STOCK PURCHASE AGREEMENT dated as of May 5, 2006 among MIH BRAZIL PARTICIPAÇÕES LTDA. BRAZIL APRIL LLC and BRAZIL MAY LLC
Exhibit
4.7
EXECUTION
COPY
dated
as of
May
5, 2006
among
MIH
BRAZIL PARTICIPAÇÕES LTDA.
BRAZIL
APRIL LLC
and
BRAZIL
MAY LLC
STOCK
PURCHASE AGREEMENT
(this
“Agreement”)
dated
May 5, 2006 between, on one side, MIH
Brazil Participações Ltda.,
a
company organized under the laws of the Federative Republic of Brazil, with
head
offices in the city of São Paulo, State of São Paulo, at Al. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇, ▇▇▇, ▇▇▇
▇▇▇▇▇,
▇▇▇▇ ▇, enrolled before the Legal Entities Taxpayers’ Registry (CNPJ) under No.
07.921.963/0001-77, herein represented in accordance with its corporate
documents (“MIH”
or
the
“Buyer”),
and,
on the other side, BRAZIL
APRIL LLC,
a
limited liability company organized and existing under the laws of the State
of
Delaware, United States of America, with head offices at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ of America, enrolled before the Legal
Entities Taxpayers’ Registry (CNPJ) under No. 06.300.168/0001-07, herein
represented in accordance its corporate documents, and BRAZIL
MAY LLC,
a
limited liability company organized and existing under the laws of the State
of
Delaware, United States of America, with head offices at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ of America, enrolled before the Legal
Entities Taxpayers’ Registry (CNPJ) under No. 06.300.167/0001-54, herein
represented in accordance its corporate documents (Brazil May LLC together
with
Brazil April LLC are jointly referred to as the “Sellers").
W
I T N E
S S E T H :
WHEREAS,
the Sellers are the legal holder and registered owner of 1,533,134 shares of
common stock and 1,533,133 shares of preferred stock of Abril
S.A.,
a
company (sociedade
por ações)
organized under the laws of the Federative Republic of Brazil, with head offices
in the City of São Paulo, State of São Paulo, at ▇▇. ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇,
▇▇▇▇
▇▇▇▇▇,
▇▇▇▇▇▇ A, enrolled with the Legal Entities Taxpayers’ Registry (CNPJ/MF) under
No. 03.788.716/0001-93 (the “Company”),
representing 13.8% and 13.8% of the total issued and outstanding shares of
common stock and preferred stock of the Company, respectively (the “Shares”);
WHEREAS,
MIH desires to acquire an equity stake of 30% of the Company’s voting and total
capital stock, though a combination of subscription of newly issued shares
of
common stock and shares of preferred stock and the purchase of shares of common
stock and shares of preferred stock from the Sellers and the Control Group
(as
defined below);
WHEREAS,
on the date hereof, MIH, the Control Group and the Company are entering into
a
subscription agreement for the subscription on the date hereof, by MIH, of
2,289,041 shares of common stock and 972,795 shares of preferred stock of the
Company;
WHEREAS,
on the date hereof, MIH, the Control Group and the Company are entering into
a
stock purchase agreement for the purchase and sale of 1,316,246 shares of
preferred stock of the Company on the date hereof, held by the Control Group,
representing 11.8% of the total issued and outstanding shares of preferred
stock
of the Company; and
WHEREAS,
MIH hereby agrees to purchase from the Sellers and the Sellers agree to sell
and
transfer to MIH the Shares on the date hereof, for the aggregate purchase price
set forth below and upon other terms and conditions set forth
herein;
NOW,
THEREFORE, in consideration of the foregoing and the mutual covenants and
agreements set forth herein, the parties hereto agree as follows:
ARTICLE
1
DEFINITIONS
“Affiliate”
means,
with respect to any Person, any other Person directly or indirectly Controlling,
Controlled by, or under common Control with such Person;
“Agreement”
means
this Stock Purchase Agreement and exhibits attached hereto;
“Business
Day”
means
any day other than a Saturday, Sunday, or other day on which commercial banks
in
the City of São Paulo, State of São Paulo are authorized or required by law to
close;
“Buyer”
means
MIH Brazil Participações Ltda.;
“CIESP”
means
Centro das Indústrias do Estado de São Paulo - CIESP;
“CG
Acquisition Shares”
means
1,316,246 shares of preferred stock of the Company, representing 11.8% of the
total issued and outstanding shares of preferred stock of the Company,
respectively, owned by the Control Group and the subject of the CG Stock
Purchase Agreement;
“CG
Stock Purchase Agreement”
means
the stock purchase agreement, dated the date hereof, between MIH, the Control
Group and the Company for the purchase and sale, by MIH, of the CG Acquisition
Shares;
“Control
Group”
means
Ativic S.A., ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇
and
▇▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇;
2
“Claim”
has
the
meaning set forth in Section 8.02 of this Agreement;
“Closing”
has
the
meaning set forth in Section 7.01 of this Agreement;
“Closing Date”
has
the
meaning set forth in Section 7.01 of this Agreement;
“Company”
means
Abril S.A.;
“Control”
(including the terms “Controls”,
“Controlled
by”
and
“under
common
Control with”)
means,
with respect to any Person or group of Persons (the “Controlling
Person(s)”),
(i) the
holding of shares representing more than 50% (fifty percent) of all the voting
