EXECUTION COPY
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SHAREHOLDERS' AGREEMENT
by and among
WORLD MOTOR HOLDINGS S. a x.x.
BS INVESTIMENTI S.G.R. S.p.A.
BS PRIVATE EQUITY S.p.A.
HOSPITALS OF ONTARIO PENSION PLAN
WORLD MOTORS S.A.
WORLD MOTORS RED S.c.A.
and
WORLD MOTORS WHITE S.c.A.
Dated as of March 27, 2006
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TABLE OF CONTENTS
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ARTICLE I DEFINITIONS......................................................2
SECTION 1.1 DEFINITIONS....................................................2
SECTION 1.2 GENERAL INTERPRETATIVE PRINCIPLES..............................7
ARTICLE II GOVERNANCE OF THE LUXCO HOLDINGS...................................7
SECTION 2.1 BOARD OF DIRECTORS OF WM.......................................7
SECTION 2.2 SHAREHOLDERS' MEETINGS OF WM...................................8
SECTION 2.3 MANAGERS OF XX XX..............................................9
SECTION 2.4 SHAREHOLDERS' MEETINGS OF XX XX...............................10
SECTION 2.5 MANAGER OF WM III.............................................11
SECTION 2.6 SHAREHOLDERS' MEETINGS OF WM III..............................12
SECTION 2.7 SCOPE AND ASSETS OF THE LUXCO HOLDINGS; LIABILITIES OF THE
LUXCO HOLDINGS; CURRENT CAPITALIZATION OF THE LUXCO HOLDINGS..12
ARTICLE III TRANSFER OF INTERESTS OF THE LUXCO HOLDINGS.....................13
SECTION 3.1 TRANSFER RESTRICTIONS.........................................13
SECTION 3.2 RIGHT OF FIRST OFFER..........................................14
SECTION 3.3 TAG-ALONG RIGHTS..............................................16
SECTION 3.4 DRAG-ALONG RIGHT..............................................17
SECTION 3.5 RIGHT TO CONSENT..............................................18
ARTICLE IV TRANSFER OF SHARES OF THE COMPANY...............................18
SECTION 4.1 TRANSFER RESTRICTIONS.........................................19
SECTION 4.2 RIGHT OF FIRST OFFER..........................................19
SECTION 4.3 TAG-ALONG RIGHTS..............................................21
SECTION 4.4 DRAG-ALONG RIGHT..............................................22
ARTICLE V ADDITIONAL AGREEMENTS...........................................23
SECTION 5.1 STANDSTILL; PARTICIPATION RIGHTS..............................23
SECTION 5.2 APPOINTMENT OF DIRECTORS OF THE COMPANY; STATUTORY AUDITORS;
CEO...........................................................24
SECTION 5.3 FINANCIAL INFORMATION; ACCESS.................................26
SECTION 5.4 CAPITAL INCREASE OF THE COMPANY...............................26
ARTICLE VI TERM; TERMINATION...............................................27
SECTION 6.1 TERM OF THE AGREEMENT.........................................27
SECTION 6.2 EFFECTS OF TERMINATION........................................28
ARTICLE VII REPRESENTATIONS AND WARRANTIES..................................28
SECTION 7.1 REPRESENTATIONS AND WARRANTIES OF THE PARTIES.................28
SECTION 7.2 NOTIFICATION OF CERTAIN MATTERS...............................29
ARTICLE VIII INDEMNIFICATION.................................................29
ARTICLE IX MISCELLANEOUS...................................................29
SECTION 9.1 NOTICES.......................................................30
SECTION 9.2 ENTIRE AGREEMENT..............................................32
SECTION 9.3 SEVERABILITY..................................................33
SECTION 9.4 LANGUAGE......................................................33
SECTION 9.5 WAIVERS AND AMENDMENTS........................................33
SECTION 9.6. SUCCESSOR AND ASSIGNS........................................33
SECTION 9.7 NO ASSIGNMENTS................................................33
SECTION 9.8 TAXES.........................................................33
SECTION 9.9 CONFIDENTIALITY...............................................33
SECTION 9.10 OBLIGATIONS SEVERAL AND NOT JOINT............................33
SECTION 9.11 PUBLIC ANNOUNCEMENTS.........................................34
SECTION 9.12 COSTS, EXPENSES..............................................34
SECTION 9.13 COUNTERPARTS.................................................34
SECTION 9.15 FURTHER ASSURANCES...........................................34
SECTION 9.16 APPLICABLE LAW...............................................34
SECTION 9.17 ARBITRATION..................................................34
LIST OF SCHEDULES
Schedule 0.1 Shares of the Luxco Holdings in the Company
Schedule 1.1 By-laws of the Luxco Holdings
Schedule 2.7 Capitalization of the Luxco Holdings
SHAREHOLDERS' AGREEMENT
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THIS SHAREHOLDERS' AGREEMENT (this "Agreement") is made as of March 27,
2006, by and among World Motor Holdings S. a x.x., a Luxembourg company ("WM
Holding"), BS Investimenti S.g.r. S.p.A., an Italian company, acting in its
capacity as manager of the fund "BS Investimenti IV" and on behalf of such fund
("BS1"), BS Private Equity S.p.A., an Italian company ("BS2" and, jointly with
BS1, the "BS Entities"), Hospitals of Ontario Pension Plan, a Canadian pension
plan ("HOOPP" and, together with WM Holding and the BS Entities, collectively,
the "Investors" and each an "Investor"), World Motors S.A., a Luxembourg company
("WM"), World Motors Red S.c.A., a Luxembourg company ("XX XX") and World Motors
White S.c.A., a Luxembourg company ("WM III" and, jointly with WM and XX XX, the
"Luxco Holdings"). WM Holding, the BS Entities, HOOPP and the Luxco Holdings are
referred to herein, collectively, as the "Parties" and, individually, as a
"Party".
R E C I T A L S
WHEREAS, WM Holding owns all of the outstanding ordinary shares (class
"A"), par value Euro 10, of WM, except for 1 (one) preferred share (class "B"),
par value Euro 10, which is owned by BS1 and 1 (one) preferred share (class
"B"), par value Euro 10, which is owned by HOOPP;
WHEREAS, the BS Entities own all of the outstanding shares (class "A"
and class "B"), par value Euro 1.25, of XX XX, except for 1 (one) share (class
"B"), par value Euro 1.25, which is owned by WM;
WHEREAS, HOOPP owns all of the outstanding shares (class "A"), par
value Euro 1.25, of WM III, except for 1 (one) share (class "B"), par value Euro
1.25, which is owned by WM;
WHEREAS, XX XX is managed by WM, as manager and by BS1, as second
manager;
WHEREAS, WM III is managed by WM, as manager;
WHEREAS, WM, XX XX and WM III own, in the aggregate and in the
proportions set forth opposite to their respective names in Schedule 0.1 hereto,
47,808,010 ordinary shares, no par value, constituting, in the aggregate as of
the date hereof, 30% (thirty percent) of the total issued and outstanding
ordinary shares less one share (and without taking into account any shares owned
by the company as treasury stock) of Ducati Motor Holding S.p.A., an Italian
company (the "Company");
WHEREAS, the Parties intend to enter into this Agreement providing for,
inter alia, (i) certain rights and obligations of the Parties with respect to
the governance of the Luxco Holdings and the Company and (ii) certain transfer
restrictions with respect to the Shares (as defined below) and other interests
owned by them and their Qualified Affiliates in the Luxco Holdings and the
Company.
NOW THEREFORE, in consideration of the foregoing and the mutual
promises, covenants and agreements contained herein, the Parties agree as
follows:
ARTICLE I
DEFINITIONS
Section 1.1 Definitions. (a) Capitalized terms used herein are used as
defined in this Article I or as defined elsewhere in this Agreement.
"Affiliate" means, with respect to any Person, an individual,
corporation, partnership, firm, association, unincorporated organization or
other entity, directly or indirectly, Controlling, Controlled by or under common
Control with such Person.
"Authority" means any national or foreign governmental, judicial,
legislative, tax or administrative authority or any subdivision, agency,
commission (including any stock exchange commission), bureau, court or office
thereof.
"By-laws" means the by-laws of each of the Luxco Holdings (in each case
as amended and restated from time to time). A copy of the amended and restated
by-laws of each of the Luxco Holdings as currently in effect is attached as
Schedule 1.1 hereto.
"Business Day" means any day other than a Saturday, Sunday or a day on
which banking institutions in Milan (Italy), Toronto (Ontario, Canada), or
Luxembourg (Luxembourg) are authorized or obligated to close by law, executive
order or any regulations specifically applicable to banking institutions.
"Confidential Information" means (i) this Agreement and any other
agreement or document referred to herein or received in connection herewith or
entered into in furtherance hereof, (ii) any information relating to the Company
or any of the Parties or their respective Affiliates, and (iii) any other
information that has been identified or marked as confidential information by a
Party or any third party.
"Control" (including the correlative meanings of the terms "Controlled
by" and "under common Control with"), as used with respect to any Person, means
(i) the record or beneficial ownership, directly or indirectly (through one or
more intermediates), of equity securities entitling such Person to exercise in
the aggregate more than 50% of the voting rights in such Person, or (ii) the
possession of the power to, directly or indirectly, (A) elect a majority of the
board of directors (or equivalent governing body) of such Person, or (B) direct
or cause the direction of the management and policies of or with respect to such
Person, whether through ownership of securities, contract or otherwise.
"Drag-along Minimum Price" means, with respect to the Shares of the
Company, a price which is (i) not lower than 80% of the Fair Market Value of
such Shares, if such Shares are publicly traded on a stock exchange market, or
(ii) equal to 100% of the Fair Market Value of such Shares, if such Shares are
not publicly traded on a stock exchange market.
"Drag-along Price" means the price per Share of the Shares of the Luxco
Holdings owned by each Drag-along Investor and calculated as the fraction (x)
the numerator of which is equal to the difference between (a) the product of the
Price per Company's Share and the number of Shares of the Company owned by the
relevant Luxco Holding and (b) the Net Financial Indebtedness of such Luxco
Holding and (y) the denominator of which is equal to the number of the issued
and outstanding Shares of such Luxco Holding, as determined by mutual agreement
of the Investors or, in case of disagreement for more than five (5) Business
Days, upon written request of WM Holding, by Mediobanca Banca di Credito
Finanziario S.p.A., Xxxxxxx Xxxxx, PriceWaterhouseCoopers or Deloitte and Touche
(whichever is engaged first), within ten (10) Business Days from the date of its
engagement, whose determinations shall be final, conclusive and binding on the
Parties and not appealable, and the fees and expenses of which will be paid by
the Investors based on their respective Pro Rata Share.
"Fair Market Value" means, as of any date of determination, on a per
Share basis, (i) with respect to any Shares that are publicly traded on a stock
exchange market, the average of the daily closing prices per Share on such stock
exchange market, as reported by the Italian newspaper "Il Sole 24 ore", for the
one-hundred and eighty (180) consecutive trading days immediately preceding the
date on which a drag-along notice is delivered from WM or WM Holding to the
other Luxco Holdings or to the other Investors in accordance with Sections 3.4
or 4.4 hereof or an Offer Notice or a Company Offer Notice is delivered by any
Investor or any Luxco Holding in accordance with Sections 3.2 or 4.2 hereof; and
(ii) with respect to any Shares that are not publicly traded on a stock exchange
market, the total amount per Share of the Shares of the Luxco Holdings, the
Company, or other Person, as applicable, which a willing buyer would pay to a
willing seller in an arm's length transaction, assuming that the buyer has
conducted a due diligence standard for this type of transactions and that each
party acts without undue pressure or compulsion to complete such transaction, as
determined by Mediobanca Banca di Credito Finanziario S.p.A., Xxxxxxx Xxxxx,
PriceWaterhouseCoopers or Deloitte and Touche, within ten (10) Business Days
following its appointment by WM Holding or WM in the cases contemplated under
Sections 3.4 or 4.4 hereof, or by the relevant offeror in the cases contemplated
under Sections 3.2 or 4.2 hereof, it being understood that, in each case, the
determinations of the investment bank or auditing firm so appointed shall be
final, conclusive and binding on the Parties and not appealeable, and the fees
and expenses thereof will be paid by the Luxco Holdings or the Investors, as the
case may be, based on their respective Pro Rata Share.
"Judgments" means any and all judgments, orders, writs, directives,
rulings, decisions, injunctions, decrees, settlement agreements or awards of any
Authority or arbitrator.
