1
Exhibit 10.1
AMENDED AND RESTATED
SHAREHOLDERS AGREEMENT
DATED JULY _, 1997
BETWEEN
(1) HIT RAIL B.V.
(2) GTS-HERMES, INC
(3) NATIONALE MAATSCHAPPIJ DER BELGISCHE SPOORWEGEN
(NMBS/SNCB)
(4) XX XXXX CARRIER
AND
(5) HERMES EUROPE RAILTEL B.V.
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TABLE OF CONTENTS
Page
Article 1 - Definitions 5
Article 2 - Issue of shares. Amendment Articles 6
Article 3 - The Business 8
Article 4 - Representations and Warranties 8
Article 5 - Covenants 12
Article 6 - Governance 15
Article 7 - Conduct of Business 21
Article 8 - Issue and Transfer of Shares; Pre-emptive Rights 23
Article 9 - Provide Fibre Capacity 25
Article 10 - Term and Termination of Agreement 25
Article 11 - Confidential Information 25
Article 12 - Miscellaneous 26
Article 13 - Applicable Law and Choice of Forum 29
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This AGREEMENT is made by and between:
1. HIT RAIL B.V., a private limited liability company, registered in
Almere and having its place of business at Xxxxx 0000, 0000 XX
Xxxxxxxx. Xxx Xxxxxxxxxxx (hereinafter "HIT Rail");
2. GTS-HERMES, INC, a Delaware corporation having its place of business
at 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, XXX, hereinafter
"GTS Hermes"; and
3. NATIONALE MAATSCHAPPIJ DER BELGISCHE SPOORWEGEN (NMBS/SNCB), a
company incorporated according to the laws of Belgium and having its
registered office at Xxxxxxxxxxxxxxx 00, 0000 Xxxxxxxx, Xxxxxxx;
4. XX XXXX CARRIER, a 100% owned subsidiary of Swedish State Railways,
a company incorporated according to the laws or Sweden, having its
office address at 01 Stockholm Lan, 80 Xxxxxxxxx Xxxxxx, 00 000
Xxxxxxxxx, Xxxxxx;
and
5. HERMES EUROPE RAILTEL B.V. a private limited liability company,
registered and having its place of business at Xxxxxxxxxxxx 00, 0000
XX Xxxxxxxxx, hereinafter the "Company";
hereinafter collectively referred to as "the Parties" and individually as a
"Party".
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WHEREAS:
a. in 1990, HIT Rail was incorporated by the National Railways as
hereinafter defined to carry out telecommunications engineering
activities in order to construct and exploit a data communications
network for railway traffic;
b. HIT Rail established the Company on July 6, 1993 to conduct the
Business as defined in Article 3 of this Agreement;
c. GTS Hermes acquired a fifty percent interest in the Company in 1994
and HIT Rail and GTS Hermes presently own the entire issued share
capital of the Company;
d. the Company has in January 1997 launched a capital restructuring
plan allowing for direct participation of the National Railways and
of selected other participants in the Company's capital and for the
issue of additional shares to the existing shareholders of the
Company;
e. it is the intention of HIT Rail to transfer its shares in the
Company to the HIT Rail Shareholders in proportion to their current
indirect shareholding in the Company and as a result the HIT Rail
Shareholders will become direct shareholders in the Company;
f. with the participation of new parties in the Company's capital there
will be new Shareholders in the Company. Pursuant thereto the
Shareholders wish to amend their existing Shareholders Agreement;
g. the parties wish to enter into this Agreement for the purposes of
recording the terms and conditions of their relationship with each
other and certain aspects of the business and management of the
Company.
NOW IT IS HEREBY AGREED AS FOLLOWS:
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ARTICLE 1 - DEFINITIONS
The following definitions shall apply in this Agreement and in the Appendices
hereto:
Affiliated Company: in relation to any Shareholder, any subsidiary or
holding company of such Shareholder and any
subsidiary of such holding company including all
National Railways Shareholders of HIT Rail;
Agreement: this Agreement and all annexes, appendices,
attachments, and schedules hereto:
Articles of Association: the amended articles of association of the Company
in the form agreed upon by the Parties and set out
in Annex 1 hereto;
Board of Supervisory
Directors: the board of non-executive directors ("Raad van
Commissarissen") of the Company;
Business Plan: the Business Plan of the Company as adopted by the
Management Board with the prior approval of the
Board of Supervisory Directors, including any
agreed amendments thereto;
Management Board: the Board of Managing Directors ("Directie") of
the Company;
General Assembly: a General Meeting of Shareholders;
HIT Rail Shareholders: the parties as Listed in Schedule 1;
Licenses: permits and authorizations granted by the
competent licensing authorities in the countries
where the Company carries out its Business;
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National Railways: Osterreichische Bundesbahnen, Nationale
Maatschappij der Belgische Spoorwegen (NMBS/SNCB),
Danske Statsbaner, Societe Nationale des Chemins
de Fer Francais ("SNCF"), Deutsche Bundesbahn,
Ente Ferrovie dello Stato, Nederlandse Spoorwegen,
Red Nacional de los Ferrocarriles Espanoles.
