Exhibit 2
Share Purchase Agreement,
dated October 8, 2002,
by and between Vattenfall AB and Song Networks Holding AB, relating to all
issued shares in Arrowhead AB.
SHARE PURCHASE AGREEMENT
BETWEEN
VATTENFALL AB (PUBL)
AND
SONG NETWORKS HOLDING AB (PUBL)
REGARDING
ALL ISSUED SHARES IN
ARROWHEAD AB
TABLE OF CONTENTS
Page
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1. DEFINITIONS and interpretation.........................................1
2. Purchase and Sale......................................................4
3. PURCHASE PRICE.........................................................4
4. CONDITIONS PRECEDENT to Closing........................................4
5. CLOSING................................................................5
6. REPRESENTATIONS AND WARRANTIES of the seller...........................5
7. REpresentations and warranties of the purchaser.......................13
8. COVENANTs of the seller...............................................14
9. INDEMNIFICATION.......................................................15
10. MISCELLANEOUS......................................................16
11. Termination........................................................18
12. GOVERNING LAW AND ARBITRATION......................................18
SHARE PURCHASE AGREEMENT
THIS SHARE PURCHASE AGREEMENT, dated as of 8 October 2002, is entered into by
and between
1. VATTENFALL AB (publ), a company organised under the laws of The Kingdom
of Sweden, with registration number 556036-2138 (the "Seller"); and
2. SONG NETWORKS HOLDING AB (publ), a company organised under the laws of
The Kingdom of Sweden, with registration number 556512-7031 (the
"Purchaser").
(together the "Parties and each a "Party")
WHEREAS
A. The Seller owns all of the issued shares in Arrowhead AB, a company duly
incorporated and organised under the laws of Sweden.
B. On the date hereof, the Parties have entered into the Restructuring and
Investment Agreement for purposes of, inter alia, restructuring the
Purchaser's group. As part of the restructuring contemplated under such
agreement, the Seller will sell and the Purchaser will purchase all of
the issued shares in the Company on the terms and conditions set out in
this Agreement.
NOW THEREFORE the Parties agree as follows:
1. DEFINITIONS AND INTERPRETATION
1.1 In this Agreement, the following terms and expressions shall have the
following meanings:
Agreement means this Share Purchase Agreement
including the Schedules by and between the
Seller and the Purchaser, as it may be
amended from time to time.
Claim means a claim for compensation made by the
Purchaser against the Seller due to a
breach of the Seller's representations and
warranties set forth in Section 6.
Closing means the completion of the sale and
purchase of the Shares pursuant to this
Agreement.
Company means Arrowhead AB, registration number
556528-4816.
Effective Date means 10 January 2003, unless
otherwise agreed between the
Parties. Encumbrance means any debenture, mortgage,
charge, lien, deposit by way of security,
xxxx of sale, lease, hire-purchase,
credit-sale or other agreement for payment
on deferred terms, option or right of
pre-emption or any other encumbrance.
Financial Statements means the audited financial
statements of the Company for the financial
years 2000 and 2001 and the management
accounts as at and for the relevant periods
ended on 31 March 2002, 30 June 2002 and 31
August 2002, as well as the notes to such
financial statements.
Governmental Entity means any court, tribunal or
administrative, governmental or regulatory
body, agency, commission, division,
department, public body or other authority,
whether supra-national, national or local.
Material Contracts means:
(i) all agreements (whether written or
oral) giving the Company access to
dark fibre or other transmission
capacity in the Network;
(ii) all agreements (whether written or
oral) with the ten largest customers
(by revenue) of the Company; and
(iii) all agreements (whether written or
oral) for operation and maintenance
of the Network;
including, without limitation, the
contracts listed in Schedule A.
Network means the opto-fibre network described in
Schedule B.
Purchase Price means the consideration for the
Shares as set out in Clause 3.1. Purchaser
means Song Networks Holding AB,
556512-7031.
Restructuring and means the Restructuring and Investment
Investment Agreement Agreement regarding the Song Networks
Holding AB group, entered into among the
Purchaser, Song Networks N.V., the
Participating Bondholders (as defined
therein), the Seller, Stena Adactum AB and
the Company on the date hereof. Seller
means Vattenfall AB, 556036-2138.
Shares means all of the 2,500 issued shares of the
Company, each with a nominal value of SEK
1,000.
Taxes means any income tax, corporation tax,
capital gains tax, transfer tax, value
added tax, sales tax, capital duty tax,
withholding tax, stamp duty, social
security fees and all other forms of taxes,
excise or fees and all penalties, charges
and interest relating to any of the
foregoing.
1.2 Interpretation
(a) When a reference is made in this Agreement to a Clause, Section
or Schedule, such reference shall be to a Clause or Section of,
or a Schedule to, this Agreement unless otherwise indicated.
(b) The table of contents and headings contained in this Agreement
are for reference purposes only and shall not affect in any way
the meaning or interpretation of this Agreement.
