Exhibit 4.1
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SHARE PURCHASE AGREEMENT
BETWEEN
FOND NARODNIHO MAJETKU CESKE REPUBLIKY
AS SELLER
AND
CEZ, a.s.
AS PURCHASER
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DATED JUNE 28, 2002
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This Share Purchase Agreement (this "Agreement") is made on June 28, 2002
pursuant to the provisions of Sections 409 et seq. of Act No. 513/1991 Coll.,
the Commercial Code, as amended (the "Commercial Code") and the provisions of
Sections 13 et seq. of Act No. 591/1992 Coll., the Securities Act, as amended
(the "Securities Act"),
between
Fond narodniho majetku Ceske republiky
having its registered office at Rasinovo nabr. 42, 128 00 Prague 2
Identification No.: 41692918
registered in the Commercial Register administered by the Prague Municipal
Court, Section A-LXII, File 174 acting through: Ing. Vladislav Raska
First Vice-Chairman of the Executive Committee
and
Ing. Jan Juchelka
Second Vice-Chairman of the Executive Committee
the ("Seller")
and
CEZ, a.s.
having its registered office at Duhova 2/1444, 140 53 Prague 4
Identification No.: 45274649
registered in the Commercial Register administered by the Prague Municipal
Court, Section 8, File 1581
acting through: Ing. Jaroslav Mil, M.B.A.
Chairman of the Board of Directors
and
JUDr. Ivan Cestr
Director
(the "Purchaser")
W I T N E S S E T H
WHEREAS, in its Resolution No. 477 dated May 6, 2002 and Resolution
No. 628 dated June 12, 2002 concerning an amendment to Resolution No. 477 dated
May 6, 2002, on the privatization of the state equity interest in the regional
distribution companies (collectively the "Resolution"), the Czech government
decided to privatize the Sale Shares by their sale on the terms and conditions
specified in this Agreement, specifically by their direct sale to the Purchaser
as the predetermined transferee; and
WHEREAS, the Seller owns, and the Purchaser wishes to acquire, the
Sale Shares;
NOW, THEREFORE, the Purchaser and the Seller have agreed as follows.
ARTICLE I
SUBJECT OF AGREEMENT
On the terms and subject to the conditions specified herein in accordance with
the Resolution, the Seller agrees to transfer the Sale Shares and title thereto
to the Purchaser for consideration and the Purchaser agrees to pay the Purchase
Price for the Sale Shares to the Seller in the manner described in Article III
hereof.
ARTICLE II
PURCHASE PRICE
2.1 Purchase Price. The purchase price for all the Sale Shares (the "Purchase
Price") has been determined on the basis of an expert opinion prepared by Ing.
Robert Maticka, DrSc., an expert in the area of economics,
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prices and appraisals, appointed in accordance with the provision of Section
196a (3) and Section 59 (3) of the Commercial Code under Resolution Ref. No. Nc
4141/2002-11 of the Prague Municipal Court dated April 17, 2002, which became
final on April 23, 2002, and is in accordance with the purchase price set by the
Resolution as the privatization decision. The Purchase Price amounts to CZK
31,943,305,000 (to wit: thirty-one billion nine hundred forty-three million
three hundred and five thousand Czech crowns) and is equal to the sum of:
(a) an amount of CZK 3,820,414,000 (to wit: three billion eight
hundred twenty million four hundred and fourteen thousand Czech
crowns) for all of the Prazska Energetika Sale Shares, i.e., CZK
2,093.91 (to wit: two thousand ninety-three 91/100 Czech crowns)
per Prazska Energetika Sale Share;
(b) an amount of CZK 3,704,720,000 (to wit: three billion seven
hundred four million seven hundred and twenty thousand Czech
crowns) for all of the Stredoceska Energeticka Sale Shares, i.e.,
CZK 1,979.29 (to wit: one thousand nine hundred seventy-nine
29/100 Czech crowns) per Stredoceska Energeticka Sale Share;
(c) an amount of CZK 3,861,276,000 (to wit: three billion eight
hundred sixty-one million two hundred and seventy-six thousand
Czech crowns) for all of the Vychodoceska Energetika Sale Shares,
i.e., CZK 3,051.96 (to wit: three thousand fifty-one 96/100 Czech
crowns) per Vychodoceska Energetika Sale Share;
(d) an amount of CZK 4,409,350,000 (to wit: four billion four hundred
nine million three hundred and fifty thousand Czech crowns) for
all of the Severoceska Energetika Sale Shares, i.e., CZK 2,816.86
(to wit: two thousand eight hundred sixteen 86/100 Czech crowns)
per Severoceska Energetika Sale Share;
(e) an amount of CZK 4,792,249,000 (to wit: four billion seven
hundred ninety-two million two hundred and forty-nine thousand
Czech crowns) for all of the Zapadoceska Energetika Sale Shares,
i.e., CZK 6,181.59 (to wit: six thousand one hundred eighty-one
59/100 Czech crowns) per Zapadoceska Energetika Sale Share;
(f) an amount of CZK 1,387,000,000 (to wit: one billion three hundred
and eighty-seven million Czech crowns) for all of the Jihoceska
Energetika Sale Shares, i.e., CZK 2,128.68 (to wit: two thousand
one hundred twenty-eight 68/100 Czech crowns) per Jihoceska
Energetika Sale Share;
(g) an amount of CZK 3,770,104,000 (to wit: three billion seven
hundred seventy million one hundred and four thousand Czech
crowns) for all of the Jihomoravska Energetika Sale Shares, i.e.,
CZK 3,196.24 (to wit: three thousand one hundred ninety-six
24/100 Czech crowns) per Jihomoravska Energetika Sale Share;
(h) an amount of CZK 6,198,192,000 (to wit: six billion one hundred
ninety-eight million one hundred and ninety-two thousand Czech
crowns) for all of the Severomoravska Energetika Sale Shares,
i.e., CZK 3,738.84 (to wit: three thousand seven hundred
thirty-eight 84/100 Czech crowns) per Severomoravska Energetika
Sale Share.
2.2 Payment of the Purchase Price. The Parties have agreed that the Purchaser
shall pay the Purchase Price as follows:
(a) a portion of the total purchase price in the amount of CZK 11,620,692,000
shall be paid by the delivery of the Draft unconditionally accepted by the CEPS
Share Transferee without limitation as to the extent of the sum of money payable
on the terms and conditions set in Article III hereof;
(b) a portion of the total purchase price in the amount of CZK 3,417,851,000
shall be paid within 30 days of the Share Settlement Date by wire transfer to
the Seller;
(c) a portion of the total purchase price in the amount of CZK 1,504,762,000
shall be paid within 30 days of the Share Settlement Date by wire transfer to
the Seller;
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(d) a portion of the total purchase price in the amount of CZK 3,850,000,000
shall be paid by the delivery of a promissory note with the sum of money payable
equal to such portion of the purchase price, drawn by the Purchaser on the
Seller, due and payable on June 30, 2003, subject to the terms and conditions
set in Article III hereof;
(e) a portion of the total purchase price in the amount of CZK 3,850,000,000
shall be paid by the delivery of a promissory note with the sum of money payable
equal to such portion of the purchase price, drawn by the Purchaser on the
Seller, due and payable on June 30, 2004, subject to the terms and conditions
set in Article III hereof;
(f) a portion of the total purchase price in the amount of CZK3,850,000,000
shall be paid by the delivery of a promissory note with the sum of money payable
equal to such portion of the purchase price, drawn by the Purchaser on the
Seller, due and payable on June 30, 2005, subject to the terms and conditions
set in Article III hereof;
(g) a portion of the total purchase price in the amount of CZK 3,850,000,000
shall be paid by the delivery of a promissory note with the sum of money payable
equal to such portion of the purchase price, drawn by the Purchaser on the
Seller, due and payable on June 30, 2006, subject to the terms and conditions
set in Article III hereof.