"Just Cause" means (i) any material breach by any manager of XX XX or
WM III of (A) any duties imposed to such manager under Luxembourg Law or (B) the
By-laws of such company or this Agreement, in each case unless such breaches are
cured by such manager within twenty (20) Business Days from receipt by such
manager of copy of a written resolution of the shareholders' meeting of the
applicable Luxco Holding indicating the breach to be cured, or (ii) gross
negligence, willful misconduct or fraud of such manager, in each case as
resolved by the shareholders' meeting of XX XX or WM III, as the case may be,
without any veto right of the manager and as ascertained by an enforceable
judgment (even if provisional) issued by a competent court.
"Law" means any national, foreign or E.U. laws, orders, rules,
directives, decrees, decisions or regulations of any Authority.
"Lien" means any mortgage, pledge, hypothecation, easement, usufruct,
charge, assignment, deposit arrangement, encumbrance, security interest, lien,
fiduciary assignment and any security or similar agreement or third party right
or defect of title or restriction of any kind or nature whatsoever.
"Lock-up Period" means the period starting from the date hereof and
ending on the first (1st) anniversary of the date hereof.
"Net Financial Indebtedness" means, with respect to any Luxco Holding,
at any applicable time, the algebraic difference between (x) all obligations of
such Person (A) for money borrowed from banks, credit institutions or third
parties (including any of its shareholders or any Qualified Affiliate thereof)
upon which interest charges are paid or which are interest-free (including
shareholders' loans and preferred equity certificates or similar securities, of
any class or category whatsoever, whether convertible or not, together with the
unpaid principal amount thereof and accrued interest thereon), (B) evidenced by
a note, bond, debenture or similar instrument (including preferred equity
certificates or similar securities, of any class or category whatsoever, whether
convertible or not, and, together with the unpaid principal amount thereof and
accrued interest thereon) and (y) all cash and cash equivalents of such Person.
"Permitted Transfer" means any Transfer of Shares that is permitted
under Sections 3.1 or 4.1 hereof.
"Person" means an individual, corporation, partnership, trust, limited
liability company, a branch of any legal entity, unincorporated organization,
joint stock company, joint venture, association or other entity, or any
government, or any agency or political subdivision thereof.
"Price per Company's Share" means the price per Share of the Company
offered to be paid by a prospective purchaser to WM Holding for each Share of
the Company, which, unless otherwise indicated by such prospective purchaser, is
equal to the fraction (x) the numerator of which is equal to the sum of (a) the
product of the price offered to be paid by the prospective purchaser to WM
Holding for each Share of WM and the number of the issued and outstanding Shares
of WM and (b) the Net Financial Indebtedness of WM and (y) the denominator of
which is equal to the number of Shares of the Company owned by WM.
"Pro Rata Share" means, as of any date of determination, with respect
to any Investor, such Investor's (indirect) pro rata share, expressed as a
percentage, of the outstanding Shares of the Company owned by such Investor at
such time out of the aggregate number of Shares of the Company owned by all the
Investors as of such time.
"representatives" means, with respect to any Person, any of such
person's officers, directors, agents, employees and advisors.
"Qualified Affiliate" means an Affiliate of any Investor(a) that has
agreed in writing (i) to be bound, in respect of all of the Shares and other
interests (including with respect to Permitted Indebtedness) it owns in any
Luxco Holdings, by this Agreement, by executing a deed of adherence hereto in
order to become a party hereunder and (ii) to Transfer, prior to ceasing to be
an Affiliate of such Investor, all of the Shares and other interests it owns in
any Luxco Holdings and all of its rights and obligations hereunder to such
Investor; and (b) as to which such Investor has agreed in writing to be liable
as a primary obligor for the obligations of such Qualified Affiliate hereunder
and any other agreement or instrument executed and delivered by such Qualified
Affiliate pursuant hereto.
"Shares" means, collectively, any shares or other equity interests of
any type or class issued by any Person (or any successor thereof) at any time,
as well as any option, subscription, preemption or purchase right, warrant or
other security to subscribe for or otherwise acquire shares or other equity
interests in such Person (or any successor thereof), it being understood that
such definition will also include any shares or other equity interests which may
be issued in respect of, in exchange for or in substitution of such Shares, from
time to time, by reason of any stock dividend, stock split, stock issuance,
reverse stock split, combination, recapitalization, reclassification, merger,
consolidation or otherwise.
"Tag-along Price" means the price per Share of the Shares of the Luxco
Holdings owned by each Tag-along Investor and calculated as the product of the
fraction (x) the numerator of which is equal to the difference between (a) the
product of the Price per Company's Share and the number of Shares of the Company
owned by the relevant Luxco Holding and (b) the Net Financial Indebtedness of
such Luxco Holding and (y) the denominator of which is equal to the number of
the issued and outstanding Shares of such Luxco Holding, as determined by mutual
agreement of the Investors or, in case of disagreement for more than five (5)
Business Days, upon written request of any Investor (with copies to the other
Investors), by Mediobanca Banca di Credito Finanziario S.p.A., Xxxxxxx Xxxxx,
PriceWaterhouseCoopers or Deloitte and Touche (whichever is engaged first)
within ten (10) Business Days from the date of its engagement, whose
determinations shall be final, conclusive and binding on the Parties and not
appealable, and the fees and expenses of which will be paid by the Investors
based on their respective Pro Rata Share.
"Transfer" means to sell, contribute or otherwise transfer, in whole or
in part, directly or indirectly, under any condition and in any way whatsoever
(including by way of sale, issuance, merger, consolidation, spin-off, demerger,
contribution or otherwise), in exchange of, or without, a consideration, whether
monetary or non monetary; to pledge, create Liens, or encumber in any way, or to
donate.
"Voting Security" means any Shares entitled to vote in the election of
directors of any Person or securities or rights convertible thereinto or
exchangeable therefor.
(b) In addition to the terms defined in clause (a) above, the following
terms shall have the respective meanings given thereto in the sections indicated
below:
Defined Term: Section:
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"A Directors" Section 2.1(a)
"Agreement" Preamble
"B Directors" Section 2.1(a)
"BS Entities" Preamble
"BS1" Preamble
"BS2" Preamble
"C Directors" Section 2.1(a)
"Company Drag-along Notice" Section 3.4
"Company Offer Notice" Section 4.2
"Company Reply Notice" Section 4.3(a)
"Company Tag-along Notice" Section 4.3(a)
"Company" Recitals
"Consent Notice" Section 3.5
"Drag-along Investor" Section 3.4
"HOOPP" Preamble
"HR Firm" Section 5.2(c)
"ICC" Section 9.13
"Indemnitor" Article VIII
"Initial Term" Section 6.1(a)
"Investor Offerees" Section 3.2(a)
"Investor" and/or "Investors" Preamble
"Losses" Section 2.1(c)
"Luxco Holding Offerees" Section 4.2
"Luxco Holdings" Preamble
"Offer Notice" Section 3.2(a)
"Offering Investor" Section 3.2(a)
"Offering Luxco Holding" Section 4.2
"Other Geeneral Partner of WM" Section 2.3(a)
"Party" and "Parties" Preamble
"Permitted Indebtedness" Section 2.7(a)
"Pro Rata Portion" Sections 4.3(a)
and 5.1
"Renewal Term" Section 6.1(a)
"Reply Notice" Section 3.3(a)
"Tag-along Investors" Section 3.3(a)
"Tag-along Luxco Holdings" Section 4.3(a)
"Tag-along Notice" Section 3.3(a)
"Term" Section 6.1(a)
"WM" Preamble
"XX XX Call Option Price" Section 2.3(c)
"XX XX Call Option Shares" Section 2.3(c)
"XX XX Call Option" Section 2.3(c)
"XX XX Managers" Section 2.3(a)
"XX XX Option Closing" Section 2.3(c)
"XX XX Option Notice" Section 2.3(c)
"XX XX" Preamble
"WM III Call Option Price" Section 2.5(c)
"WM III Call Option Shares" Section 2.5(c)
"WM III Call Option" Section 2.5(c)
"WM III Option Closing" Section 2.5(c)
"WM III Option Notice" Section 2.5(c)
"WM III" Preamble
"WM Holding" Preamble
Section 1.2 General Interpretative Principles. Whenever used in this
Agreement, except as otherwise provided or unless the context otherwise
requires, any noun or pronoun shall be deemed to include the plural as well as
the singular and to cover all genders. Unless otherwise specified, the terms
"hereof" and "herein" and similar terms refer to this Agreement as a whole
(including any schedules hereto), and references herein to "Articles" or
"Sections" refer to Articles or Sections of this Agreement.
ARTICLE II
GOVERNANCE OF THE LUXCO HOLDINGS
Section 2.1 Board of Directors of WM. (a) During the Term (as defined
below), WM shall be governed by a board of directors consisting of five (5)
directors of whom (i) three (3) shall be appointed upon designation of WM
Holding (the "A Directors"), (ii) one (1) shall be appointed upon designation of
BS1 (the "B Director"), and (iii) one (1) shall be appointed upon designation of
HOOPP (the "C Director"). The board of directors of WM shall remain in office
for a 3 (three)-year term. The annual compensation due to the directors in
connection with their service as directors of WM is equal to Euro 5,000. Upon
request of WM, any amounts paid to the B Director and the C Director in relation
to their office as directors of WM shall be promptly reimbursed to WM by the BS
Entities, with respect to the B Director, and by HOOPP, with respect to the C
Director. In addition, directors will be entitled to reimbursement of reasonable
out-of-pocket expenses incurred by them in connection with their service, unless
otherwise decided by the shareholders' meeting of WM.
(b) Should any member of the Board of Directors of XX xxxxx from his or
her office for any reason whatsoever, the substitute shall be elected upon
designation of the Investor who designated such ceasing member of the board of
directors.
(c) If any of the Investors wishes to remove a director designated by
it and elected pursuant to clause (a) of this Section 2.1 during such director's
term as director of WM, such Investor shall give written notice to the other
Investors informing them of its intention to remove the director. WM Holding
shall then cause a shareholders' meeting of WM to be held in order to remove
such director and each of the Investors shall take all such other actions as may
be necessary or appropriate to effect such removal in accordance with such
request, provided that the Investor requesting the removal shall indemnify and
hold harmless the other Investors and WM from and against any and all
liabilities, losses, damages, claims, costs and expenses (including, without
limitation, reasonable attorney's fees) (collectively, "Losses") incurred or
suffered by any of them or their respective Affiliates or representatives
arising out of, relating to or based upon such removal.
(d) The overall management of WM shall be the responsibility of the
board of directors of WM, which, with the favorable vote of the simple majority
of the directors of WM (provided that at least two (2) of the A Directors shall
have voted in favor of such resolution), shall establish the policies and
operating procedures of WM, manage the business and affairs of WM and exercise
and direct all corporate powers of WM. Subject to applicable Law, the board of
directors of WM may delegate its powers to one or more of the A Directors, it
being understood that any decision of WM, in its capacity as manager of XX XX
and of WM III, regarding the management of XX XX and/or WM III (other than any
decision regarding the ordinary course of business thereof, which may be
delegated to any A Director) (i) shall be of the exclusive competence of the
board of directors of WM, (ii) may not be delegated and (iii) shall be taken by
resolution of such board of directors with the favorable vote of the simple
majority of the directors of WM present or duly represented at such meeting,
provided that at least two (2) of the A Directors shall have voted in favor of
such resolution.
Section 2.2 Shareholders' Meetings of WM. All resolutions of any
shareholders' meeting of WM shall be passed by a simple majority of the Shares
present or represented and voting at such meeting, except if a different quorum
or other majority or requirements are required by applicable Law; provided,
however, that any resolutions of the shareholders' meeting of WM regarding any
change of Articles 6, 7, 8, 10, 13 (last paragraph), 15 and 18 and Sections 9.3
and 9.5 of the By-laws of WM (including any change to any other articles or
sections of the By-laws or the addition of any other articles or sections of the
By-laws which affect such articles), shall be approved by the affirmative
unanimous vote of the shareholders representing 100% of the capital of WM (it
being understood that, to the extent that the proposed change does not have or
would not reasonably be expected to have an adverse effect on the rights of
HOOPP or the BS Entities under such By-laws, each of the shareholders of WM
agrees to validly vote in favor of such change).