(c) Whenever the words "include," "includes" or "including" are used
in this Agreement, they shall be deemed to be followed by the
words "without limitation."
(d) The words "hereof," "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provision of this
Agreement.
(e) All terms defined in this Agreement shall have the defined
meanings when used in any certificate or other document made or
delivered pursuant hereto unless otherwise defined therein.
(f) The definitions contained in this Agreement are applicable to
the singular as well as the plural forms of such terms and to
the masculine as well as to the feminine and neuter genders of
such term.
(g) Any agreement, instrument or statute defined or referred to
herein or in any agreement or instrument that is referred to
herein means such agreement, instrument or statute as from time
to time amended, modified or supplemented, including (in the
case of agreements or instruments) by waiver or consent and (in
the case of statutes) by succession of comparable successor
statutes and references to all attachments thereto and
instruments incorporated therein.
2. PURCHASE AND SALE
At Closing and upon the terms and subject to the conditions set forth in
this Agreement, the Seller shall sell and the Purchaser shall purchase
the Shares free and clear from all Encumbrances and together with all
accrued rights and benefits pertaining thereto.
3. PURCHASE PRICE
3.1 The Purchase Price for the Shares shall be SEK 100,000,000
(one-hundred-million).
3.2 The Purchaser shall pay the Purchase Price to the Seller at Closing in
cash, such cash consideration to be paid by the Purchaser to the Seller
in immediately available funds pursuant to written wire transfer
instructions delivered by the Seller to the Purchaser prior to the
Effective Date.
3.3 No interest shall accrue on the Purchase Price during the period from
the date of this Agreement and the Effective Date.
4. CONDITIONS PRECEDENT TO CLOSING
4.1 The obligation of each of the Parties to complete the sale and purchase
of the Shares under this Agreement shall be conditional to the
fulfilment of the conditions precedent set forth in Article 9 of the
Restructuring and Investment Agreement, which hereby are incorporated by
reference.
4.2 The obligation of the Purchaser to complete the purchase of the Shares
under this Agreement shall be conditional to the Seller having fulfilled
all its material obligations under Article 2 and Section 5.1 (b) of the
Restructuring and Investment Agreement.
4.3 Each of the Parties shall, in its own discretion, be entitled to waive
any unfulfilled conditions set forth in Clause 4.1.
4.4 The Purchaser shall, in its own discretion, be entitled to waive any
unfulfilled conditions set forth in Clause 4.2.
4.5 Each Party will use all reasonable endeavours to fulfil or procure the
fulfilment of the conditions set out in Clauses 4.1, and the Purchaser
will use all reasonable endeavours to fulfil or procure the fulfilment
of the conditions set forth in Clause 4.2, and will notify the other
Party in writing immediately of the satisfaction of any such conditions.
5. CLOSING
5.1 Closing shall take place on the Effective Date at 9 a.m. (Stockholm
time) at the offices of Xxxxxxxx & Danielsson Advokatbyra AB in
Stockholm, Sweden, unless otherwise agreed.
5.2 At Closing:
(a) the Seller shall transfer the ownership of the Shares and shall
deliver into the Purchaser's possession the share certificates
representing the Shares duly endorsed in blank;
(b) the Purchaser shall pay the Purchase Price as set out in Clause 3.2;
(c) the Seller shall transfer its claim against the Company to the
Purchaser for a consideration of SEK 1 (one), as set forth in
Clause 8.5;
(d) the Seller shall procure that all mortgages, charges, pledges and
other Encumbrances over the assets of the Company are discharged
and shall deliver to the Purchaser evidence of such discharges;
(e) the Purchaser shall procure that an extraordinary general meeting
is held in the Company in order to elect new board members. The
Seller shall procure that each board member who has been elected
by a general meeting and who is not re-elected resigns without any
claim for compensation of whatever nature. The Purchaser shall
procure that each current board member is discharged from
liability as regards the period of his or her office until Closing
at the next annual general meeting of the Company, provided that
the auditors of the Company recommend that such discharge be
granted;
(f) the Seller shall deliver to the Purchaser all powers of attorney
issued by the Company;
(g) the Seller shall cause the Company, at the Purchaser's request, to
issue powers of attorney enabling the persons appointed by the
Purchaser to sign for and on behalf of the Company until new
signatories have been duly registered; and
(h) each Party shall do or procure to be done all reasonable acts
necessary to consummate the transactions contemplated by this
Clause 5.2.
6. REPRESENTATIONS AND WARRANTIES OF THE SELLER
The Seller represents and warrants that the following statements are
true and correct as of the date expressly stated in the relevant Clause
or, otherwise, as per the date hereof and at the Effective Date:
6.1 Corporate Organization. Each of the Seller and the Company is a
corporation duly incorporated and validly existing under the laws of
Sweden and is duly qualified to conduct business as it is now being
conducted or presently proposed to be conducted.