2.3 Interest. The portion of the total purchase price that will be paid under
Section 2.2 (b) through (g) hereof shall bear interest from the transfer date of
the Sale Shares at a rate equal to 3M PRIBOR CZK (Prague Interbank Offered Rate)
plus a margin of 0.3% per annum. The interest rate shall be determined as of the
Share Settlement Date and thereafter on the first business day of each calendar
quarter until the full repayment of the installments under Section 2.2 (b) and
(c) hereof or, as the case may be, until the date of payment under the drafts
drawn by the Purchaser under Section 2.2 (d) through (g) hereof. Interest shall
be due and payable on the last Business Day of each calendar quarter by wire
transfer, with the last interest payment being due and payable on the payment
date of the last installment or on the date of the last payment under the drafts
drawn by the Purchaser under Section 2.2 (d) through (g) hereof.
2.4 Assignment of Receivable. The amount payable in respect of the portion of
the purchase price under Section 2.2 (b) hereof, which may be adjusted in
accordance with Section 3.6 (c) hereof, shall, in accordance with Section III/5
of the Resolution, be assigned by the Seller without consideration to the
Ministry of Labor and Social Affairs for the purposes of pension insurance,
including interest payable on the assigned portion of the purchase price under
Section 2.3 hereof. Subsequently, this amount shall be set off between the
Ministry of Labor and Social Affairs and the Purchaser against the amount
payable to the Purchaser in respect of the purchase price under the Agreement
with the Ministry of Labor and Social Affairs. Notwithstanding the stated
maturity of the portion of the purchase price under Section 2.2 (b) hereof, the
Purchaser shall not be in default with its payment until the date of Draft
Settlement, if the Draft Settlement is to be made under this Agreement, and the
assignment of the amount payable in respect of this portion of the purchase
price to the Ministry of Labor and Social Affairs.
ARTICLE III
CLOSING
3.1 Closing. The transfer of the Sale Shares by the Seller to the
Purchaser and the payment of the Purchase Price by the Purchaser to
the Seller under the provisions of Section 2.2 hereof (the "Closing")
shall be made in the manner described below in this Section 3.1:
(a) The transfer of the Sale Shares from the Seller to the Purchaser
shall be arranged, in accordance with the Settlement Orders, by
the universal settlement center UNIVYC, a.s., having its
registered office at Rybna 14, Prague 1, Identification No.:
25081489 ("UNIVYC"). UNIVYC shall settle the transfer in
accordance with its rules governing the settlement of
off-exchange securities transactions, unless the Settlement Order
provide otherwise.
(b) The Purchaser shall pay the portion of the Purchase Price
pursuant to Section 2.2 (a) and (d) through (g) hereof to the
Seller by the close of the second Business Day immediately
preceding the Share Settlement Date by the delivery of the Draft
unconditionally accepted by the CEPS Share Transferee under the
CEPS Share Purchase Agreement without limitation as
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to the sum payable under the draft to the Depositary, and by the
delivery of the drafts drawn by the Purchaser under Section 2.2
(d) through (g) hereof. The Purchaser together with the CEPS
Share Transferee shall deposit the Draft with the Depositary. The
Depositary shall confirm in writing the receipt of the Draft to
the Purchaser and the CEPS Share Transferee and, by 10.00 a.m. on
the Business Day immediately preceding the Share Settlement Date,
to the Seller. The Depositary shall release the Draft to the
Seller on the day following written notice from the CEPS Share
Transferee or evidence from the Seller or the Purchaser to the
effect that the shares in CEPS, a.s. have been credited, pursuant
to the CEPS Share Purchase Agreement, to the securities account
of the CEPS Share Transferee maintained at the Securities Center.
If the Depositary shall not have received such notice from the
CEPS Share Transferee or such evidence from the Seller or the
Purchaser within 30 days of the receipt of the Draft, the
Depositary shall return the Draft to the CEPS Share Transferee.
The Depositary shall inform the Purchaser and the CEPS Share
Transferee or, respectively, the Seller and the Purchaser without
delay of the delivery of the draft to the Seller or the return of
the Draft to the CEPS Share Transferee.
(c) The Seller agrees to enter the Seller Settlement Order in the
settlement system of UNIVYC no later than 12:00 noon on the
Business Day immediately preceding the Share Settlement Date.
(d) The Purchaser agrees to enter the Purchaser Settlement Order in
the settlement system of UNIVYC, through the Securities Dealer,
no later than 12:00 noon on the Business Day immediately
preceding the Share Settlement Date.
(e) The Purchaser shall ensure that an amount denominated in Czech
crowns equal to the sum of the fees charged by UNIVYC and the
Securities Dealer in connection with the Closing shall have been
deposited in account No. 71 504-011/0100 maintained with Komercni
banka, a.s. no later than 12:00 (noon) on the Business Day
immediately preceding the Share Settlement Date so that UNIVYC is
able to carry out the Settlement Order.
(f) The Purchaser shall pay the portion of the Purchase Price
pursuant to Section 2.2 (c) hereof to the Seller within thirty
(30) days of the Settlement Date to the Seller's account No.
421657/0300, Variable Symbol: 503444001, Specific Symbol:
4767569102, maintained with Ceskoslovenska obchodni banka, a.s.,
Prague 1 - Namesti Republiky Branch.
(g) The Securities Dealer shall act on the Purchaser's behalf
vis-a-vis UNIVYC and shall, without limitation, enter the
Purchaser Settlement Order in the settlement system maintained by
UNIVYC. The obligations of the Purchaser hereunder and its
liability for any breach thereof shall not be affected in any
respect by any act or omission of the Securities Dealer.
3.2 Alternative Settlement Method. Should it be impossible to use the
settlement system of UNIVYC to effect the transfer of the Sale Shares
from the Seller to the Purchaser, the Parties shall take action and
cooperate in good faith to effect the transfer of the Sale Shares from
the Seller to the Purchaser by alternative means.
3.3 Partial Settlement. If the conditions, if any, for the transfer of any
of the Sale Shares that are registered shares subject to a restriction
on transfer have not been satisfied, the settlement shall only be made
with respect to that portion of the Sale Shares for which the failure
to satisfy the conditions does not hinder the transfer. The Seller
shall use its reasonable best efforts to ensure that the conditions
for the transfer of any unsettled shares are subsequently satisfied;
in particular, the Seller shall make a request for the consent to the
transfer of such shares. If the conditions with respect to all or a
part of such unsettled shares are satisfied, the Parties shall make a
settlement in respect of such shares and transfer such shares within
thirty (30) days of the satisfaction of the conditions for the
transfer. If the transfer of such unsettled shares shall not have
taken place by June 20, 2006, the number of the Sale Shares shall be
reduced by the number of such shares and the Purchase Price shall be
reduced accordingly, i.e., by the value of the shares which have not
been transferred and the pro rata amount payable in connection with
the Purchase Price.
3.4 Subsequent Settlement. If, due to a capital increase, the Seller shall
acquire additional shares in Prazska Energetika, Stredoceska
Energeticka, Vychodoceska Energetika, Severoceska Energetika,
Zapadoceska Energetika, Jihoceska Energetika, Jihomoravska Energetika
or Severomoravska
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Energetika within one year of the Settlement Date, the Purchaser shall
accept a tender offer of the Seller within 30 days of receipt and
purchase such additional shares from the Seller for a purchase price
determined pursuant to this Agreement payable on the relevant quantity
of such additional shares on terms and conditions similar to those
contained herein.
3.5 Special Settlement. The Purchaser shall, pursuant to a written request
of the municipality Lobendava, Postal Code: 407 82, Decin District,
transfer free-of-charge 297 registered shares in Severoceska
Energetika to the municipality without undue delay after the delivery
of the written request of Lobendava to the Purchaser.