Section 2.3 Managers of XX XX. (a) During the Term, XX XX shall be
governed and managed by WM acting as its manager. In addition to WM, BS1 shall
act as additional manager of XX XX (the "Other Manager of XX XX" and together
with WM, collectively, the "XX XX Managers"), and shall have powers limited to
any decision regarding the implementation of the decisions validly taken by the
shareholders' meeting of XX XX with respect to the purchase or sale of Shares of
the Company under Sections 4.2, 4.3 and 5.1(b) hereof, it being understood that
WM shall not be entitled to take any decisions with respect to such matters. The
XX XX Managers shall remain in office for the Term, unless earlier removed in
accordance with clause (b) of this Section 2.3. No fee, remuneration or
compensation shall be due to the Managers in connection with their service as
managers of XX XX, except for reimbursement of reasonable out-of-pocket expenses
incurred by them in connection with their service. No manager shall be liable to
XX XX, its shareholders or any other Person for any Losses arising out of any
action taken or not taken by such manager in compliance with applicable Law and
the By-laws or acting in good faith after receipt of opinion or advice of
counsel or accountants selected by it, in each case in compliance with
applicable Law and the By-laws. If the manager (or any of its Affiliates or
representatives) is a party or is threatened to be made a party to any action,
suit or proceeding (of any type whether civil, administrative or investigative)
by reason of any alleged actions or omissions arising out of such manager's (or
any of its representatives') activities acting on behalf of XX XX, then XX XX
shall, to the fullest extent permitted by Law, indemnify and hold harmless the
manager and each of its Affiliates and representatives from and against any and
all Losses suffered or incurred by them arising out of or resulting from or in
connection with such actions, suit or proceeding (excluding any Losses which
arise from any event constituting Just Cause), provided that the manager has
acted in compliance with applicable Law and the By-laws or in good faith after
receipt of opinion or advice of counsel or accountants chosen by it, in each
case in compliance with applicable Law and the By-laws.
(b) WM may not be removed from its office as Manager of XX XX for any
reason whatsoever, except in the following cases:
(i) in case of Just Cause;
(ii) in case of any change of articles Articles 6, 7, 8, 10, 13 (last
paragraph), 15 and 18and Sections 9.3, 9.5 of the By-laws of WM, unless resolved
with the affirmative unanimous vote of the shareholders representing 100% of the
capital of WM or unless required by mandatory provisions of Law (provided that
in, such latter case alternative protective provisions having substantially the
same effect are provided in favor of the BS Entities and HOOPP); or
(iii) in case of removal for Just Cause of WM as manager of WM III.
(c) The Other Manager of XX XX may be removed from its office as
Manager of XX XX only by a decision of the shareholders' meeting of XX XX passed
by the BS Entities, or as otherwise provided by the By-laws of XX XX, provided
that, upon such removal, the Other Manager of XX XX shall be promptly replaced
with a Qualified Affiliate of BS1 acting as Other Manager of XX XX.
(d) In the event that WM is removed as manager of XX XX in accordance
with clause (b) of this section 2.3, then the BS Entities shall have the
irrevocable option to purchase from WM (the "XX XX Call Option") all of the
Shares owned by WM in XX XX at such time (the "XX XX Call Option Shares") at a
price (which may only be payable in cash) equal to their nominal value (the "XX
XX Call Option Price"). The XX XX Call Option may be exercised by delivering to
WM a written notice (a "XX XX Option Notice") during a period of ten (10)
Business Days following the removal of WM as manager of XX XX. The closing of
such sale (the "XX XX Option Closing") shall occur as soon as reasonably
practicable (but, in any event, within the later of (x) ten (10) Business Days
following receipt of the XX XX Option Notice by WM or (y) the second Business
Day after the receipt of any necessary governmental approvals) at a time and
place specified in writing by the BS Entities. At the XX XX Option Closing, (i)
the BS Entities (or a Qualified Affiliate thereof designated in writing to WM)
shall pay or cause to be paid to WM the XX XX Call Option Price by wire transfer
of immediately available funds to the WM's bank account (all the necessary
information of which shall be notified in writing to the buyer by WM at least
five (5) Business Days prior to the XX XX Option Closing), and (ii) WM shall (A)
Transfer to the buyer title to the XX XX Call Option Shares, free and clear of
all Liens (other than those resulting from this Agreement or the By-Laws), and
(B) execute and deliver any such documents and instruments reasonably required
to effect the sale of such XX XX Call Option Shares, to the buyer, free and
clear of any Liens (other than those resulting from this Agreement or the
By-Laws). It is understood that WM shall not make to the BS Entities any
representations and warranties regarding the XX XX Call Option Shares other than
with respect to powers and title. The buyer shall bear all stamp duties,
transfer taxes, or similar governmental charges in connection with such sale.
Each party shall bear its own fees and expenses of any attorneys, auditors,
consultants or investment firms retained in connection with such sale.
Section 2.4 Shareholders' Meetings of XX XX. (a) All resolutions of any
shareholders' meeting of XX XX shall be passed by a simple majority of the
Shares present or represented and voting at such meeting, except if a different
quorum or other majority or requirements are required by applicable Law;
provided, however, that any decision of the shareholders' meeting of XX XX
regarding any change of Articles 5 (penultimate and last paragraphs), 6, 8, 9,
10, 16, 17, 18, 20 of the By-laws of XX XX (including any change to any other
articles or sections of the By-laws or the addition of any other articles or
sections of the By-laws which affect such articles), shall be approved by the
affirmative unanimous vote of the shareholders representing 100% of the capital
of XX XX (including the vote of the Managers), it being understood that, to the
extent that the proposed change does not have or would not reasonably be
expected to have an adverse effect on the rights of WM under such By-laws, each
of the shareholders of XX XX agrees to validly vote in favor of such change.
(b) The shareholders' meeting of XX XX shall have exclusive competence
to take any decision regarding (i) the purchase or sale of Shares of the Company
under Sections 4.2, 4.3 and 5.1(b) hereof, (ii) the termination of this
Agreement in accordance with Article VI hereof, and (iii) any issuance of Shares
by WMII.
Section 2.5 Manager of WM III. (a) During the Term, WM III shall be
governed and managed by WM acting as its manager. WM shall remain in office for
the Term, unless earlier removed in accordance with clause (b) of this Section
2.5. No fee, remuneration or compensation shall be due to WM in connection with
its services as manager of WM III, except for reimbursement of reasonable
out-of-pocket expenses incurred by it in connection with its service. The
manager shall not be liable to WM III, its shareholders or any other Person for
any Losses arising out of any action taken or not taken by the manager in
compliance with applicable Law and the By-laws or acting in good faith after
receipt of opinion or advice of counsel or accountants selected by it. If the
manager (or any of its Affiliates or representatives) is a party or is
threatened to be made a party to any action, suit or proceeding (of any type
whether civil, administrative or investigative) by reason of any alleged actions
or omissions arising out of such manager's (or any of its Affiliates' or
representatives') activities acting on behalf of WM III, then WM III shall, to
the fullest extent permitted by Law, indemnify and hold harmless the manager and
each of its Affiliates and representatives from and against any and all Losses
suffered or incurred by them arising out of or resulting from or in connection
with such actions, suit or proceeding, excluding any Losses which arise from any
event constituting Just Cause, provided that the manager has acted in compliance
with applicable Law and the By-laws or in good faith after receipt of opinion or
advice of counsel or accountants chosen by it.
(b) WM may not be removed as manager of WM III for any reason
whatsoever except in the following cases:
(i) in case of Just Cause;
(ii) in case of any change of Articles 6, 7, 8, 10, 13 (last
paragraph), 15 and 18 and Sections 9.3, 9.5 of the By-laws of WM, which has or
would reasonably be expected to have a material adverse effect on the rights of
HOOPP thereunder, unless resolved with the affirmative unanimous vote of the
shareholders representing 100% of the capital of WM or unless required by
mandatory provisions of Law (provided that, in such latter case, alternative
protective provisions having substantially the same effect are provided in favor
of the BS Entities and HOOPP); or
(iii) in case of removal for Just Cause of WM as manager of XX XX.
(c) In the event that WM is removed as manager of WM III in accordance
with clause (b) of this section 2.5, then HOOPP (acting directly or through a
Qualified Affiliate thereof) shall have the irrevocable option to purchase from
WM (the "WM III Call Option") all of the Shares owned by WM in WM III at such
time (the "WM III Call Option Shares") at a price (which may only be payable in
cash) equal to their nominal value (the "WM III Call Option Price"). The WM III
Call Option may be exercised by delivering to WM a written notice (a "WM III
Option Notice") during a period of 10 (ten) Business Days following the removal
of WM as manager of WM III. The closing of such sale (the "WM III Option
Closing") shall occur as soon as reasonably practicable (but, in any event,
within the later of (x) ten (10) Business Days following receipt of the WM III
Option Notice by WM or (y) the second Business Day after the receipt of any
necessary governmental approvals) at a time and place specified by HOOPP. At the
WM III Option Closing, (i) HOOPP (or a Qualified Affiliate thereof designated in
writing to WM) shall pay or cause to be paid to WM the WM III Call Option Price
by wire transfer of immediately available funds to the WM's bank account (all
the necessary information of which shall be notified in writing to the buyer by
WM at least five (5) Business Days prior to the WM III Option Closing), and (ii)
WM shall (A) transfer to the buyer title to the WM III Call Option Shares, free
and clear of all Liens (other than those resulting from this Agreement or the
By-Laws), and (B) execute and deliver any such documents and instruments
reasonably required to effect the sale of such WM III Call Option Shares, to the
buyer, free and clear of any Liens (other than those resulting from this
Agreement or the By-Laws). The buyer shall bear all stamp duties, transfer
taxes, or similar governmental charges in connection with such sale. It is
understood that WM shall not make to HOOPP any representations and warranties
regarding the XX XX Call Option Shares other than with respect to powers and
title. Each party shall bear its own fees and expenses of any attorneys,
auditors, consultants or investment firms retained in connection with such sale.
Section 2.6 Shareholders' Meetings of WM III. (a) All resolutions of
any shareholders' meeting of WM III shall be taken by a simple majority of the
Shares present or represented and voting at such meeting, except if a different
quorum or other majority or requirements are required by applicable Law;
provided, however, that any decision of the shareholders' meeting of WM III
regarding any change of Articles 5 (penultimate and last paragraphs), 6, 8, 9,
10, 16, 17, 18, 20 of the By-laws of WM III (including any change to any other
articles or sections of the By-laws or the addition of any other articles or
sections of the By-laws which affect such articles), shall be approved by the
affirmative vote of the shareholders representing 100% of the capital of WM III
(including the vote of WM as manager), it being understood that, to the extent
that the proposed change does not have or would not reasonably be expected to
have an adverse effect on the rights of WM under such By-laws, each of the
shareholders of WM III agrees to validly vote in favor of such change.
(b) The shareholders' meeting of WM III shall have exclusive competence
to take any decision regarding (i) the purchase or sale of Shares of the Company
under Sections 4.2, 4.3 and 5.1(b) hereof, (ii) the termination of this
Agreement in accordance with Article VI hereof, (iii) any issuance of Shares by
WM III, and (iv) the exercise of HOOPP's rights under Section 2.5(b).
Section 2.7 Scope and assets of the Luxco Holdings; Liabilities of the
Luxco Holdings; Current capitalization of the Luxco Holdings. (a) Unless
otherwise agreed in writing among the Investors, (i) the corporate scope of the
Luxco Holdings shall be limited to the management (directly or indirectly,
including, with respect to WM, through the management of the other Luxco
Holdings) and Transfer of the Shares of the Company respectively held by them,
and (ii) none of the Luxco Holdings shall have any assets other than (A) their
respective Shares of the Company, (B) in case of a tender offer with respect to
the Voting Securities of the Company effected by WM and/or any of the Luxco
Holdings in accordance with Section 5.1(b) hereof, the Voting Securities of the
Company so acquired, (C) in case of Transfer of Shares of the Company by any
Luxco Holding to a third party against non-cash consideration in accordance with
Sections 4.2, 4.3 or 4.4 hereof, such non-cash consideration received by them in
consideration of such Transfer, and (D) cash and cash equivalents.
(b) Unless otherwise agreed in writing among the Parties, none of the
Luxco Holdings shall have any liabilities other than (i) shareholders' loans,
preferred equity certificates or similar debt securities (whether convertible or
not, of any type or class whatsoever), in each case funded or purchased by the
applicable Investor or an Affiliate thereof or (ii) in case of a tender offer
with respect to the Voting Securities of the Company effected by WM and or any
of the Luxco Holdings in accordance with Section 5.1(b) hereof, senior or
mezzanine financing provided by one or more internationally recognized banks or
financial institutions in connection with such tender offer ("Permitted
Indebtedness").