Statens Jarnvagar, Schweizerische Bundesbahnen,
and British Rail, provided that other European
national railway companies may in the future
become shareholders of HIT Rail and for this
reason National Railways;
PanEuropean
Telecommunications
Operator: an operator of telecom infrastructure facilities
within Europe, whose scope is limited to providing
cross border services, contracting as a carrier's
carrier with (licensed or otherwise authorized)
telecom-operators and/or service providers. The
providing of telecom services within a country
will not belong to the activities of the Company,
except where requested by a customer and agreed to
by the Participating Shareholder;
Participating Shareholder: a Shareholder who provides infrastructure to the
Company;
Shareholders: the holders of the Shares and parties to this
Agreement;
Shares: any and all issued shares in the capital of the
Company;
ARTICLE 2 - ISSUE OF SHARES, AMENDMENT ARTICLES.
2.1 On 15 January 1997, the Board of Supervisory
Directors has resolved, conditional upon the
execution of an amendment of the articles of
association of the Company in accordance with
the draft of Loeff Xxxxxx Xxxxxxx, (the
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"Deed of Amendment" dated May 28, 1997) inter alia to issue new shares
in the Company up to a maximum of 297,000 shares with a nominal value
of NLG 1,000.--. The Shareholders have decided to issue the new shares
to the following Parties:
(a) to HIT Rail 24,007 shares, each share having a par value of
NLG 1,000.-- which shares shall be paid up by off-set by the
Company of its loan debt in the principal amount of NLG
24,007,000.-- owing to HIT Rail;
(b) to GTS Hermes 150,592 shares, each share having a par
value of NLG 1,000.-- which shares shall be paid up to 33%
by off-set by the Company of its loan debt in the principal
amount of NLG 50,197,000.-- owing to GTS Hermes;
(c) to NMBS/SNCB 11,424 shares each share having a par value
of NLG 1,000.- which shares shall be paid up both by off-set
by the Company of its loan debt in the principal amount of
the Dutch guilder equivalent of 3,420,000 ECU and by
contribution of a lease of dark fibre;
(d) to XX Xxxx Carrier 4,365 shares each share having a par
value of NLG 1,000.-- which shares shall be paid up by
off-set by the Company of its loan debt in the principal
amount of NLG 4,365,000.--
2.2 It is understood by the parties that capital contribution tax will be
levied on the issue of the shares referred to in 2.1 above, which tax
shall be paid by the Company;
2.3 Upon the execution of the Deed of Amendment and the issue of the new
shares to all the Parties (other than the Company), the Shares in the
Company shall be held as follows:
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HIT Rail 24,047 shares (12.63%)
GTS Hermes 150,632 shares (79.08%)
NMBS/SNCB 11,424 shares (6.00%)
XX Xxxx Carrier 4,365 shares (2.29%)
ARTICLE 3 - THE BUSINESS
The activities of the Company (hereinafter collectively the "Business") shall be
to engage in:
(i) becoming a PanEuropean Telecommunications Operator offering
telecommunications services and/or facilities to third parties,
including the Shareholders and their Affiliated Companies, including
but not limited to constructing international telecommunications
network infrastructures (hereinafter referred to as "Hermes
Longlines") for the provision of those services, and offering
international leased lines to third parties;
and
(ii) seeking to influence the legal and regulatory climates in the European
Community, its Member States and adjoining countries and each of the
jurisdictions where the Company engages or intends to engage in the
activities described above.
ARTICLE 4 - REPRESENTATIONS AND WARRANTIES
4.1 HIT Rail represents and warrants to the other Parties that:
(a) it is the type of entity indicated in the heading of this
Agreement, duly formed and validly existing under the laws
of the jurisdiction indicated in the heading of this
Agreement, that it has complied with all its material legal
and statutory obligations and that it has the power under
its constitutive documents to execute and deliver this
Agreement and to perform its obligations thereunder:
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(b) the execution of this Agreement by its undersigned
representative and the delivery and performance by it of
this Agreement:
(1) have been duly authorized by all necessary action
and do not violate any applicable law, statute,
rule, regulation, order, ordinance, or requirement
of any governmental entity with applicable
jurisdiction;
(2) do not and shall not result in the breach of, or
constitute a default under, or require any consent
under (except for those that have already been
obtained) its constitutive documents or any
indenture, bank loan or credit agreement,
mortgage, or other agreement or instrument to
which it is a party or by which it or any of its
properties may be bound or affected; and
(3) shall constitute its valid, binding and
enforceable obligations in accordance with the
terms of this Agreement;
(c) HIT Rail's only owners as of the date of this Agreement are
the HIT Rail Shareholders and the national railways of
Slovenia, Slovakia and Luxemburg;
(d) no representation, warranty, or covenant by HIT Rail in this
Agreement is inconsistent with, or would cause HIT Rail to
breach, any other promise or contractual obligation by HIT
Rail; and
(e) HIT Rail has not agreed with any entity other than GTS
Hermes and the Company to assist or cooperate in the
development of the Business or any PanEuropean
Telecommunication Operator.
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4.2 GTS Hermes represents and warrants to the other Parties that:
(a) it is the type of entity indicated in the heading of this
Agreement, duly formed and validly existing under the laws
of the jurisdiction indicated in the heading of this
Agreement, that it has complied with all its material
legal and statutory obligations and that it has the power
under its constitutive documents to execute and deliver
this Agreement and to perform its obligations thereunder.
