EXHIBIT 4.11
DATED 2 MARCH 2006
(1) CORPORATE SYNERGY
(2) THE DIRECTORS
(3) GOLD FROST LTD
(4) X. XXXXX-FOOD INTERNATIONAL LTD
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PLACING AND
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XXX.XXXXXXXXXXXXXXXX.XX.XX
00 XXXXX XXXXX XXXXXX XXXXXX XX0X 0XX
T x00 (0)00 0000 0000 F x00 (0)00 0000 0000
DX 0000 XXXXXX XXXXXXXX XXXX
CONTENTS
CLAUSE PAGE
1. INTERPRETATION 1
2. CONDITIONS 5
3. APPLICATION FOR ADMISSION 6
4. AUTHORITIES 6
5. PLACING 7
6. ALLOTMENT OF PLACING SHARES 7
7. PAYMENT AND REGISTRATION 8
8. FEES, COMMISSIONS AND EXPENSES 9
9. WARRANTIES 10
10. INDEMNITY 11
11. TERMINATION 15
12. ANNOUNCEMENTS 16
13. NOTICES 17
14. GENERAL 18
SCHEDULE 1 20
SCHEDULE 2 21
SCHEDULE 3 22
SCHEDULE 4 29
AGREED FORM DOCUMENTS
Announcement
AIM Admission Document (Final Proof)
Controlling Shareholder Agreement
Legal Due Diligence Report
Long Form Report
Option Agreement
Presentation
Rule 39 Letters
Working Capital Report
DATED March 2006
PARTIES
(1) CORPORATE SYNERGY PLC (registered number 02617599) whose registered office
is at 00 Xxx Xxxxx Xxxxxx, Xxxxxx XX0X 0XX ("CS");
(2) THE PERSONS whose names and addresses are set out in Schedule 1 (the
"DIRECTORS"); and
(3) GOLD FROST LTD, a company which is incorporated and registered in Israel
(registered number 52-003482-8) whose registered office is at 0 Xxxxx, Xxxx
Xxxxxx, Xxxxx 00000, Xxxxxx (the "COMPANY").
(4) X. XXXXX-FOOD INTERNATIONAL LTD, a company which is incorporated and
registered in Israel (registered number 520043209) whose registered office
is at 0 Xxxxx, Xxxx Xxxxxx, Xxxxx 00000, Xxxxxx (the "PARENT").
RECITALS
(A) Subject to and upon the terms and conditions set out below, the Company
proposes to issue 12,857,142 Ordinary Shares, being the Placing Shares, at
the Placing Price, to Placees procured by or on behalf of CS, to provide
additional working capital to the Group.
(B) CS is willing as agent for the Company to use reasonable endeavours to
procure subscribers for the Placing Shares and CS will act as the Company's
nominated adviser and broker following completion of the fundraising
referred to above.
(C) Application will be made for the admission to trading on AIM of the
Admission Shares.
OPERATIVE PROVISIONS
1. INTERPRETATION
1.1 In this agreement (including the recitals and the Schedules) the following
words and expressions have the following meanings unless the context
otherwise requires:
"ADMISSION" means the admission of the Admission Shares to trading on AIM
becoming effective as provided in rule 6 of the AIM Rules;
"ADMISSION SHARES" means all Ordinary Shares which will be in issue or
unconditionally allotted following Admission;
"AIM" means the market of that name operated by London Stock Exchange;
"AIM ADMISSION DOCUMENT" means the document in the Agreed Form containing
details of the Placing and comprising an admission document for the
purposes of the AIM Rules;
"AIM RULES" means London Stock Exchange's rules relating to AIM as in force
at the date of this agreement or, where the context requires, as amended or
modified after the date of this agreement;
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"ANNOUNCEMENT" means the regulatory announcement in the Agreed Form
containing details of the Placing which announcement shall have been made
in accordance with AIM Rule 2 prior to the date of this agreement;
"ASSOCIATED COMPANY" means in relation to a company, any subsidiary
undertaking or parent undertaking in relation to it or any subsidiary
undertaking in relation to such a parent undertaking;
"BOARD" means the board of directors of the Company from time to time or a
duly authorised committee of it;
"BROKER" has the meaning given to the expression "BROKER" in the AIM Rules;
"BUSINESS DAY" means a day upon which dealings in domestic securities may
take place on London Stock Exchange;
"CA 85" means the Companies Xxx 0000 (as amended by the Companies Act
1989);
"COMPANY'S SOLICITORS" means Mishcon de Reya of Xxxxxx Xxxxx, 00 Xxx Xxxx
Xxxxxx, Xxxxxx XX0X 0XX (as to English law) and Xxxxx Legal Partners of 00
Xxxxx Xxxxxx, Xxxxxxxxx Xxxxxxx 00000, Xxxxxx (as to Israeli law);
"CONDITIONS" means the conditions set out in clause 2.1;
"CONTROLLING SHAREHOLDER AGREEMENT" means the agreement in the Agreed Form
of even date between the Company and the Parent;
"CREST" means the computer-based system established under the Regulations
which enables title to units of relevant securities (as defined in the
Regulations) to be evidenced and transferred without a written instrument
and in respect of which CRESTCo Limited is the Operator (as defined in the
Regulations);
"DIRECTORS" means those persons listed in Schedule 1;
"EXECUTIVE DIRECTORS" means Xxx Xxxxxxxx, Xxxxxx Xxxxxxxx and Xxx Hochboim;
"EXISTING ORDINARY SHARES" means the Ordinary Shares in issue on the date
of this agreement;
"FORMS OF CONFIRMATION" means the letters of confirmation attached to the
Placing Letters;
"FSA" means the Financial Services Authority;
"FSMA" means the Financial Services and Markets Xxx 0000;
"GROUP" means the Company and its subsidiary undertakings and associated
undertakings from time to time (if any) and "MEMBER OF THE GROUP" shall be
construed accordingly;
"INDEMNIFIED PERSON" means CS, each subsidiary of CS and each of the
directors, officers and employees of CS and each such subsidiary;
"INDEMNITY" means the indemnity contained in clause 10.2;
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"ISSUE DOCUMENTS" means the Placing Letter, the Presentation and the AIM
Admission Document;
"LAST ACCOUNTS" means the audited consolidated profit and loss account of
the Group for the twelve months' period ended on the Last Accounts Date and
the audited consolidated balance sheet of the Group as at the Last Accounts
Date and the notes to and the directors' and auditor's reports on them;
"LAST ACCOUNTS DATE" means 30 September 2005;
"LEGAL DUE DILIGENCE REPORT" means the Company's Solicitors' legal due
diligence report on the Company in the Agreed Form addressed to each of the
Company and CS, of even date;
"LISTING RULES" means the listing rules made pursuant to Part VI of FSMA;
"LONDON STOCK EXCHANGE" means London Stock Exchange plc;
"LONG FORM REPORT" means the long form report by Haysmacintyre on the
Company in the Agreed From addressed to each of the Company and CS;
"LONG STOP DATE" means 23 March 2006;
"MARRIOTT XXXXXXXX" means Marriott Xxxxxxxx of 00 Xxxxx Xxxxx Xxxxxx,
Xxxxxx XX0X 0XX;
"NIS" means New Israeli Shekels;
"NOMINATED ADVISER" has the meaning given to the expression "NOMINATED
ADVISER" in the AIM Rules;
"NON-EXECUTIVE DIRECTORS" means Xxxxx Xxxxxx, Xxxx Xxxxxxxxxx and Xxx
Xxxxxxxx;
"ORDINARY SHARES" means ordinary shares of NIS 1.0 each in the capital of
the Company;
"PLACEES" means persons who have, immediately prior to Admission, agreed to
subscribe for Placing Shares pursuant to the Placing Letters and who have
not withdrawn such agreement to subscribe for Placing Shares as at
Admission;
"PLACING" means the placing of the Placing Shares pursuant to this
agreement;
"PLACING LETTERS" means the placing letters delivered or sent to potential
Placees by CS in connection with the Placing including the letters of
confirmation attached to them;
"PLACING PRICE" means the price of 35 xxxxx per Placing Share;
"PLACING PROOF" means the placing proof of the AIM Admission Document in
the Agreed Form;
"PLACING SHARES" means 12,857,142 Ordinary Shares which are to be issued by
the Company pursuant to the Placing and the terms of this agreement;
"PRESENTATION" means the institutional presentation in the Agreed Form ;
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"REGISTRARS" means the Company's registrars, being Computershare Investor
Services PLC of XX Xxx 00, Xxx Xxxxxxxxx, Xxxxxxxxxx Xxxx, Xxxxxxx XX00
0XX;
"REGULATIONS" means the Uncertificated Securities Regulations 2001 (SI 2001
No. 3755);
"REGULATORY NEWS SERVICE" means the electronic information dissemination
service operated by the London Stock Exchange's Company Announcements
Office, or any alternative "PIP service" (primary information provider
service) which the Company has selected for the purposes of making
regulatory announcements in accordance with the AIM Rules;
"SETTLED" means agreed, compromised or settled by the relevant Indemnified
Person in accordance with clause 10.5 or determined by a court of competent
jurisdiction to be the responsibility of an Indemnified Person and
"Settlement" shall be construed accordingly;
"SPECIFIED EVENT" means an event occurring or matter arising on or after
the date of this agreement and before Admission which if it had occurred or
arisen before such date would have rendered any of the Warranties untrue or
incorrect; in any material respect;
"SUPPLEMENTARY ADMISSION DOCUMENT" means any document supplementary to the
AIM Admission Document which the Company is required to publish in
accordance with this Agreement;
"VAT" means United Kingdom value added tax;
"VERIFICATION NOTES" means the verification notes, questions and answers in
their final, signed form dated with the date of this agreement relating to
the AIM Admission Document and the Announcement;
"WARRANTIES" means the warranties set out in clause 9 and Schedule 3; and
"WARRANTY CERTIFICATE" means a certificate in the form set out in Schedule
4; and
"WORKING CAPITAL REPORT" means the board memorandum in the Agreed Form
containing the cash flow and working capital projections for the period to
30 June 2007 in relation to the Company (including a forecast of its
working capital requirements).