(c) Schedule 2.7 hereto sets forth a true and accurate description of
the capitalization of each Luxco Holding as of the date hereof. Each of the
Investors shall promptly deliver to the other Investors an updated version of
such Schedule 2.7 in case of any change of the capitalization of the applicable
Luxco Holding.
ARTICLE III
TRANSFER OF INTERESTS OF THE LUXCO HOLDINGS
Section 3.1 Transfer Restrictions. (a) During the Term, in accordance
with the By-laws of the Luxco Holdings, the Investors shall not Transfer title
to or beneficial ownership of any Shares in the Luxco Holdings, other than in
connection with the following Permitted Transfers and in compliance with clause
(b) of this Section 3.1: (i) any Transfer by any Investor of all or part of its
Shares in the Luxco Holdings to a Qualified Affiliate thereof before or after
the Lock-up Period (it being understood that, in the event that WM or BS1
transfers its Shares in XX XX or WM III to a Qualified Affiliate, such
transferee will automatically become the manager of such Luxco Holding); (ii)
any Transfer by any Investor occurring after the Lock-up Period of all or part
of its Shares to an unaffiliated third Person in a transaction which is subject
to the right of first offer provided for in Section 3.2 hereof and in the
By-laws of the Luxco Holdings and which complies with Section 3.3 hereof,
provided that, as a condition to any such Transfer, the Transferor shall have
procured that the Transferee agrees to adhere to this Agreement as if it were a
party hereunder by entering into a deed of adherence with the other Parties (it
being understood that such requirement shall not apply in the event that, after
giving effect to any Transfer under Sections 3.3 and 3.4, the BS Entities and
HOOPP would cease to be shareholders of the relevant Luxco Holding); (iii) any
Transfer of Shares in any Luxco Holdings under Sections 2.3(d), 2.5(c), 3.3 and
3.4 hereof; (iv) a pledge of the applicable Shares to a internationally
recognized bank or financial institution made by any Investor (A) with the
written consent of all of the Investors (provided that the Investor retains the
voting rights on the applicable Shares and the applicable pledgee agrees in
writing that any sale of such Shares under such pledge in case of foreclosure
under the pledge agreement remains subject to the provisions of this Article
III) or (B) in connection with a tender offer with respect to the Voting
Securities of the Company effected by WM and or any of the Luxco Holdings in
accordance with Section 5.1(b) hereof; or (v) any Transfer by any Investor of
all or part of its Shares in the Luxco Holdings that occurs before or after the
Lock-up Period with the written consent of all the other Investors, provided
that, as a condition to any such Transfer, the Transferor shall have procured
that the Transferee agrees to adhere to this Agreement as if it were a party
hereunder by entering into a deed of adherence with the other Parties. Any
attempt to Transfer any Shares in violation of this Section 3.1 shall be null
and void ab initio and the applicable Luxco Holding shall have no obligation to
register such interests in the name of the Transferee.
(b) It is understood that any Investor Transferring any of its Shares
of the applicable Luxco Holding hereunder (including under Sections 3.2, 3.3 and
3.4 hereof) shall also Transfer, as a condition to such Transfer, an equal
percentage of unpaid principal amount of any Permitted Indebtedness together
with accrued and unpaid interest thereon and all other rights and obligations
relating thereto until the date of such Transfer.
Section 3.2 Right of First Offer. (a) In the event that at any time
after the end of the Lock-up Period, other than in connection with a Permitted
Transfer to a Qualified Affiliate or with the written consent of all the other
Investors, any Investor (such Investor, the "Offering Investor") intends to
Transfer, or cause the applicable Luxco Holding to Transfer, its Shares in any
Luxco Holdings to a third party, such Investor shall, in accordance with the
By-laws, send a written notice (the "Offer Notice") to the other Investors (the
"Investor Offerees") setting forth such Investor's desire to Transfer its Shares
in the relevant Luxco Holding pursuant to this Section 3.2 and specifying, with
respect to such proposed Transfer, the number of Shares, the purchase price per
Share and all other material payment terms including, without limitation, the
consideration (which may consist of cash or consideration other than cash), it
being understood that, in the event that the Offering Investor is HOOPP or the
BS Entities, the Offer Notice will also contain an irrevocable offer of the
Offering Investor to sell to WM Holding or a Qualified Affiliate thereof all of
the Shares owned by such Offering Investor in WM at their nominal value subject
to the commitment by WM Holding or a Qualified Affiliate to acquire no less than
its Pro Rata Portion of the Shares subject of the Offer Notice.
(b) Each of the Investor Offerees shall have the right to purchase a
number of Shares in the relevant Luxco Holding subject of the Offer Notice equal
to its Pro Rata Portion (as defined in this clause (b)), at the terms and
conditions set forth in the Offer Notice, it being understood that, in the event
that WM Holding is one of the Investor Offerees, then WM Holding shall have the
right to cause a Qualified Affiliate thereof to purchase all of the Shares owned
by the Offering Investor in WM at the nominal value thereof. The Investor
Offerees (or any of them) will have to notify to the Offering Investor their
irrevocable election to purchase all (but not less than all) the Shares subject
of the Offer Notice (and WM Holding will have to notify to the Offering Investor
its irrevocable and unconditional election to cause a Qualified Affiliate
thereof to purchase the Shares of WM subject of the Offer Notice) within fifteen
(15) Business Days from the date of receipt of the Offer Notice, specifying, in
each case, if applicable, their irrevocable commitment to purchase also the
Shares offered to the other Investor Offerees in the event that such Investor
Offerees declined to purchase the Shares offered under the Offer Notice. For
purposes of this Section 3.2, the term "Pro Rata Portion" shall mean a number of
Shares of the relevant Luxco Holding equal to the fraction the numerator of
which is the number of Shares of the Company owned (indirectly through the
applicable Luxco Holding) by the applicable Investor Offeree and the denominator
of which is the aggregate number of Shares of the Company owned (indirectly
through the applicable Luxco Holding) by all of the Investor Offerees as of such
time.
(c) In the event that there has been a timely election by the Investor
Offerees (or any one of them) to acquire all (but not less than all) the Shares
subject of the Offer Notice, then the sale of such Shares shall close at a time
and place selected by the Offering Investor or at such other time or place
agreed among the parties in writing, but in any event within the later of (x)
fifteen (15) Business Days from the date of receipt of the above election notice
from the Investor Offerees (or any one of them) or (y) the second Business Day
after the receipt of any necessary governmental approvals. At such closing, (i)
the Investor Offerees (or any one of them), as the case may be, shall deliver to
the Offering Investor the consideration to be exchanged for the offered Shares,
(A) in case of cash consideration, by wire transfer of immediately available
funds to the bank account designated by the Offering Investors and (B) in case
of non-cash consideration, at the direction of the Offering Investor, in each
case by at least five (5) Business Days prior to such date, and (ii) the
Offering Investor shall Transfer title to the Shares being sold and deliver all
other documents required to effect the sale of such Shares in accordance with
the same terms and conditions set forth in the Offer Notice. It is understood
that the Offering Investor shall not make to the Investor Offerees any
representations and warranties regarding the Shares being sold in accordance
with this Section 3.2 other than with respect to powers and title. The purchaser
shall pay any transfer taxes or similar governmental charges in connection with
such sale and shall otherwise pay its own costs and expenses in connection with
such sale.
(d) In the event that the Investor Offerees fail to notify the Offering
Investor of their irrevocable election to purchase all (but not less than all)
the Shares subject of the Offer Notice within the fifteen (15) Business Day
period specified in clause (b) of this Section 3.2, the Offering Investor may
Transfer, subject to Section 3.3, 3.4 and 3.5 hereof, all (but not less than
all) the Shares subject of the Offer Notice to any third party within and no
later than six (6) months following the date of delivery of the Offer Notice or
such other longer term if the Transfer is made pursuant to Sections 3.3 or 3.4.
If such Transfer is completed, upon written request of the other Investors, the
Offering Investor will provide to the Investor Offerees written evidence that
the Transfer to the third party has been completed at a price not lower than the
price contained in the Offer Notice (and, in the event that such price is paid,
in whole or in part, for consideration other than cash, evidence that the value
of such non-cash consideration as of the date of delivery of the Offer Notice is
equal to the Fair Market Value thereof) and substantially at the same terms and
conditions set forth therein, provided, however, that no such Transfer shall be
completed unless the Transferee executes a deed of adherence to this Agreement
to become a party hereto.
Section 3.3 Tag-along rights. (a) Without prejudice to Section 3.2
hereof, in the event that at any time after the end of the Lock-up Period, other
than in connection with a Permitted Transfer to a Qualified Affiliate or with
the written consent of all the other Investors, WM Holding wishes to Transfer
any of the Shares it owns in WM to a third Person, WM Holding shall give to the
other Investors (the "Tag-along Investors") written notice setting forth its
intention to sell such Shares in WM, the proposed sale price (which shall
include an indication of the Price per Company's Share, which may be payable in
cash or in consideration other than cash) and any and all other material terms
and conditions of such Transfer (the "Tag-along Notice") and, for fifteen (15)
Business Days following the date of the Tag-along Investors' receipt of such
Tag-along Notice, provided that such Investors have not timely exercised their
right of first offer under Section 3.2 hereof, such Tag-along Investors shall
have the right to deliver a reply notice (the "Reply Notice") to WM Holding
setting forth their irrevocable and unconditional election to require WM Holding
to include in the proposed sale contemplated by the Tag-along Notice an
aggregate number of Shares owned by each Tag-along Investor respectively in XX
XX and WM III equal to their respective Pro Rata Portion (as defined in this
clause (a)) if the Shares proposed to be sold by WM Holding do not exceed 50% of
the outstanding Shares of WM and (ii) 100% of the Shares owned by each Tag-along
Investor respectively in XX XX and WM III, if the Shares proposed to be sold by
WM Holding exceed 50% of the outstanding Shares of WM. For purposes of this
Section 3.3, the term "Pro Rata Portion" shall mean a number of Shares of the
relevant Luxco Holding owned by the relevant Tag-along Investor which is equal
to the product of (x) the number of issued and outstanding Shares of the
relevant Tag-along Investor and (y) a fraction the numerator of which is the
number of Shares of WM proposed to be sold by WM Holding and the denominator of
which is the number of issued and outstanding Shares of WM.
(b) Following the receipt of the Reply Notice, WM Holding shall be
obligated to include in such sale the Shares set forth in the Reply Notice at a
price per Share not lower than the Tag-along Price and substantially on the same
terms and conditions set forth in the Tag-along Notice.
(c) In the event there has not been a timely election by the Tag-along
Investors to include their Shares in the sale proposed by WM Holding, then WM
Holding may, within six (6) months following the date of delivery of the
Tag-along Notice and without any further obligation to the Tag-along Investors,
Transfer its Shares at a purchase price per Share not lower than the Tag-along
Price and substantially at the same terms and conditions as those set forth in
the Tag-along Notice. If such Transfer is completed, upon written request of the
Tag-along Investors, WM Holding will provide to the Tag-along Investors evidence
that the Transfer to the third party has been perfected at a purchase price per
Share not lower than the price indicated in the Tag-along Notice and
substantially on the same terms and conditions set forth in the Tag-along
Notice.
(d) In the event the BS Entities and/or HOOPP have timely delivered
Reply Notice, the sale by WM Holding of the Shares set forth in the Tag-along
Notice and the sale by the BS Entities and/or HOOPP of their Shares shall take
place simultaneously and, on the closing date and place which shall be
communicated by WM Holding to the Tag-along Investors in writing, the Tag-along
Investors (or any of them) shall (A) Transfer title to the prospective
Transferee of the Shares being sold, free and clear of all Liens and (B) execute
and deliver any such documents and instruments (including the same
representations and warranties provided by WM and its Qualified Affiliates in
respect to the Shares being sold, provided that the sellers will use their
reasonable best efforts to negotiate with the prospective purchaser that any
liability for breach of representations and warranties will be several and not
joint among the sellers and provided, further, that in the event that they do
not succeed in obtaining such limitation, in the internal relations among the
sellers the liability shall be allocated pro rata to the Shares sold) required
to effect the Transfer of title to such Shares to the prospective Transferee,
free and clear of any Liens. All costs and expenses incurred by the Investors in
connection with such transaction shall be borne by them in proportion to the
Shares being sold (excluding, for the avoidance of doubt, any fees paid or to be
paid to any of the Parties or any Affiliate thereof). Unless otherwise agreed
with the purchaser, the purchaser shall pay any transfer taxes or similar
governmental charges in connection with such sale.