(b) the execution of this Agreement by its undersigned
representative and the delivery and performance by it of
this Agreement:
(1) have been duly authorized by all necessary action and do
not violate any applicable law, statute, rule,
regulation, order, ordinance, or requirement of any
governmental entity with applicable jurisdiction;
(2) do not and shall not result in the breach of, or
constitute a default under, or require any consent under
(except for those that have already been obtained) its
constitutive documents or any indenture, bank loan or
credit agreement, mortgage, or other agreement or
instrument to which it is a party or by which it or any
of its properties may be bound or affected; and
(3) shall constitute its valid, binding and enforceable
obligations in accordance with the terms of this
Agreement.
4.3 NMBS/SNCB represents and warrants to the other Parties that:
(a) it is the type of entity indicated in the heading of this
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Agreement, duly formed and validly existing under the laws
of the jurisdiction indicated in the heading of this
Agreement, that it has complied with all its material legal
and statutory obligations and that it has the power under
its constitutive documents to execute and deliver this
Agreement and to perform its obligations thereunder;
(b) the execution of this Agreement by its undersigned
representative and the delivery and performance by it of
this Agreement:
(1) have been duly authorized by all necessary action
and do not violate any applicable law, statute,
rule, regulation, order, ordinance, or requirement
of any governmental entity with applicable
jurisdiction;
(2) do not and shall not result in the breach of, or
constitute a default under, or require any consent
under (except for those that have already been
obtained) its constitutive documents or any
indenture, bank loan or credit agreement,
mortgage, or other agreement or instrument to
which it is a party or by which it or any of its
properties may be bound or affected; and
(3) shall constitute its valid, binding and
enforceable obligations in accordance with the
terms of this Agreement.
4.4 XX Xxxx Carrier represents and warrants to the other Parties
that:
(a) it is the type of entity indicated in the heading
of this Agreement, duly formed and validly
existing under the laws of the jurisdiction
indicated in the heading of this
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Agreement, that is has complied with all its
material legal and statutory obligations and that
it has the power under its constitutive documents
to execute and deliver this Agreement and to
perform its obligations thereunder;
(b) the execution of this Agreement by its undersigned
representative and the delivery and performance by
it of this Agreement:
(1) have been duly authorized by all
necessary action and do not violate any
applicable law, statute, rule,
regulation, order, ordinance, or
requirement of any governmental entity
with applicable jurisdiction;
(2) do not and shall not result in the
breach of, or constitute a default
under, or require any consent under
(except for those that have already been
obtained) its constitutive documents or
any indenture, bank loan or credit
agreement, mortgage, or other agreement
or instrument to which it is a party or
by which it or any of its properties may
be bound or affected; and
(3) shall constitute its valid, binding and
enforceable obligations in accordance
with the terms of this Agreement.
ARTICLE 5 - COVENANTS
5.1 HIT Rail
HIT Rail covenants and agrees with GTS Hermes and the Company that it
shall
(i) use its best efforts to establish such commercial agreements
between individual HIT Rail Shareholders and the Company, to
obtain rights of way
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from individual HIT Rail Shareholders and to cooperate in
obtaining such Licenses as may advance the Business and (ii)
shall use their best efforts to ensure that the HIT Rail
Shareholders cooperate in obtaining such Licenses all in
accordance with the Business Plan of the Company and as may
be necessary or advisable in furtherance or the Company's
Business, (iii) shall not, so long as both HIT Rail and GTS
Hermes are Shareholders and for one year after HIT Rail
ceases to be a Shareholder, agree with any entity other than
GTS Hermes and the Company to assist or cooperate in the
development of any PanEuropean Telecommunications Operator
and (iv) shall use their best efforts to obtain on the
Company's behalf such materials as may be required and
arrange inspection visits of selected rights of way for the
purpose of making initial cost estimates.
5.2 Further Funding
The Parties understand that further funding of the Company
may become necessary through loans or additional
capitalization and the Parties shall do all things
reasonably necessary including the waiving of pre-emptive
rights in accordance with Article 6.2 (c) to facilitate such
further funding. The Shareholders each shall procure that
its nominees on the Board of Supervisory Directors of the
Company, if any, shall not unreasonably oppose additional
capitalization and each accepts the principle of being
diluted in its share holding to the extent that it does not
participate in the subscription for new shares in accordance
with the pre-emption provisions set out in the Articles of
Association. It is the sole discretion of each Shareholder,
whether to participate in such issue(s) of shares. The
period in which pre-emption rights can be exercised will be
four weeks. The Shareholders will inform each other within
four weeks of having been notified of an issue of shares
with a pre-emptive right whether or not they will make use
of such right, and if so, to what extent.
5.3 Non compete
So long as GTS Hermes is a Party to the Agreement GTS Hermes
shall not agree with any other entity than HIT Rail and the
Company to assist or
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cooperate in the development of any PanEuropean
Telecommunications Operator.
5.4 Waiver statutory forced sale rights
GTS Hermes hereby unconditionally and irrevocably waives its
rights to purchase the Shares held by the other Shareholders
in the Company pursuant to article 201 (a) of Book 2 of the
Netherlands Civil Code;
5.5 Employee share options
The Parties acknowledge that it may be desirable from an
incentive point of view to issue share options to the
management and or employees of the Company and, without
prejudice to the provision of Article 8.2 of this Agreement,
the Parties agree to vote in favour of options to issue
shares pursuant to any reasonable and "arms length" share
option agreement containing customary terms and conditions.
