Exhibit 4.4
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SHARE PURCHASE AGREEMENT
BETWEEN
CEZ, a.s.
AS SELLER
AND
CZECH REPUBLIC - MINISTRY OF LABOR AND SOCIAL AFFAIRS
AS PURCHASER
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DATED AUGUST 19, 2002
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This Share Purchase Agreement (this "Agreement") is made on August 19, 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
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. ▇▇▇▇ ▇▇▇▇▇
Director
(the "Seller")
Czech Republic - Ministry of Labor and Social Affairs
Na Poricnim ▇▇▇▇▇ ▇/▇▇▇, ▇▇▇▇▇▇ ▇, ▇▇▇▇▇▇ Code: 128 01
Identification No.: 00551023
acting through Minister of Labor and Social Affairs Ing. Zdenek Skromach, head
of the division of the executive branch of the government
(the "Purchaser")
W I T N E S S E T H
WHEREAS, the Seller owns 26,783,600 book-entry registered shares of
CEPS, a.s., having its registered office at ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇/▇, ▇▇▇ ▇▇ ▇▇▇▇▇▇
▇▇, Identification No.: 25702556 (the "Company"), having a nominal value of CZK
100 per share, SIN: 770000002673 (the "Sale Shares"), representing approximately
15% of the Company registered capital; and
WHEREAS, in connection with its decision to privatize shares in the
regional distribution companies by direct sale to the Purchaser as the
predetermined transferee, made in Resolution No. 477 dated May 6, 2002 and
Resolution No. 628 dated June 12, 2002 (collectively, the "Resolution), the
Czech Republic government granted in the Resolution its consent, pursuant to
Section 12 (7) of Act No. 219/2000 Coll., on the Property of the Czech Republic
and the Action of the Czech Republic in Legal Relationships, as amended, and
Section 13 (6) of Act No. 239/2001 Coll., on the Czech Consolidation Agency and
Amendments to Certain Acts, to the acquisition of the Sale Shares by the
Purchaser on the terms and subject to the conditions specified herein;
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, 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.
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ARTICLE II
PURCHASE PRICE
The Purchase Price for all of the Sale Shares (the "Purchase Price") has been
determined in accordance with the purchase price set by the Resolution and
amounts to CZK 3,417,851,000 (to wit: three billion four hundred seventeen
million eight hundred and fifty-one thousand Czech crowns), i.e., approximately
CZK 127.6098 per Sale Share. The Purchase Price may, in accordance with the
Resolution, be adjusted in the manner described in Section 3.6 hereof.
ARTICLE III
SETTLEMENT OF THE TRANSFER OF THE SALE SHARES
AND PURCHASE PRICE PAYMENT
3.1 Settlement of the Transfer of the Sale Shares.
(a) The settlement of 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 ▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇ ▇, Identification No.: 25081489
("UNIVYC") on the CEPS Share Settlement Date. UNIVYC shall settle the
transfer of the Sale Shares in accordance with its rules governing the
settlement of off-exchange securities transactions, unless the
Settlement Orders expressly provide otherwise.
(b) The Seller agrees to enter the Seller Settlement Order in the
settlement system of UNIVYC, through the Seller's Securities Dealer,
no later than 12:00 noon on the Business Day immediately preceding the
CEPS Share Settlement Date.
(c) The Purchaser agrees to enter the Purchaser Settlement Order in the
settlement system of UNIVYC, through the Purchaser's Securities
Dealer, no later than 12:00 noon on the Business Day immediately
preceding the CEPS Share Settlement Date.
(d) Each Securities Dealer shall act on behalf of its respective Party
vis-a-vis UNIVYC and shall, without limitation, enter the appropriate
Settlement Order in the settlement system maintained by UNIVYC so that
the transfer of the Sale Shares can be effected in accordance with
subsection (a). The obligations of the Parties hereunder and the
Parties' liability for any breach thereof shall not be affected in any
respect by any act or omission of any Securities Dealer.