Section 3.4 Drag-along Right. Notwithstanding any other provision of
this Agreement, if at any time after the Lock-up Period a bona fide firm offer
from an unaffiliated third Person to acquire (by merger, sale of assets or stock
or otherwise directly or indirectly in one or a series of related transactions),
at a price implying a Price Per Company's Share not lower than the Drag-along
Minimum Price, 90% or more of the Shares in WM owned by WM Holding is received
by WM Holding, then WM Holding may require the other Investors (each, a
"Drag-along Investor") to Transfer to the prospective Transferee all of their
respective Shares owned by them in the applicable Luxco Holdings simultaneously
with the Transfer of the Shares in WM to be sold by WM Holding, by delivering a
written notice to the other Investors (which shall include an indication of the
Price per Company's Share) in which it irrevocably elects to include in such
proposed Transfer to the prospective Transferee all (and not less than all) the
Shares in the Luxco Holdings of such Investors, which shall be obliged to
Transfer to the prospective Transferee all of the Shares owned by them in the
applicable Luxco Holding, simultaneously with the direct or indirect Transfer of
the Shares in WM to be sold by WM Holding or otherwise participate in such
transaction (or series of related transactions) at a price per Share equal to
the Drag-along Price (which implies a Price Per Company's Share not lower than
the Drag-along Minimum Price and may be payable in cash or in consideration
other than cash) and at the same terms and conditions as WM Holding. To the
extent appropriate, each Investor agrees to vote all of the Shares of the Luxco
Holdings held by it in favor of such transaction and, in general, take any
action which is necessary or appropriate in connection therewith. If the
Transfer contemplated by this Section 3.4 is proposed to be effected, the
closing date and place shall be communicated by WM Holding to the other
Drag-along Investors in writing with a prior notice of fifteen (15) Business
Days and the other Investors shall (A) Transfer title to the prospective
Transferee of the Shares being sold, free and clear of all Liens, and (B)
execute and deliver any such documents and instruments (including the same
representations and warranties provided by WM Holding in respect to the Shares
being sold, provided that the sellers will use their reasonable best efforts to
negotiate with the prospective purchaser that any liability for breach of
representations and warranties will be several and not joint among the sellers
and provided, further, that in the event that they do not succeed in obtaining
such limitation, in the internal relations among the sellers the liability shall
be allocated pro rata to the Shares sold) reasonably required to effect the
Transfer of title to such Shares to the prospective Transferee, free and clear
of any Liens. All costs and expenses incurred by the Investors in connection
with such transaction shall be borne by them on a pro rata basis on the number
of Shares included by each of the Investors in such Transfer (excluding, for the
avoidance of doubt, any fees paid or to be paid to any of the Parties or any
Affiliate thereof). Unless otherwise agreed with the purchaser, the purchaser
shall pay any transfer taxes or similar governmental charges in connection with
such sale.
Section 3.5 Right to Consent. In the event that at any time after the
end of the Lock-up Period, other than in connection with a Permitted Transfer to
a Qualified Affiliate or with the written consent of all the other Investors,
the BS Entities or HOOPP wish to Transfer any of the Shares they own
respectively in XX XX and WM III to a third Person, and the other Investors have
not exercised their rights under Section 3.2 hereof, such Investor shall deliver
to WM a written notice (the "Consent Notice") setting forth its irrevocable
intention to Transfer such Shares respectively in XX XX or WM III, indicating
the name of the prospective purchaser and requesting to WM to give its consent
with respect to the Transfer of Shares described in the Consent Notice. The
relevant Investor shall provide promptly to WM any information, reasonably
requested by WM, which may be necessary or useful in order to evaluate the
prospective purchaser. Within ten (10) Business Days following the date of WM's
receipt of such Consent Notice, WM shall send to the relevant Investor a written
notice granting or denying its consent to the proposed Transfer, it being
understood that (i) WM's consent may not be unreasonably withheld or delayed;
(ii) WM shall grant its consent in case the proposed Transferee is a an
internationally recognized financial institution, institutional investor or an
industrial company which is not active (directly or indirectly, through any of
its Affiliates) in the same business as the business conducted by the Company or
its subsidiaries; and (iii) in case WM denies its consent to the proposed
Transfer, WM shall indicate in writing to the relevant Investor the reasons of
such denial and shall deliver or cause to be delivered an irrevocable written
offer of one or more alternative prospective purchasers willing to acquire such
Shares at the price and at substantially at the same terms and conditions
indicated in the Consent Notice; it being understood that, in case of failure by
WM to indicate such prospective purchasers within thirty (30) Business Days from
the date of receipt of the Consent Notice, the consent shall be deemed granted.
If, following the above procedure, WM denies to give its consent to the Transfer
of Shares proposed in the Consent Notice, then the relevant Investor may not
Transfer such Shares to the proposed purchaser.
ARTICLE IV
TRANSFER OF SHARES OF THE COMPANY
Section 4.1 Transfer Restrictions. During the Term and in accordance
with the by-laws of the Company, the Luxco Holdings shall not Transfer title to
or beneficial ownership of any Shares of the Company, other than in connection
with the following Permitted Transfers: (i) any Transfer by WM occurring after
the expiration of the Lock-up Period of all or part of its Shares in the Company
to a third party in a transaction which is subject to the right of first offer
provided for in Section 4.2 hereof, provided that, as a condition to any such
Transfer, the Transferor shall have procured that the Transferee agrees to
adhere to this Agreement as if it were a party hereunder by entering into a deed
of adherence with the other Parties (it being understood that such requirement
shall not apply in the event that, after giving effect to any Transfer under
Sections 4.3 and 4.4, XX XX and WM III would cease to be shareholders of the
Company); (ii) any Transfer by XX XX or WM III occurring after the expiration of
the fifth (5th) anniversary of the date hereof (provided that the Initial Term
has been renewed and that, if not renewed, such obligation shall be effective
until the expiration of the Term) of all (and not less than all) of their Shares
in the Company to any Person in a transaction which is subject to the right of
first offer provided for in Section 4.2 hereof, provided that, as a condition to
any such Transfer, the Transferor shall have procured that the Transferee agrees
to adhere to this Agreement as if it were a party hereunder by entering into a
deed of adherence with the other Parties; (iii) any Transfer by any Luxco
Holding of its Shares in the Company under Sections 4.2, 4.3 and 4.4 hereof; or
(iv) a pledge of the applicable Shares to an internationally recognized bank or
financial institution made by any Luxco Holding (A) with the written consent of
all of the Investors (provided that the Luxco Holding retains the voting rights
on the applicable Shares and the applicable pledgee agrees in writing that any
sale of such Shares under such pledge in case of foreclosure under the pledge
agreement remains subject to the provisions of this Article IV) or (B) in
connection with a tender offer with respect to the Voting Securities of the
Company effected by WM and/or any of the Luxco Holdings in accordance with
Section 5.1(b) hereof.
Section 4.2 Right of First Offer. (a) Without prejudice to Section 4.1
hereof, in the event that any Luxco Holding (such Person, the "Offering Luxco
Holding") intends to Transfer its Shares in the Company to a third party, it
shall send a written notice (the "Company Offer Notice") to the other Luxco
Holdings (the "Luxco Holding Offerees") setting forth its desire to sell the
Shares of the Company owned by it pursuant to this Section 4.2, specifying with
respect to such proposed sale, the number of Shares, the purchase price per
Share and all other material payment terms including, without limitation, the
consideration payable (which may be cash or consideration other than cash).
(b) Each of the Luxco Holding Offerees shall have the right to purchase
a number of Shares in the Company subject of the Offer Notice equal to its Pro
Rata Portion (as defined in this clause (b)), at the terms and conditions set
forth in the Company Offer Notice. The Luxco Holding Offerees (or any one of
them) will have to notify to the Offering Luxco Holding their irrevocable
election to purchase all (but not less than all) of the Shares subject of the
Company Offer Notice within fifteen (15) Business Days from the date of receipt
of the Company Offer Notice, specifying, in each case, if applicable, their
irrevocable commitment to purchase also the Shares offered to the other Luxco
Holding Offeree in the event that such Luxco Holding Offeree declined to
purchase the Shares offered under the Company Offer Notice. For purposes of this
Section 4.2, the term "Pro Rata Portion" shall mean a number of Shares of the
Company equal to the product of (x) the total number of Shares of the Company
proposed to be sold by the Offering Luxco Holding and (y) a fraction the
numerator of which is the number of Shares of the Company owned by the
applicable Luxco Holding Offeree and the denominator of which is the aggregate
number of Shares of the Company owned by all the Luxco Holding Offerees as of
such time.
(c) In the event that there has been a timely election of the Luxco
Holding Offerees (or any one of them) to acquire all (but not less than all) of
the Shares subject of the Company Offer Notice, then the sale of such Shares
shall close at a time and place selected by the Offering Luxco Holding or at
such other time or place agreed among the parties in writing, but in any event
within fifteen (15) Business Days from the date of receipt of the above election
notice from the Luxco Holding Offerees (or any one of them). At such closing,
(i) the Luxco Holding Offerees (or any one of them), as the case may be, shall
deliver to the Offering Luxco Holding the consideration to be exchanged for the
offered Shares, (A) in case of cash consideration, in immediately available
funds to the bank account designated by the Offering Luxco Holding and (B) in
case of non-cash consideration, at the direction of the Offering Luxco Holding,
in each case at least five (5) Business Days prior to such date, and (ii) the
Offering Luxco Holding shall Transfer title to the Shares being sold, free and
clear of any Liens (other than those resulting from this Agreement or the
By-Laws), and deliver all other documents required to effect the sale of such
Shares in accordance with the same terms and conditions set forth in the Company
Offer Notice. It is understood that the Offering Luxco Holding shall not make to
the Luxco Holding Offerees any representations and warranties regarding the
Shares being sold in accordance with this Section 4.2 other than with respect to
powers and title. The purchaser shall pay any transfer taxes or similar
governmental charges in connection with such sale and shall otherwise pay its
own costs and expenses in connection with such sale.
(d) In the event that the Luxco Holding Offerees fail to notify the
Offering Luxco Holding their irrevocable election to purchase all (but not less
than all) the Shares subject of the Company Offer Notice within the fifteen (15)
Business Day period specified in clause (b) of this Section 4.2, the Offering
Luxco Holding shall be free to Transfer all (but not less than all) the Shares
subject of the Company Offer Notice to any third party within and no later than
six (6) months following the date of delivery of the Company Offer Notice or
such other longer term if the Transfer is made pursuant to Sections 4.3 or 4.4.
If such Transfer is completed, upon written request of the Luxco Holding
Offerees, the Offering Luxco Holding will provide to the Luxco Holding Offerees
written evidence that the Transfer to the third party has been perfected at a
price not lower than the price contained in the Company Offer Notice (and, in
the event that such price is paid, in whole or in part, for consideration other
than cash, evidence that the value of such non-cash consideration as of the date
of delivery of the Company Offer Notice is equal to the Fair Market Value of the
Shares subject to the Company Offer Notice) and substantially at the same terms
and conditions set forth therein, provided, however, that no such Transfer shall
be completed unless the Transferree executes a deed of adherence to this
Agreement as a party hereto.