1.2 In this agreement:
(A) any reference to a document being "IN THE AGREED FORM" means in the
form of the draft signed for the purpose of identification by Marriott
Xxxxxxxx (on behalf of CS) and either of the Company's Solicitors (on
behalf of the Company) with such alterations (if any) as may
subsequently be agreed by or on behalf of the parties;
(B) the Interpretation Xxx 0000 shall apply in the same way as it applies
to an enactment;
(C) save where the context otherwise requires and except as expressly
provided to the contrary, words and expressions defined in CA 85 have
the same meaning as in CA 85 save that references to a "company" shall
be construed so as to include any company, incorporation or other
corporate body wheresoever and howsoever incorporated or established;
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(D) references to clauses, recitals and Schedules are to clauses of and
recitals and Schedules to this agreement;
(E) headings are included for convenience only and shall be disregarded in
its interpretation;
(F) any document referred to as being certified shall be certified as a
true and complete copy by either of the Company's Solicitors;
(G) general words shall not be given a restrictive meaning by reason of
their being preceded or followed by words indicating a particular
class or examples of acts matters or things;
(H) any obligations arising from, or representations, warranties,
indemnities and undertakings made or given under, the provisions of
this agreement which are incurred, made or given by two or more
persons shall, unless expressly provided to the contrary, be joint and
several;
(I) references to "(pound)", "pounds" or "xxxxx" shall be to the currency
of the United Kingdom.
2. CONDITIONS
2.1 The obligations of CS under clauses 6 and 7 of this agreement are
conditional upon:
(A) the release of the Announcement through the Regulatory News Service by
not later than 7.30 am on 24 February 2006;
(B) the delivery to Marriott Xxxxxxxx on behalf of CS of each of the
documents referred to in Schedule 2 by the times and in the form
referred to in that Schedule;
(C) the Controlling Shareholder Agreement having been duly executed by the
Parent and dated with a date being no later than the date which falls
immediately prior to the date of Admission and a certified copy having
been delivered to Marriott Xxxxxxxx on behalf of CS;
(D) the Warranty Certificate having been duly executed and dated with the
date immediately prior to the date of Admission and having been
delivered to Marriott Xxxxxxxx on behalf of CS on that date;
(E) the Company having fully complied with its obligations under this
Agreement to the extent that such obligations are required to be
performed before Admission;
(F) the obligations of CS not having been lawfully terminated pursuant to
clause 11; and
(G) Admission having become effective at or before 8.00 a.m. on 9 March
2006;
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or (in the case of any time/date provided above) such later time or date
(being not later than 3.00 p.m. on the Long Stop Date) as the Company and
CS may agree in writing PROVIDED THAT each of the parties shall perform its
obligations under this agreement until such time (if any) as any of the
Conditions shall have become incapable of being satisfied.
2.2 The Company shall, with the assistance of CS, procure due satisfaction of
the Conditions set out in clauses 2.1.(A), 2.1(B) and use all reasonable
endeavours to procure the fulfilment of the other Conditions in each case
by the times and dates (if any) stated in clause 2.1.
2.3 If any of the Conditions are not fulfilled (or waived in writing by CS) by
3.00 p.m. on the Long Stop Date, this agreement shall automatically lapse
(unless CS shall first have served notice in writing upon the Company to
extend the Long Stop Date, any such notice being in the absolute discretion
of CS) and clause 11.4 shall apply. CS may, in its absolute discretion,
waive or extend the time and date for the satisfaction of any of the
Conditions. Any such waiver or extension may be granted by CS subject to
such conditions as CS may in its absolute discretion consider appropriate.
3. APPLICATION FOR ADMISSION
3.1 Subject to the condition specified in clause 3.3 the Company hereby
instructs CS to make an application for Admission and will use all
reasonable endeavours with the assistance of CS to obtain Admission
including paying all fees and executing and delivering all such documents
as shall be necessary in connection with the application therefor and,
insofar as lies within its power, shall generally use all reasonable
endeavours to do or procure to be done all such things as may properly be
required by London Stock Exchange for the purposes of or in connection with
Admission so as to enable Admission to take place by 8.00 a.m. on9 March
2006.
3.2 CS is given all such reasonable and proper authorities and powers by the
Company as are required for the purposes of obtaining Admission and CS
shall take all reasonable steps to assist in the obtaining of Admission
including (without limitation) liaising with and dealing (insofar as it is
able) with any requirements of London Stock Exchange in connection with the
same.
3.3 The application for Admission shall be conditional upon fulfilment of the
following conditions (unless waived in writing by the Company) (i) the
receipt by CS of duly executed Placing Letters from Placees containing
commitments to subscribe in aggregate for all the Placing Shares at the
Placing Price, (ii) the receipt by CS of cleared funds from any Placees who
do not intend to take their Placing Shares through CREST, and (iii) none of
such Placees having indicated any intention to CS prior to Admission to
withdraw its commitment to subscribe for the number of Placing Shares
indicated in its duly executed Placing Letter. In the event that either of
the conditions expressed in this clause is not satisfied, then CS shall
immediately notify the Company of this event and, unless the Company
consents to the contrary, CS shall use all reasonable endeavours to
withdraw the application for Admission, and this agreement shall
automatically lapse and Clause 11.4 shall apply.
4. AUTHORITIES
4.1 The Company authorises and instructs CS and CS hereby agrees to use its
reasonable endeavours to procure subscribers at the Placing Price for the
Placing Shares and for such purpose:
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(A) irrevocably appoints CS as its agent for the purpose of procuring
Placees and confirms its authority to CS or its agents to seek
commitments from Placees by the distribution of Placing Letters and
copies of the Presentation and Placing Proof;
(B) confers on CS and its agents all lawful and proper powers, authorities
and discretions on behalf of the Company which are within its powers
and necessary to implement the Placing; and
(C) agrees to ratify and approve all documents, acts and things which CS
and its agents shall lawfully and properly do or have done in the
exercise of or in contemplation of such appointment, powers,
authorities and discretions.
4.2 The Company shall give all such assistance and provide any information CS
may reasonably require for the making and implementation of the Placing and
subject to the advice of the Company's Solicitors given in good faith will
do (or procure to be done insofar as it is reasonably able) all such
reasonable things and execute (or procure to be executed insofar as it is
reasonably able) all such reasonable documents as may be necessary to be
done or executed by the Company or on its behalf by its officers or
employees in connection with the Placing.
5. PLACING
5.1 Pursuant to but without limiting the authority in clause 4.1, CS agrees, as
agent of the Company and in reliance on the Warranties, to use reasonable
endeavours to procure persons to subscribe for the Placing Shares at the
Placing Price and otherwise upon the terms of the Issue Documents.
5.2 CS shall hold all subscription monies received by it from Placees pending
payment of the sums due under clause 7 or (if this agreement shall lapse in
accordance with clauses 2.3 or 3.3 or shall be terminated pursuant to
clause 11) return of the same to the persons entitled to those monies.
5.3 For the avoidance of doubt, nothing in this Agreement obliges CS to
subscribe any Placing Shares itself or implies an absolute obligation on it
to subscribe any Placing Shares, and CS may, if it so wishes, subscribe as
a Placee some of the Placing Shares.
6. ALLOTMENT OF PLACING SHARES
6.1 Subject to prior notifications in accordance with Clause 6.2, (if all
Conditions other than allotment of the Placing Shares and Admission have
been satisfied) the Company shall allot Placing Shares to the persons
notified in accordance with clause 6.2, conditionally only upon Admission
and otherwise upon the terms of the Issue Documents, and following such
allotment shall deliver to Marriott Xxxxxxxx on behalf of CS a certified
copy of the relevant allotment resolution.