3.6 Adjustment of the Purchase Price; Draft Settlement. After the Closing
Date, the auditor of CEPS shall, in accordance with the Resolution,
carry out an audit of the results of operations of CEPS for the period
from the execution of the CEPS Share Purchase Agreement to the Closing
Date, and the New Expert shall prepare the New Expert Opinion on the
basis of such audit. If the New Expert is appointed by both courts of
competent jurisdiction pursuant to the nominations made by the CEPS
Share Transferee and the Purchaser under the CEPS Share Purchase
Agreement, the purchase prices payable for the shares in CEPS
transferred under the CEPS Share Purchase Agreement and the Agreement
with the Ministry of Labor and Social Affairs may, on the basis of the
New Expert Opinion, be subject to change in accordance with the CEPS
Share Purchase Agreement and the Agreement with the Ministry of Labor
and Social Affairs. Even if the New Expert is not appointed pursuant
to such nominations by both courts of competent jurisdiction, the New
Expert shall still prepare the New Expert Opinion and deliver the same
to the Expert. The Expert shall compare the values of the shares in
CEPS determined by the New Expert Opinion and the Initial Expert
Opinion and, if required, prepare the Expert's New Expert Opinion or
confirm that he insists on the Initial Expert Opinion. The New Expert
Opinion shall be prepared by the New Expert and delivered to the
Seller, the Purchaser, the CEPS Share Transferee and the Ministry of
Labor and Social Affairs within 60 days following the Closing Date. In
the event of the preparation of the New Expert Opinion by the Expert,
the Expert's New Expert Opinion shall be delivered in the manner
described in the preceding sentence. If, on the basis of the New
Expert Opinion of the New Expert or the Expert's New Expert Opinion,
there is a change in the purchase prices payable for the shares in
CEPS transferred under the CEPS Share Purchase Agreement and the
Agreement with the Ministry of Labor and Social Affairs, the method
for the payment of the Purchase Price shall be changed as follows:
(a) The total amount of the Purchase Price hereunder shall remain
unchanged.
(b) The portion of the Purchase Price payable under Section 2.2 (a)
hereof shall automatically be changed so that it is equal to the
purchase price for the shares in CEPS transferred under the CEPS
Share Purchase Agreement as determined pursuant to the New Expert
Opinion of the New Expert or pursuant to the Expert's New Expert
Opinion. On the Draft Settlement Date, the Seller and the
Purchaser shall, in the presence of the CEPS Share Transferee,
exchange the Draft delivered by the Purchaser to the Seller on
the Share Settlement Date for the New Draft.
(c) The portion of the total purchase price payable under Section 2.2
(b) hereof (to be assigned free-of-charge to the Ministry of
Labor and Social Affairs) shall automatically be changed so that
it is equal to the purchase price for the shares in CEPS
transferred under the Agreement with the Ministry of Labor and
Social Affairs determined under Section 3.6 hereof.
(d) If pursuant to Section 3.6 (c) hereof, the portion of the total
purchase price payable under Section 2.2 (b) hereof is reduced,
the portion of the purchase price payable under Section 2.2 (c)
hereof shall automatically be increased by the amount of the
reduction in the portion of the total purchase price payable
under Section 2.2 (b) hereof. The Purchaser shall pay the amount
of such increase to the Seller within 15 days following the date
of the proper settlement of drafts on the Draft Settlement Date
in accordance with Section 3.6 (g) hereof by wire transfer to the
Seller's account specified in Section 3.1 (f) hereof.
(e) If pursuant to Section 3.6 (c) hereof, the portion of the total
purchase price payable under Section 2.2 (b) hereof is increased,
the portion of the total purchase price payable under Section 2.2
(c) hereof shall automatically be reduced by the amount of the
increase in the portion of the total purchase price payable under
Section 2.2 (b) hereof. The Seller shall return the amount of
such reduction to the Purchaser within 15 days following the date
of the
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proper settlement of drafts on the Draft Settlement Date in
accordance with Section 3.6 (g) hereof by wire transfer to the
Purchaser's account subsequently specified in writing by the
Purchaser.
(f) The portions of the total purchase price payable under Section
2.2 (d) through (g) hereof shall automatically be increased by
the amount of the reduction in the portion of the total purchase
price payable under Section 2.2 (a) hereof or, as the case may
be, reduced by the amount of the increase in the portion of the
total purchase price payable under Section 2.2 (a) hereof, with
the relative amounts of the portions of the total purchase price
payable under Section 2.2 (d) through (g) hereof remaining
unchanged after such increase/reduction in the individual
portions of the total purchase price. The same changes shall
apply to the principal amounts of the drafts to be drawn by the
Purchaser pursuant to Section 2.2 (d) through (g) and this
Section hereof and exchanged on the Draft Settlement Date for the
drafts originally drawn by the Purchaser under Section 2.2 (d)
through (g) hereof and delivered on the Share Settlement Date to
the Seller.
(g) Draft Settlement Date. On the Draft Settlement Date, the Parties
shall, at the Seller's registered office and in the presence of
the CEPS Share Transferee, settle the drafts so that:
- the Purchaser shall draw a New Draft, the CEPS Share
Transferee shall unconditionally accept the New Draft and
the Purchaser shall deliver the New Draft to the Seller
against the return of the Draft, the latter to be destroyed
in the presence of the CEPS Share Transferee; and,
simultaneously,
- the Purchaser shall draw new drafts pursuant to Section 2.2
(d) through (g) and Section 3.6 (f) hereof and deliver such
drafts to the Seller against the return of the drafts
originally drawn by the Purchaser pursuant to Section 2.2
(d) through (g) hereof and delivered by the Purchaser to the
Seller on the Share Settlement Date, the latter to be now
destroyed.
(h) The Parties and the CEPS Share Transferee shall provide to one
another any and all assistance required for such settlement of
drafts as described in Section 3.6 (g) hereof (the "Draft
Settlement") and refrain from any action that might make such
settlement impossible. If any Party is in default with the Draft
Settlement, the defaulting Party shall pay to the other Party a
contractual penalty of CZK 10,000,000 (to wit: ten million Czech
crowns) for each day of default.
ARTICLE IV
REPRESENTATIONS OF THE SELLER
The Seller hereby represents that all of the facts set forth in Sections 4.1
through 4.7 hereof are true and correct as of the date hereof and warrants that
the facts set forth in Sections 4.1 through 4.7 hereof shall be true and correct
as of the transfer date of the Sale Shares to the Purchaser.
4.1 Organization of the Seller. The Seller is a legal entity duly established
under Act No. 171/1991 Coll., on the Competence of Authorities of the Czech
Republic in the Matter of Transfers of State-Owned Property to Other Persons and
on the National Property Fund of the Czech Republic, as amended.
4.2 Organization of the Companies. Each of the Companies is a joint stock
company duly organized and validly existing under the laws of the Czech
Republic.
4.3 Authorization of Agreement. The Seller has all requisite corporate power,
authority and legal capacity to execute and deliver this Agreement and perform
its obligations hereunder. This Agreement has been duly and validly authorized
and executed and delivered by the Seller and constitutes the legal, valid and
binding obligations of the Seller in accordance with applicable law. The
Seller's obligations hereunder are enforceable against the Seller in accordance
with the terms of this Agreement.
4.4 No Violation. Neither the execution and delivery by the Seller of this
Agreement nor the performance by the Seller of any of its obligations hereunder
will violate any organizational or similar document of the
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Seller, or any contractual or other obligation of the Seller, or any judgment or
administrative order by which the Seller is bound or which is applicable to the
Seller's assets or any part thereof or to which the Seller's assets are subject,
or any law or regulation applicable to the Seller.
4.5 Consents of Third Parties. Except for (i) consents, permits and
authorizations already obtained by the Seller, including, without limitation,
the Resolution, (ii) the notification under Section 183d(1) of the Commercial
Code that shall be made by the Seller in connection with the sale of the Sale
Shares following the date of transfer of the Sale Shares to the Purchaser, (iii)
approval of the concentration by the Antitrust Office pursuant to Sections 12 et
seq. of the Competition Act, and (iv) Antitrust State Aid Decision 1 under the
State Aid Act, no consent, waiver, approval, permit or authorization of, or
declaration or filing with, or notification to, any person is required on the
part of the Seller in connection with the execution and delivery of this
Agreement, or the performance by the Seller of any of its obligations hereunder.