Section 4.3 Tag-along rights. (a) Without prejudice to Sections 4.1 and
4.2 hereof, in the event that at any time after the end of the Lock-up Period WM
wishes to sell any of the Shares of the Company owned by it to a third Person,
WM shall give to the other Luxco Holdings (the "Tag-along Luxco Holdings")
written notice setting forth its intention to sell such Shares in the Company
and all the material terms and conditions of such Transfer (including the price,
which may be payable in cash or in consideration other than cash) (the "Company
Tag-along Notice") and, for fifteen (15) Business Days following the date of the
Tag-along Luxco Holdings' receipt of such Company Tag-along Notice, provided
that such Luxco Holdings have not exercised their right of first offer under
Section 4.2 hereof, each of the Tag-along Luxco Holdings shall have the right to
deliver a reply notice (the "Company Reply Notice") to WM setting forth its
irrevocable election to require WM to include in the proposed sale contemplated
by the Company Tag-along Notice (i) an aggregate number of Shares of the Company
owned by each Tag-along Luxco Holding equal to its Pro Rata Portion (as defined
in this clause (a)) of Shares in the Company offered for sale by WM, if such
percentage does not exceed 50% of the Shares of the Company owned by WM and (ii)
all of the Shares of the Company owned by each Tag-along Luxco Holding, if the
percentage of Shares of the Company offered in sale by WM exceeds 50% of the
Shares of the Company owned by WM, in each case, at a purchase price per Share
not lower than the price indicated in the Company Tag-along Notice. For purposes
of this Section 4.3, the term "Pro Rata Portion" shall mean a number of Shares
of the Company equal to the product of (x) the total number of Shares of the
Company owned by the applicable Tag-along Luxco Holding and (y) a fraction, the
numerator of which shall be the number of Shares of the Company proposed to be
sold by WM and the denominator of which is the total number of Shares of the
Company owned at such time by WM.
(b) Following the receipt of the Company Reply Notice, WM shall be
obligated to include in such sale the Shares set forth in the Company Reply
Notice at a purchase price per Share not lower than the price indicated in the
Company Tag-along Notice (or at a higher price) and substantially on the same
terms and conditions set forth in the Company Tag-along Notice.
(c) In the event there has not been a timely election by the Tag-along
Luxco Holdings (or any of them) to include their Shares in the sale proposed by
WM, then WM may, within six (6) months following the date of delivery of the
Company Tag-along Notice and without any further obligation to the Tag-along
Luxco Holdings, Transfer its Shares at a purchase price per Share not lower than
the price indicated in the Company Tag-along Notice and substantially at the
same terms and conditions indicated in the Company Tag-along Notice. If such
Transfer is completed, upon written request of the Tag-along Luxco Holdings, WM
will provide to the Tag-along Luxco Holdings written evidence that the Transfer
to the third party has been perfected at a price per Share not lower than the
price set forth in the Company Tag-along Notice and substantially on the same
terms and conditions set forth in the Company Tag-along Notice.
(d) In the event there has been a timely election by any of the
Tag-along Luxco Holdings to include its Shares of the Company in a proposed
sale, the sale by WM of the Shares set forth in the Company Tag-along Notice and
the sale by the Tag-along Luxco Holdings of their Shares as set forth in the
Company Reply Notice shall take place simultaneously and, on the closing date
and place which shall be communicated by WM to the Tag-along Luxco Holdings in
writing, WM and the Tag-along Luxco Holdings (or any of them) shall (A) Transfer
title to the prospective Transferee of the Shares being sold, free and clear of
all Liens, and (B) execute and deliver any such documents and instruments
(including the same representations and warranties as those provided by WM in
respect to the Shares being sold) reasonably required to effect the Transfer of
title to such Shares to the prospective Transferee, free and clear of any Liens.
All costs and expenses incurred by the Luxco Holdings in connection with such
transaction (excluding, for the avoidance of doubt, any fees paid or to be paid
to any of the Parties or any Affiliate thereof) shall be borne by them on a pro
rata basis on the number of Shares of the Company (considered on a fully-diluted
basis) included by each of the Luxco Holdings in such Transfer. Unless otherwise
agreed with the purchaser, the purchaser shall pay any transfer taxes or similar
governmental charges in connection with such sale.
Section 4.4 Drag-along Right. Without prejudice to Section 4.1 hereof,
if at any time after the Lock-up Period, a bona fide offer from an unaffiliated
third Person to purchase (by merger, sale of assets or stock or otherwise,
directly or indirectly in one or a series of related transactions), at a price
not lower than the price per Share offered to WM and, in any event, at a price
not lower than the Drag-Along Minimum Price (which may be payable in cash or in
consideration other than cash), 90% or more of the Shares of the Company owned
by WM is received by WM, then WM may require the other Luxco Holdings to
Transfer to the prospective Transferee all of the Shares of the Company owned by
them simultaneously with the Transfer of the Shares of the Company to be sold by
WM, by delivering a written notice (the "Company Drag-along Notice") to the
Luxco Holdings in which it elects to include in such proposed Transfer to the
prospective Transferee all (and not less than all) the Shares of the Company of
such Luxco Holdings, which shall be obliged to Transfer to the prospective
Transferee all of the Shares of the Company owned by them, simultaneously with
the Transfer of the Shares in the Company to be sold by WM or otherwise
participate in such transaction (or series of related transactions) at a price
per Share of the Company not lower than the price indicated in the Company
Drag-along Notice and on the same terms and conditions as WM. If the Transfer
contemplated by this Section 4.4 is proposed to be effected, the closing date
and place shall be communicated by WM to the Luxco Holdings in writing with a
prior notice of fifteen (15) Business Days, at such closing, WM and the Luxco
Holdings shall (A) Transfer title to the prospective Transferee of the Shares
being sold, free and clear of all Liens, and (B) execute and deliver any such
documents and instruments (including the same representations and warranties as
those provided by WM in respect to the Shares being sold) reasonably required to
effect the Transfer of title to such Shares to the prospective Transferee, free
and clear of any Liens. All costs and expenses incurred by the Luxco Holdings in
connection with such transaction shall be borne by them on a pro rata basis on
the number of Shares of the Company (considered on a fully-diluted basis)
included by each of the Luxco Holdings in such Transfer (excluding, for the
avoidance of doubt, any fees paid or to be paid to any of the Parties or any
Affiliate thereof). Unless otherwise agreed with the purchaser, the purchaser
shall pay any transfer taxes or similar governmental charges in connection with
such sale.
ARTICLE V
ADDITIONAL AGREEMENTS
Section 5.1 Standstill; Participation Rights. (a) Each of the Parties
agrees that, during the Term, neither it nor any of its representatives or
Affiliates nor the representatives of any of the foregoing, acting alone or in
concert with others, shall in any manner, without all of the Investors' prior
written consent, (i) effect or seek, offer or propose (whether publicly or
otherwise) to effect, or cause or participate in, or in any way knowingly assist
(including, without limitation, through the provision of financing) any other
Person to effect or seek, offer or propose (whether publicly or otherwise) to
effect, or cause or participate in, any acquisition of beneficial ownership of
any Voting Securities of the Company; (ii) form, join or in any way participate
in a "group" or "shareholders agreements" (other than this Agreement) with
respect to any Voting Securities of the Company; (iii) otherwise act, alone or
in concert with others, to seek to control or influence the management, board of
directors or policies of the Company (it being understood that any
representative of the Investors who serves as a director of the Company may
continue to so serve and to exercise his or her fiduciary obligations to the
Company and its shareholders in this capacity); (iv) take any action that might
force the Company to make a public announcement regarding any of the types of
matters set forth in sub-clause (i) above; or (v) enter into discussions or
arrangements with any third party with respect to any of the matters set forth
in sub-clauses (i) through (iv) above; provided, however, that anything in the
foregoing to the contrary notwithstanding, WM and WM Holding, at their sole
discretion, shall be entitled at any time to (A) offer, commence and effect a
voluntary tender offer seeking to acquire, directly or indirectly, acting alone
or with others, not less than 100% of the Voting Securities of the Company in
compliance with clause (b) below and (B) after the completion of such tender
offer, and provided that as a result of such offer WM or WM Holding, acting
alone or with others, shall own 30% or more of the Voting Securities of the
Company, during each twelve (12)-month period thereafter, acquire, directly or
indirectly, acting alone or with others, not more than 3% of the Voting
Securities of the Company in compliance with clause (b) below, it being
understood that none of the limitations provided under this clause (a) and this
proviso (B) will apply if WM or WM Holding, acting alone or with others, will
own more than 50% of the Voting Securities of the Company. In case of breach of
any of the agreements set forth in this Section 5.1, the defaulting Party shall
(1) indemnify and hold harmless the other Parties from and against any and all
Losses incurred or suffered by any of them, or any of their respective
Affiliates or representatives, arising out of, relating to or based upon such
breach; and (2) promptly provide, or cause to be provided, at its sole cost and
expense, adequate financial means to fund any obligation of the other Parties in
connection with a mandatory tender offer with respect to any of the outstanding
Voting Securities of the Company.
(b) In the event that WM or WM Holding intends to offer, commence or
effect a voluntary tender offer to acquire not less than 100% of the Voting
Securities of the Company or acquire other Voting Securities of the Company as
permitted under clause (a) above, such transaction will be effected by WM,
acting alone or with others or together with the other Luxco Holdings that have
elected to participate in such transaction at the terms set forth in this clause
(b), at the purchase price and at the other terms and conditions decided by WM
in its sole discretion and as specified in a notice to be delivered by WM to the
other Luxco Holdings. Each Luxco Holding shall then have the right to acquire in
such transaction a number of Voting Securities of the Company not exceeding its
pro-rata portion of the Voting Securities held by it as of the applicable date,
by delivering a written notice to WM setting forth its irrevocable election to
acquire such Voting Securities of the Company and its commitment to acquire also
the Voting Securities of the Company that the other Luxco Holding does not wish
to acquire, in each case at not less than one hundred percent (100%) of the
purchase price per Voting Security and on the same terms and conditions as
specified in WM's notice. It is understood that in case of a timely election by
any Luxco Holding to acquire any Voting Securities of the Company under this
clause (b), WM and such Luxco Holding shall be obliged to timely fund or
guarantee, and each relevant Investor shall timely provide the applicable Luxco
Holding with, on a prorata basis based on the number of Voting Securities of the
Company proposed to be acquired by each of them, all necessary debt financing
and/or equity contributions in sufficient aggregate amount in order to allow WM
and the applicable Luxco Holdings to acquire the Voting Securities of the
Company proposed to be acquired by them and pay any fees and expenses in
connection with the transactions contemplated by WM's notice or the financing
thereof, acknowledging that its obligations are not subject to, or conditional
on, obtaining financing or other conditions. In the event that XX XX or WM III
fails to deliver such notice within five (5) Business Days from the date of
delivery of WM's notice or elects to exercise such rights with respect to less
than such Luxco Holding's pro-rata portion, the other Luxco Holdings shall be
entitled to acquire such Voting Securities of the Company with respect to which
such Luxco Holding shall not have exercised its rights under this Section
5.1(b).
Section 5.2 Appointment of Directors of the Company; Statutory
Auditors; CEO. (a) During the Term, as promptly as practicable upon receipt of a
notice, or any of the Investors' actual knowledge (prior to receiving such
notice), of call of any shareholders' meeting of the Company at which directors
and/or statutory auditors (if applicable) are up for election, the board of
directors of WM will meet to discuss and prepare the slate of candidate
directors to be deposited and proposed by WM at such shareholders' meeting in
accordance with the Company's by-laws. It is understood that, unless otherwise
agreed in writing among the Investors, such list will be composed as follows and
in the following order (except, with respect to the last candidate designated by
the A Directors, as set forth in sub-clause (y) of the proviso below): (i) the A
Directors will have the right to propose the first candidates on a sub-list
equal to 60% of the total directors (rounded up to the nearest next whole) (the
applicable portion of which will be disinterest outside directors and will have
the requirements provided by the Company's by-laws), (ii) the B Director will
have the right to propose the other candidates on a sub-list equal to 30% of the
total directors (rounded down to the nearest next whole) (the applicable portion
of which will be disinterest outside directors and will have the requirements
provided by the Company's by-laws), and (iii) the C Director will have the right
to propose the final candidates on a sub-list equal to 10% of the total
directors (rounded down to the nearest next whole), provided that (x) the total
number of the members to be elected to the board of directors will be determined
by the A Directors at their sole discretion and shall not be less than eleven
(11) nor more than twelve (12), (y) the C Director will have the right to
designate at least one (1) director of the Company and one (1) of the candidates
proposed by the A Directors shall be listed as the last candidate on the slate
to be presented at the shareholders' meetings of the Company, and (z) any
disinterested outside directors (so-called "consiglieri indipendenti") to be
appointed in accordance with the Company's by-laws will be appointed as to 50%
out of the total number thereof (rounded up to the nearest next whole) by the A
Directors and as to 50% out of the total number thereof (rounded down to the
nearest next whole) by the B Director. Following such selection, at any meeting
(or any adjournment or postponement thereof) of the shareholders' meeting of the
Company held after the date hereof for purposes of electing new directors of the
Company, WM shall (i) deposit the above candidate directors' slate with the
Company, (ii) appear at such meeting or otherwise cause the Voting Securities of
the Company owned by the Luxco Holdings to be counted as present thereat for
purposes of establishing a quorum, and (iii) vote (or cause to be voted), in
person or by proxy, all of such Voting Securities in favor of the approval of
the election of such slate, in accordance with the terms of the Company's
by-laws and other organizational documents. If the by-laws of the Company are
amended, the Parties will agree to amend this Section 5.2 in order to reflect
mutatis mutandis the above principles.