6.2 CS shall notify the Company as soon as possible following the signature of
this agreement of the names and denominations in which the Placing Shares
are to be allotted and issued as specified in the registration particulars
included in the Forms of Confirmation together with details as specified in
the Forms of Confirmation of those shares which are to be held in
certificated form and those which are to be held in uncertificated form
and, with respect to the latter, specifying each relevant Placee's CREST
participant ID reference and the relevant CREST member account ID
reference(s) relating to the CREST member account(s) to which that Placee
wishes Placing Shares to be credited, and further specifying any other
information reasonably required to enable the Company's shares to be traded
on AIM.
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6.3 The Placing Shares allotted pursuant to this clause 6 shall be issued
subject to the memorandum and articles of association of the Company and
subject to payment in full of the Placing Price for each such share and
shall be allotted and issued fully paid free from all claims, liens,
charges, encumbrances and equities and on terms that they rank pari passu
in all respects with the Existing Ordinary Shares.
6.4 In the event that any Placee shall fail within 72 hours from Admission to
make payment in full for the Placing Shares allotted to it in accordance
with this clause 6, CS shall notify the Company of this fact and shall use
its reasonable endeavours to find an alternative person to acquire such
shares. If CS procures an alternative person to acquire such shares, and
such person pays for the shares in full in cleared funds, then such person
shall be deemed to replace the original Placee for the purposes of this
agreement. CS acknowledges that it may be required pursuant to the Civil
Procedure Rules of England and Wales to provide evidence to a court in
respect of any claim which the Company may make against any such non-paying
Placee. CS confirms that it shall, as agent of the Company, request (in
such manner and at such times as XX xxxxx reasonable) any such non-paying
Placee to make payment to the Company. CS shall use its reasonable
endeavours on behalf of the Company, by liaising with the Registrar and
monitoring the operation of the DVP system within CREST and in respect of
any Placing Shares to be issued in uncertificated form, with the aim of
ensuring that no Placing Shares are acquired by any Placee which has not
paid for such shares in full in cleared funds.
7. PAYMENT AND REGISTRATION
7.1 Subject to the satisfaction or waiver of all the Conditions, CS will pay or
cause to be paid to the Company to the account specified in clause 7.4, or
as the Company may direct, the proceeds of the Placing (being the Placing
Price multiplied by the number of the Placing Shares) which shall have been
received by it in cleared funds (the "PLACING PROCEEDS"), less the fees and
commission referred to in clause 8.1 and less any costs and expenses which
CS is entitled to be reimbursed pursuant to clause 8.2 and less any
deduction properly made pursuant to clause 8.4 as soon as reasonably
practicable following Admission and subject to the preceding provisions of
this clause not later than the second Business Day after the date of
Admission.
7.2 As soon as practicable following Admission, and subject to clause 6.4, the
Company shall instruct its Registrars to procure registration (without
registration fees and in accordance with the Regulations) of the Placees
(as indicated to it in accordance with clause 6.2) as the holders of
Placing Shares.
7.3 Company shall instruct its Registrars to procure that definitive
certificates in respect of the Placing Shares which CS shall have notified
the Company under clause 6.2 (subject to the operation of clause 6.3) are
to be issued in certificated form will be prepared and delivered or posted
to the persons entitled to them and that the appropriate CREST member
accounts are properly credited in respect of Placing Shares which CS shall
have notified the Company under clause 6.2 are to be issued in
uncertificated form, in each case as soon as practicable after Admission
or, in the event of any difficulties or delays in the admission of the
Placing Shares to CREST and if CS shall so determine, shall procure that
definitive certificates in respect of all of the Placing Shares shall be
prepared and delivered to the Placees as soon as reasonably practicable
thereafter.
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7.4 The account of the Company referred to in clause 7.1 is:
Bank Bank Leumi
Branch Alenbi no. 802
Swift-code XXXXXXXX000 or IBAN: IL10802
Account Number 655900/61
Account Name Gold Frost Ltd.
7.5 The Company irrevocably instructs CS either itself or through its agents to
make payments to the Company under clauses 7.1 and 7.2 by electronic funds
transfer.
8. FEES, COMMISSIONS AND EXPENSES
8.1 In consideration of the services to be provided by CS in connection with
the Placing, and subject to Admission occurring, the Company shall pay
(together with VAT where applicable):
8.1.1 to CS a corporate finance fee of (pound)100,000 (which shall
become due and owing once all of the Placing Proceeds (being
(pound)4,499,999.70) shall have been received by CS in cleared
funds);
8.1.2 to CS a commission of 5.5% of the Placing Proceeds which have
been received by CS in cleared funds;
8.1.3 the expenses to be borne by the Company under clause 8.2.
8.2 Whether or not Admission occurs, the Company will bear all expenses of or
incidental to the Placing, including, without limitation, the fees of its
and CS's professional advisers (including the reasonable fees plus out of
pocket expenses of Marriott Xxxxxxxx, subject to a maximum in respect of
such fees of (pound)20,000 and in respect of disbursements of (pound)600
inclusive in each case of VAT) (provided always that all fees and expenses
of CS in excess of (pound)1,000 per item have been approved in advance by
the Company), the cost of printing (and CS shall use its reasonable
endeavours to ensure that the printers of the AIM Admission Document shall
invoice the Company directly) and distribution of the Issue Documents, the
Announcement and the AIM Admission Document and all other documents
connected with the Placing, brokers' fees, Registrars' fees, all reasonable
out of pocket expenses and disbursements of CS and, where properly
chargeable, VAT (provided always that CS shall not deduct any expenses from
the Placing Proceeds which it remits to the Company other than the expenses
stated on the schedule of expenses in the Agreed Form). The Company will
forthwith upon demand by CS (as the case may be) reimburse to it the amount
of any such expenses which it has paid on behalf of the Company.
8.3 Save where this agreement lapses in accordance with clauses 2.3 or 3.3, or
is terminated pursuant to clause 11, the amounts payable under clause 8.1
shall become payable at the times indicated in clause 8.1 and may be
withheld by CS from any payment under clause 7.1 against production of an
invoice therefor.
8.4 Where under any provision of this agreement a sum is reimbursed to CS the
Company shall, in addition, pay to CS, as appropriate, in respect of VAT:
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8.4.1 to the extent that any reimbursement is in respect of any supply
of services to the Company, such amount as equals any VAT
properly charged to CS in respect of such expenses and which it
is unable to recover together with an amount representing any VAT
properly chargeable on the consideration for the supply; and
8.4.1 any VAT properly chargeable on the consideration for the supply;
and
8.4.2 to the extent that any such reimbursement is in respect of a
disbursement made by CS as agent on behalf of the Company, such
amount as equals any VAT properly paid on that disbursement by CS
(provided that CS shall notify the supplier that the supply is
being made to an overseas company, and shall seek to have the
supplier invoice the Company directly).
9. WARRANTIES
9.1 The Company the Parent and each of the Executive Directors (each of whom
acknowledges that CS is entering into this agreement in reliance on such
Warranties) warrant to CS in the terms set out in Part 1 of Schedule 3.
Each of the Non-Executive Directors (each of whom acknowledges that CS is
entering into this agreement in reliance on such warranty) warrants to CS
in the terms set out in Part 2 of Schedule 3.
9.2 Where any of the Warranties is given to the best of the knowledge,
information and belief of the Company, the Parent or the Directors (or
qualified by any similar expression) the Company, the Parent and each of
the Directors is deemed also to warrant that such Warranty has been given
after it has made all due and careful enquiries.
9.3 Acceptance of the terms of this agreement will constitute an undertaking by
the Company not knowingly, recklessly or negligently to cause, and to use
all reasonable endeavours not to permit, any Specified Event to occur
before Admission.
9.4 If any breach of Warranty or Specified Event or matter which may give rise
to a claim under the Indemnity shall occur or come to the knowledge of the
Company, the Parent or any of the Directors prior to Admission or any other
fact or circumstance occurs or arises within its or his knowledge at any
time prior to Admission which would or might constitute a significant new
factor, material mistake or inaccuracy for the purposes of section 87G of
FSMA as if the Admission Document were a prospectus for the purposes of
Part II of FSMA, it or he shall forthwith give notice of the same to CS and
provide it with such information with regard to it as CS shall reasonably
require.