5.6 Dividends
It is the intention of the Parties to maximize distributions
of the Company to its Shareholders, taking into
consideration the contractual obligations in relation to
further funding by issuance of shares or notes, as well as
to the extent allowed by law and the Articles of
Association, and subject to the retention in the Company of
sufficient funds to ensure the continued operation and
development of the Company in accordance with its Business
Plan. The Parties will procure that their representatives in
the Board of Supervisory Directors will, pursuant to article
20 paragraph 2 of the Articles of Association, vote to pay
out profits to the Shareholders, taking into account the
aforementioned principle.
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5.7 Articles or Association
The Parties other than the Company shall procure that the
amendment of the currently applicable articles of
association shall be effected as soon as possible following
the date of signing of this Agreement and pending such
amendment the Parties other than the Company agree to be
bound by the Articles of Association (and GTS shall procure
that the same be observed by the Company to the extent
possible) as if they were in force from the date of the
signing of this Agreement onwards.
ARTICLE 6 - GOVERNANCE
6.1 Structure
The Shareholders shall hold General Assemblies, and the
Company shall have a Board of Supervisory Directors and a
Management Board.
6.2 General Assemblies
(a) The Shareholders shall hold an annual General Assembly at
the offices of the Company's headquarters or at such other
place as the Shareholders may agree, and may hold
extraordinary General Assemblies at the request of
Shareholders holding at least 10 percent of the issued share
capital of the Company. The Management Board shall ensure
that notice of any General Assembly and an agenda are
distributed to and received by the Shareholders no less than
fifteen (15) days prior to the date of the General Assembly.
Subject to the provisions of the Articles of Association and
applicable law, the quorum for any General Assembly shall be
four fifths (4/5) of the Shares. If the quorum is not met,
then a second meeting will be called on a date which is at
least 5 business days and not more than 4 weeks after the
date of the first meeting. In such second meeting
resolutions on the subjects put before the first meeting can
be adopted by a majority of votes cast irrespective of the
number of shareholders represented such second meeting.
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(b) The Shareholders shall each vote in favour of the
appointment of all Supervisory Directors duly nominated in
accordance with the Articles of Association and Articles
6.3(d) and 6.5 of this Agreement.
(c) All decisions of the General Assembly shall be adopted by a
simple majority of the votes cast, with the exception of the
following decisions which shall require at least eighty-five
(85)% of the votes cast:
(i) the purchase by the Company of Shares in its own
capital and any redemption of Shares;
(ii) the exclusion of pre-emptive rights in the case
of an issue of new shares and the transfer of
Shares held by the Company, except in the event of
a public listing of the Shares or of new shares or
of an offering of Shares or options on new shares
(warrants) to professional investors in order to
obtain further funding;
(iii) a winding up or dissolution of the Company;
(iv) any amendment of the Articles of Association of
the Company other than those pertaining to
increases in the authorized capital of the Company
or to convert the Company into an N.V. ("Naamloze
Vennootschap") to enable a public listing of
Shares or new shares;
(v) any amendment of the scope of business of the
Company;
(vi) the declaration of dividends; and
(vii) the admission of new shareholders to this
Agreement.
6.3 Board of Supervisory Directors
(a) Subject to the provisions of this Agreement and the Articles
of Association, the Board of Supervisory Directors shall
have complete and exclusive power to supervise the policy of
the Management Board and the general course of affairs of
the Company and the Business.
(b) Subject to the provisions set forth below and the Articles
of Association and unless otherwise agreed by the
Shareholders, the number of persons comprising the Board of
Supervisory Directors shall not exceed ten (10) members and
shall
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not be less than four (4) members.
(c) The Board of Supervisory Directors shall designate its
Chairman and Vice Chairman and the Shareholders shall
procure that the Board of Supervisory Directors appoints as
Chairman and Vice Chairman the persons so designated. The
Chairman shall prepare an agenda for the meetings of the
Board of Supervisory Directors, without prejudice to the
right of the members to put up for discussion at meetings
issues other than those set out in the agenda. The Chairman,
or in his absence the Vice Chairman, shall preside the
meetings.
(d) Each Participating Shareholder who holds an interest of at
least 6.8% in the issued capital of the Company shall be
entitled to make a binding nomination for the appointment of
one (1) Supervisory Director, and, the other Participating
Shareholders together to the extent each holds less than
6.8% shall be entitled by rotation to make a binding
nomination for the appointment for 2 years of one (1)
Supervisory Director, provided that, so long as HIT Rail is
the legal owner of at least one (1) Share. HIT Rail shall be
entitled to nominate at least one (1) Supervisory Director.
If the Participating Shareholders together holding less than
6.8% cannot agree on the person to be appointed, any one of
them may refer the decision to appoint a new member to the
Supervisory Board whose decision shall be binding on the
Participating Shareholders. So long as GTS Hermes is the
legal owner of 50% of the Shares, GTS Hermes shall have the
right to make a binding nomination for appointment of such
number of members of the Board of Supervisory Directors as
matches the number of members appointed by the other
Shareholders. If GTS Hermes is the legal owner of two-thirds
(2/3) or more of the Shares, GTS Hermes shall have the right
to make a binding nomination for appointment of such number
of members to the Board of Supervisory Directors equal to
one member more than appointed pursuant to the nominations
by all the other Shareholders. The percentage of 6.8%
reflects the estimated increase of the interest of NMBS in
the Company after the HIT Rail Shareholders have become
direct shareholders of the Company as mentioned in the
"WHEREAS" clause under e., and consequently, such percentage
is subject to change if the issued capital of the Company as
set forth in Article 2, is increased.