4.6 Issuance of Shares. The Sale Shares have been duly issued by the respective
Companies in accordance with applicable laws and the respective Companies'
Articles of Association and no separately transferable right within the meaning
of Section 156a of the Commercial Code has been separated from the Sale Shares.
The Sale Shares of each Company represent such percentage of the Company's
registered capital, rounded to two decimal places, as is set forth in the
relevant provisions of Article VIII hereof. The voting rights attached to the
Sale Shares have been determined on the basis of their nominal value without any
quantitative limitation. For the avoidance of doubt, neither this nor any other
representation of the Seller contained herein shall be construed so that the
acquisition of the Sale Shares by the Purchaser has no effect on the duration,
enforceability, effectiveness, validity of or the ability to further exercise
the special rights attached to the golden Sale Shares under Section 10a (4)(b)
of Act No. 92/1991 Coll., on the Conditions for the Transfer of State-Owned
Assets to Other Persons, as amended, and Article IV, Section 2 of Act No.
210/1993 Coll.; such special rights are vested in the Seller and may not be
exercised by the Purchaser or any other person.
4.7 Seller's Ownership of the Sale Shares. The Seller is the exclusive owner of
each of the Sale Shares, free and clear of any and all Third Party Rights, and
all of the Sale Shares are freely transferable.
4.8 Damages. In the event of a breach by the Seller of any of the
representations of the Seller contained in this Article IV (the "Seller's
Representations") or of any of its agreements, covenants or undertakings
contained in this Agreement (the "Seller's Covenants"), the Seller shall be
obligated to pay to the Purchaser compensation for any damage incurred by the
Purchaser as a result of or in connection with such breach of the Seller's
Representations or the Seller's Covenants.
ARTICLE V
REPRESENTATIONS OF THE PURCHASER
The Purchaser hereby represents that all of the facts set forth in Sections 5.1
through 5.5 hereof are true and correct as of the date hereof and warrants that
such facts shall be true and correct as of the transfer date of the Sale Shares
to the Purchaser.
5.1 Organization of the Purchaser. The Purchaser is a joint-stock company duly
organized and existing under the laws of the Czech Republic.
5.2 Authorization of Agreement. The Purchaser has all requisite corporate
power, authority and legal capacity to execute and deliver this Agreement and
perform its obligations hereunder. This Agreement has been duly and validly
authorized and executed and delivered by the Purchaser and constitutes the
legal, valid and binding obligations of the Purchaser in accordance with
applicable law. The Purchaser's obligations hereunder are enforceable against
the Purchaser in accordance with the terms of this Agreement.
5.3 No Violation. Neither the execution and delivery by the Purchaser of this
Agreement nor the performance by the Purchaser of any of its obligations
hereunder will violate any organizational or similar document of the Purchaser,
or any contractual or other obligation of the Purchaser, or any judgment or
administrative order by which the Purchaser is bound or to which the Purchaser's
assets or any part thereof are subject, or any law or regulation applicable to
the Purchaser.
5.4 Selected Finance Documents. In relation to the Selected Finance Documents,
the Purchaser shall, within nine (9) months of the execution of this Agreement,
(i) obtain documents from the relevant banks,
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pursuant to which the banks shall waive or otherwise forfeit the rights they
would have by virtue of a breach by the Purchaser of the Selected Affirmative
Covenant or (ii) release itself, whether by prepayment of the obligations
resulting from or related to the Selected Finance Documents or otherwise, from
the obligations arising out of the Selected Finance Documents or the Selected
Affirmative Covenant. The Purchaser shall inform the Seller in writing of
compliance or non-compliance with this obligation within the same time limit.
5.5 Consents of Third Parties. Except for (i) consents, permits and
authorizations already obtained by the Purchaser, (ii) the notification under
Section 183d(1) of the Commercial Code that shall be made by the Purchaser in
connection with the acquisition of the Sale Shares after the date of transfer of
the Sale Shares to the Purchaser, and (iii) approval of the concentration by the
Antitrust Office pursuant to Sections 12 et seq. of the Competition Act, no
consent, waiver, approval, permit or authorization of, or declaration or filing
with, or notification to, any person is required on the part of the Purchaser in
connection with the execution and delivery of this Agreement, or the performance
by the Purchaser of any of its obligations hereunder.
5.6 Damages. In the event of a breach by the Purchaser of any of the
representations of the Purchaser contained in this Article V (the "Purchaser's
Representations") or of any of its agreements, covenants or undertakings
contained in this Agreement (the "Purchaser's Covenants"), the Purchaser shall
be obligated to pay to the Seller compensation for any damage incurred by the
Seller as a result of or in connection with such breach of the Purchaser's
Representations or the Purchaser's Covenants.
ARTICLE VI
JOINT COVENANTS OF THE PARTIES
6.1. Consummation of the Sale. The Parties shall take all actions that may be
necessary or desirable for the consummation of the sale of the Sale Shares upon
the terms and subject to the conditions contained herein.
6.2 Concentration Approval.
(a) The Purchaser covenants to file with the Antitrust Office, within seven
days of the execution of this Agreement, an application pursuant to
Competition Act for the approval of the concentration that may be
established by the sale of the Sale Shares hereunder.
(b) In preparing the application for approval of the concentration and in the
course of the procedure in respect of such application, each Party shall
provide to the other Party all requisite assistance, in particular, provide
all the required information to the other Party within the shortest
possible time limits or, if required, procure such information at the
request of the other Party within the shortest possible time limits and
shall act in the procedure so that the Concentration Approval is granted.
(c) Concentration Approval means the decision of the Antitrust Office approving
the concentration established by the sale of the Sale Shares by the Seller
to the Purchaser. Concentration Approval shall also mean the case where,
upon the expiration of a certain time limit, the Antitrust Office shall be
deemed, according to the Competition Act, to have approved the
concentration. Further, Concentration Approval shall also mean a decision
of the Antitrust Office to the effect that the concentration established by
the sale of the Sale Shares by the Seller to the Purchaser is not subject
to approval by the Antitrust Office.
6.3 Antitrust State Aid Decision 1
(a) The Seller covenants to file with the Antitrust Office, within seven days
of the execution of this Agreement, an application for exemption from the
prohibition of State aid under the State Aid Act for the reason that the
sale of the Sale Shares hereunder might be deemed to be State aid.
(b) In preparing the application for exemption from the prohibition of State
aid and in the course of the procedure in respect of such application, the
Purchaser shall provide the Seller all requisite assistance; in particular,
each Party shall provide all the required information to the other Party
within the shortest possible time limits or, if required, procure such
information at the request of the other Party within the shortest possible
time limits and shall act in the procedure so that Antitrust State Aid
Decision 1 is issued.
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(c) Antitrust State Aid Decision 1 means the decision of the Antitrust Office,
pursuant to which the Antitrust Office terminates the procedure because it
has found that no State aid is involved in the sale of the Sale Shares by
the Seller to the Purchaser. Antitrust State Aid Decision 1 shall also mean
a decision of the Antitrust Office, pursuant to which the Antitrust Office
approves an exemption from the prohibition of State aid.
6.4 Information Requirement. If any Party becomes aware of any fact that is
decisive for the running of any time limit determined by this Agreement, it
shall inform the other Party of such fact without delay.