9.5 Each of the Directors severally warrants in relation to himself only that:
(A) he has never been charged with or convicted of any criminal offence
other than a road traffic offence (except one involving or which could
involve a custodial sentence, whether suspended or not);
(B) the performance of his duties to the Company will not breach or
infringe any obligation, duty or restriction binding upon him or to
which he is otherwise subject (including, without limitation, any duty
of confidence or any non-competition or other restrictive covenant);
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(C) he has never been the subject of any order under the Company Directors
Disqualification Xxx 0000 or been adjudged bankrupt or been the
subject of a petition for a bankruptcy order duly presented to the
Court or entered into a voluntary arrangement (within the meaning
given in Section 253 Insolvency Act 1986) or been the subject of any
interim order under Section 252 of that Act nor have any bankruptcy or
any analogous proceedings been brought against him;
(D) he has received advice and guidance from the Company's Solicitors as
to the nature of his responsibilities and obligations under the AIM
Rules in relation to the application for Admission, the Company's
compliance with the AIM Rules on an ongoing basis and his status as a
director of an AIM quoted company under the AIM Rules and he has had a
proper opportunity to discuss, and raise questions concerning, such
advice and guidance with the Company's Solicitors.
9.6 Each Director's and the Parent's aggregate liability for all claims made by
CS under the Warranties is limited to the amount set out against his or its
name in Schedule 1 unless the claim, or the delay in discovering it,
results from the fraud, or wilful concealment of such Director or the
Parent in which case the liability of that Director and/or the Parent (as
the case may be) shall be unlimited.
9.7 The Warranties shall continue in full force and effect notwithstanding the
completion of all matters and arrangements referred to in or contemplated
by this agreement.
9.8 For a claim for breach of any of the Warranties to be valid as against the
Company, the Parent or any of the Directors, notice of such claim
(specifying the basis and quantum of such claim in reasonable detail) must
be given to the person against whom it is asserted on or before the date
being three months following the date of the publication of the interim
financial statements of the Company for the period ending 30 June 2007.
9.9 In so far as it is lawfully able, the Company will not and will procure
that none of its subsidiary undertakings will, (and the Directors each
undertake that they will not on behalf of any member of the Group) between
the date of this agreement and the earlier of Admission or termination of
this Agreement, enter into any agreement, commitment or arrangement which
is a substantial transaction (within the meaning of Rule 12 of the AIM
Rules) or which is reasonably likely to materially and adversely affect the
Placing or the issue of the Placing Shares, without the prior written
consent of CS (such consent not to be unreasonably withheld or delayed).
9.10 The Warranties are given in each case by the Company, the Parent and the
Directors subject to matters fairly disclosed in the Admission Document.
9.11 Where any warranty contains the word "material", this shall be deemed to
mean material in the context of the Placing.
10. INDEMNITY
10.1 No claim shall be made by the Company, the Parent or the Directors against
any Indemnified Person to recover any loss, damage, costs, charges or
expenses which any member of the Group or any other person may suffer or
incur by reason of or arising out of the performance by any Indemnified
Person of its obligations under this agreement or in connection with the
Placing or the publication or despatch of any of the Issue Documents, the
Announcement or the AIM Admission Document save to the extent that such
loss, damage, costs, charges or expenses arise(s) as a result of the
negligence or wilful default or fraud of any Indemnified Person or the
material breach by any Indemnified Person of its obligations under this
agreement or any other relevant contractual undertaking or any material
contravention by any Indemnified Person of the regulatory system (as
defined in the handbook and rules of the FSA).
11
10.2 The Company undertakes to CS (for itself and on the basis that it shall
enjoy absolute discretion as to the enforcement of any claim under this
clause, as agent or trustee on behalf of and for the benefit of any
Indemnified Persons) to the fullest extent permitted by law to indemnify
and keep indemnified each Indemnified Person against all Settled claims,
Settled actions, Settled demands, Settled liabilities, judgments or
proceedings in any jurisdiction which may be made, brought or established
against it (together "CLAIMS") and against all Settled loss, Settled
damage, reasonable costs, reasonable charges and reasonable expenses in any
jurisdiction which any such person may suffer or incur (including but not
limited to those suffered or incurred in disputing any Claim) (together
"LOSSES") and which in any case directly results from or is attributable to
the Placing or the transactions contemplated by this agreement including
without limitation:
(A) the approval and/or despatch or publication of the Issue Documents
and/or the Announcement and/or the AIM Admission Document;
(B) the allotment or issue of the Placing Shares;
(C) any breach by the Company of any of the Warranties or any of its other
obligations under this agreement;
(D) the proper performance by any Indemnified Person of its obligations
under this agreement or otherwise in connection with the Placing
and/or Admission;
(E) any failure or alleged failure to comply with any legal, statutory or
regulatory requirement of the United Kingdom or elsewhere in relation
to the Placing and/or Admission;
(F) any Issue Document, the Announcement or the AIM Admission Document not
containing or being alleged not to contain all information required to
be stated in it or any statement in it being or being alleged to be
defamatory, untrue, inaccurate, incomplete or misleading in any
respect or having been or alleged to have been made negligently or
otherwise without the required standard of skill and care or
reasonableness;
unless and to the extent that such Claim(s) or Loss(es) result(s) from the
negligence, wilful default or fraud of such Indemnified Person or material
breach by it of its obligations under this agreement or a material
contravention by it of the regulatory system (as defined in the handbook
and rules of the FSA) or the provisions of the FSMA.
12
10.3 If the United Kingdom HM Revenue & Customs or any other taxing authority in
any jurisdiction brings into any charge to taxation any sum payable under
any indemnity contained in this clause 10 (the "ORIGINAL AMOUNT") then (to
the extent that the matter in respect of which the sum is payable is not
allowable as a deduction for tax purposes) the amount so payable shall be
grossed-up by such amount (the "ADDITIONAL AMOUNT") as will ensure that
after subtraction of the taxation so chargeable there shall remain a net
sum equal to the original amount. To the extent that an Indemnified Person
subsequently obtains any tax credit, allowance or repayment of tax as a
result of the Company paying to the Indemnified Person the additional
amount or as a result of or in connection with the circumstances giving
rise to the payment of the additional amount, the Indemnified Person shall
notify the Company and shall pay to the Company an amount which equates to
so much of the economic benefit which the Indemnified Person has received
from that tax credit, allowance, repayment or relief as does not exceed the
additional amount (any question as to the accrual or amount of any such
economic benefit, the order and manner of making any claim for any tax
credit, allowance, repayment or relief, and the timing of any payment being
determined by the Indemnified Person's auditors or the Nominated Adviser's
auditors if the relevant person does not have auditors).
10.4 The Indemnity shall extend to include all costs and expenses including
reasonable legal fees and expenses suffered or incurred by any Indemnified
Person in connection with establishing or obtaining advice relating to or
enforcing its rights under this clause 10 (together with any VAT properly
chargeable on them).
10.5 As soon as reasonably practical and in any event within 20 Business Days
after it becomes aware of any claim made or threatened within the scope of
the indemnities contained in clause 10 or any matter which has given or is
likely to give rise to a claim under the Warranties or the Indemnity, CS
shall notify in the case of any such claim within the scope of the
Indemnity the Company, and in the case of any such claim under the
Warranties to the Company, the Directors and the Parent of the relevant
claim or matter and shall thereafter on request (i) keep (as the case may
be) the Company, the Directors and the Parent informed of the progress of
the claim or the status of the matter, (ii) provide (as the case may be)
the Company, the Directors and the Parent with copies of such documentation
relating to the claim or matter as it may reasonably request and (iii) give
(as the case may be) the Company, the Directors and the Parent such
opportunity as it may reasonably request to make representations regarding
the conduct of the claim or the handling of the matter; and (iv) take such
action as the Company and/or the Directors and/or the Parent may reasonably
request to avoid, dispute, resist, appeal, compromise, settle or defend any
such claim; in each case subject to the relevant Indemnified Person being
indemnified in a manner satisfactory to it against any and all reasonable
costs, charges and expenses incurred by it in complying with any such
request and provided always that nothing in this clause 10.5 shall require
any of the Indemnified Persons to:
(a) provide a copy of any document or provide any information which the
Indemnified Person is legally advised is privileged as regards the
Indemnified Person in the context of any litigation connected with the
claim or subject to a duty of confidentiality; or
(b) do, or refrain from doing, anything which would, or which such
Indemnified Person in good faith considers might, prejudice any
insurance cover to which any of the Indemnified Persons may from time
to time be entitled to or from which it or any of them may benefit; or
(c) do, or refrain from doing, anything the doing of or failure to do, CS
in good faith considers (i) would damage its reputation or the
goodwill attaching to its business or that of any subsidiary of CS or
(ii) would or would be likely to conflict with CS's duties or
obligations under any law or regulatory requirement (including any
requirement of the London Stock Exchange plc); or
13
Provided that if none of the Company or the Directors or the Parent
indemnifies the relevant Indemnified Person in a manner satisfactory to it
as aforesaid, or if none of the Company or the Directors or the Parent
requests the relevant Indemnified Person to take action in respect of the
claim or matter, in either case within 20 Business Days of the notification
by CS of the claim, then the Indemnified Person may pay or settle or resist
or otherwise deal with the claim as it in its absolute discretion thinks
fit. In the event that CS receives contradictory instructions or requests
under this clause, it shall be entitled to disregard such instructions or
requests and follow the instructions or requests from the Company. Where
any notification or information is provided by CS to the Company for the
purposes of this clause, such notification or information shall be
disclosed by the Company to the Directors and the Parent.