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(e) The Board of Supervisory Directors shall meet at least
quarterly at the office of the Company's headquarters,
unless the Board agrees to meet elsewhere. Notice of Board
meetings shall be provided by the Chairman no less than four
(4) weeks in advance and the proposed agenda for such
meeting shall be provided by the Chairman no less than two
(2) weeks in advance. The quorum for meetings of the Board
of Supervisory Directors validly convened shall be a simple
majority of the members of the Board of Supervisory
Directors. If the quorum is not represented in such meeting,
a second meeting of the Board of Supervisory Directors will
be called on a date which is at least 5 business days and
not more than 4 weeks after the date of the first meeting.
In such second meeting, resolutions on the subjects put
before the first meeting can be adopted by a majority of the
votes cast irrespective of the number of Supervisory
Directors represented at such second meeting. Each
Supervisory Director may designate any other Supervisory
Director to serve as his attorney-in-fact at any such
meeting. The Company shall bear the reasonable costs and
expenses of the attendance of the members at the meetings of
the Board of Supervisory Directors.
(f) At each of its regular meetings, the Board of Supervisory
Directors shall determine the time and place of the Board's
next regular meeting. The Chairman may, on his own
initiative or at the request of any other member, call
non-regular meetings of the Board of Supervisory Directors.
(g) The Board of Supervisory Directors may also convene and/or
take action by telephone or video-conferencing, provided
that the quorum set out in paragraph (e) above is present
thereat. The Board may also take action by unanimous written
consent.
(h) Subject to the Articles of Association, issues arising at
any meeting shall be decided by a simple majority of the
members of the Board of Supervisory Directors.
(i) Each Supervisory Director has one vote. If an equal number
of votes is cast in favour of and against a proposal, the
Chairman shall not have a deciding vote.
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In respect of any such proposal:
(i) the proposal shall be referred to the Chief
Executive Officer of each of the Shareholders or
his designee, who shall use their best efforts to
reach agreement with respect to such proposal
within 30 days of such meeting; their agreement
shall be considered a resolution of the Board of
Supervisory Directors; and
(ii) if they fail to come to an agreement on the
proposal, the deadlock mechanism provided for in
paragraph 4 of Article 18 of the Articles of
Association shall mutatis mutandis apply. The
committee of experts appointed in accordance with
such provision will be instructed to render a
decision within 60 days.
6.4 Management Board
(a) Taking into account the terms of this Agreement and the
Articles of Association the Management Board shall:
(1) carry out the Business Plan of the Company as
amended from time to time;
(2) organize preparation for carrying out decisions of
the Board of Supervisory Directors made in
accordance with the relevant provisions of the
Articles of Association and submit reports on
their accomplishment;
(3) prepare a proposed revision to the Business Plan
on an annual basis and present it to the Board of
Supervisory Directors;
(4) prepare a proposed budget setting forth a detailed
plan for capital and any other investment,
expenses, and projected revenue for the Company in
connection with its activities over the fiscal
year covered by such budget period, and present
the proposed budget to the Board or Supervisory
Directors;
(5) manage Company property including its cash funds
within such guidelines as may be set by the Board
of Supervisory Directors;
(6) conclude contracts and agreements in the Company's
name and ensure
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their fulfillment;
(7) distribute profits in accordance with
the relevant provisions of the Articles
of Association;
(8) adequately insure and keep so insured
the Company against all risks usually
insured against by companies carrying on
the same or similar business;
(9) carry out other functions based on the
Articles of Association that are not
inconsistent with the provisions of this
Agreement or the direction of the Board
of Supervisory Directors; and
(10) subject to Article 12.2, represent the
Company in its relations with
organizations, state organizations,
firms, and institutions concerning the
Business.
(b) GTS Hermes shall procure that the Management Board
shall not without the prior written approval from
the Board of Supervisory Directors permit the
Company to engage in any dealings with relatives
(in the case of an individual) of members of the
Management Board or enter into any contracts with
any Shareholder or Affiliated Company which are
not in the ordinary course of business for the
Company or which am not on normal commercial terms
such as would be offered any unrelated third
party.
(c) GTS Hermes shall have the right to nominate for
removal or appointment of the Managing Director
and the other Shareholders agree, subject to the
provision set out in paragraph (d) below, to vote
in favour of any such nomination, unless it cannot
reasonably be expected to do so, and GTS Hermes
agrees to indemnify and hold the other
Shareholders harmless from and against any
liabilities which it might incur as a result of
any removal contemplated above.
(d) Any Managing Director to be appointed in
accordance with the above shall have submitted to
the Shareholders prior to his appointment a
written statement agreeing to be bound by the
confidentiality covenant set out in Article 11 of
this Agreement in respect of any information
labelled confidential by the Shareholders.
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(e) GTS Hermes covenants with the other Parties that it shall at all times
procure that the Company complies with all of its obligations under
this Agreement and the Articles of Association.