3.2 Alternative Settlement Method. Should it be impossible, for any reason, 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 and the payment of the Purchase Price by the Purchaser to the Seller
by alternative means.
3.3 Purchase Price Payment. The Parties agree that the Purchase Price shall be
due and payable within 30 days following the CEPS Share Settlement Date and
shall be paid exclusively in the manner described in Sections 3.5 and 3.6
hereof, i.e., the Purchaser shall not be required to pay the Purchase Price,
including any amounts payable in connection therewith, in any manner other than
that described in Sections 3.5 and 3.6 hereof and the Seller shall not be
entitled to require that the Purchaser pay the Purchase Price or any amounts
payable in connection therewith in any other manner.
3.4 Interest. The Purchase Price shall bear interest from the transfer date of
the Sale Shares within the meaning of the REAS Share Purchase Agreement until
payment 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
settlement of the shares in the regional distribution companies under the REAS
Share Purchase Agreement and, subsequently, as of the first business day of each
calendar quarter until the payment in full of the portion of the purchase price
pursuant to Section 2.2 (b) of the REAS Share Purchase Agreement. Interest shall
be due and payable on the last Business Day of each calendar quarter, provided
that the last interest payment shall be due and payable on the payment date of
the portion of the portion of the purchase price pursuant to Section 2.2 (b) of
the REAS Share Purchase Agreement.
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3.5 Payment by Setoff. The Seller and the Purchaser have expressly agreed in
accordance with the Resolution that the Purchaser shall pay the Purchase Price,
including interest thereon under Section 3.4 hereof, by a set-off against the
amount payable by the Seller in respect of the portion of the purchase price due
to the FNM CR from the Seller under Section 2.2 (b) and Section 3.6 of the REAS
Share Purchase Agreement and assigned to the Purchaser without consideration by
the FNM CR in accordance with the Resolution. Notwithstanding the payment date
of the Purchase Price as determined in Section 3.6 hereof and the interest
payment date as determined in Section 3.4 hereof, the Purchaser shall not be in
default with the payment until the set-off date pursuant to this Section. The
Parties have agreed to set off in full, on the basis of mutual agreement, the
amounts payable by one of the Parties to the other, i.e., the amount payable by
the Purchaser to the Seller in respect of the Purchase Price (determined by
Article II and Section 3.6 hereof), including interest thereon pursuant to this
Agreement, against the Purchaser's Receivable from the Seller assigned to the
Purchaser by the FNM CR, including interest thereon (as such Receivable is
defined in Article VIII of the REAS Purchase Agreement), within 10 days
following the day on which the Seller delivers to the Purchaser the New Expert
Opinion providing the final adjustment to the Purchase Price or the Expert's New
Expert Opinion or on which the Seller notifies the Purchaser in writing that the
Expert has confirmed his insistence on the Initial Expert Opinion (depending on
the variants pursuant to Section 3.6 hereof). If the Parties fail to agree on
the set-off within the specified time limit, the Parties agree that the set-off
of the amounts specified above, including interest thereon, shall be effected
automatically on the last day of the above time limit (i.e., without any other
action being required).
3.6 New Expert Opinion; Purchase Price Adjustment. The Purchase Price shall be
determined on the basis of the Initial Expert Opinion prepared for the purposes
of the CEPS Share Purchase Agreement. After the Closing Date, the auditor of the
Company shall, in accordance with the Resolution, carry out an audit of the
results of operations of the Company 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 Purchaser and OSINEK and the value of the Sale Shares according to
the New Expert opinion is not equal to the Purchase Price, the Parties hereby
agree that the Purchase Price in accordance with the New Expert Opinion shall
automatically be reduced or increased so as to be identical with the value of
the Sale Shares determined by the New Expert Opinion. Even if the New Expert
shall not be 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 Sale
Shares 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. In such event, the Purchase Price shall be either
equal to the Purchase Price determined according to the first sentence of this
paragraph or, if the value of the Sale Shares pursuant to the Expert's New
Expert Opinion is not identical with the Purchase Price, the Parties hereby
agree that the Purchase Price in accordance with the Expert's New Expert Opinion
shall automatically be reduced or increased so as to be equal to the value of
the Sale Shares determined by the Expert's New Expert Opinion. The same change
shall apply to the amount of the receivable to be assigned by the FNM CR without
consideration to the Purchaser under Section 3.5 hereof for the purposes of
payment by setoff. The New Expert Opinion shall be prepared by the New Expert
and delivered to the Seller, OSINEK and the FNM CR within 60 days following the
Closing Date; the Seller shall deliver the New Expert Opinion received from the
New Expert to the Purchaser within this time limit. 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
the Expert confirms his insistence on the Initial Expert Opinion, the Seller
shall give written notice thereof to the Purchaser within 60 days following the
Closing Date.