6.2 Power, Authority and Authorization. The execution, delivery and
performance of this Agreement by the Seller has been duly authorized by
all necessary corporate actions on the part of the Seller, and the
person executing this Agreement on behalf of the Seller is duly
authorized to do so.
6.3 No Conflicts. The execution, delivery and performance of this Agreement
by the Seller does not and shall not (i) violate any provision of any
law, rule or regulation applicable to it or any of its subsidiaries or
its organizational documents or those of any of its subsidiaries or (ii)
conflict with, result in a breach of or constitute (with due notice or
lapse of time or both) a default under any material contractual
obligations to which it or any of its subsidiaries is a party or under
its organisational documents.
6.4 Ownership of the Company. The Seller is as of the date hereof, and will
be as of the Effective Date, the legal owner of 100% of the Shares, and
such ownership interest and the share capital, consisting of 2,500
shares, each of a nominal value of SEK 1,000, has been validly issued
and is fully paid and non-assessable.
6.5 Capitalization. Except for the Shares, there are no authorized, issued,
reserved for issuance or outstanding:
(i) shares or voting securities of the Company;
(ii) securities of the Company convertible into or exchangeable for
shares or voting securities of the Company;
(iii) warrants, calls, options or other rights to acquire from or
subscribe to the Company, or any obligation of the Company to
issue, any shares or voting securities or securities convertible
into or exchangeable or exercisable for shares or voting
securities of the Company or any other securities in respect of,
in lieu of or in substitution for shares; and
(iv) there are no outstanding obligations of the Company to repurchase,
redeem or otherwise acquire or dispose of any such securities or
to issue, deliver, sell, pledge or otherwise encumber, or cause to
be issued, delivered, sold, pledged or otherwise encumbered, any
such securities.
All of the outstanding shares of the Company have been validly
issued and are fully paid, non-assessable and free of pre-emptive
rights and are owned by the Seller.
6.6 The copy of the articles of association of the Company set forth in
Schedule 6.6 is true, accurate and complete.
6.7 No Participation. Except for the shares held in Triangelbolaget D4 AB,
which will be transferred in accordance with Clause 8.4, the Company
does not own or hold any interest of any nature whatsoever in any shares
or other securities or participation of any entity. Nor has it, or has
agreed to become, a member of any joint venture, consortium, partnership
or any unincorporated association, and the Company is not, nor has
agreed to become, party to any agreement or arrangement for sharing of
commissions or other income.
6.8 Business and Operations. The Company does not conduct any other business
than to own and manage opto-fibre cables and to let indefeasible rights
of use regarding optic fibre cables within the field of data and
telecommunication. The Company does not have any branch, agency, place
of business or permanent establishment outside Sweden, with the
exception of repeater stations, network and other similar installations.
6.9 Books and records. All the accounts, books, minutes from shareholders'
meetings and board meetings, ledgers and financial records are in the
Company's possession, and have been in all material respects properly
and accurately kept and completed and all corporate filings have been
duly and timely made. Since 6 February 2002, no shareholders' resolution
of any kind has been passed in relation to the Company.
6.10 Financial Information. The Financial Statements and other financial
information provided by the Company to the Purchaser and the Purchaser's
advisers:
(a) comply in all material respects with applicable accounting
requirements and the published rules, regulations and guidelines
of all relevant authorities with respect thereto, have been
prepared in accordance with applicable accounting requirements
applied on a consistent basis, except as reflected in such
financial information;
(b) present a true and fair view of the financial position of the
Company as at the dates and the results of operations of the
Company for the periods stated therein; and.
(c) contain and reflect such reserves as were required by applicable
accounting principles to be reflected in such statements as of
said dates including but not limited to all liabilities - actual,
contingent or accrued - and for all reasonably anticipated losses
and costs.
6.11 Save as disclosed in the Financial Statements, the Company:
(a) has not issued any guarantee or indemnity in respect of the
obligation or solvency of any third party,
(b) is not otherwise responsible for the obligations of any person,
and
(c) is not committed to any indebtedness other than indebtedness
arising in the ordinary course of business, excluding the debt to
the Seller which shall be transferred to the Purchaser as set
forth in Clause 8.5.
6.12 At the Effective Date:
(a) and prior to Closing, all receivables and payables between, on the
one hand, the Company and, on the other hand, the Seller or any
other company within the Vattenfall AB group shall have been
settled, including without limitation the amounts outstanding to
Vattenfall Regionnat AB under the IRU agreement dated on or about
27 September 2002 but excluding the interest bearing debt referred
to in Clause 6.12 (b) (ii) below;
(b) thereafter, the sum of inventory, trade and other receivables and
cash and bank balances of the Company shall be more than or equal
to the liabilities of the Company (excluding (i) the long and
short term debts to Utfors relating to the lease agreement dated
31 May 2002 (the amount of which was originally SEK 55 million),
(ii) the interest bearing debt to the Seller (which will be
transferred to the Purchaser as set forth in Clause 8.5), and
(iii) share capital);
(c) the Company shall have no long term debts except the debts set
forth in this Clause 6.12 (b) (i) and (ii) above;
(d) the Company shall have no interest bearing debt except the
interest bearing debt to the Seller, which shall be transferred to
the Purchaser as set forth in Clause 8.5; and
(e) the shareholders' equity of the Company shall not be less than the
registered share capital of the Company.