10.6 The Company agrees that it will not without the prior written consent of CS
(such consent not to be unreasonably withheld or delayed) settle or
compromise or consent to the entry of any judgement with respect to any
pending or threatened claim in respect of which indemnification is being
sought under this clause 10 unless such settlement, compromise or consent
includes a release of all Indemnified Persons from all liability arising
out of such claim.
10.7 This clause 10 does not seek to exclude or restrict any duty or liability
which CS has to the Company or any other party under FSMA, the Conduct of
Business Rules made by the FSA and set out in the FSA's Conduct of Business
Sourcebook (the "RULES") or any other principles, rules or guidance in the
handbook of rules and guidance of the FSA or pursuant to any applicable
common law principles. In addition, the undertakings, limitations and
exclusions of liability and the indemnities under this clause 10 shall only
have effect in so far as they are not prohibited under the Rules or under
any other applicable laws, rules or regulations, and they shall not extend
to any actions, claims, demands, expenses, costs, charges, losses, damages,
or other liabilities ("Indemnified Loss") to the extent the same arise from
or are attributable to the negligence, fraud or wilful default of any
Indemnified Person or any of their agents or sub-agents or a breach by any
Indemnified Person of the Rules or any relevant contractual undertaking.
Furthermore, the indemnity in clause 10.2 shall not apply to any
Indemnified Loss suffered or incurred by an Indemnified Person in respect
of any Ordinary Shares acquired or held or disposed by it, unless those
shares were acquired by it as a Placee or otherwise pursuant to this
agreement. Neither the Warranties nor the indemnity in clause 10 shall
apply to any shares acquired by CS pursuant to the option agreement in
favour of CS described in the Admission Document.
10.8 Payment of any claim under the Warranties or the Indemnity shall pro tanto
satisfy and discharge any other claim thereunder which is capable of being
made in respect of the same subject matter. No Indemnified Person shall be
entitled to recover damages or any other amount in respect of any claim
under this agreement or otherwise obtain reimbursement or restitution more
than once in respect of the same subject matter.
10.9 The Company, the Parent and the Directors shall not be liable for any
individual claim under the Warranties unless the amount of such claim
exceeds (pound)1,000. Further, no liability shall attach to the Warrantors
in respect of claims under the Warranties unless the aggregate amount of
the liability of the Warrantors in respect of all such claims shall exceed
(pound)5,000, in which event the Warrantors shall be liable for the whole
of such liability and not merely the excess; Provided that such limitation
shall not apply to any Claim which arises as a result of the fraud or
willful misconduct or willful concealment of any of the Warrantors;
provided further that this clause shall be without prejudice to the need
for CS to notify claims or matter to the Company under clause 10.5.
14
10.10 No liability under this agreement shall attach to any of the Warrantors,
and no claim shall be brought under this agreement against any of the
Warrantors, if the loss or liability suffered or incurred by the
Indemnified Person to which the claim relates is contingent or future.
10.11 No claim may be made by an Indemnified Person against any party under this
agreement to the extent that an Indemnified Person has already made
recovery in respect of the subject matter of such claim and if any such
recovery is made after any party to this agreement has made payment to an
Indemnified Person, then that Indemnified Person shall refund to such party
the full amount of any such payment less any costs, expenses and tax
suffered or incurred by the Indemnified Person.
11. TERMINATION
11.1 If before Admission:
(A) any statement contained in the Announcement has, in the reasonable
opinion of CS been discovered to be untrue, incorrect or misleading in
any respect which it reasonably considers (acting in good faith) to be
material in the context of the Placing; or
(B) there has, in the reasonable opinion of CS (acting in good faith),
been a breach of any of the Warranties or any other obligations on the
part of the Company under this agreement which it reasonably considers
(acting in good faith) to be material in the context of the Placing;
or
(C) a Specified Event has, in the reasonable opinion (acting in good
faith) of CS, occurred which it reasonably considers to be material in
the context of the Placing; or
(D) any of the Conditions shall have become incapable of fulfilment before
the latest time provided in clause 2.1 and has not been waived as
provided in clause 2; or
(E) in the opinion of CS, acting reasonably, any circumstances have arisen
such that a supplementary Admission Document would be required under
the AIM Rules and which in the opinion of CS (after such reasonable
consultation with the Company as the circumstances permit) is a
significant new factor, material mistake or inaccuracy in the context
of the Placing, notwithstanding that (where applicable) a
supplementary admission document may have been published by the
Company or the Company is willing to publish such supplementary
admission document;
then, upon CS (as appropriate) giving notice of such matter to the Company,
clause 11.3 shall apply.
11.2 If before Admission there shall in the opinion of CS (acting in good
faith), develop, occur or come into effect any change in national or
international financial, economic, political, military or market conditions
or other event, which in the opinion of CS, is likely materially and
adversely to affect the financial or trading position or prospects of the
Group or to have a materially prejudicial effect on the Placing or make the
success of the Placing doubtful or makes it impracticable or inadvisable to
proceed with the Placing CS will consult with the Company (to the extent
practicable) and, if CS shall, at any time before Admission, give notice of
any such matter to the Company, clause 11.3 shall apply.
15
11.3 Where this clause 11.3 applies, CS may in their absolute discretion,
following discussions with the Company:
(A) allow the issue of the Placing Shares to proceed on the basis of the
Issue Documents; or
(B) give notice to the Company (at the same time as the notice pursuant to
clause 11.1 or, as the case may be, clause 11.2 or at any time after
it, but before Admission) terminating this agreement in which case
clause 11.4 shall apply.
11.4 If this agreement is terminated pursuant to the provisions of this clause
11 or lapses in accordance with clauses 2.3 or 3.3:
(A) no party to this agreement will have any claim against any other
party, except that:
(1) such termination or lapse shall be without prejudice to any
accrued rights or obligations under this agreement (provided
always that no party shall have any liability in respect of the
Warranties in such circumstances;
(2) the Company shall pay the expenses specified in clause 8.2;
(3) if the reason for the termination shall be an act or omission
knowingly undertaken by the Company such that any of the
Warranties are thereby rendered untrue or incorrect in any
material respect, then CS shall be entitled to receive from the
Company a corporate finance fee of (pound)100,000 and an amount
equal to 25 per cent of the value at the Placing Price of the
Placing Shares for which CS held firm Placing Letters;
(4) any payments required to be made in accordance with this clause
11.4(A) shall be made within ten Business Days after such
termination or lapse; and
(5) the provisions of clauses 1, 10, 11, 12, 13 and 14 shall remain
in full force and effect;
(B) the Company shall withdraw or cause to be withdrawn the application
for Admission; and
(C) if so requested in writing by CS the Company shall make an
announcement in a form reasonably and properly required by CS, or if
the Company shall fail so to do CS may themselves jointly make such
announcement.
12. ANNOUNCEMENTS
12.1 Save for the issue and publication of the Announcement, no public
announcement or communication which is or might be material in the context
of the Placing or which relates to Admission shall be published, by or on
behalf of any member of the Group between the date of this agreement and
the date thirty days after Admission without the prior written consent of
CS such consent not to be unreasonably withheld or delayed.
16
12.2 The Company will not and will procure that no other member of the Group
will prior to Admission:
(A) enter into any commitment or agreement, or put itself in a position
where it is obliged to announce that any commitment or agreement may
be entered into, which is or might be material in the context of the
Placing or Admission; or
(B) issue any relevant securities (as defined in CA 85); or
(C) enter into any agreement or undertaking to do any of the above;
without the prior written consent of CS, such consent not to be
unreasonably withheld or delayed.
12.3 CS shall be entitled to make for itself or on behalf of any other
Indemnified Person, after such consultation with the Company as shall be
reasonably practicable in the circumstances, any announcement concerning
the Placing as may be necessary in its reasonable and proper opinion to
ensure compliance with rule 10 of the AIM Rules or the FSMA (and, in
particular, Parts VIII and XXVII of that Act).
13. NOTICES
13.1 Any notice to be given under this agreement shall be in writing (not
including writing on the screen of a visual display unit or other similar
device which shall not be treated as writing for the purposes of this
agreement) and shall be addressed as follows:
(A) In the case of the Company:
13.(A).1 The Company irrevocably appoints Mishcon de Reya
(RJT/22816-1) of Xxxxxx Xxxxx, 00 Xxx Xxxx Xxxxxx, Xxxxxx
XX0X 0XX to be its agent for the receipt of service of
process in England and Wales. It agrees that any Service
Document may be effectively served on it in connection with
proceedings in England and Wales by service on its agent.