6.5 Removal; Successors
From time to time during the term of this agreement, any Shareholder
may request the removal or suspension of a Supervisory Director
previously nominated by that Shareholder in accordance with Article
6.3, and, the other Shareholders undertake upon the making of such
request to exercise their voting rights in favour of such removal or
suspension and, in case of removal, in favour of the appointment of a
successor nominated by that Shareholder, which nominee the
Shareholders undertake to promptly appoint in the place of the removed
Supervisory Director. Unless the Shareholders agree otherwise, if a
Shareholder removes a Supervisory Director previously nominated by
that Shareholder, that Shareholder shall bear any liability for such
removal and shall indemnify the other Shareholders and the Company
against any costs that they may incur in connection with such removal.
ARTICLE 7 - CONDUCT OF BUSINESS
7.1 Shareholder Representatives
(a) Each Shareholder shall appoint one (1) natural person to serve as its
representative at the General Assemblies and to carry out other
responsibilities of Shareholders as provided in this Agreement. A
representative may, after giving reasonable written notice to the
other representatives, designate any natural person to serve as a
substitute at any General Assembly and for any other purpose under
this Agreement.
(b) Each Shareholder may remove its representative from time to time. Upon
the death, disability, resignation, or removal of its representative,
a Shareholder shall appoint a successor representative and shall
promptly notify the other Parties of such appointment.
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(c) A person designated as the representative of a Shareholder shall be
deemed to continue as such unless and until the Company and all the
other Shareholders receive a written notice signed by the appointing
Shareholder designating a successor representative. The Company and
each Shareholder shall be entitled to rely on the authority of the
most recently appointed representative of whose appointment they have
received notice with respect to any matter for which a Shareholder's
representative may act under this Agreement.
(d) Each Shareholder shall ensure that this representative has appropriate
authorization to act on its behalf with respect to any actions
required, permitted, or provided under this Agreement to be taken by
its appointing Shareholder and noted on the agenda for a particular
meeting, including without limitation giving or receiving notices,
offers, acceptances, and other communications provided for in this
Agreement.
(e) Unless the Shareholders agree otherwise, if a Shareholder removes its
representative pursuant to Article 7.1 (b) hereof, that Shareholder
shall bear any liability for such removal and shall indemnify the
other Shareholders and the Company against any costs that they may
incur in connection with such removal.
7.2 Award of Licenses
Each Shareholder agrees to cooperate with the Company in obtaining the
Licenses and operating the Business in connection therewith in
accordance with the Business Plan.
7.3 Shareholder Advisory Council (SAC)
To ensure sufficient Shareholder representation regarding key business
issues, the Management Board will form a Shareholder Advisory Council
(SAC) to be populated by a representative from each Participating
Shareholder. This will not be a voting body or a decision-making body,
but rather a group of active and
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interested Shareholders willing to both offer advice and counsel to
the Management Board as well as to ensure awareness within their own
organization of Company issues and progress. The SAC would normally
convene six times per year.
ARTICLE 8 - ISSUE AND TRANSFER OF SHARES; PRE-EMPTIVE RIGHTS
8.1 The Shareholders agree to grant their consent pursuant to paragraph 1
of Article 8 of the Articles of Association to any transfer of Shares
to a transferee who is and remains an Affiliated Company of the
transferor Shareholder and the Shareholders may, when entitled under
this Agreement to be issued additional Shares, designate an Affiliated
Company to take up such Shares provided that:
(1) the obligations of the transferor Shareholder under this
Agreement will remain unaffected by the transfer
contemplated above; and
(2) the Shares will be retransferred to the transferor
Shareholder (or in the event there have been a series of
transfers between Affiliated Companies, then to the first
transferor Shareholder) immediately prior to the ultimate
transferee ceasing to be an Affiliated Company of the
transferor Shareholder except if the (first) transferor
Shareholder has been voluntarily liquidated; and
(3) the transferor Shareholder warrants that it shall
unconditionally and irrevocably guarantee the performance of
the Affiliated Company's obligations under this Agreement.
8.2 Except in case of a public listing or an issue of new shares or Shares
or options on shares (warrants) to professional investors to obtain
further funding, it shall be a condition precedent to any issuance of
shares by the Company to a third party and to the right of any
Shareholder to transfer its Shares to any third party (including
Affiliated Companies) or to designate the allotment of additional
shares to an Affiliated Company that the transferee or allottee
becomes a Party to this Agreement. The joining of such transferee
or allottee as a Party to this Agreement will take place by means of,
and as of the date of,
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the signing of an admittance statement by such third party in the
format as attached hereto as Annex 2. The transferee or allottee shall
send the admittance statement to the Company, which shall provide
each of the Parties with a copy thereof. The Shareholders hereby agree
for the future to the amendment of this Agreement at any time an
admittance statement becomes effective.
8.3 The Shareholders and the Company shall do or procure to be done all
such acts and things as may be necessary to give full effect to the
transfers contemplated in this Article 8 and the registrations
thereof.
8.4 Subject to Article 8.1. if a Shareholder transfers all of its
Shares, the transferor Shareholder shall upon completion of such
transfer and the transferee becoming a party to this Agreement be
released from all its obligations and liabilities under this
Agreement, with the exception of:
(i) any liability resulting from antecedent breaches of this
Agreement; and
(ii) those provisions of this Agreement stated to continue after
termination hereof.