6.13 Insolvency. The Company is solvent and is not subject to bankruptcy,
insolvency, or any form of bankruptcy, liquidation, reconstruction or
other insolvency proceeding. There are no potential actions or
circumstances which might result in the Company being subject to
bankruptcy, liquidation, reconstruction or insolvency or any other form
of bankruptcy, liquidation or other insolvency proceeding.
6.14 Absence of Significant Changes. Except as contemplated by this
Agreement, since 31 August 2002, the Company has conducted its business
in the ordinary course consistent with good business practice and there
has not been:
(a) any material adverse effect on the business, operating or
financial position or prospects of the Company;
(b) any material change in the method of accounting or accounting
practices of the Company, other than changes required by
applicable accounting rules and regulations;
(c) any direct or indirect redemption, purchase or other acquisition
of any shares by the Company or any declaration, setting aside or
payment of any dividend or other distribution (whether in cash,
stock or property) in respect of such shares, other than announced
cash dividends; or any issuance of shares:
(d) any merger or consolidation with any other person;
(e) any acquisition or disposal of a material amount of assets or
property; or
(f) any material investment or engagement in any similar or other
extraordinary business transaction.
6.15 Absence of Undisclosed Liabilities. There are no liabilities of the
Company of any kind whatsoever, whether or not accrued and whether or
not contingent or absolute, determined or determinable, that are
material to the Company, other than liabilities incurred in the ordinary
course of business consistent with good business practice.
6.16 Except as set forth in Schedule 6.16, there is, as at the date of this
Agreement (or the Effective Date as to transactions between, on the one
hand, the Company and, on the other hand, the Seller or any other
company in the Vattenfall AB group), no individual material long-term
payment obligation of the Company with a duration of more than one year
and with an annual cost to the Company of more than SEK 500,000.
6.17 Intra-group Arrangements. All agreements and arrangements between the
Seller, or any subsidiaries or affiliates of the Seller, on the one hand
and the Company on the other hand are on arm's-length and fair market
terms.
6.18 Litigation. Except for the dispute with the former employee Xxxxxx
Tejme, which has been settled by the Company paying Xxxxxx Tejme an
amount of SEK 1,000,000, there are, as at the date hereof, no claims,
actions, suits, proceedings or investigations pending or threatened
against the Company or any of its assets before any Governmental Entity
or arbitration tribunal which, individually or in the aggregate, have a
reasonable likelihood of resulting in a material adverse effect on the
condition (financial or otherwise, including for the avoidance of doubt
any tax consequences) of the business assets, results of operations or
prospects of the Company. The Company is not subject to any outstanding
order, writ, injunction or decree which would have, individually or in
the aggregate, a material adverse effect on the condition (financial or
otherwise, including for the avoidance of doubt any tax consequences) of
the business assets, results of operations or prospects of the Company.
6.19 Compliance. The Company is not in conflict with, or in default or
violation of, (i) any law, rule, regulation, order, judgment or decree
applicable to the Company or by which any property or asset of the
Company is bound or affected, or (ii) any note, bond, mortgage,
indenture, contract, agreement, lease, license, permit, franchise or
other instrument or obligation to which the Company is a party or by
which the Company or any property or asset of the Company is bound or
affected, except for any such conflicts, defaults or violations that
would not, individually or in the aggregate, prevent or materially delay
consummation of the transactions contemplated hereby, or otherwise
prevent the Company from performing its obligations under this Agreement
and do not, individually or in the aggregate, have a material adverse
effect on the condition (financial or otherwise, including for the
avoidance of doubt any tax consequences) of the business assets, results
of operations or prospects of the Company.
6.20 Licenses and Permits. The Company has obtained all necessary permissions
and licenses from all relevant Governmental Entities in order to carry
out all of the activities carried out by it and no circumstances have
occurred or currently exist which would or may give rise to any right on
the part of the relevant Governmental Entities to revoke, terminate or
materially alter the terms of all or any such permissions or licenses.
The Company has fully complied with all its obligations and liabilities
under or in relation to all of such permissions and licenses and is not
in breach or default of any of the provisions of any of them.
6.21 Title to Assets. All assets of the Company, including all debts due to
the Company, used or held for the purpose of the Company's business, are
the absolute property of the Company and all such assets and all assets
and debts which have subsequently been acquired or arisen are the
absolute property of the Company.
