and
unconditional notification in writing to the Conferrer, by which
the
Recipient chooses to execute the option which is being conferred
upon him
by this agreement (both above and below: the “execution
notification”)
and that shall be delivered to the Conferrer, which shall be during
the
course of the execution period only (hereinafter the “execution
date”).
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| 3.2 |
Should
the Recipient choose to execute the option, at his sole and complete
discretion, he shall submit the execution notification to the Conferrer
and also he shall pay to the Conferrer the shares consideration,
subject
to the following:
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| 3.2.1 |
The
Conferrer has ratified in writing that the condition of the shares
and of
the Company on the option execution date is as stipulated and described
in
this agreement and in its
appendices;
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| 3.2.2 |
The
Company’s shares were transferred into the name of the Recipient and/or on
his behalf;
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| 3.2.3 |
The
directors serving on behalf of the Conferrer have resigned and in
their
place are directors who have been appointed by the
Recipient;
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| 3.3 |
At
the time of signing the agreement, the parties shall sign a shares
transfer deed, notifications to the Company concerning the resignation
of
the Company’s board of directors and statements to the Companies
Registrar, all of which shall be without a franked date (hereinafter:
the
“documents”).
It is agreed that the documents shall be held in trust by adv. Erez
Tik
from 0 Xxxxxxx Xxxxx Xxx Xxxx Xxxxxx (hereinafter: the “Trustee”).
The parties shall empower the Trustee to fill in the director’s
resignation date and the appointment of the new director on the option
realization date and on all the other documents necessary according
to
Article 7 below.
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The
Conferred undertakes to sign and submit all necessary documents to the Trustee
within 30 days from the date of signing this Agreement by the Recipient. A
breach of the provisions of this article shall be considered as fundamental
breach by the Conferrer.
In
addition, the Conferrer shall sign an irrevocable Power of Attorney which gives
a Power of Attorney to the Recipient’s lawyers to execute, in his name and in
his xxxxx, those necessary actions required for the completion of the transfer
of the shares into the name of the Recipient and the execution of the other
actions which are the subject of this agreement (hereinafter: the “Power
of Attorney”).
The
wording of the Power of Attorney shall be drafted by the Recipient's attorney
and shall be duly singed, confirmed and submitted to the Recipient within 14
days of its submission to the Conferrer.
| 3.4 |
Should
the Recipient not have delivered the Recipient’s execution notification by
the end of the execution period, then the option shall expire
automatically and the Conferrer shall not have any complaint and/or
demand
and and/or claim in respect of
this.
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| 4. |
Presentations
and undertakings
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| 4.1 |
The
Conferrer declares, certifies and undertakes in respect of the shares
and
the Company, including regarding any subsidiary, as
follows:
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| 4.1.1 |
The
Company’s Incorporation and Articles of Association do not include any
article which is in contradiction to this
Agreement;
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| 4.1.2 |
The
Company is in a state as reflected in the financial statements for
30
September 2007 (hereinafter -
"the Balance Sheet")
submitted and presented as Appendix
B,
and any discrepancy and/or inaccuracy shall be remedied and indemnified
by
the Conferrer within 7 days of Recipient's first demand in
writing;
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| 4.1.3 |
There
are no attachments and/or debts and/or obligations and/or any third
party's rights which apply to the shares and/or to the Company and/or
to
any of its assets, except those specifically mentioned and reflected
in
the Balance Sheet. It is hereby emphasized that the Conferrer undertakes
to submit to the Recipient the consent of any third party to the
sale of
the shares inasmuch as their consent is
required;
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| 4.1.4 |
The
Company is not engaged in any obligation and/or binding agreement
of any
kind;
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| 4.1.5 |
There
are no engagements or obligations between the Company and the shareholders
or Company’s officers or associated parties, including in relation to
loans and/or to the placing of guarantees and/or letters of
indemnification, except the shareholders loan as described in the
Balance
Sheet, which was taken into account in the Consideration For the
Shares as
mentioned in this Agreement, and subordinated to the Recipient in
case of
exercising of the Option under this Agreement, as part of the
Consideration For the Shares and part of the purchase
thereof;
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| 4.1.6 |
The
Company is not involved in any existing and there are no anticipated
legal
process;
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| 4.1.7 |
Any
licenses required by any law for purposes of operating the Company
in
accordance with its activities is in the Company's
possession;
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| 4.1.8 |
The
Company has had no employees and does not currently have any employees
and
therefore it has no obligations towards any employees of any
kind;
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| 4.1.9 |
The
Company has all necessary Intellectual property rights in connection
with
its current activities, and it does not infringe any such right of
any
third party.