(b) In the event that the by-laws of the Company are modified so as to
reintroduce a board of auditors, (i) the B Director, after consultation with the
C Director, will have the right to propose to WM one (1) member for election to
such board of auditors and (ii) the A Directors will have the right to propose
to WM another member for election to such board of auditors, it being understood
that the third member will be appointed by the minority shareholder(s) of the
Company in accordance with applicable Law.
(c) Unless otherwise agreed among the Investors, WM will use its best
efforts to cause the first candidate of the sub-list proposed by the A Directors
to be proposed as candidate CEO of the Company. If the B Director or the C
Director disagrees on the identity of such candidate for sound and reasonable
business reasons (such as a not reputable professional track record), unless an
alternative candidate is proposed by the A Directors (and such alternative
candidate is accepted by the B Director and the C Director provided that the B
Director and the C Director may disagree on the identity of such new candidate
only for sound and reasonable business reasons), upon request of the dissenting
Director, the board of directors of WM will consult one of the following firms:
Xxxx Xxxxxxx International, Xxxxxxxx & Struggles, Xxxxxx Xxxxxxxx and Xxxx
Xxxxxx & Partners (the "HR Firm") to propose, within and no later than thirty
(30) Business Days thereafter, a list of candidates selected among well-reputed
managers, from which the board of directors of WM, by simple majority of the
directors then in office and with the vote of at least two (2) A Directors, will
designate the candidate CEO. It is understood that the list proposed by the HR
Firm may not include the name of the CEO proposed by the A Directors in respect
of which the B Director or the C Director has expressed his or her disagreement.
The cost of the HR Firm shall be entirely borne by the BS Entities if the B
Director has expressed his or her disagreement or by HOOPP if the C Director has
expressed his or her disagreement. It is understood that the A Directors will be
free to choose from the sub-list proposed by them the director to be replaced
following the above procedure. It is further understood that in no event the
disagreement on, and the time required for the selection of, the candidate CEO
in accordance with this clause (b) shall delay or prevent in any way the deposit
of the candidate directors' slate prepared in accordance with clause (a) of this
Section 5.2 and the voting by WM of the candidates designated therein.
Section 5.3 Financial Information; Access. (a) All financial
information relating to the Company and its subsidiaries which is available to
WM and may be disclosed by it to the Investors as long as they directly or
indirectly hold Shares of the Company without violating any applicable
securities Laws will be, as promptly as reasonably practicable after receipt
thereof, disclosed by it to the other Investors, provided that, to the extent
required by applicable securities Laws or by the Company, each of the Investors
will enter into a confidentiality agreement in form and substance reasonably
acceptable to the Company and the Investors.
(b) Without prejudice to the terms set forth in Articles III and IV
hereof, upon written request of any Investor, the other Investors shall use
their respective best efforts to grant to potential purchasers of Shares of the
Company or of any Luxco Holding access to the information of the Company or any
Luxco Holding reasonably requested by such purchasers to the extent and within
the limits permitted by applicable Law, provided that, in any case, such
potential purchasers will enter into a confidentiality agreement in form and
substance reasonably acceptable to the Company and the Investors.
Section 5.4 Capital Increase of the Company. The Investors acknowledge
and agree that, prior to date hereof, the Company has approved a capital
increase for an aggregate amount equal to Euro 80,000,000 to be offered for
subscription to each of its shareholders (the "Capital Increase") and that, in
connection with such Capital Increase, the Company, and Investindustrial
Holdings S.A. (as Affiliate of WM holding) has entered into a preliminary
underwriting agreement with UniCredit Banca Mobiliare S.p.A. whereby UniCredit
Banca Mobiliare S.p.A. has undertaken to enter into a definitive underwriting
agreement with the Company and the Luxco Holdings at the terms and conditions
set forth therein in order to underwrite the portion of such Capital Increase
which is not subscribed by the Company's shareholders (other than the Luxco
Holdings) or third parties in the open market. In furtherance of the foregoing,
(i) each of the Luxco Holdings agrees to subscribe, and each of the Invesots
agrees to cause to be subscribed by the applicable Luxco Holding, such Luxco
Holding's pro-rata portion of the Capital Increase based on its holdings of
Company's Shares on the date hereof and (ii) each of the Investors agrees to
provide each applicable Luxco Holding with adequate debt financing and/or equity
contributions in sufficient aggregate amount that, if funded in accordance with
their terms, will provide sufficient funds to allow such Luxco Holding to pay to
the Company the subscription price of the Shares subscribed by it and pay any
fees and expenses in connection with the transactions contemplated hereby or the
financing thereof, acknowledging that its obligations hereunder are not subject
to, or conditional on, obtaining financing. In addition to the foregoing, each
of the Luxco Holdings hereby agrees to enter into an underwriting agreement with
UniCredit Banca Mobiliare S.p.A. and the Company substantially at the terms of
the above preliminary underwriting agreement and to perform its obligations
thereunder.
ARTICLE VI
TERM; TERMINATION
Section 6.1 Term of the Agreement. (a) This Agreement will be effective
for a period (the "Initial Term") starting from the date hereof and ending (i)
with respect to all the Parties, on the third (3rd) anniversary of the date
hereof or, in case of renewal of the Initial Term in accordance with clause (b)
of this Section 6.1, at the end of the last Renewal Term not renewed in
accordance with clause (b) of this Section 6.1; or (ii) with respect to any
Investor, the earlier date on which such Investor and any of its Qualified
Affiliates shall cease to be a shareholder of the relevant Luxco Holding
following a Permitted Transfer hereunder (provided that the Transferor shall
have procured that the Transferee agrees to adhere to this Agreement as if it
were a party hereunder by entering into a deed of adherence with the other
Parties and provided, further, that such requirement shall not apply in the
event that, after giving effect to any Transfer under Sections 3.3 and 3.4, the
relevant Investor would cease to be shareholders of the relevant Luxco Holding);
or (iii) with respect to any Luxco Holding, the earlier date on which such Luxco
Holding shall cease to be a shareholder of the Company (x) following a Permitted
Transfer hereunder (provided that the Transferor shall have procured that the
Transferee agrees to adhere to this Agreement as if it were a party hereunder by
entering into a deed of adherence with the other Parties and provided, further,
that such requirement shall not apply in the event that, after giving effect to
any Transfer under Sections 4.3 and 4.4, XX XX and WM III would cease to be
shareholders of the Company) or (y) in the events provided under mandatory
applicable securities Laws.
(b) At the expiry of the Initial Term, the Agreement will be
automatically renewed for additional terms of three (3) years (each of such
terms, a "Renewal Term" and, together with the Initial Term, collectively the
"Term"), unless earlier terminated by any Party by mean of written notice, at
least twelve (12) months prior to the expiration of the Initial Term or the
Renewal Term.
Section 6.2 Effects of Termination. In the event of termination of this
Agreement in accordance with Section 6.1 hereof, this Agreement shall thereafter
cease to have effect and no Party shall have any liability to the other Party or
any of its Affiliates, directors, officers, employees, shareholders and
partners, except for Section 5.3(a) and Articles VIII and IX hereof, which will
survive in accordance with their respective terms and except that nothing herein
will relieve any Party from liability for a breach of any provision of this
Agreement or limit or restrict the rights or remedies of any Party against the
other Party for any breach of this Agreement.
ARTICLE VII
REPRESENTATIONS AND WARRANTIES
Section 7.1 Representations and Warranties of the Parties. As an
inducement to the other Parties to enter into this Agreement, each Party
represents and warrants to the other Parties that:
(a) Organization and Authority. It is duly organized, validly existing
and in good standing under the Laws of the jurisdiction of its formation and has
full power, authority and legal right to own, lease and operate its properties
and to carry on its business as now conducted and to execute and deliver this
Agreement, to perform its obligations hereunder and to consummate the
transactions contemplated hereby. The execution and delivery of this Agreement,
the performance of its obligations hereunder and the consummation of the
transactions contemplated hereby have been duly and validly authorized and
approved by all necessary action on its part.
(b) Execution and Delivery. This Agreement has been duly and validly
executed and delivered by its legal representative and (assuming due execution
and delivery by the other Parties) constitutes a legal, valid and binding
obligation of it enforceable against it in accordance with its terms, except as
such enforcement may be limited by any applicable bankruptcy Laws.
(c) No Conflict. The execution and delivery of, and performance by it
of its obligations under, this Agreement (i) does not and will not result in a
violation of, or be in conflict with, any provision of its organizational or
authorizing documents, result in a violation of, or be in conflict with, any
term or provision of, any Law, governmental rule, judgment or order of any
Authority applicable to or binding upon it or any of its properties; and (ii)
does not constitute a breach of or default under any material contract,
agreement or other instrument to which it is a party or by which it or any of
its properties is bound.
(d) No Default. It is not in default under any material mortgage, loan
agreement, deed of trust or other agreement evidencing indebtedness to which it
is party or by which it is bound, or in violation of, or in default under, any
Law, which default or violation would materially and adversely affect its
ability to perform its obligations under this Agreement.
(e) Consents and Approvals. The due execution, delivery and performance
of this Agreement by it do not and will not require any consent, approval,
authorization, or other order of or action by any governmental authority or
regulatory body or any other third party, other than such consents, approvals
and authorizations as have been obtained by it on or prior to the date hereof
and are in full force and effect on the date hereof.
(f) No Litigation. There is no claim, action, suit, proceeding, inquiry
or investigation pending or, to the best of its knowledge threatened, against it
before or by any Authority or regulatory body, which purports to affect the
transactions contemplated hereby or would materially and adversely affect its
ability to perform its obligations under this Agreement.
Section 7.2 Notification of Certain Matters. Each of the Parties shall
give prompt notice to the other Parties of the occurrence or non-occurrence of
any event the occurrence or non-occurrence of which would be reasonably likely
to cause (i) any representation or warranty of such Party contained in this
Agreement to be untrue or inaccurate in any respect during the Term; or (ii)
such Party to fail to comply with or satisfy in any respect any covenant,
condition or agreement to be complied with or satisfied by it hereunder;
provided, however, that the delivery of any notice pursuant to this Section 7.2
shall not limit or otherwise affect the remedies available hereunder to the
Parties receiving such notice.
ARTICLE VIII
INDEMNIFICATION
Each Party (an "Indemnitor") shall indemnify and hold harmless the
other Parties and their respective Affiliates and each of their respective
successors and assigns and the representatives thereof from and against all
Losses suffered or incurred by them arising out of or resulting from (i) the
breach of any representation or warranty made by the Indemnitor in this
Agreement or (ii) the breach of any covenant or agreement by the Indemnitor
contained in this Agreement.
ARTICLE IX
MISCELLANEOUS
Section 9.1 Notices. All notices or other communications required or
permitted by this Agreement shall be effective upon receipt and shall be in
writing and delivered personally or by overnight courier, or sent by facsimile,
as follows:
(a) if to WM Holding, to:
World Motor Holdings S. a x.x.
00 Xxxxxx X-X Xxxxxxx
X-0000 Xxxxxxxxxx
Attention: Emmanuel Famerie
Facsimile: x000 000 000
with a copy (which shall not constitute notice) to:
Chiomenti Studio Legale
Xxx X. Xxxxx, 0
00000 Xxxxxx, Xxxxx
Attention: Avv. Xxxxx Xxxxx and Avv. Xxxxxx Xxxxxxx
Facsimile: x00 00 0000 0000
(b) if to BS 1, to:
BS Investimenti SGR S.p.A.
Xxx X. Xxxxx, 0
00000 Xxxxxx, Xxxxx
Attention: Xxxxxxx Xxxxxxxxx
Facsimile: x00 00 0000 0000
with a copy (which shall not constitute notice) to:
Xxxxx Xxxxxxxxxx
Xxx Xxxxxxxx Xxxxx, 0
00000 Xxxxxx, Xxxxx
Attention: Avv. Bruno Gattai and Avv. Xxxxxx Xxxxxxxx
Facsimile: x00 00 00000000
(c) if to BS 2, to:
BS Private Equity S.p.A.