6.22 Title to Network. Without prejudice to the generality of Clause 6.21,
the Company:
(a) has full legal title to the cable, duct, sea-cable and equipment
described in Schedules 1 and 2 to the Amendment Agreement dated 4
July 2002 among Pangea Europe Ltd (in administrative
receivership), Pangea Networks Sweden AB (in bankruptcy), Pangea
Networks Norway AS (in bankruptcy), Pangea Networks Services ApS
(in bankruptcy), the Company and Figuration AB; and
(b) has, pursuant to the respective agreement, legal and valid rights
to use for dark fibre or transmission capacity in the Network
sufficient for its business as currently conducted, without any
increasing cost.
6.23 Possession of Assets. All such assets are, where capable of possession,
in the possession of or under the control of the Company and the Company
is entitled to take possession or control of such assets.
6.24 No Encumbrance of Assets. None of the material property, assets,
undertaking, goodwill or uncalled capital of the Company is subject to
any Encumbrance or any agreement or commitment to give or create any of
the foregoing, except for such Encumbrance or agreement or commitment
which would not have a material adverse effect on the condition
(financial or otherwise, including for the avoidance of doubt any tax
consequences) of the business assets, results of operations or prospects
of the Company.
6.25 Plant and Machinery, etc. The plant, machinery, vehicles and all other
equipment owned or used in connection with the Company's business are,
subject to normal wear and tear, in reasonable working order having
regard to their age and use.
6.26 Network Performance. The operational performance of the Network meets
such service levels that (i) the Company has agreed with its ten largest
customers (by revenue) or (ii) are generally applied in the industry in
which the Company operates.
6.27 Real Estate. As per the date of this Agreement the real estate set out
in Schedule 6.27 comprise all the real estate owned, leased, occupied or
otherwise used in connection with the business of the Company.
6.28 Environmental. There are no past or present conditions or circumstances
present at any real property owned or leased by the Company or arising
out of the Company's business, which have given or are reasonably
anticipated to give rise to: (a) violation of any environmental/health
law or environmental/health permit; (b) liabilities or obligations for
any notification, investigation, clean-up, remediation or other
corrective work under any such law or permit; (c) claims arising under
any such law or permit for personal injury, property damage or damage to
natural resources or the environment, or (d) fines, penalties or other
monetary assessments under any environmental or health law or permit.
6.29 Material Contracts. The Material Contracts are in full force and effect
and the Seller is, after having made due inquiries, not aware of any
default, or event which after notice or lapse of time or both would
constitute a default, by any party obligated thereunder and neither the
Seller nor the Company has received or given notice to terminate any
such contract. All Material Contracts have, when originally entered into
by other parties, been fully and legally transferred to the Company.
6.30 Except for the Material Contracts, there is no right, obligation or
agreement of the Company, the failure, termination or cancellation of
which individually would result in a material adverse effect on the
condition (financial or otherwise, including for the avoidance of doubt
any tax consequences) of the business assets, results of operations or
prospects of the Company.
6.31 The Company has not entered into any agreement on terms less favourable
to the Company than market terms.
6.32 Assets and Contracts Sufficient for the Business. The assets owned or
held by the Company together with the contracts to which the Company is
a party comprise all assets and contracts necessary for the continuation
of its business as presently conducted.
6.33 To the Seller's knowledge, no circumstance or event has occurred, or may
reasonably be expected to occur, which would result in any material
limitation or restriction in the operation of the Company's activities
as presently conducted.
6.34 Intellectual Property Rights. The intellectual property rights used by
the Company and all pending applications are (or where appropriate in
the case of pending applications, will upon registration be) legally
owned by, licensed to or used under the authority of the owner by the
Company. The intellectual property rights which are owned by the Company
(whether registered or not) and all pending applications therefore are
(or where appropriate in the case of pending applications, will upon
registration be) in force and are not being infringed or attacked or
opposed by any person. The Company does not use any intellectual
property rights which belong to a third party except pursuant to a
valid, written license or other agreement. The principal products and
services of the Company do not infringe any rights or interests of third
parties in intellectual property rights. No claims of infringement of
any such rights or interest have been made by any third party.
6.35 Insurance. The Company maintains insurance adequate and customary for
the conduct of the Company's business and is not in default under any
applicable insurance contracts.
6.36 Employment, Pension Agreements and Labour Matters. The employees of the
Company are employed on such terms that are generally applied in Sweden
and no extraordinary benefits have been granted, including, inter alia,
pension benefits. Any and all collective bargaining agreements to which
the Company is a party have been entered into on terms which are normal
and customary for companies carrying out activities similar to the
Company's business.
6.37 No employee or officer of the Company has a period of termination notice
which is in excess of twelve months (unless so provided for under law or
a collective bargaining agreement) or is entitled to any severance
payment.
6.38 As per the date of this Agreement and except as set out in Schedule
6.38, there is no former employee of the Company that has a right of
re-employment by the Company.