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| 4.2 |
The
Conferrer declares and undertakes that the Recipient is given full
due
diligence on the shares, on the Company, and any of its assets and
on
their financial and economic state which shall not include therein
any
information which is inaccurate and/or untrue and/or incomplete,
and with
no information lacking therein which is liable to be considered as
essential information which could influence the considerations of
a
reasonable investor for purposes of making a decision appertaining
to the
acquisition of the shares. The Conferrer is aware that the basis
for the
readiness of the Recipient to realize the option and to purchase
the
shares in exchange for the payment of the consideration for the shares,
is
the presentations, the declarations and the facts which are referred
to in
this agreement.
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The
Conferrer shall provide full indemnification for any damage, expense or lose
the
Recipient shall incur due to any misrepresentation and/or any demand or payment
to any authority and/or any other third party, caused in any time before
payments of the Consideration For the Shares.
| 5. |
Operating
the Company until the end of the execution
period
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During
the period of time from the date of signing this agreement until the end of
the
execution period (hereinafter: the “interim
period”)
the
Conferrer undertakes as follows:
| 5.1 |
To
operate the Company involving ordinary business
only;
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| 5.2 |
Not
to transfer and/or to attach any of the assets and/or the rights
of the
Company nor to give any consent for granting other rights of any
kind
whatsoever to any third party on any of its
assets;
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| 5.3 |
Not
to initiate any actions for the Company’s dissolution and/or
receivership;
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| 5.4 |
Not
to withdraw dividends, nor to carry out owners’ withdrawals from the
Company or to receive any payment whatsoever
therefrom;
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| 5.5 |
To
request the consent of the Recipient in advance for any Company engagement
with a third party of any kind which is essential for the Company
and/or
which is not within the course of the Company’s normal
business;
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| 5.6 |
Not
to undertake any changes to the Company’s Articles of Association, the
Company’s registered capital and its issued and fully paid-up share
capital or to allocate any shares or other rights in the
Company;
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| 5.7 |
To
deliver to the Recipient a copy of all minutes of any board of directors’
meeting or of a shareholders’ meeting;
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| 5.8 |
That
the Recipient shall be entitled to appoint an observer on his behalf
on
the Company’s board of directors and the Conferrer shall allow said
observer to be present at all of the Company’s board of directors’
meetings.
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| 5.9 |
That
the Conferrer will not directly or indirectly issue or authorize
the
payment to the Conferrer or any of its affiliates any payment or
bonus of
any nature from the Company.
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| 5.10 |
That
the Conferrer will not demand any indebtedness of the Company to
become
due prior to its current maturity
date.
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| 6. |
Due
diligence
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| 6.1 |
For
purposes of checking the feasibility of execution the option, the
Recipient shall arrange due diligence for the Company and for its
assets,
its rights and obligations (hereinafter: the “Recipient’s
check”
or the “due
diligence”),
which shall terminate by, and no later than, the end of the execution
period.
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| 6.2 |
The
Conferrer hereby undertakes by way of an undertaking, the breach
of which
would constitute a fundamental breach, to assist the Recipient
in the due
diligence, and to put at his disposal immediately upon his request,
records and documents of any kind whatsoever and/or any information
that
the Recipient shall request for purposes of completing the
checks.
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| 6.3 |
It
is agreed that inasmuch as this may be demanded by the Recipient,
the
parties shall act during the due diligence period for purposes of
formulating a detailed shares acquisition agreement, which shall
apply to
them should the option be executed by the Recipient. Nothing in the
aforesaid derogates from the validity of this agreement, should the
option
be realized without the agreement stipulated above having been
signed.
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| 7. |
Date
of completing the transaction
(closing)
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The
Parties shall coordinate when to meet at the offices of advocate Tik, Gilad,
& Co., in Tel Aviv in order to execute all of the actions below, as
integrated obligations, which shall be not later than 10 days from the date
of
submitting the Execution Notification:
| 7.1 |
The
Trustee shall hand over all of the documents to the Recipient which
have
been previously submitted to him according to the provisions of this
Agreement, which shall include letters of all directors' resignation,
duly
approved protocol of the Conferrer regarding transfer of shares and
of the
shareholders' loan to the Recipient, deeds for transfer of shares,
singed
notification to Company Registrar in Israel regarding the transfer
of
shares to the Recipient, all directors shall sing a waiver of any
complain
and/or demand from the Company in wording to be approved in advance
by
Recipient's attorney, and any other additional document which the
Recipient shall reasonably need for completion of all undertakings
of the
Conferrer under this Agreement;
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| 7.2 |
The
Conferrer shall ratify in a letter that the state of the shares and
of the
Company on the option realization date is as detailed and described
in
this agreement and in its
appendices;
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| 7.3 |
The
Recipient shall pay to the Conferrer the consideration for the shares
according to all provisions in article 1
above;
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| 7.4 |
The
parties’ obligations in this clause are integrated, and the non-fulfilling
of any of the obligations of one party, in addition to this being
a breach
of the agreement, shall absolve the other party from his undertakings
for
the performance of his obligations at that time, as
aforesaid.