8.5 Except where the transfer is in accordance with this Article 8, upon
the transfer by a Shareholder of all its Shares, such Shareholder
shall deliver to the Company the written resignations of all those
Members of the Board of Supervisory Directors nominated by such
Shareholder pursuant to the provisions of Article 7.
8.6 Notwithstanding any other provision of this Agreement, if any binding
measure of the Commission or Council of the European Communities or
any judgement of any court or tribunal or any regulation or
legislation of any other relevant authority shall prohibit or in any
way restrict the holding of Shares by a Shareholder (the Prohibited
Shareholder), then the Prohibited Shareholder may give a written
notice (the Transfer Notice) to the other Shareholders and the Company
to transfer some or all of its Shares to a third party and, where a
prohibited Shareholder shall be entitled under this Agreement to be
issued any additional Shares or require or accept a transfer of any
Shareholder's Shares,
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it may designate a third party, in each case, acceptable to the
other Shareholders to take up such Shares (or the rights to be
allotted Shares) within thirty-five (35) days of receipt of notice
that such third party is acceptable provided that if the other
Shareholders shall not accept such third party within twenty-one
(21) days of receipt of the Transfer Notice, and unless otherwise
agreed by the Shareholders, the other Shareholders shall be
obliged to purchase all of the Shares held by the Prohibited
Shareholder on a pro rata basis within thirty-five (35) days of
receipt of the Transfer Notice, failing which the Prohibited
Shareholder shall be obliged to transfer such Shares (or the
rights to be allotted Shares) to such third party who shall be
deemed to be acceptable to the other Shareholders. The purchase
price of any transferred Shares shall be determined pursuant to
the procedures set forth in Article 8 of the Articles of
Association.
ARTICLE 9 PROVIDE FIBRE CAPACITY
The Company or its designated vendor will provide fibre capacity in its network
for use by the Shareholders on fair commercial terms, use, quantity and price to
be negotiated on a bilateral basis between the relevant Shareholder and the
Company or its designated vendor.
ARTICLE 10 - TERM AND TERMINATION OF AGREEMENT
Except for obligations under Article 11 which shall survive termination, and
obligations or liabilities not discharged upon termination, this Agreement shall
terminate in respect of all Parties simultaneously pursuant to a decision to
terminate this Agreement as of a certain date, provided that such decision has
been approved in writing by such a number of Parties together holding at least
eighty-five (85)% of the voting Shares. In addition all rights and obligations
under this agreement (except for obligations and liabilities which have not been
discharged or which survive termination) shall terminate automatically in
respect of any Party, if such Party no longer holds Shares in the Company.
ARTICLE 11 - CONFIDENTIAL INFORMATION
The Parties shall not and shall procure that none of their officers, employees,
Managing or
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Supervisory Directors, or Affiliated Companies or their officers, employees,
Managing or Supervisory Directors, or the Company or any of its Managing or
Supervisory Directors, or employees shall at any time hereafter, save when
required by law, make use of or disclose or divulge to any third party any
information relating to the Company which has been designated in writing as
confidential by the disclosing Party.
ARTICLE 12 - MISCELLANEOUS
12.1 Government Notification and Information
If the Shareholders jointly conclude that any applicable antitrust or
competition regulatory requirement of the European Communities or any
other governmental body requires a notification or information, or if
the Shareholders jointly conclude that it would be desirable to submit
such notification or information, then the Shareholders shall
cooperate in the preparation and delivery of the notification or
information.
12.2 Publicity
For the duration of this Agreement, any formal press, public
announcement, news release or other form of major publicity relating to
this Agreement or any of its terms shall be made only after prior
consultation between the Parties and if the substantive content is
mutually agreed upon. No party shall unreasonably withhold or delay its
consent to any formal press, public announcement, news release,
filings, or other form of major publicity relating to the existence of
this Agreement or its terms, if such is required by the laws of any
jurisdiction governing any of the Parties or in connection with the
procurement of capital.
12.3 Severability
Each and every obligation under this Agreement shall be treated as a
separate obligation and shall be severally enforceable as such and in
the event of any obligation or obligations being or becoming
unenforceable in whole or in part such
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part or parts as are unenforceable shall be deemed deleted from this
Agreement and any such deletion shall not affect the enforceability of
the remainder of this Agreement.
12.4 Force Majeure
The failure or delay of any Shareholder (the "Affected Shareholder") to
perform any obligation under this Agreement or the Company being unable
to conduct its business solely by reason of acts of civil or military
authority, civil disturbance, war, strikes or other labour disputes (by
employees of any third party) or disturbances, fire, or laws,
regulations, acts, or orders of any governmental agency or official
thereof, other catastrophes, or any other circumstances beyond its
reasonable control ("Force Majeure") shall not be deemed to be a breach
of this Agreement so long as the Affected Shareholder or its Affiliated
Company shall not have contributed to such Force Majeure, shall have
used its best reasonable efforts to avoid such Force Majeure or to
ameliorate its effects, and shall continue to take all actions within
its power to comply to the extent possible with the terms of this
Agreement. In the event of any such failure or delay, performance of the
obligations shall be deferred until the Force Majeure ceases to affect
the performance of obligations hereunder, provided that if the Force
Majeure affects the performance of a material obligation and has not
ceased within nine (9) months, any Affected Shareholder may withdraw as
a Party to this Agreement.