Xxx X. Xxxxx, 0
00000 Xxxxxx, Xxxxx
Attention: Xxxxxxx Xxxxxxxxx
Facsimile: x00 00 0000 0000
with a copy (which shall not constitute notice) to:
Xxxxx Xxxxxxxxxx
Xxx Xxxxxxxx Xxxxx, 0
00000 Xxxxxx, Xxxxx
Attention: Avv. Bruno Gattai and Avv. Xxxxxx Xxxxxxxx
Facsimile: x00 00 00000000
(d) if to HOOPP, to:
Hospital of Ontario Pension Plan
Xxx Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx (Xxxxxx) X0X 0X0
Attention: Xxxx Xxxxxxx, Vice President,
Private Equity and Special Situations
Facsimile: x0 000 000 0000
with a copy (which shall not constitute notice) to:
Blake, Xxxxxxx & Xxxxxxx LLP
000 Xxx Xxxxxx, Xxxxx 0000
Commerce Court West
Toronto, Ontario (Canada) X0X 0X0
Attention: Xxx Xxxxx, Esq.
Facsimile: x0 000 0000000
(e) if to WM, to:
World Motors S.A.
00 Xxxxxx X-X Xxxxxxx
X-0000 Xxxxxxxxxx
Xxxxxxxxx: Emmanuel Famerie
Facsimile: x000 00000000
with a copy (which shall not constitute notice) to:
Chiomenti Studio Legale
Xxx X. Xxxxx, 0
00000 Xxxxxx, Xxxxx
Attention: Avv. Xxxxx Xxxxx and Avv. Xxxxxx Xxxxxxx
Facsimile: x00 00 0000 0000
(f) if to XX XX, to:
World Motors Red S.c.A.
c/o BS Private Equity S.p.A.
Xxx X. Xxxxx, 0
00000 Xxxxxx, Xxxxx
Attention: Xxxxxxx Xxxxxxxxx
Facsimile: x00 00 0000 0000
with a copy (which shall not constitute notice) to:
Xxxxx Xxxxxxxxxx
Xxx Xxxxxxxx Xxxxx, 0
00000 Xxxxxx, Xxxxx
Attention: Avv. Bruno Gattai and Avv. Xxxxxx Xxxxxxxx
Facsimile: x00 00 00000000
(g) if to WM III, to:
World Motors White S.c.A.
c/o Hospital of Ontario Pension Plan
Xxx Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx (Xxxxxx) X0X 0X0
Attention: Xxxx Xxxxxxx, Vice President,
Private Equity and Special Situations
Facsimile: x0 000 000 0000
with a copy (which shall not constitute notice) to:
Blake, Xxxxxxx & Xxxxxxx LLP
000 Xxx Xxxxxx, Xxxxx 0000
Commerce Court West
Toronto, Ontario (Canada) X0X 0X0
Attention: Xxx Xxxxx, Esq.
Facsimile: x0 000 0000000
or to such other address as hereafter shall be furnished as provided in
this Section 9.1 by any Party to the other Parties. Any demand, notice or other
communication given by personal delivery shall be conclusively deemed to have
been given on the day of actual delivery thereof and, if given by facsimile, on
the day of transmittal thereof if given during the normal business hours of the
recipient, and on the Business Day during which such normal business hours next
occur if not given during such hours on any day.
Section 9.2 Entire Agreement. This Agreement (including any schedules
hereto) sets forth the entire understanding and agreement between the Parties as
to the matters covered herein and supersedes and replaces any prior
understanding, agreement or statement of intent among the Parties, in each case,
written or oral, of any and every nature with respect thereto.
Section 9.3 Severability. In the event that any provision of this
Agreement shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby as long as the remaining provisions do not fundamentally alter
the relations among the parties and the parties shall negotiate and agree a fair
revision of this Agreement so as to replace the invalid, illegal or
unenforceable provisions with provisions as similar in terms to such invalid,
illegal or unenforceable provision as may be possible and be valid, legal and
enforceable.
Section 9.4 Language. The English language shall be the language used
for the interpretation and construction of this Agreement.
Section 9.5 Waivers and Amendments. No modification of or amendment to
this Agreement shall be valid unless made in writing and executed by both
Parties, referring specifically to this Agreement and stating the Parties'
intention to modify or amend the same. Any waiver of any term or condition of
this Agreement must be in a writing signed by the Party sought to be charged
with such waiver referring specifically to the term or condition to be waived,
and no such waiver shall be deemed to constitute the waiver of any other breach
of the same or of any other term or condition of this Agreement.
Section 9.6. Successor and Assigns. This Agreement shall inure to the
benefit of the Parties and their respective successors and permitted assigns.
Section 9.7 No Assignments. None of the Parties may assign (directly or
indirectly in whole or in part) any of its rights or delegate any of its
obligations under this Agreement without the prior written consent of the other
Parties.
Section 9.8 Taxes. Except as otherwise provided herein, each Party
shall be solely responsible for the payment of all taxes imposed on it in
connection with this Agreement.
Section 9.9 Confidentiality. During the Term, unless otherwise agreed
to in writing by the Parties, each of the Parties shall, and shall cause its
Affiliates and its representatives, agents and advisors to, keep and hold in
confidence, any and all Confidential Information, unless such information is (i)
or becomes available to or known by the public generally through no fault of the
disclosing Party, (ii) otherwise available to the disclosing Party without
restriction or breach of any confidentiality agreement, (iii) necessary for the
consummation of the transactions contemplated hereby, (iv) requested to be
disclosed by any Authority or under applicable provision of Law or stock
exchange rules (provided that prior to disclosing any such information pursuant
to this sub-clause (iv), such Party shall, if possible, give prior written
notice to the other Parties), or (v) necessary to disclose in order to comply
with any statutory or contractual obligation to report to any Person (provided
that in the case of this sub-clause (v), any such Person shall be (A) strictly
prohibited from making any use of, publishing or otherwise disclosing to others
such Confidential Information and (B) agree to be bound by a confidentiality
agreement on terms and conditions at least as restrictive as those contained
herein with the disclosing Party not to disclose such confidential information
to other Persons).
Section 9.10 Obligations Several and not Joint. All rights and
obligations deriving from this Agreement to each of the Parties shall be several
and not joint, with the exceptions of the rights and obligations of the BS
Entities, which shall be joint and several.
Section 9.11 Public Announcements. No public announcement concerning
the terms of this Agreement shall be made by any Party or its Affiliates without
the prior written consent of the other Parties unless such public announcement
is made in order to comply with an obligation required by Law or stock exchange
regulation, in which case the Parties shall use their best efforts to consult
with each other and agree the form and content of such disclosure prior to the
announcement.
Section 9.12 Costs, Expenses. Each Party shall, save to the extent
expressly provided herein to the contrary, be responsible for its own costs and
expenses incurred in the preparation, negotiation and execution of this
Agreement and the documents to be entered into as referred to herein.
Section 9.13 Counterparts. This Agreement may be executed, and
exchanged via facsimile or equivalent means, in six or more counterparts, each
of which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
Section 9.14 Time of the Essence. Time is of the essence with respect
to all provisions of this Agreement that specify a time for performance;
provided, however, that the foregoing shall not be construed to limit or deprive
any Party of any of its rights or grace periods provided hereunder.
Section 9.15 Further Assurances; Inconsistencies. (a) Each Party shall
cooperate and take such action as may be reasonably requested by any other Party
in order to carry out the provisions and purposes of this Agreement and the
transactions contemplated hereby, including by filing, or causing to be filed,
any statement which is necessary or appropriate under applicable Law (including
Italian securities Laws and the U.S Securities and Exchange Act of 1934, each as
amended from time to time, and the rules promulgated thereunder) in connection
herewith.
(b) To the extent that any provision of this Agreement conflicts with
or is inconsistent with the By-laws, then this Agreement shall control and
prevail among the Parties.
Section 9.16 Applicable Law. This Agreement is governed by, and
construed according to, the Laws of Luxembourg.
Section 9.17 Arbitration. (a) Any dispute, claim or controversy arising
from, relating to, or in connection with this Agreement, including without
limitation any question regarding its existence, validity, termination, or the
performance or breach thereof, shall be referred to and finally resolved and
settled by arbitration administered by International Chamber of Commerce
International Court of Arbitration (the "ICC"), in accordance with ICC Rules of
Arbitration in effect at the time of the arbitration, which rules are deemed to
be incorporated by reference into this clause except as they may be modified
herein or by agreement of the Parties. Each Party hereby irrevocably waives its
right to commence any proceedings in any court with respect to any matter
subject to arbitration under this Agreement. The arbitral tribunal shall consist
of three arbitrators, all three of whom shall be lawyers. The arbitration shall
be conducted by three (3) arbitrators appointed in accordance with the ICC
Rules. In multi-party disputes there shall be also three (3) arbitrators, all of
which to be appointed by the ICC. The place of arbitration shall be Paris
(France). The language of the arbitration shall be English. No arbitrator shall
be an Affiliate, employee, officer or director of either Party or of their
respective Affiliates, nor shall any Arbitrator have any interest that would be
affected in any material respect by the outcome of the dispute. The decision of
a majority of the arbitrators shall be final and binding on the Parties and
their respective successors and assigns. The decision shall not be subject to
appeal. The arbitral tribunal shall determine the proportions in which the
Parties shall pay the fees and expenses of the arbitral tribunal. The Parties
hereby agree that the arbitral tribunal shall have the power to award equitable
remedies (including specific performance). Nothing in this section shall be
construed as preventing either Party from seeking conservatory or similar
interim relief in aid of arbitration, including but not limited to a preliminary
injunction or attachment in aid of the arbitration, in any court of competent
jurisdiction. A request for such interim or conservatory measure by a Party to a
court shall not be deemed a waiver of this agreement to arbitrate.
(b) Except as set forth in the penultimate sentence of the preceding
paragraph, by signing this Agreement, the Parties are agreeing to have all
disputes, claims or controversies arising out of or relating to this Agreement
decided by arbitration, and are waiving any rights they might possess to have
those matters litigated in a court or jury trial. Each Party's agreement to this
arbitration is voluntary.
[signatory page follows]
IN WITNESS WHEREOF, the Parties have executed this Agreement on the
date first above written.
WORLD MOTOR HOLDINGS S. A X.X.
By: /s/ Emmanuel Famerie
----------------------------------
Name: Emmanuel Famerie
Title: Manager
BS INVESTIMENTI S.G.R. S.P.A.
By: /s/ Xxxxxxx Xxxxxxxxx
----------------------------------
Name: Xxxxxxx Xxxxxxxxx
Title: Chairman
BS PRIVATE EQUITY S.P.A.
By: /s/ Xxxxxxx Xxxxxxxxx
----------------------------------
Name: Xxxxxxx Xxxxxxxxx
Title: Chairman
HOSPITALS OF ONTARIO PENSION PLAN
By: /s/ Xxxx Xxxxxxx
----------------------------------
Name: Xxxx Xxxxxxx
Title: Vice President, Private
Equity and Special Situations
By: /s/ Xxxxxx Xxxxxxxxxx
----------------------------------
Name: Xxxxxx Xxxxxxxxxx
Title: Portfolio Manager
WORLD MOTORS S.A.
By: /s/ Emmanuel Famerie
----------------------------------
Name: Emmanuel Famerie
Title: Director
WORLD MOTORS WHITE S.C.A.
By: /s/ Emmanuel Famerie
----------------------------------
Name: Emmanuel Famerie
Title: Manager
WORLD MOTORS RED S.C.A.
By: /s/ Emmanuel Famerie
----------------------------------
Name: Emmanuel Famerie
Title: Manager
SCHEDULE 0.1
------------
SHARES OF THE COMPANY OWNED BY THE LUXCO HOLDINGS
--------------------------------------------------------------------------------
WM XX XX WM III
--------------------------------------------------------------------------------
Shares of the Company 24,821,919 11,144,047 11,842,044
--------------------------------------------------------------------------------
SCHEDULE 1.1
------------
BY-LAWS OF THE LUXCO HOLDINGS
SCHEDULE 2.7
------------
CAPITALIZATION OF THE LUXCO HOLDINGS
--------------------------------------------------------------------------------
(Euro ml.) WM XX XX WM III Total
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Equity 2.1 1.6 1.0 4.7
--------------------------------------------------------------------------------
Shareholders' loan (interest-free) 21.1 9.5 10.1 40.6
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total Funding 23.2 11.1 11.1 45.3
--------------------------------------------------------------------------------