13.(A).2 Any Service Document shall be deemed to have been duly
served if marked for the attention of Xxxxxxx Xxxxx
(RJT/22816-1) at Mishcon de Reya (address as per clause
13.(A).1 or such other address within England and Wales as
may be notified to the party wishing to serve the Service
Document and:
13.(A).2.1 left at the specified address; or
13.(A).2.2 sent to the specified address by first class post.
In the case of clause 13.(A).2.1 the Service Document will
be deemed to have been duly served when it is left. In the
case of clause 13.(A).2.2, the Service Document shall be
deemed to have been duly served two clear Business Days
after the date of posting.
17
13.(A).3 If the agent at any time ceases for any reason to act as
such, the Company shall appoint a replacement agent having
an address for service in England or Wales and shall notify
the other parties to this Agreement of the name and address
of the replacement agent. Failing such appointment and
notification, CS shall be entitled by notice to the Company
to appoint a replacement agent to act on the Company's
behalf. The provisions of this clause applying to service on
an agent apply equally to service on a replacement agent;
13.(A).4 A copy of any Service Document served on an agent shall be
sent by post to the Company. Failure or delay in so doing
shall not prejudice the effectiveness of service of the
Service Document;
13.(A).5 "Service Document" means a claim form, order or judgement
issued out of the courts of England and Wales or other
document relating to or in connection with any Proceedings;
(B) in the case of CS:
Corporate Synergy PLC
00 Xxx Xxxxx Xxxxxx
Xxxxxx XX0X 0XX
Fax: 0000 000 0000
Attention: For the urgent attention of the Head of Corporate Finance
(C) in the case of the Directors and the Parent, the addresses
respectively set out in Schedule 1 and at the beginning of this
agreement.
13.2 Any notice shall be valid if delivered by hand or sent by legible facsimile
transmission or pre-paid first class post (airmail if sent to or from an
address outside the United Kingdom) and if delivered by hand or sent by
legible facsimile transmission shall conclusively be deemed to have been
given or served at the time of despatch and if sent by post in the manner
described above shall conclusively be deemed to have been received 48 hours
from the time of posting (or 72 hours if sent to or from an address outside
the United Kingdom).
13.3 Any notice given by CS under clauses 13.1 or 13.2 may also be given by any
of its directors to any director of the Company either personally or by
telephone (to be confirmed immediately in writing) and shall have immediate
effect from such personal or telephone notification.
14. GENERAL
14.1 Any time, date or period referred to in this agreement may be extended by
mutual agreement between the parties but as regards any time, date or
period as originally fixed or so extended, time shall be of the essence.
14.2 The obligations and liabilities of any party shall not be affected by any
time forbearance, indulgence, release or compromise given to him or any
other party, nor by any other matter or circumstance which (but for this
provision) would operate to or affect any such obligations except an
express written release by all the parties to whom the relevant obligations
and liabilities are owed or due.
18
14.3 The rights and remedies reserved to any party under any provision of this
agreement or in any document to be executed pursuant to it shall be in
addition and without prejudice to any other rights or remedies available to
it whether under this agreement or any such document or by statute common
law or otherwise.
14.4 The provisions of this agreement (including without limitation, the
Warranties, the Indemnity and the provisions of clauses 12 to 14 inclusive)
which are capable of having effect following Admission shall remain in full
force and effect, notwithstanding the completion of all matters,
arrangements and transactions referred to in or contemplated by this
agreement.
14.5 This agreement may be entered into in any number of counterparts and by the
parties to it on separate counterparts, each of which when executed and
delivered shall be an original but all the counterparts shall together
constitute one and the same instrument.
14.6 The parties agree and acknowledge that:
(A) nothing in this agreement, except for clauses 10.1 and 10.2 which are
intended to benefit persons who are not parties to this agreement, is
intended to benefit any person who is not a party to it (a
"NON-PARTY") and no Non-Party has any right under the Contracts
(Rights of Third Parties) Xxx 0000 to enforce any term of this
agreement without the prior written consent of CS; and
(B) no consent of any Non-Party shall be required for any rescission of or
amendment to this agreement.
The provisions of this clause 14.7 do not affect any right or remedy of a
third party which exists or is available otherwise than by operation of the
Contracts (Rights of Third Parties) Xxx 0000.
14.7 This agreement shall be governed by and construed in accordance with
English Law and the parties irrevocably submit themselves to the exclusive
jurisdiction of the English Courts.
THIS AGREEMENT has been duly executed under hand by the parties and delivered on
the date set out at the head of page 1
19
SCHEDULE 1
DIRECTORS
-------------------------- -------------------------- --------------------------
MAXIMUM LIABILITY
UNDER WARRANTIES
NAME ADDRESS (POUND STERLING)
-------------------------- -------------------------- --------------------------
Gil Hochboim 0 Xxxxx Xxxx Xxxxxx
Xxxxx 00000
Xxxxxx 11,000
-------------------------- -------------------------- --------------------------
Xxx Xxxxxxxx 0 Xxxxx Xxxx Xxxxxx
Xxxxx 00000
Xxxxxx 250,000
-------------------------- -------------------------- --------------------------
Xxxxxx Xxxxxxxx 0 Xxxxx Xxxx Xxxxxx
Xxxxx 00000
Xxxxxx 250,000
-------------------------- -------------------------- --------------------------
Xxxxx Xxxxxx Fairways
00 Xxxxxxxxxx Xxxxxx
Xxxxxx Xxxxx
Xxxxxxxxxxxxx
XX00 0XX 15,000
-------------------------- -------------------------- --------------------------
Xxx Xxxxxxx 0 Xxxxxx Xxxx Xxxxxx
Xxxx-Xxxx 00000
Xxxxxx 3,000
-------------------------- -------------------------- --------------------------
Xxxx Xxxxxxxxxx 0 Xxxxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx 000
Xxxxx Xxxxx
Xxx Xxxx
Xxxxxx 3,000
-------------------------- -------------------------- --------------------------
THE PARENT
-------------------------- -------------------------- --------------------------
X. Xxxxx-Food 0 Xxxxx, Xxxx Xxxxxx0
International Ltd Yavne 00000
Xxxxxx 250,000
-------------------------- -------------------------- --------------------------
20
SCHEDULE 2
DOCUMENTS TO BE DELIVERED
(A) Save to the extent that they have been delivered to CS prior to signature
of this agreement, each of the following documents is to be delivered, in a
form previously approved by CS, to Marriott Xxxxxxxx on behalf of each of
CS, forthwith upon execution of this agreement (or such other time as is
specified below) and, save where the context otherwise requires, is to be
dated with the date of this agreement:
1. a certified copy of the minutes of a meeting of the Board:
(a) approving and authorising the execution of this agreement;
(b) approving the Placing;
(c) approving and authorising the application for Admission;
(d) approving and authorising the publication of the Issue Documents,
the Announcement and the AIM Admission Document
2. a copy of the Announcement initialled by a Director;
3. a copy of the Placing Proof initialled by a Director;
4. a certified copy of a resolution of the Board in accordance with
clause 7 approving the allotment and issue of the Placing Shares;
5. a copy of the AIM Admission Document initialled by a Director;
6. a copy of the Presentation initialled by a Director;
7. certified copies of the responsibility letters and powers of attorney
given by each Director;
8. the Verification Notes (with supporting documents) duly signed by each
party responsible for them;
9. an original of the Legal Due Diligence Report;
10. an original of the Long Form Report;
11. an original of the Working Capital Report;
12. an original of the Controlling Shareholder Agreement;
13. an original of the Option Agreement;
14. the original Rule 39 Letters;
15. the application for Admission duly signed by a Director.
(B) An original copy of the Warranty Certificate to be delivered by close of
business on the Business Day immediately preceding the expected date of
Admission.
21
SCHEDULE 3
WARRANTIES
PART 1
1. PRESENTATION, ANNOUNCEMENT AND AIM ADMISSION DOCUMENT
1.1 All statements of fact contained in the Presentation, the Announcement, the
AIM Admission Document are true and accurate and not misleading and all
expressions of opinion, intention or expectation contained therein are made
on reasonable grounds, are truly and honestly held and are made after due
and careful consideration and enquiry.
1.2 There are no facts or matters known or which on reasonable enquiry could
have been known to the Company or the Directors which have not been
disclosed in the Presentation, the Announcement, the AIM Admission
Document, the omission of which makes any statement therein misleading or
which would be material for disclosure therein.
1.3 The Directors have made all due and careful enquiry to satisfy themselves
that, taking into account the proceeds of the Placing and the bank
facilities currently available to it, the Company and the Group has
sufficient working capital for its present requirements that is for at
least 12 months from the date of Admission.