ARTICLE IV
REPRESENTATIONS OF THE SELLER
The Seller hereby represents that all of the facts set forth in Sections 4.1
through 4.8 hereof are true and correct as of the date hereof and warrants that
the facts set forth in Sections 4.1 through 4.8 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 joint-stock company duly
organized and existing under the laws of the Czech Republic.
4.2 Organization of the Company. The Company is a joint stock company duly
organized and validly existing under the laws of the Czech Republic.
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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 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 Selected Finance Documents. In relation to the Selected Finance Documents,
the Seller shall, within nine (9) months of the execution of the REAS Share
Purchase Agreement, (i) obtain documents from the relevant banks, pursuant to
which the banks shall waive or otherwise forfeit the rights they would have by
virtue of a breach by the Seller 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 Seller shall inform the Purchaser in writing of compliance or
non-compliance with this obligation within the same time limit.
4.6 Consents of Third Parties. 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 or the Company in connection with the
execution and delivery of this Agreement, or the performance by the Seller of
any of its obligations hereunder.
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 Dividends. No dividends or other distributions have been distributed or paid
to the Seller by the Company or authorized or approved by the Company's general
meeting since January 1, 2002.
4.9 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 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 5.4 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 division of the executive
branch of the government acting on behalf of the Czech Republic through the head
of the division of the executive branch 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.
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
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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 Consents of Third Parties. Except for the consent of the Czech Republic
government to the acquisition of the Sale Shares, which has been granted by the
Resolution, 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.
5.5 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 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 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. No later than 4
Business Days prior to the CEPS Share Settlement Date, the Seller shall inform
the Purchaser in writing of the satisfaction of the conditions for the
settlement of the sale of the Sale Shares and of the date on which such
conditions were satisfied.
ARTICLE VII
TERMINATION
7.1 Termination. The contractual relationship between the Seller and the
Purchaser hereunder shall terminate only for the following reasons, except the
reason set forth under subsection (a), in which case it shall terminate with an
ex tunc effect (according to an express agreement of the Parties):
(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 Seller set forth in Section 4.5 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 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
(f) 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
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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 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 4.5 hereof is evidenced and
the date on which the Purchaser and OSINEK execute a written agreement with the
Depositary pursuant to Section 3.3 of the CEPS Share Purchase Agreement.
"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;
"FNM CR" means Fond narodniho majetku Ceske republiky (National Property Fund of
the Czech Republic), having its registered office at ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇, ▇▇▇ ▇▇
Prague 2, Identification No.: 41692918.
"CZK" means the Czech crown, the lawful currency of the Czech Republic.
"Purchase Price" shall have the meaning ascribed to such term in Article II and
Section 3.6 hereof.
"New Expert" means the expert appointed by a court pursuant to nominations made
by OSINEK 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 Section 3.6 hereof, even
though he or she has not been appointed by the courts.
"New Expert Opinion" means the expert opinion giving a valuation of the Sale
Shares, prepared by the New Expert after the Closing Date under Section 3.6
hereof.
"Expert's New Expert Opinion" means the expert opinion giving a valuation of the
Sale Shares, prepared by the Expert after the Closing Date under Section 3.6
hereof.
"Commercial Code" shall have the meaning ascribed to such term in the Preamble
to this Agreement.