ARTICLE VII
TERMINATION
7.1 Termination. The contractual relationship between the Seller and the
Purchaser hereunder shall terminate only for the following reasons:
(a) prior to the transfer of the Sale Shares to the Purchaser, by mutual
agreement of the Seller and the Purchaser as of the date provided for
herein;
(b) if the REAS Concentration Approval or the CEPS Concentration Approval is
not granted or Antitrust State Aid Decision 1 or Antitrust State Aid
Decision 2 or Antitrust State Aid Decision 3 is not issued, as of the date
on which the time limit for filing a complaint against a final rejection by
the Antitrust Office in any of such matters has expired without such
complaint having been filed or (if such complaint against the rejection by
the Antitrust Office has been filed within the statutory time limit) as of
the date on which the decision of the competent court dismissing such
complaint becomes final and effective;
(c) the obligation of the Purchaser set forth in Section 5.4 hereof has not
been performed within the time limit specified therein;
(d) for the reasons set out in Section 9.1 and/or Section 9.2 and/or Section
9.3 hereof;
(e) rescission by the Seller or the Purchaser prior to the transfer of the Sale
Shares to the Purchaser in the event that the Antitrust Office issues,
instead of Antitrust State Aid Decision 1, a decision approving an
exemption from the prohibition of State aid "subject to specified
conditions," with effect as of the date of delivery of the notice of
rescission;
(f) rescission by the Seller prior to the transfer of the Sale Shares to the
Purchaser, if the Purchaser shall materially breach this Agreement and, if
such breach is capable of being cured, shall fail to cure such breach
within fifteen (15) days after written notice thereof from the Seller, with
effect as of the date of delivery of the notice of rescission to the
Purchaser; or
(g) rescission by the Purchaser prior to the transfer of the Sale Shares to the
Purchaser, if the Seller shall materially breach this Agreement and, if
such breach is capable of being cured, shall fail to cure such breach
within fifteen (15) days after written notice thereof from the Purchaser,
with effect as of the date of delivery of the notice of rescission to the
Seller.
7.2 Exclusion of Certain Provisions of the Commercial Code. Neither Party shall
be entitled to rescind or otherwise terminate this Agreement except as expressly
provided in Section 7.1 hereof, and the application of the provisions of Section
345 (1) and (3), Sections 346 through 350, Section 356 and Section 436(1)(d) of
the Commercial Code shall be excluded and shall not apply to this Agreement.
ARTICLE VIII
DEFINITIONS
For the purposes of this Agreement, the following terms shall have the following
meanings:
"CEPS, a.s." means CEPS, a.s., having its registered office at Elektrarenska
774/2, 101 52 Prague 10, Identification No.: 25702556.
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"Share Settlement Date" means the eighth Business Day immediately following the
later of the Availability Date of All Decisions and the date on which compliance
with the obligations described in Section 5.4 hereof is evidenced and the date
on which the Purchaser and the CEPS Share Transferee execute a written agreement
with the Depositary.
"Draft Settlement Date" means the eighth Business Day immediately following the
preparation and delivery of the New Expert Opinion by the New Expert, insofar as
the New Expert shall be appointed by both courts of competent jurisdiction, or,
as the case may be, of the New Expert Opinion by the Expert, to the Purchaser
and the CEPS Share Transferee.
"Confidential Information" means any information concerning the terms and
conditions of this Agreement and, in addition, any information exchanged between
the Parties and their respective advisers in connection with the negotiation of
this Agreement. Confidential Information shall not include any information which
becomes available to the general public other than by a breach of any obligation
of the relevant Party under Section 10.3 hereof;
"Jihoceska Energetika" means Jihoceska energetika, a.s., having its registered
office at Lannova 16, 370 49 Ceske Budejovice, Identification No.: 60826819.
"Jihomoravska Energetika" means Jihomoravska energetika, a.s., having its
registered office at Lidicka 36, 659 44 Brno, Identification No.: 49970194.
"CZK" means the Czech crown, the lawful currency of the Czech Republic.
"Purchase Price" shall have the meaning ascribed to such term in Section 2.1
hereof.
"Ministry of Labor and Social Affairs" means the division of the executive
branch of the government acting on behalf of the Czech Republic in accordance
with Act No. 219/2000 Coll., on the Property of the Czech Republic and the
Action of the Czech Republic in Legal Relationships, as amended.
"CEPS Share Transferee" means OSINEK, a.s., having its registered office at
Ruska 56, c.p. 397, Ostrava-Vitkovice, Postal Code: 706 02, Identification No.:
0001 2173.
"New Draft" means the draft drawn by the Purchaser on the Seller, made not to
order, in the principal amount equal to the purchase price for the shares in
CEPS, a.s. as determined by the CEPS Share Purchase Price according to the New
Expert Opinion, insofar as the New Expert shall be appointed by both courts of
competent jurisdiction, or, as the case may be, according to the Expert's New
Expert Opinion pursuant to Section 3.6 hereof, payable at sight, to be accepted
by the CEPS Share Transferee as the drawee, in the form of Exhibit A hereto.
"New Expert" means the expert appointed by both courts pursuant to nominations
made by the CEPS Share Transferee and the Purchaser under the CEPS Share
Purchase Agreement. If the proceedings in respect of either of or both the
nominations for the expert under the CEPS Share Purchase Agreement are
discontinued because of a bar of res judicata, New Expert means the expert
nominated under the CEPS Share Purchase Agreement, even though he or she has not
been appointed by the courts.
"New Expert Opinion" means the expert opinion giving a valuation of the shares
in CEPS sold under the CEPS Share Purchase Agreement, prepared by the New Expert
after the Share Settlement Date under Section 3.6 hereof.
"Expert's New Expert Opinion" means the expert opinion giving a valuation of the
shares in CEPS sold under the CEPS Share Purchase Agreement, prepared by the
Expert after the CEPS Share Settlement Date under Section 3.6 hereof.
"Commercial Code" shall have the meaning ascribed to such term in the Preamble
to this Agreement.
"Securities Dealer" means the person having a securities dealer license pursuant
to the Securities Act and being a member of UNIVYC that shall be designated by
written notice of the Purchaser delivered to the Seller within 60 days of the
execution of this Agreement.
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"Availability Date of All Decisions" means the date on which the CEPS
Concentration Approval, the REAS Concentration Approval, Antitrust State Aid
Decision 1, Antitrust State Aid Decision 2 and Antitrust State Aid Decision 3
become final and enforceable. In the event that the above decisions do not
become final and enforceable on the same day, the Availability Date of All
Decisions shall be the latest of the dates on which the CEPS Concentration
Approval, the REAS Concentration Approval, Antitrust State Aid Decision 1,
Antitrust State Aid Decision 2 and Antitrust State Aid Decision 3 become final
and enforceable.
"CEPS Concentration Approval" means the decision of the Antitrust Office
approving the concentration of competitors established by the sale of shares in
CEPS, a.s. by the Purchaser to OSINEK under the CEPS Share Purchase Agreement;
OSINEK shall apply for the approval. CEPS Concentration Approval shall also mean
the case where, upon the expiration of a certain time limit, the Antitrust
Office shall be deemed, according to the Competition Act, to have approved the
concentration of competitors established by the sale of shares in CEPS, a.s. by
the Purchaser to OSINEK under the CEPS Share Purchase Agreement. Further, CEPS
Concentration Approval shall also mean a decision of the Antitrust Office to the
effect that the concentration established by the sale of shares in CEPS, a.s. by
the Purchaser to OSINEK under the CEPS Share Purchase Agreement is not subject
to approval by the Antitrust Office.
"REAS Concentration Approval" shall have the meaning ascribed to such term in
Section 6.2(c) hereof.
"Business Day" means any day on which UNIVYC and banks in the Czech Republic are
open for business.
"Third Party Rights" means any encumbrance and contractual right of a third
party with respect to securities, including, without limitation, any pledge,
right of first refusal, call option or put option, suspension of rights and
restriction on transfer.
"Prazska Energetika" means Prazska energetika, a.s., having its registered
office at Na Hroude 1492/4, 100 05 Prague 10, Identification No.: 60193913.
"Sale Shares" means, collectively, the Sale Shares of Prazska Energetika, the
Sale Shares of Stredoceska Energeticka, the Sale Shares of Vychodoceska
Energetika, the Sale Shares of Severoceska Energetika, the Sale Shares of
Zapadoceska Energetika, the Sale Shares of Jihoceska Energetika, the Sale Shares
of Jihomoravska Energetika, and the Sale Shares of Severomoravska Energetika.