6.39 Taxes. All necessary Tax and other returns and reports required to be
filed prior to the Effective Date by the Company have been duly and
timely filed with the appropriate authorities and all such returns and
reports have been prepared in accordance with applicable laws and
regulations. During the five-year period preceding the Effective Date
there has been no tax audit, and there is no tax audit pending, with
respect to the Company.
6.40 The Company has made proper reservations for accrued but unpaid Taxes as
per the Effective Date.
6.41 All Taxes due prior to the Effective Date have been fully and timely
paid. No deficiency in Tax payment or any additional assessment of Tax
in respect of the period up to and including the Effective Date will be
claimed or made by any authority for any year or part thereof in respect
of the Company.
6.42 Change of Control. Except for the agreement with RSL COM Sweden AB dated
1 February 2002 for which the Seller will use its best efforts to seek a
waiver, the Company is not a party to any agreement or arrangement under
the terms of which any other party will by reason of any change of
control of the Company (either through a change in the ownership of the
shares in the Company, a change in management of the Company or
otherwise), be entitled to terminate or amend the agreement or
arrangement or exercise any right thereunder, nor will any such change
of control of the Company automatically result in any termination,
amendment or payment or any other right or entitlement. The execution of
the transactions contemplated under this Agreement does not (i) result
in the creation of any mortgage, lien, pledge, security interest, option
or other Encumbrance of any kind upon any of the assets of the Company,
or (ii) require any registration of filing with or consent, approval,
permit, authorization or action by any Governmental Entity.
6.43 Finders and Advisors. No financial advisor, broker, agent or finder has
been retained by the Company in connection with this Agreement or any
transaction contemplated hereby, and no such financial advisor, broker,
agent or finder is entitled to any fee or other compensation on account
of this Agreement or any transaction contemplated hereby. Neither the
Seller, nor the Company has promised any bonus or other remuneration to
any of the employees of the Company in relation to the successful
completion of the transactions contemplated by this Agreement.
6.44 Full Disclosure. There are no material facts or circumstances concerning
the Company not disclosed to the Purchaser that might reasonably have
been expected to affect a reasonable general buyer's decision to enter
into this Agreement on the terms set forth herein.
7. REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
7.1 Corporate Organization. The Purchaser is a corporation duly incorporated
and validly existing under the laws of Sweden and is duly qualified to
conduct business as it is now being conducted or presently proposed to
be conducted.
7.2 Power, Authority and Authorization. The execution, delivery and
performance of this Agreement by the Purchaser has been duly authorized
by all necessary corporate actions on the part of the Purchaser, and the
person executing this Agreement on behalf of the Purchaser is duly
authorised to do so.
7.3 No Conflicts. Except as set forth in the Song Disclosure Schedule (as
defined in the Restructuring and Investment Agreement), the execution,
delivery and performance of this Agreement by the Purchaser does not and
shall not (i) violate any provision of any law, rule or regulation
applicable to it or its organizational documents or (ii) conflict with,
result in a breach of or constitute (with due notice or lapse of time or
both) a default under any material contractual obligations to which it
is a party or under its organisational documents.
8. COVENANTS OF THE SELLER
8.1 For a period of two (2) years from the Effective Date, the Seller
undertakes not to launch or acquire any fully owned subsidiary in
Sweden, the primary business of which would compete directly with the
business of the Company as carried out at the date hereof and at the
Effective Date.
8.2 From the date of this Agreement until the Effective Date, except as
expressly contemplated in this Agreement or as required by law, the
Seller shall cause the Company to conduct its business in the ordinary
course and take such measures and actions as are required to fulfil the
implementation of the Business Plan (as defined in the Restructuring and
Investment Agreement), and shall use all reasonable efforts to preserve
intact its material business organisations and relationships with third
parties (including but not limited to their respective relationships
with customers, suppliers, key employees and business partners).
8.3 The Seller shall from the date of this Agreement until the Effective
Date not cause the Company to take any action that would knowingly cause
any of the representations and warranties set forth in this Agreement to
be untrue or incorrect in any material respect.
8.4 The 525 issued shares in Triangelbolaget D4 AB, 556007-9799, each with a
nominal value of SEK 50, which are currently owned by the Company will
be transferred to the Seller prior to the Effective Date. Such share
transfer will be made on such terms and conditions so that no risk
relating to (i) the business of Triangelbolaget D4 AB, whether past,
present or future, or (ii) the Company's shareholding in Triangelbolaget
D4 AB (including under any shareholders' agreement) will remain with the
Company. The Seller agrees to fully indemnify and hold harmless the
Purchaser and the Company against and in respect of any and all damages,
claims, losses, liabilities, costs and expenses incurred or suffered by
the Purchaser or the Company relating to the Company's holding of shares
in Triangelbolaget D4 AB.