"Purchaser's 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.
"Seller's 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 Seller delivered to the Purchaser within 60
days of the execution of this Agreement. "Securities Dealers" means,
collectively, the Purchaser's Securities Dealer and the Seller's Securities
Dealer.
"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 CEPS Concentration Approval,
the REAS Concentration Approval, Antitrust State Aid Decision 1, Antitrust State
Aid Decision 2 and Antitrust State Aid Decision 3 do not become final and
enforceable on the same day, the Availability Date of All Decisions shall be
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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.
"OSINEK" means OSINEK, a.s., having its registered office at ▇▇▇▇▇ ▇▇, ▇.▇. ▇▇▇,
▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ Code: 706 02, Identification No.: 0001 2173.
"CEPS Concentration Approval" means the decision of the Antitrust Office
approving the concentration established by the sale of the Company's shares by
the Seller 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
established by the sale of the Company's shares by the Seller 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 the Company's shares by the Seller to
OSINEK under the CEPS Share Purchase Agreement is not subject to approval by the
Antitrust Office.
"REAS Concentration Approval" shall have the meaning similar to that of the CEPS
Concentration Approval, but with respect to the concentration which may be
established under the REAS Share Purchase Agreement and the application for
which shall be filed by the Seller.
"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, including, without limitation, any pledge, mortgage, easement, right of
first refusal, lien, lease, call option or put option, suspension of rights and
restriction on transfer.
"Sale Shares" shall have the meaning ascribe to such term in the Preamble
hereto.
"Purchaser's Representations" shall have the meaning ascribed to such term in
Section 5.5 hereof.
"Seller's Representations" shall have the meaning ascribed to such term in
Section 4.9 hereof.
"Purchaser Settlement Order" means the order entered by the Purchaser through
the Purchaser's 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. The form of the Purchaser
Settlement Order is attached hereto as Exhibit A; however, this form shall be
used only if the Purchaser fails to enter the Purchaser Settlement Order
directly through a terminal (data communication).
"Seller Settlement Order" means the order entered by the Seller through the
Seller's 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 if the
Purchaser maintained at the Securities Center. The form of the Seller Settlement
Order is attached hereto as Exhibit B; however, this form shall be used only if
the Seller fails to enter the Seller Settlement Order directly through a
terminal (data communication).
"Settlement Orders" means, collectively, the Purchaser Settlement Order and the
Seller Settlement Order.
"Initial Expert Opinion" means the Expert's expert opinion No. 667-2002 of April
2002, pursuant to which the Sale Shares were valued by the Expert prior to the
execution of this Agreement and on which the determination of the Purchase Price
under Article II hereof is based.
"Antitrust State Aid Decision 1" 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 FNM CR, because it has found that no
State aid is involved in the sale of shares under the REAS Share Purchase
Agreement. Antitrust State Aid Decision 1 shall also mean the decision of the
Antitrust Office, pursuant to which the Antitrust Office approves an exemption
from the prohibition of State aid.
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"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 the Ceska konsolidacni agentura, or on the
basis of an application filed by the competent authority headed by a member of
the Czech Republic government, 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 OSINEK, 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.
"Depositary" means the person designated by agreement of the Purchaser and
OSINEK, with whom a draft in the amount of the purchase price of the sale shares
in CEPS as determined in the CEPS Share Purchase Agreement will be deposited
after its issuance by the Seller and acceptance by OSINEK under the CEPS Share
Purchase Agreement.
"CEPS Share Purchase Agreement" means the share purchase agreement dated June
28, 2002 entered into by and between the Purchaser and OSINEK, under which the
Purchaser shall transfer to OSINEK 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 Company's registered
capital.
"REAS Share Purchase Agreement" means the share purchase agreement dated June
28, 2002 entered into by and between the Purchaser and the FNM CR, under which
the FNM CR shall transfer to the Seller shares in the regional distribution
companies (REAS - 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.) in accordance with the Resolution.