"Jihoceska Energetika Sale Shares" means, collectively, (i) 651,579 book-entry
bearer common shares of Jihoceska Energetika, ISIN: CZ0005077057, having a
nominal value of CZK 1,000 per share, the total nominal value of which
represents 34% of the registered capital of Jihoceska Energetika.
"Jihomoravska Energetika Sale Shares" means, collectively, 1,179,544 book-entry
bearer common shares of Jihomoravska Energetika, ISIN: CZ0005077958, having a
nominal value of CZK 1,000 per share, the total nominal value of which
represents 33.4% of the registered capital of Jihomoravska Energetika.
"Prazska Energetika Sale Shares" means, collectively, 1,315,611 book-entry
bearer common shares of Prazska Energetika, ISIN: CZ0005078154, having a nominal
value of CZK 1,000 per share, the total nominal value of which represents 34% of
the registered capital of Prazska Energetika.
"Severoceska Energetika Sale Shares" means, collectively, (i) 1,565,046
book-entry bearer common shares of Severoceska Energetika, ISIN: CZ0005078055,
having a nominal value of CZK 1,000 per share, (ii) 297 book-entry registered
common shares of Severoceska Energetika, ISIN: CZ0005106781, having a nominal
value of CZK 1,000 per share, and (iii) 1 book-entry registered golden share of
Severoceska Energetika, SIN: 770950001725, having a nominal value of CZK 1,000,
the total nominal value of which represents 48.05% of the registered capital of
Severoceska Energetika.
"Severomoravska Energetika Sale Shares" means, collectively, (i) 1,654,706
book-entry bearer common shares of Severomoravska Energetika, ISIN:
CZ0005078352, having a nominal value of CZK 1,000 per share, (ii) 3,076
book-entry registered common shares of Severomoravska Energetikav, SIN:
770950000404, having a nominal value of CZK 1,000 per share, the total nominal
value of which represents 0.09% of the registered capital of Severomoravska
Energetika, and (iii) 1 book-entry registered golden share of Severomoravska
Energetika, SIN: 770950000677, having a nominal value of CZK 1,000, the total
nominal value of which represents 48.66% of the registered capital of
Severomoravska Energetika.
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"Stredoceska Energeticka Sale Shares" means, collectively, (i) 1,871,706
book-entry bearer common shares of Stredoceska Energeticka, ISIN: CZ0005078253,
having a nominal value of CZK 1,000 per share, (ii) 39 book-entry registered
common shares of Stredoceska Energeticka, SIN: 770950000784, having a nominal
value of CZK 1,000 per share, and (iii) 1 book-entry registered golden share of
Stredoceska Energeticka, SIN: 770950000792, having a nominal value of CZK 1,000,
the total nominal value of which represents 58.30% of the registered capital of
Stredoceska Energeticka.
"Vychodoceska Energetika Sale Shares" means, collectively, (i) 1,265,177
book-entry bearer common shares of Vychodoceska Energetika, ISIN: CZ0005076950,
having a nominal value of CZK 1,000 per share, and (ii) 1 book-entry registered
golden share of Vychodoceska Energetika, SIN: 770950001469, having a nominal
value of CZK 1,000, the total nominal value of which represents 49.62% of the
registered capital of Vychodoceska Energetika.
"Zapadoceska Energetika Sale Shares" means, collectively, (i) 774,853 book-entry
bearer common shares of Zapadoceska Energetikav, ISIN, CZ0005077354, having a
nominal value of CZK 1,000 per share, (ii) 391 book-entry registered common
shares of Zapadoceska Energetika, SIN: 770950000818, having a nominal value of
CZK 1,000 per share, and (iii) 1 book-entry registered golden share of
Zapadoceska Energetika, SIN: 770950000719, having a nominal value of CZK 1,000,
the total nominal value of which represents 48.28% of the registered capital of
Zapadoceska Energetika.
"Purchaser's Representations" shall have the meaning ascribed to such term in
Section 5.6 hereof.
"Seller's Representations" shall have the meaning ascribed to such term in
Section 4.8 hereof.
"Purchaser Settlement Order" means the order entered by the Purchaser through
the Securities Dealer in the UNIVYC settlement system to arrange the
registration of the transfer of the Sale Shares from the securities account of
the Seller maintained at the Securities Center to the securities account of the
Purchaser maintained at the Securities Center on the Settlement Date. The form
of the Purchaser Settlement Order is attached as Exhibit B hereto.
"Seller Settlement Order" means the order entered by the Seller in the UNIVYC
settlement system to arrange the registration of the transfer of the Sale Shares
from the securities account of the Seller maintained at the Securities Center to
the securities account if the Purchaser maintained at the Securities Center on
the Settlement Date. The form of the Seller Settlement Order is attached as
Exhibit C hereto.
"Settlement Orders" means, collectively, the Purchaser Settlement Order and the
Seller Settlement Order.
"Initial Expert Opinion" means the Expert's expert opinion pursuant to which the
shares in CEPS sold under the CEPS Shares Purchase Agreement were valued prior
to the execution of this Agreement.
"Antitrust State Aid Decision 1" shall have the meaning ascribed to such term in
Section 6.3 (c) hereof.
"Antitrust State Aid Decision 2" means the decision of the Antitrust Office,
pursuant to which the Antitrust Office shall terminate the procedure conducted
under the State Aid Act on the basis of an application for an exemption from the
prohibition of State Aid, filed by Ceska konsolidacni agentura, because it has
found that no State aid is involved in the sale of shares under the Zapadoceska
Energetika Share Purchase Agreement. Antitrust State Aid Decision 2 shall also
mean the decision of the Antitrust Office, pursuant to which the Antitrust
Office approves an exemption from the prohibition of State aid.
"Antitrust State Aid Decision 3" means the decision of the Antitrust Office,
pursuant to which the Antitrust Office shall terminate the procedure conducted
under the State Aid Act on the basis of an application for an exemption from the
prohibition of State aid, filed by the CEPS Share Transferee, because it has
found that no State aid is involved in the sale of shares under the CEPS Share
Purchase Agreement. Antitrust State Aid Decision 3 shall also mean the decision
of the Antitrust Office, pursuant to which the Antitrust Office approves an
exemption from the prohibition of State aid.
"Severoceska Energetika" means Severoceska energetika, a.s., having its
registered office at Teplicka 874/8, 405 49 Decin IV, Identification No.:
49903179.
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"Severomoravska Energetika" means Severomoravska energetika, a.s., having its
registered office at 28. rijna 152, 709 02 Ostrava, Identification No.:
47675691.
"Depositary" means the person designated by agreement of the Purchaser and the
CEPS Share Transferee, with whom the Draft will be deposited after its issuance
by the Seller and acceptance by the Purchaser pursuant to Section 3.1 (b)
hereof.
"Draft" means the draft drawn by the Purchaser on the Seller, made not to order,
in the principal amount of CZK 11,620,692,000, payable at sight, to be accepted
by the CEPS Share Transferee as the drawee, in the form attached as Exhibit A
hereto. The principal amount of the Draft shall be equal to the purchase price
for the shares in CEPS, a.s. determined by the CEPS Share Purchase Agreement
prior to its adjustment pursuant to Section 3.6 hereof.
"CEPS Share Purchase Agreement" means the share purchase agreement dated June
28, 2002 entered into by and between the Purchaser and the CEPS Share
Transferee, under which the Purchaser shall transfer to the CEPS Share
Transferee 91,064,240 book-entry registered common shares of CEPS, a.s., having
a nominal value of CZK 100 per share, SIN: 770000002673, representing
approximately 51% of the registered capital of CEPS, a.s.
"Agreement with the Ministry of Labor and Social Affairs" means the share
purchase agreement entered into by and between the Purchaser and the Ministry of
Labor and Social Affairs, under which the Purchaser shall transfer to the
Ministry of Labor and Social Affairs 26,783,600 book-entry registered common
shares of CEPS, a.s., having a nominal value of CZK 100 per share, SIN:
770000002673, representing approximately 15% of the registered capital of CEPS,
a.s., for a purchase price of CZK 3,417,851,000, which may be adjusted according
to the New Expert Opinion or, as the case may be, the Expert's New Expert
Opinion.