8.5 The Parties agree that at Closing, there will be a substantial debt of
the Company owed to the Seller (including without limitation amounts
originally owed to another Vattenfall AB group company, which claims, to
the extent outstanding, the Seller undertakes to cause to be transferred
to it prior to Closing). The Parties agree that such claim of the Seller
will be transferred to the Purchaser at Closing in consideration of the
payment by the Purchaser of SEK 1 (one), provided however that the
Seller, in its own choice, may as a shareholder contribute
unconditionally to the Company the whole or part of the claim. The
Seller agrees to fully indemnify and hold harmless the Purchaser and the
Company against and in respect of any and all damages, claims, losses,
liabilities, costs and expenses incurred or suffered by the Purchaser or
the Company due to the transactions contemplated in this Clause 8.5.
9. INDEMNIFICATION
9.1 The Seller shall indemnify and hold harmless the Purchaser or, at the
Purchaser's option, the Company, and their respective successors and
assigns against and in respect of any and all damages, claims, losses,
liabilities, costs and expenses incurred or suffered by the Purchaser or
the Company due to any breach of a representation or warranty contained
in Section 6, provided however, that the Seller's liability shall not
exceed its liability had reduction of the purchase price (Sw:
nedsattning av kopeskillingen) been the sole and exclusive remedy for a
breach of such representations and warranties. Except as follows from
this Clause 9.1, no other remedies under the Swedish Sale of Goods Act
(Sw: koplagen (1990:931)) shall be available for a breach of the
representations and warranties contained in Section 6.
9.2 No limitations shall apply to the Seller's obligations under this
Section 9 (Indemnification) in case the Seller knowingly or grossly
negligently (i) makes a misrepresentation or (ii) breaches a warranty
under this Agreement.
9.3 Notwithstanding anything to the contrary in this Agreement, the Seller's
liability for Claims shall be subject to each of the following
limitations:
(a) The Purchaser shall not be entitled to make any
Claims hereunder and the Seller shall not be liable
for such Claims to the extent the Purchaser, any
subsidiary of the Purchaser or its advisers had
actual knowledge of such breach prior to the
execution of this Agreement.
(b) No Claim may be made by the Purchaser and no
liability shall arise in respect of any damage or
loss if and to the extent such damage or loss:
(i) occurs as a result of any legislation,
regulations or tax rates not in force at the
Effective Date, or which take effect
retroactively, or occurs as a result of any
change in the generally established practice
of relevant authorities or governmental bodies;
(ii) is recoverable under a policy of insurance in
force on the Effective Date or which would
have been recoverable had the insurance
protection level which existed on the
Effective Date been continued; or
(iii) is the subject of a specific accrual,
allowance, provision or reserve in the
Financial Statements, provided that such
accrual, allowance, provision or reserve has
not been, or should not have been, dissolved
on the date hereof.
9.4 Subject to Clause 9.5, the Purchaser shall give prompt written notice to
the Seller of any Claim hereunder describing in reasonable detail the
nature of the Claim and, if possible, a good faith estimate of the
amount claimed; provided, however, that the failure of the Purchaser to
give notice as provided in this Clause 9.4 shall not relieve the Seller
of its obligations under this Section 9, except to the extent that the
Seller shall have suffered damages as a result of such failure, in which
case the indemnification obligations of the Seller hereunder shall be
reduced by the amount of such damages.
9.5 A Claim shall not be valid unless notice in writing of such Claim has
been given to the Seller within:
(a) with respect to Claims that are not based on a breach of a
representation or warranty contained in Clauses 6.39-41 (Taxes)
and 6.28 (Environmental), thirteen (13) months after the Effective
Date;
(b) with respect to Claims which are based on a breach of a
representation or warranty contained in Clauses 6.39-41 (Taxes)
and 6.28 (Environmental), six months (i) after the expiry of the
period provided by the statute of limitations applicable to such
tax or environmental liability or (ii) after a final decision by
the competent authority or court, whichever is the later.
9.6 The Purchaser shall not be entitled to a reduction of the Purchase Price
under this Agreement unless and until the aggregate amount of all Claims
exceeds SEK 5,000,000 (five million), in which case recovery can be made
for the full amount, subject to all other limitations provided for in
this Agreement.
9.7 If any Claim consists of a tax-deductible cost, then the amount of the
Claim shall be reduced with the actual tax savings available to the
Purchaser or the Company.
9.8 The Seller's total and aggregate liability under this Agreement shall in
no event exceed a maximum amount corresponding to SEK 100,000,000. This
limitation of liability shall not apply to the Seller's liability under
Clause 8.5.
9.9 The Seller shall (in its choice) be given the opportunity, at its own
cost, to handle or take part in the handling of any claim from a third
party that may result in the Seller being liable pursuant to this
Section 9. The Seller shall handle such claim in consultation with the
Purchaser. The Seller shall be given access to all information, whether
written or oral, which is required in order to counter such claim,
except where such information constitute trade secrets or other
confidential information.