1.4 All reasonable enquiries have been made to ascertain and verify the
accuracy of all statements of fact and the reasonableness of all other
statements contained in the Presentation, the Announcement, the AIM
Admission Document and in particular the replies to the Verification Notes
have been prepared or approved by persons having appropriate knowledge and
responsibility to enable them properly to provide such replies and the
replies therein for which any officer or employee of the Company or the
Group is responsible have been provided with due care and attention are
true and accurate.
2. AUTHORITY TO ALLOT CASH PLACING SHARES
2.1 Save as disclosed in the Admission Document, the Company has power under
its memorandum and articles of association to allot and issue the Cash
Placing Shares in the manner proposed in this agreement and all necessary
steps have been taken (subject only to Admission) to permit and implement
the issue of the Cash Placing Shares so as to enable full effect to be
given to the terms of this agreement and the Placing. The Company has
sufficient authority pursuant to its constitutional documents and the laws
under which it operates to allot and issue the Cash Placing Shares to
Placees procured by CS without first offering them to holders of existing
Ordinary Shares on a pre-emptive basis.
2.2 Save as disclosed in the Admission Document, the allotment and issue of the
Cash Placing Shares will not infringe any limits, powers or restrictions to
which the Company is subject or the terms of any contract, obligation or
commitment whatsoever of the Company nor give rise to any obligation under
any such contract, obligation or commitment which is inconsistent with the
acquisition by any allottee or subscriber of valid unencumbered title to
the Placing Shares or any of them.
22
3. SHARE CAPITAL
3.1 Save as disclosed in the Admission Document, there are not in force any
options or other agreements which have not been disclosed to CS which call
for the issue of, or accord to any person the right to call for the issue
of, any Ordinary Shares or shares in the capital or other securities of the
Company.
3.2 Save as disclosed in the Admission Document, all sums due in respect of the
issued share capital of the Company have been paid to and received by the
Company.
3.3 Save as disclosed in the Admission Document, there have been given to CS
(or its professional advisers) details of all current agreements (whether
written or unwritten) between the Company and any one or more of the
shareholders in the Company relating to any rights of pre-emption over or
rights to require a sale or purchase of any shares in the capital of the
Company.
4. LAST ACCOUNTS
Save as disclosed in the Admission Document, the Last Accounts:
(A) give a true and fair view of the state of affairs of the Company as at
the Last Accounts Date, of the profit or loss and of the cash flows of
the Company for the financial year ended on that date; and
(B) have been prepared in accordance with all applicable statements of
standard accounting practice and generally accepted accounting
principles and practices consistently applied save to the extent
disclosed in the Last Accounts.
5. POSITION SINCE LAST ACCOUNTS DATE
Save as disclosed in the Admission Document, since the Last Accounts Date:
(A) the business of the Company has been carried on in the ordinary and
usual course;
(B) there has been no adverse change in the financial or trading position
or prospects of the Company;
(C) no contracts or commitments of an unusual or unduly onerous nature
have been entered into by the Company;
(D) other than in the ordinary course of business, the Company has not
entered into or assumed or incurred any contract, commitment,
borrowings, indebtedness in the nature of borrowing, guarantee,
liability (including contingent liability) or other obligation which,
in any such case, has not been discharged at the date of this
agreement or will not be discharged prior to Admission;
(E) no dividend or other distribution has been declared, paid or made by
the Company;
(F) no debtor has been released by the Company to an extent which is
material on terms that he pays less than the book value of his debt
and no debt of such material amount owing to the Company has been
deferred, subordinated or written-off or so far as the Directors are
aware is now likely to prove to any material extent irrevocable (and
for the purposes of this warranty "material" shall mean having a value
of (pound)20,000 or more); and
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(G) neither the Company, nor the Directors, have entered into any
memorandum of understanding, heads of terms or similar arrangements in
respect of the issue or transfer of any shares in the capital of the
Company or offer for the same;
save, in each case, for matters which, individually or in aggregate, are
not material for disclosure in the context of the Placing.
6. ACCOUNTING RECORDS
Save as set out in the Legal Due Diligence Report or the Long Form Report
or the Admission Document, all accounts, books, ledgers, financial and
other records of the Company have been properly and accurately maintained
in all material respects and contain true and accurate records of all
matters required to be entered therein.
7. LITIGATION AND PROCEEDINGS
7.1 Save as disclosed in the Admission Document, the Company does not have any
claims outstanding against it or is engaged in, or has within the last
twelve months been engaged in, any litigation or arbitration or similar
proceedings, or in any governmental, regulatory or similar investigation or
enquiry, which individually or collectively may have or, during the last
twelve months, has had a significant effect on the financial or trading
position or prospects of the Company. So far as the Company and the
Directors are aware there is no such claim, litigation, proceeding,
investigation or enquiry pending or threatened. There are no circumstances
known or which, on reasonable enquiry, could have been known to the Company
or the Directors which are likely to give rise to any such claim,
litigation, proceeding, investigation or enquiry.
7.2 Save as disclosed in the Admission Document, the Company has not taken any
action and no other steps have been taken or legal proceedings started or
threatened against the Company for its administration, winding up or
dissolution, or for it to enter into any compromise, arrangement or
composition for the benefit of creditors, or for the appointment of a
receiver, administrator, provisional liquidator, trustee or similar officer
of it, or of any of its properties, revenues or assets and there are no
circumstances known, or which could on reasonable enquiry have been known,
known, to the Company or the Directors which are likely to give rise to any
of the foregoing.
8. BORROWINGS
9.1 Save as disclosed in the Admission Document the Company does not have any
borrowings not has granted any security interest to secure any future
borrowings, in each case which are material in the context of the Placing
and Admission.
9.2 Save as disclosed in the Admission Document, no event has occurred or, to
the best of the knowledge, information and belief of the Directors is about
to occur by reason of the happening of which any secured or unsecured
borrowings of the Company have become or would, with the giving of notice
or the lapse of time, become payable prior to maturity, and there are not
circumstances known to the Directors having made all reasonable enquiries
which might lead to the occurrence of any such event.
24
9. DIRECTORS' RESPONSIBILITIES AND FINANCIAL REPORTING PROCEDURES
9.1 The Directors are aware of the nature of their responsibilities and
obligations as directors of a company whose shares are admitted to trading
on AIM.
9.2 The Directors have established procedures which provide a reasonable basis
for them to make proper judgments as to the financial position and
prospects of the Company.
10. CONFLICTS OF INTEREST
Save for contracts of employment or engagement between the Company and the
directors or as disclosed in the Admission Document, there are no
agreements, arrangements or understandings (whether legally enforceable or
not) between the Company and any person who is a director (or connected
party) or shareholder or the beneficial owner of any interest in the
Company or any company in which the Company is interested relating to the
management of the Company's business or the appointment or removal of the
directors of the Company or the ownership or transfer of ownership or the
letting of any assets to or by the Company or the provision of finance,
goods, services or other facilities to or by the Company or otherwise
howsoever relating to its affairs.
11. GENERAL
Save as disclosed in the Admission Document, neither the Company nor, so
far as the Company and the Directors are aware any of its officers, agents
or employees, has committed or omitted to do any act or thing the
commission or omission of which is materially in contravention of any Act,
Order or Regulation or the like giving rise to any fine, penalty, default
proceedings or other liability on the part of the Company and the Company
has not committed any material breach of any anti-trust or anti-monopoly
legislation and no officer has committed any such breach in relation to the
Company.
12. PRO FORMA STATEMENT OF NET ASSETS
The pro forma statement of net assets of the Company at Part IV of the AIM
Admission Document:
(A) has been prepared (and is presented in the AIM Admission Document) on
a basis consistent with the Company's accounting policies and
practices;
(B) has been prepared on the bases and assumption set out in it (but not
on any other bases or assumption which, in either case, ought to be
disclosed in the AIM Admission Document); and
(C) has been made after making the adjustments set out in it (but not
after any other adjustment), all of which adjustments are appropriate
in the context of the matters described in the AIM Admission Document.
13. WORKING CAPITAL
13.1 The Working Capital Report has been approved by the Directors and has been
prepared after due and careful enquiry and on the bases and assumption
stated in the Working Capital Report which each director believes to be
reasonable. Based on the current awareness of the Company, there is no
material fact or assumption not set out in the Working Capital Report which
ought reasonably to have been taken into account but which has not been
taken into account in the preparation of the Working Capital Report.
25
13.2 Each statement of fact in the Working Capital Report is true and accurate
in all material respects and not misleading (by itself or in its context),
each expression of opinion or intention or expectation in it has been made
on reasonable grounds after due and careful enquiry and has been duly and
honestly held by the directors and is fairly based and, so far as the
Company is aware, there is no other material fact omitted to be disclosed
in the Working Capital Report which, by such omission, would make any such
statement or expression misleading.