"Zapadoceska Energetika Share Purchase Agreement" means the share purchase
agreement entered into by and between the Purchaser and Ceska konsolidacni
agentura, having its registered office at Janovskeho 438/2, Prague 7, Postal
Code: 170 06, Identification No.: 70109966, under which Ceska konsolidacni
agentura shall transfer to the Purchaser 31,754 book-entry registered common
shares of Zapadoceska energetika, a.s., having a nominal value of CZK 1,000 per
share, SIN: 770950000818, representing approximately 1.98% of the registered
capital of Zapadoceska energetika, a.s. for a purchase price of CZK 196,290,000.
"Party" means either the Seller or the Purchaser, and "Parties" means
collectively the Seller and the Purchaser.
"Companies" means, collectively, (i) Prazska Energetika, (ii) Stredoceska
Energeticka, (iii) Vychodoceska Energetika, (iv) Severoceska Energetika, (v)
Zapadoceska Energetika, (vi) Jihoceska Energetika, (vii) Jihomoravska
Energetika, and (viii) Severomoravska Energetika.
"Stredoceska Energeticka" means Stredoceska energeticka, a.s., having its
registered office at Vinohradska 325/8, 120 21 Prague 2, Postal Code: 60193140.
"Closing Date" mean, in accordance with the Resolution, the date on which the
shares in CEPS, a.s. shall be transferred under the CEPS Share Purchase
Agreement from the securities account of the Purchaser maintained at the
Securities Center to the securities account of the CEPS Share Transferee
maintained at the Securities Center.
"UNIVYC" shall have the meaning ascribed to such term in Section III(a) hereof.
"Antitrust Office" means the Office for the Protection of Competition.
"Resolution" shall have the meaning ascribed to such term in the Preamble
hereto.
"Selected Finance Documents" means (i) the DEM 280 Million Multi-Currency Loan
Agreement entered into by and between the Purchaser and a syndicate of banks,
due 2003 and (ii) the EUR 85 Million Guarantee Agreement for the benefit of the
European Investment Bank entered into by and between the Purchaser and a
syndicate of banks, due 2013.
"Selected Affirmative Covenant" means the Purchaser's covenant under the
Selected Finance Documents to hold more than 50% share in the company owning the
assets of the transmission grid.
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"Vychodoceska Energetika" means Vychodoceska energetika, a.s., having its
registered office at Sladkovskeho 215, 501 03 Hradec Kralove, Identification
No.: 60108720.
"Closing" shall have the meaning ascribed to such term in Section 3.1 hereof.
"Draft Settlement" shall have the meaning ascribed to such terms in Section 3.6
(h) hereof.
"Securities Act" shall have the meaning ascribed to such term in the Preamble
hereto.
"Competition Act" means Act No. 143/2001 Coll., on the Protection of Competition
and Amendments to Certain Acts.
"State Aid Act" means Act No. 59/2000 Coll., on State Aid, as amended.
"Zapadoceska Energetika" means Zapadoceska energetika, a.s., Gauldenerova 19,
303 28 Plzen, Identification No. 49790463.
"Purchaser's Covenants" shall have the meaning ascribed to such term in Section
5.6 hereof.
"Seller's Covenants" shall have the meaning ascribed to such term in Section 4.8
hereof.
"Expert" means doc. Ing. Robert Maticka, DrSc., an expert in the area of
economics, prices and appraisals, appointed for the purposes of the CEPS Share
Purchase Agreement in accordance with the provisions of Section 196a (3) and
Section 59 (3) of the Commercial Code by Resolution Ref. No. Nc 4139/2002-7 of
the Prague Municipal Court dated April 8, 2002, which became final and effective
on April 9, 2002.
ARTICLE IX
INTERCONNECTED AGREEMENTS
9.1 If the CEPS Share Purchase Agreement shall not have been entered into
within 60 (sixty) days following the execution of this Agreement or if the
CEPS Share Purchase Agreement shall be terminated, whether by agreement of
the parties thereto or by withdrawal of any of the parties thereto or
otherwise, this Agreement shall terminate as of the same date.
9.2 If the Agreement with the Ministry of Labor and Social Affairs shall not
have been entered into within 60 (sixty) days following the execution of
this Agreement or if the Agreement with the Ministry of Labor and Social
Affairs shall be terminated, whether by agreement of the parties thereto or
by withdrawal of any of the parties thereto or otherwise, this Agreement
shall terminate as of the same date.
9.3 If the Zapadoceska Energetika Share Purchase Agreement shall not have been
entered into within 60 (sixty) days of the execution of this Agreement or
if the Zapadoceska Energetika Share Purchase Agreement shall be terminated,
whether by agreement of the parties thereto or by withdrawal of any of the
parties thereto or otherwise, this Agreement shall terminate as of the same
date.
9.4 If the Antitrust Office fails to issue Antitrust State Aid Decision 1 or
Antitrust State Aid Decision 2 or Antitrust State Aid Decision 3 and issues
instead of any (or all) of them a decision approving an exemption from the
prohibition of State aid "subject to the specified conditions" and,
consequently, any of the agreements referred to in Sections 9.1 through 9.3
hereof terminates, the other agreements referred to in Sections 9.1 through
9.3 hereof shall terminate as of the same date.
ARTICLE X
FINAL PROVISIONS
10.1 Costs and Expenses. The Parties shall bear their own respective costs and
expenses incurred in connection with the negotiation and execution and
delivery of this Agreement and the performance of their obligations
hereunder.
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10.2 Further Assurances. The Parties agree to take such other actions not
expressly provided for herein as may be necessary or desirable for the
consummation of the sale of the Sale Shares upon the terms and subject to the
conditions contained herein.
10.3 Confidentiality and Publicity.
Each of the Parties agrees that it shall not disclose any Confidential
Information to any third party without the prior written consent of the other
Party. This obligation of confidentiality shall not apply to disclosures of
Confidential Information to employees, directors, advisers or agents of the
Parties, provided, however, that the disclosing Party shall in each case be
liable for any breach of the obligations under this Section 10.3 by such
persons. In addition, the obligation of confidentiality under this Section 10.3
shall not apply in the event that a Party is required by applicable law or a
judicial or administrative decision to provide a court or administration body
with any Confidential Information, however, in each such case only to the extent
required by such law or such judicial or administrative decision and subject to
a prompt written notice thereof to the other Party if permitted by applicable
law. Notwithstanding the above provisions of this Section 10.3, the Seller shall
be entitled to disclose any Confidential Information also to the Cabinet of the
Czech Republic, the Ministry of Finance of the Czech Republic, the Ministry of
Industry and Trade of the Czech Republic and the Ministry of Labor and Social
Affairs of the Czech Republic.
10.4 Entire Agreement, Amendments. This Agreement represents the entire
understanding and agreement between the Parties with respect to the subject
matter hereof and can be amended only by a written instrument signed by both
Parties.
10.5 Waivers. No failure on the part of either Party to exercise, and no delay
in exercising or extension of time for the exercise of, any right hereunder
shall operate as a waiver thereof.
10.6 Governing Law. All rights and obligations of the Parties hereunder shall be
governed by the laws of the Czech Republic.
10.7 Arbitration. Any dispute that may arise out of or in connection with this
Agreement shall, to the exclusion of courts of general jurisdiction, be finally
settled by arbitration under the Rules of Arbitration of the Arbitration Court
attached to the Economic Chamber of the Czech Republic and the Agrarian Chamber
of the Czech Republic by three arbitrators appointed in accordance with the
Rules. The Parties agree to perform all obligations placed upon them in the
award within the time limits specified therein. The language of the arbitration
shall be Czech. The venue of the arbitration shall be Prague, the Czech
Republic. This arbitration clause shall be separately enforceable.
10.8 Costs of Arbitration. All costs and expenses of arbitration shall be
apportioned between the parties to the arbitration by the arbitrators on the
basis of the arbitral award.