12.5 Entire Agreement
This Agreement and the agreements to be entered into pursuant to it
supersede all prior agreements among the Parties with respect to the
subject matter hereof and contain the entire agreement among the Parties
with respect to the subject matter hereof, including the Annexes. Each
party confirms to each of the others that it is not relying on any
representation, warranty, or commitment of any kind save as set out in
or explicitly contemplated by this Agreement and the Annexes and, for
the avoidance of doubt, the Parties (other than the Company) acknowledge
that their respective Shareholders are not parties hereto and are in no
way whatsoever bound by, and will not be held to by the Company, any
Shareholder or any of their
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respective Affiliated Companies, any of the terms hereof.
12.6 Amendment
This Agreement may not be amended, supplemented, or discharged, and no
provision may be modified or waived, except as expressly provided in
this Agreement or by an instrument in writing signed by such a number of
Parties together holding at least (eighty-five) (85)% of the voting
shares in the capital of the Company, in which case the amended
Agreement shall be effective in respect of all Parties to the Agreement
as of the date of the signed instrument, notwithstanding the fact that
any one Party has not approved such amendment. No waiver of any
provision hereof by any Party shall be deemed a waiver by or in favour
of any other Party, nor shall any such waiver by any Party be deemed a
continuing waiver of any matter or a waiver of any other matter by such
Party. No allowance of time or other indulgence shall constitute a
waiver or preclude the subsequent assertion or enforcement of the right
or remedy concerned or any other right or remedy. No exercise of any
right or remedy shall be deemed to imply a waiver of, or prevent the
subsequent assertion or exercise of, any other right or remedy in
respect of the same or any other matter. No amendment, modification,
supplement, discharge, or waiver hereof or hereunder shall require the
consent of any person not a Party to this Agreement except as required
by law.
12.7 Variations in Terms and Pronouns
All terms, pronouns, and any variations thereof, shall be deemed to
refer to the masculine, feminine, neuter, singular, or plural as the
identify of the person or persons or entity or entities require.
12.8 Headings
All captions or headings contained in this Agreement are for convenience
or the Parties only and shall not affect the interpretation of any
provision of this Agreement.
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12.9 Language
All meetings of the Company and all documentation relating to the
Company shall be in the English language unless otherwise required by
applicable law.
12.10 Costs
The Company shall bear the reasonable legal fees and expenses
incidental to the registration, preparation and completion of this
Agreement.
12.11 Counterparts
This Agreement may be executed and delivered (including by facsimile
transmission) in one or more counterparts, and by the different
parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed to be an original but all of
which taken together shall constitute one and the same agreement. This
Agreement shall be binding as of the date of signing by at least two
Parties and shall be binding an each other Party as of the date of its
signing.
ARTICLE 13 - APPLICABLE LAW AND CHOICE OF FORUM
(a) This Agreement shall be governed by and construed in accordance with
the laws of The Netherlands.
(b) In the event that disagreements or disputes arise with respect to the
interpretation or performance of this Agreement or any of its
provisions, the Parties will use their best efforts to resolve them
through consultation. Disagreements or disputes that have not been
settled by such consultation within thirty (30) days after the first
notification thereof by one Party to the other will, at the request of
either Party, be submitted to and finally settled by arbitration in
accordance with the Rules of The Netherlands Arbitration Institute.
The arbitration shall be conducted in Amsterdam, The Netherlands, in
the English language.
Signed in five counterparts
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HIT RAIL B.V. GTS HERMES, INC.
/s/Illegible
______________________________ ________________________________
By: X. Xxxxxxx By:
Title: M.O. HIT Rail B.V. Title:
Date: 4. December 1997 Date:
NMBS/SNCB XX XXXX CARRIER
______________________________ ________________________________
By: By:
Title: Title:
Date: Date:
HERMES EUROPE RAILTEL B.V.
______________________________
By:
Title:
Date:
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HIT RAIL B.V. GTS HERMES, INC.
/s/Xxxxxx X. Xxxxxx
______________________________ ________________________________
By: By: Xxxxxx X. Xxxxxx
Title: Title: President & CEO
Date: Date:
NMBS/SNCB XX XXXX CARRIER
______________________________ ________________________________
By: By:
Title: Title:
Date: Date:
HERMES EUROPE RAILTEL B.V.
______________________________
By:
Title:
Date:
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-30-
HIT RAIL B.V. GTS HERMES, INC.
______________________________ ________________________________
By: By:
Title: Title:
Date: Date:
NMBS/SNCB XX XXXX CARRIER
/s/Illegible
______________________________ ________________________________
By: By:
Title: Title:
Date: Date:
HERMES EUROPE RAILTEL B.V.
______________________________
By:
Title:
Date:
33
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HIT RAIL B.V. GTS HERMES, INC.
______________________________ ________________________________
By: By:
Title: Title:
Date: Date:
NMBS/SNCB XX XXXX CARRIER
______________________________ ________________________________
By: By:
Title: Title:
Date: Date:
HERMES EUROPE RAILTEL B.V.
/s/Xxx Xxxxxx
______________________________
Hermes Europe Railtel B.V.
By: Xxx Xxxxxx
Title: Managing Director
Date: 4. Dec 97