13.3 The statement in relation to the working capital available to the Group set
out in the AIM Admission Document has been properly made after due and
careful enquiry and has been made after taking full account of all relevant
factors.
13.4 So far as the Company is aware, all information supplied by or on behalf of
the Company to CS for the purpose of reviewing the working capital
projections and/or requirements of the Company in connection with the
Admission was when given, and so far as the Company is aware remains,
complete, true and accurate in all material respects and not misleading in
any material respect.
14. TAXATION
14.1 Save as disclosed in the Admission Document, so far as the Company is aware
no claim or dispute involving the Company has been made or has arisen with
any Tax Authority which could reasonably be considered material in the
context of Admission. So far as the Company and the Directors are aware,
there is no significant risk that such a claim will be made or that such a
dispute will arise.
15. ADMISSION DOCUMENT
So far as the Warrantors are aware, and taking into account the
professional responsibilities of the relevant advisers to the Company, the
Admission Document contains all such information as, investors would
reasonably require, and reasonably expect to find there, for the purpose of
making an informed assessment of the assets and liabilities, financial
position, profits and losses and prospects of the Group and of the rights
attaching to the Placing Shares.
16. PROPERTY AND ENVIRONMENTAL MATTERS
Save as disclosed in the Admission Document, the Company does not own or
occupy any property or have any actual or contingent liability of any kind
in respect of any freehold or leasehold land or buildings, other than any
of the property expressly stated in the Admission Document as being used or
occupied by, or let or licensed to the Company.
17. THE BUSINESS
17.1 Save as disclosed in the Admission Document, the Company carries adequate
insurance cover (having regard to the levels and the risks normally insured
against by persons carrying on the same or (a) similar business or
business(es) as that/those carried on by the Company) and all such
insurances are in full force and effect and not voidable and there is no
material insurance claim made by or against the Company pending, threatened
or outstanding and all premiums due and payable in respect of all
insurances have been duly paid.
26
17.2 Save as disclosed in the Admission Document, all material licences,
consents and other permissions and approvals required for carrying on the
business or businesses now carried on by the Company or any of its
subsidiary undertakings have been obtained and are in full force and effect
and, so far as the Company and the Directors are aware, there is no
circumstance which indicates that any licence, consent, permission or
approval is likely to be revoked or incapable of renewal.
17.3 Save as disclosed in the Admission Document, no services supplied, no goods
or articles manufactured or distributed or currently proposed to be
manufactured or distributed by the Company and no method or process
employed by it (or by any licensee under any licence granted by it)
infringe or are likely to infringe any valid and enforceable patent, trade
xxxx, registered design or other industrial, intellectual or commercial
monopoly rights of any third party and so far as aforesaid no claim has
been made against the Company or any such licensee in respect of such
infringement in each such case as is material in the context of the
Placing.
17.4 Save as disclosed in the Admission Document, so far as the Company and the
Directors are aware all the agency, distributorship, marketing, purchasing,
manufacturing and licensing agreements to which the Company is a party and
which are individually material in the context of the Placing, are valid
and subsisting and so far as the Company and the Directors are aware
nothing has been done or omitted to be done by the Company or the Directors
which would enable any such agreement to be terminated validly for material
breach of the terms of any such agreement.
17.5 The Company is duly incorporated and has the requisite power and authority
to carry on its businesses.
18. INSOLVENCY
18.1 So far as the Company and the Directors are aware, no order has been made
or petition presented or resolution passed for the winding up of the
Company or for the appointment of a provisional liquidator to the Company
or for an administration order in respect of the Company.
18.2 So far as the Company and the Directors are aware, No receiver (whether or
not an administrative receiver) or receiver and manager has been appointed
by any person of the whole or any part of the business or assets of the
Company.
18.3 So far as the Company and the Directors are aware, no voluntary arrangement
has been proposed under the Israeli equivalent (if any) to section 1 of the
Insolvency Xxx 0000 in respect of the Company, no compromise or arrangement
has been proposed, agreed to or sanctioned under the Israeli equivalent (if
any) to section 45 CA 85 in respect of the Company and no action is being
taken to strike the Company off the register under the Israeli equivalent
(if any) to section 652 CA 85.
19. REPORTS
19.1 So far as the Warrantors are aware, and taking into account the
professional responsibilities of the relevant advisers in relation to such
reports, all statements and financial information contained in the Long
Form Report and in the Legal Due Diligence Report are correct in every
material respect and not incomplete or misleading in any material respect,
no information has been knowingly withheld which would make any statement
of fact in such reports misleading in any material respect and the
Warrantors agree in all material respects with all expressions of opinion,
expectation and intention contained in the Long Form Report and the Legal
Due Diligence Report and such expressions of opinion, expectation and
intention attributed to the Directors in such respects are honestly held by
them and are either fairly based on facts which are within their knowledge
(having made all reasonable enquiries) or made on reasonable grounds.
27
19.2 So far as the Company and the Directors are aware, all written information
supplied directly or indirectly by the Directors and the Company to CS (or
any persons acting on its behalf) or to the Reporting Accountants for the
purposes of or in connection with the Placing and the Acquisition was when
supplied and is now true and accurate in all material respects.
20. VERIFICATION
The Company and the Directors are satisfied that the answers recorded in
the Verification Notes have been prepared or approved by persons having
appropriate knowledge and responsibility to enable them properly to provide
such replies and are, subject to any express limitation included in such
answers, neither untrue nor inaccurate not incomplete nor misleading in any
material respect.
PART 2
21. Each Non-Executive Director severally warrants that the personal
information given by him for the purpose of publishing the Admission
Document is true, complete and accurate in all material respects at the
date of this document, that there is no omission therefrom which might make
the same misleading and that, without prejudice to the foregoing all
information relating to himself which might be material for disclosure in
the Admission Document has been disclosed in writing to CS.
22. Each Non-Executive Director severally warrants that he has read the Long
Form Report and the Legal Due Diligence Report and the Admission Document,
and severally warrants that he has discussed with the Executive Directors
any matters referred to therein which appear to him to be material in the
context of Admission and the Placing.
23. Each Non-Executive Director severally warrants that, so far as he is aware,
all statements of fact contained in the Presentation, the Announcement, the
Placing Proof and the AIM Admission Document are true and accurate and not
misleading and all expressions of opinion, intention or expectation
contained therein are made on reasonable grounds, are truly and honestly
held and are made after due and careful consideration and enquiry.
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SCHEDULE 4
WARRANTY CERTIFICATE
Corporate Synergy PLC
00 Xxx Xxxxx Xxxxxx
Xxxxxx XX0X 0XX
o 2006
Dear Sirs
We refer to the placing agreement dated o 2006 between Corporate Synergy PLC (1)
the Directors (2) Gold Frost Ltd (3) and X. Xxxxx-Food International Ltd (4)
(the "PLACING AGREEMENT"). Words and expressions defined in the Placing
Agreement have the same meanings in this letter.
We confirm to you that so far as we are aware:
1. each of the Conditions (other than Admission) has been, or will, upon
delivery of this letter, have been satisfied or fulfilled in accordance
with its terms; and
2. none of the Warranties was breached, or untrue, or inaccurate or misleading
at the date of the Placing Agreement and no Specified Event has occurred.
This letter, which has been delivered to you prior to the date of Admission, is
to be released to you immediately prior to Admission.
-------------------------
duly authorised on
behalf of Gold Frost Ltd
29
SIGNED by )
for and on behalf of )
CORPORATE SYNERGY PLC )
SIGNED by )
for and on behalf of )
GOLD FROST LTD )
EXECUTED AND DELIVERED AS A DEED BY
--------------------------------------------------
GIL HOCHBOIM
IN THE PRESENCE OF:
----------------------------------------
EXECUTED AND DELIVERED AS A DEED BY
--------------------------------------------------
XXX XXXXXXXX
IN THE PRESENCE OF:
----------------------------------------
30
EXECUTED AND DELIVERED AS A DEED BY
--------------------------------------------------
XXXXXX XXXXXXXX
IN THE PRESENCE OF:
----------------------------------------
EXECUTED AND DELIVERED AS A DEED BY
--------------------------------------------------
XXXXX XXXXXX
IN THE PRESENCE OF:
----------------------------------------
EXECUTED AND DELIVERED AS A DEED BY
--------------------------------------------------
XXX XXXXXXX
IN THE PRESENCE OF:
----------------------------------------
31
EXECUTED AND DELIVERED AS A DEED BY
--------------------------------------------------
XXXX XXXXXXXXXX
IN THE PRESENCE OF:
----------------------------------------
EXECUTED AND DELIVERED )
AS A DEED BY )
X. XXXXX-FOOD INTERNATIONAL )
LTD )
)
acting by: )
------------------------------------------------
Director
------------------------------------------------
Director/Secretary
32