10. MISCELLANEOUS
10.1 This Agreement sets forth the entire understanding of the Parties with
respect to the transaction contemplated hereby. It shall not be amended
or modified except by a written instrument duly executed by each of the
Parties. Any and all previous agreements and understandings between the
Parties regarding the subject matter hereof, whether written or oral,
are superseded by this Agreement.
10.2 The failure of any Party to insist upon strict adherence to any term of
this Agreement on any occasion shall not be considered a waiver of any
right hereunder, nor shall it deprive that party of the right thereafter
to insist upon the strict adherence to that term or any other terms of
this Agreement.
10.3 This Agreement shall be binding upon and inure to the benefit of the
Parties hereto and may not be assigned by either Party, without the
prior written consent of the other Party.
10.4 The Seller and the Purchaser will each bear its own fees and expenses,
including but not limited to legal fees and expenses, incurred in
connection with the negotiations, preparation and execution of this
Agreement and the transactions contemplated hereby.
10.5 All notices, requests, demands, approvals, waivers and other
communications required or permitted under this Agreement must be in
writing in the English language and shall be deemed to have been
received by a party when:
(a) sent by facsimile, on the day of dispatch thereof, provided that the
transmission is confirmed in writing by the sender's telecopy;
(b) delivered by hand, on the day of delivery.
All such notices and communications shall be addressed as set
out below or to such other addresses as may be given by written
notice in accordance with this Clause 10.5.
If to the Purchaser: Song Networks Holding AB
Attention: Xxxxx Xxxxxxx and Xxxx Xxx
Xxxxxxxxxx 00, X.X. Xxx 000
XX-000 00 Xxxxxxxx
Xxxxxx
Fax number: x00 0 0000 00 00
With a copy to: Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
Attention: Xxxxxx Xxxxx
One Canada Square
Xxxxxx Xxxxx
Xxxxxx X00 0XX
Xxxxxxx
Fax number: x00 00 0000 0000
If to the Seller: Vattenfall AB
Attention: Mats Xxxxxxxxx
Xxxxxx Xxxxxxxxxx 00
XX-000 00 Xxxxxxxxx
Xxxxxx
Fax number: x00 0 000 00 00
With a copy to: Advokatfirman Glimstedt
Attention: Jan Litborn
Xxxxxxxxxxxxxx 0
X.X. Xxx 00000
XX-000 00 Xxxxxxxxx
Xxxxxx
Fax number: x00 0 000 000 00
10.6 The Parties shall not issue any press release or make any public
announcement to the news media or financial markets regarding the
negotiation and execution of this Agreement, unless the terms of such
press release or public announcement have the prior approval of the
other Party, which approval shall not be unreasonably withheld,
conditioned or delayed; provided, however, that such approval shall not
be required if such press release or public announcement is required by
applicable law or stock exchange rule, in which case, if reasonably
practicable, prior to making such press release or public announcement,
such Party shall consult with and consider in good faith the views of
the other Party in connection therewith.
11. TERMINATION
Either Party has the right to terminate this Agreement with immediate
effect upon notice to the other Party in the event that the Restructuring
and Investment Agreement is terminated or void for any reason.
12. GOVERNING LAW AND ARBITRATION
12.1 This Agreement shall be governed by and construed in accordance with the
laws of Sweden without regard for any principles of conflicts of laws
thereof.
12.2 Any dispute, controversy or claim arising out of or in connection with
the Agreement, or the breach, termination or invalidity thereof, shall
be settled by arbitration in accordance with the Swedish Act on
Arbitration (Sw: lagen om skiljeforfarande).
12.3 The arbitral tribunal shall be composed of three arbitrators. The place
of arbitration shall be Stockholm. The language to be used in the
proceedings shall be English.
12.4 All meetings and hearings shall be in private unless the Parties agree
otherwise. The Parties may not disclose or communicate to any person
information concerning the arbitration or the award or information
disclosed during the proceedings, other than as required to enforce its
rights under the award or prescribed by relevant stock exchange
regulation. This information is to be treated as strictly confidential
by the parties.
12.5 The decisions or awards of the arbitral tribunal shall be final and
binding upon the Parties affected thereby and each of the Parties hereby
irrevocably and expressly covenants to comply promptly and in good faith
with any and all such decisions or awards.
____________
IN WITNESS HEREOF, the Parties have caused this Agreement to be duly executed
as of the day and year first above written.
This Agreement has been executed in two (2) identical counterparts, of which
the Parties hereto have received one each.
VATTENFALL AB
/s/ Xxxxxxx Xxxxxxx
------------------------
Name: Xxxxxxx Xxxxxxx
Title: Vice President
SONG NETWORKS HOLDING AB
/s/ Xxxx Xxxxxxxx /s/ Xxxxxxxx Xxxxxx
------------------------- ------------------------
Name: Xxxx Xxxxxxxx Name: Xxxxxxxx Xxxxxx
Title: Chairman of the Board Title Board Member