"Zapadoceska Energetika Share Purchase Agreement" means the share purchase
agreement entered into by and between the Seller and Ceska konsolidacni
agentura, having its registered office at ▇▇▇▇▇▇▇▇▇▇ ▇▇▇/▇, ▇▇▇▇▇▇ ▇, Postal
Code: 170 06, Identification No.: 70109966, under which Ceska konsolidacni
agentura shall transfer to the Seller 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.
"Company" shall have the meaning ascribed to such term in the Preamble hereto.
"Closing Date" mean, in accordance with the Resolution, the date on which the
Company's shares shall be transferred under the CEPS Share Purchase Agreement
from the securities account of the Seller maintained at the Securities Center to
the securities account of OSINEK maintained at the Securities Center.
"UNIVYC" shall have the meaning ascribed to such term in Section 3.1 (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 Seller's covenant under the Selected
Finance Documents to hold more than 50% share in the company owning the assets
of the transmission grid.
9
"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.
"Purchaser's Covenants" shall have the meaning ascribed to such term in Section
5.5 hereof.
"Seller's Covenants" shall have the meaning ascribed to such term in Section 4.9
hereof.
"Expert" means doc. Ing. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, 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 provision 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 REAS Share Purchase Agreement is 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 with an ex
tunc effect.
9.2 If the CEPS Share Purchase Agreement is 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 with an ex
tunc effect.
9.3 If the Zapadoceska Energetika Share Purchase Agreement is 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 with an ex tunc effect.
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. The fees
charged by UNIVYC in connection with the settlement of the transfer of the Sale
Shares shall be paid by the Seller.
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
10
this Section 10.3, the Purchaser shall be entitled to disclose any Confidential
Information also to the FNM CR, the Cabinet of the Czech Republic, the Ministry
of Finance of the Czech Republic and the Ministry of Industry and Trade 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 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 10.7):
If to the Purchaser:
CEZ, a.s.
▇▇▇▇▇▇ ▇/▇▇▇▇
▇▇▇▇▇ ▇ - Michle, PSC: 140 53
Attention: Ing. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Director of Equity Interest Section
If to the Seller:
Czech Republic - Ministry of Labor and Social Affairs
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇/▇▇▇, ▇▇▇▇▇ 2, PSC: 128 01
Attention: JUDr. ▇▇▇▇▇ ▇▇▇▇▇▇
Director of Organizational and Administrative Division
10.8 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.
10.9 Binding Effect; Assignment. This Agreement shall be binding upon the
Parties and their respective successors and permitted assigns. 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.
10.10 No Unilateral Setoff. Except for the setoff under Section 3.5 hereof, 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.
10.11 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 equal to 1.5 times the discount rate set by the
Czech National Bank and in effect on the first day of default.
10.12 Counterparts. This Agreement has been executed in four (4) counterparts.
Each of the Parties shall receive two counterparts.
11
Prague, July 22, 2002
On behalf of CEZ, a.s.:
[signature]
-----------------------------------
Name: Ing. Jaroslav Mil, M.B.A.
Title: Chairman of the Board of Directors
[signature]
-----------------------------------
Name: JUDr. ▇▇▇▇ ▇▇▇▇▇
Title: Director
On behalf of the Czech Republic - Ministry of Labor of Social Affairs:
[signature]
-----------------------------------
Name: Ing. Zdenek Skromach
Title: Minister of Labor and Social Affairs
12
Exhibit A
[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 ▇▇▇▇▇ ▇, ▇▇▇▇▇ 14, Identification No.: 25 08 14 89
("Univyc") to check the matched transfer orders regarding the sale of shares in
CEPS, 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
13
Exhibit B
[Form of Seller Settlement Order]
The Agent, a.s., with its registered office at .............................,
represented by ....................... (name, surname, title), authorized to
represent the seller, .........................., 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 ▇▇▇▇▇ ▇, ▇▇▇▇▇ 14, Identification No.: 25 08 14 89
("Univyc") to check the matched transfer orders regarding the sale of shares in
Zapadoceska 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
14
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/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Head of Finance Administration