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| 7.5 |
The
parties shall sign any document that their representatives shall
deem
necessary for purposes of completing the transaction, including any
document that may be required for purposes of transferring the shares
and
for purposes of receiving any certification that may be required,
and any
other activity shall be taken that may be required for purposes of
fulfilling the provisions of this agreement in
full.
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| 7.6 |
At
the demand of the Recipient, the parties shall prepare, through their
comptroller’s and/or accountants on their behalf and/or the Company’s
accountant, an accounting (hereinafter: the “accounting”),
in respect of discrepancies and amendments in the state of the Company
compared with the Conferrer’s presentations and the obligations as
stipulated in the Balance Sheet and this Agreement, and also they
shall so
make in the future, without any limitation as to time, any verification
that the Recipient may request owing to the revealing of an expense,
loss
and/or payment and/or claim of any kind (provided that it will be
according to a peremptory ruling) and/or a benefit to a third party
and/or
an obligation to a third party the grounds for which relate to the
period
of time prior to the realization of the option, and which did not
appear
or was not referred to in this agreement and in its appendices. The
Conferrer undertakes to appear and to allow the execution of the
accounting as stated above within 14 days of the Recipient’s demand in
writing. The provisions in this article shall not derogate from any
other
provision regarding the final balance sheet to be prepared in for
the
closing.
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| 8. |
Breach
and remedies
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| 8.1 |
Omitted.
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| 8.2 |
None
of the provisions in this document may be interpreted as derogating
from
the rights of the parties under the provisions of the Law of Contract
(Remedies Owing to a Breach of Contract) [5]731-1970, and from the
other
legal rights under any law for the receipt of any assistance or remedy,
in
addition to the agreed upon compensation, unless explicitly stipulated
otherwise in this document.
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| 9. |
General
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| 9.1 |
To
safeguard the rights of the Recipient under this agreement, the
Recipient
shall be permitted to register a first ranking charge on the shares.
The
Conferrer shall cooperate and enable the Recipient to create and
register
such charge within 21 days of the date of signing this
Agreement.
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The
Recipient undertakes to allow the immediate expunging and cancellation of the
charge at the end of the realization period should the Recipient not realize
the
option by the end of the realization period (which is not owing to a breach
of
this agreement by the Conferrer).
| 9.2 |
The
Recipient shall be permitted to transfer or delegate his rights under
the
option and according to this Agreement to a third party, either for
or
without consideration as the Recipient so chooses. The Recipient
shall
deliver to the Conferrer a notification in writing concerning the
endorsement and transfer of the rights under the option to a third
party,
legally signed by the Recipient and the third party, which shall
not
require any ratification from the Conferrer for said
transfer.
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| 9.3 |
Each
party shall bear all the taxes and obligatory payments that apply
to him
by any law in respect of the conferring or receipt of the option
under
this document.
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| 9.4 |
This
agreement will be subject only to the laws of the State of Israel
and any
dispute in connection therewith shall be litigated only by the competent
courts in Tel Aviv.
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| 9.5 |
No
change whatsoever to this agreement shall be valid unless said change
shall be made in writing and signed by the parties to the agreement
and a
notification in respect thereof sent to their representatives by
registered mail.
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| 9.6 |
Without
derogating from the contents of this agreement, regarding the delivery
of
the realization notification, the addresses of the parties to this
agreement are as stipulated at the top of this agreement, and any
notification that shall be sent by one party to this agreement to
the
other shall be considered as having been received within 72 hours
from the
date of its having been sent by registered mail, and if delivered
by hand,
then at the time of its delivery.
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And
a witness whereof the parties have come to sign:
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/s/
Xxxx Xxxxxxx,
CEO
DCI
USA Inc.
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/s/ World Group Shipping
Ltd.
World Group Shipping
Ltd.
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