10.9 Notices. All notices and other communications under this Agreement shall be
in writing and shall be deemed given to the relevant Party when delivered
personally or mailed by registered mail at the following address (or at such
other address as the relevant Party may have specified by notice given to the
other Party pursuant to this Section 10.9):
If to the Seller:
Fond narodniho majetku Ceske republiky
Rasinovo nabrezi 42
120 00 Praha 2
Attention: 2nd Vice-Chairman of the Executive Committee
If to the Purchaser:
CEZ, a.s.
Duhova 2/1444
Praha 4 - Michle, PSC: 140 53
Attention: Ing. Miroslav Stehlik, Director of Equity Interest Section
16
10.10 Severability. If any one or more of the provisions contained in this
Agreement is for any reason held to be invalid, illegal or unenforceable in any
respect, then, to the maximum extent permitted by law, such invalidity,
illegality or unenforceability shall not affect any other provision of this
Agreement, and the Parties shall attempt to deliver the benefits of such
provision in a manner that is not invalid, illegal or unenforceable.
10.11 Binding Effect; Assignment. This Agreement shall be binding upon the
Parties and their respective successors and permitted assigns. With the
exception of the Seller's right to assign all or any part of its claims against
the Purchaser for the payment of the Purchase Price to the Ministry of Labor and
Social Affairs, neither the Seller nor the Purchaser shall be entitled to assign
its rights hereunder to any third party without the prior written consent of the
other Party. The Seller shall only be entitled to use the Draft delivered to it
hereunder in accordance with the Resolution, i.e., to increase the registered
capital of the CEPS Share Transferee by setting off the amount payable under the
Draft against the claim of the CEPS Share Transferee for the payment of the
issue price of the shares. The Seller shall not be entitled in any way to
transfer the drafts drawn by the Purchaser under Section 2.2 (d) through (g)
hereof or the rights thereunder; such drafts may be made by the Purchaser "not
to order."
10.12 No Unilateral Setoff. None of the Parties shall be entitled to any
unilateral setoff of any claim it may have against the other Party in respect of
any of its obligations it may have to the other Party hereunder.
10.13 Default Interest. In the event of a default in the payment of any amount
due and payable under this Agreement, the defaulting Party shall pay to the
other Party, from the default date until the date such amount shall have been
paid, default interest at a rate of 0.05% for each day of default.
10.14 Counterparts. This Agreement has been executed in four (4) counterparts.
Each of the Parties shall receive two counterparts.
17
Prague, July 28, 2002
On behalf of Fond narodniho majetku Ceske republiky:
[signature]
- -----------------------------------
Name: Ing. Vladislav Raska
Title: First Deputy Director of the Executive Committee
[signature]
- -----------------------------------
Name: Ing. Jan Juchelka
Title: Second Deputy Director of the Executive Committee
On behalf of CEZ, a.s.:
[signature]
- -----------------------------------
Name: Ing. Jaroslav Mil, M.B.A.
Title: Chairman of the Board of Directors
[signature]
- -----------------------------------
Name: JUDr. Ivan Cestr
Title: Director
18
Exhibit A
[Form Draft]
| Prague, [ ] [ ], 2002
| ---------------------
| Place and date of issuance
|
| at sight Pay for this Draft
| Maturity
|
Accepted on [ ] [ ], | To: Fond narodniho majetku Ceske republiky, with its registered office at
2002 OSINEK, a.s., | Rasinovo nabrezi 128 00, Praha 2, Identification No.: 41692918
Ruska 56, c.p. 397, |
Ostrava-Vitkovice, | NOT TO ORDER
Postal Code: 706 02, |
Identification No.: | Currency CZK Sum ==[ ]==
0001 2173 |
|
| ==[ ] Czech crowns==
- ----------------- |
Date of acceptance | Sum in words
and signature of the |
acceptor | The Draft may be presented for payment within five years of the
| issuance date.
|
| Drawee: OSINEK, a.s., Ruska 56, c.p. 397, Ostrava-Vitkovice, Postal Code: 706
| 02, Identification No. 0001 2173
|
| Due and payable in (place of payment): Ostrava - Vitkovice
|
| CEZ, a.s., with its registered office at Duhova 2/1444, 140 53 Praha
| 4, Identification No.: 45274649
|
|
| -----------------------------------------------------------------
| Business name, address and signature(s) of the person(s)
| authorized to act on behalf of the drawer, with the specification
| of title
19
Exhibit B
[Form of Purchaser Settlement Order]
The Agent, a.s., with its registered office at .............................,
represented by ....................... (name, surname, title), authorized to
represent the purchaser, .........................., with its registered office
at ............................., in procuring the settlement of the purchase of
the book-entry securities specified below, hereby requests UNIVYC, a.s., with
its registered office in Praha 1, Rybna 14, Identification No.: 25 08 14 89
("Univyc") to check the matched transfer orders regarding the sale of shares in
Prazska energetika, a.s., Stredoceska energeticka, a.s., Vychodoceska
energetika, a.s., Severoceska energetika, a.s., Zapadoceska energetika, a.s.,
Jihoceska energetika, a.s., Jihomoravska energetika, a.s., and Severomoravska
energetika, a.s.:
Name (business name) of the Agent: ....................
Contact Person, Tel. No.: ....................
The Dealer's No. at Univyc: ....................
Type of Settlement: ....................
The owner's Registration No. at the Securities Center: ....................
The owner's Identification No. at the Securities Center: ....................
ISIN of the Securities: ....................
Number of Securities Transferred: ....................
Price per Security: ....................
Settlement Date: ....................
...................................................................
signature of the person authorized to act on behalf of the Dealer,
conforming to the specimen signatures kept at Univyc
20
Exhibit C
[Form of Seller Settlement Order]
(Name of transferor) ......................., with its registered office at
.............................., represented by ....................... (name,
surname, title), hereby requests UNIVYC, a.s., with its registered office in
Praha 1, Rybna 14, IC: 25 08 14 89 ("Univyc") to check the matched transfer
orders regarding the sale of shares in Prazska energetika, a.s., Stredoceska
energeticka, a.s., Vychodoceska energetika, a.s., Severoceska energetika, a.s.,
Zapadoceska energetika, a.s., Jihoceska energetika, a.s., Jihomoravska
energetika, a.s., and Severomoravska energetika, a.s.:
Name of the Transferor: ....................
Contact Person, Tel. No.: ....................
The Transferor's No. at Univyc: ....................
Type of Settlement: ....................
The owner's Registration No. at the Securities Center: ....................
The owner's Identification No. at the Securities Center: ....................
ISIN of the Securities: ....................
Number of Securities Transferred: ....................
Price per Security: ....................
Settlement Date: ....................
.......................................................................
signature of the person authorized to act on behalf of the Transferor,
conforming to with the specimen signatures kept at Univyc
21
Exhibit D
[Form Promissory Note of the Purchaser]
Currency CZK Sum ==[]==
Prague, [ ] [ ], 2002
- ---------------------
Place and date of issuance
I promise to pay on []
Maturity Date
to: Fond narodniho majetku Ceske republiky, with its registered office at
Rasinovo nabrezi 128 00, Praha 2, Identification No.: 41692918
not to order
==[] Czech crowns==
Sum in words
Due and payable in (place of payment): Prague CEZ, a.s.
Due and payable at (domicile): [fill in a Czech bank or Duhova 2/1444, 140 53 Praha 4 a foreign
bank branch in Prague] Identification No.:
45274649
----------------------------------------------
Business name, address and signature(s) of the
person(s) authorized to act on behalf of the
drawer, with the specification of title
22
CERTIFICATION OF FAIR AND ACCURATE TRANSLATION
The undersigned hereby certifies that to the best of my knowledge the above
English translation is a fair and accurate translation of the original Czech
language document.
Date: June 25, 2003 By: /s/ Libuse Latalova
---------------------------------
Name: Libuse Latalova
Title: Head of Finance Administration