shares of another Person or (ii) the ability to appoint the majority of the
members of the board of directors or other governing body of such other
Person;
“Governmental
Authority”
means
any government, governmental entity, regulatory authority, department,
commission, board, agency or instrumentality, any recognized stock exchange
and
any court, arbitrator, tribunal, whether foreign or domestic with jurisdiction
over the Parties;
“Indemnified Parties”
has
the
meaning set forth in Section 8.01 of this Agreement;
“Lien”
means
any mortgage, lien, pledge, charge, security interest, encumbrance, title
defect, objections, rights of first refusal, options or other restriction of
any
kind, or any other right in favour of or claim by, any third party of whatsoever
nature;
“Losses”
has
the
meaning set forth in Section 8.01 of this Agreement;
“MIH”
means
MIH Brazil Participações Ltda.;
“Parties”
means
the Company, MIH and the Sellers; and “Party”
means
any of them;
“Person”
means
an individual, corporation, partnership, limited liability company, association,
trust or other entity or organization, including a government or political
subdivision or an agency or instrumentality thereof;
“Purchase
Price”
has
the
meaning set forth in Section 2.02 of this Agreement;
“Sellers”
means
Brazil April LLC and Brazil May LLC;
“Sellers’
Bank Accounts”
has
the
meaning set forth in Section 2.03 of this Agreement;
3
“Shares”
means
1,533,134 shares of common stock and 1,533,133 shares of preferred stock of
the
Company, representing 13.8% and 13.8% of the total issued and outstanding shares
of common stock and preferred stock of the Company, respectively, owned by
the
Sellers and the subject of the purchase and sale contemplated in this
Agreement;
“Subscription
Agreement”
means
the subscription agreement, dated the date hereof, between MIH, the Sellers
and
the Company, for the subscription, by MIH, of the Subscription
Shares;
“Subscription
Shares”
means
2,289,041 shares of common stock and 972,795 shares of preferred stock of the
Company, to be issued by the Company and subscribed by MIH on the Closing
Date;
“Transaction Documents”
means
this Agreement, the CG Stock Purchase Agreement, the Subscription Agreement,
the
Shareholders’ Agreement of the Company, to be entered into between MIH, MIH
(UBC) Holdings BV, the Control Group and the Company on the Closing Date and
the
Registration Rights Agreement to be entered into between MIH, MIH (UBC) Holdings
BV, the Control Group and the Company on the Closing Date.
ARTICLE
2
PURCHASE
AND SALE
SECTION
2.02.
Purchase
Price.
As
consideration for the Shares, the Buyer agrees to pay to the Sellers the
purchase price of US$ 58.214109 per Share of common stock and the purchase
price
of US$ 58.214109 per Share of preferred stock, corresponding to a total amount
of US$ 178,500,000.00 (the “Purchase
Price”).
SECTION
2.03.
Payment.
The
Purchase Price shall be paid by the Buyer to the Sellers in United Stated
dollars, by international wire transfer (contrato
de câmbio),
in
immediately available funds, to the bank accounts set forth on Schedule 2.03
(the “Sellers’
Bank Accounts”).
The
Buyer shall be solely liable for any costs and expenses incurred by the Buyer
in
connection with any transfers of money into and/or out of Brazil that are made
by the Buyer in relation to the payment of the Purchase Price, including,
without limitation, those related to the foreign exchange
transaction
4
that
will be entered into by the Buyer in order to
remit the Purchase Price from Brazil to the Sellers’ Bank Accounts. The Purchase
Price will be distributed among the Sellers in accordance with the proportion
of
Shares sold by each of them as set forth on Schedule 2.03.
SECTION
2.04.
Waiver
of Preemptive Rights.
Each of
the Sellers expressly waives any preemptive right it may be entitled in relation
to the purchase and sale of the Shares, the purchase and sale of the CG
Acquisition Shares and the subscription of the Subscription Shares.
SECTION
2.05.
Taxes.
The
Parties agree that the Sellers shall be solely liable for the payment of the
Imposto
▇▇ ▇▇▇▇▇ sobre Ganho de Capital (capital
gain income tax) payable in Brazil. The Parties further agree that should a
withholding be required to be made by the Buyer in Brazil from the Purchase
Price in connection with the abovementioned Brazilian capital gain income tax,
the amount of such withholding will be calculated and determined by the Sellers.
The Sellers will in writing instruct the Buyer to withhold such amount, as
so
determined by the Sellers, and shall send to the Buyer its pro forma calculation
of the amount of the withholding in the form of communication attached hereto
as
Schedule 2.05. The Sellers will hold the Buyer harmless and indemnified from
any
claims from the Brazilian Secretaria
da Receita Federal or
any
other Governmental Authority that
may
arise out of such determination. The Parties agree, finally, that the Buyer
shall be solely liable for the payment of any Contribuição
Provisória sobre Movimentação Financeira - CPMF -
that is
assessed on any transfers of money that are made by the Buyer or its Affiliates
in connection with the payment of the Purchase Price to the
Sellers.
ARTICLE
3
REPRESENTATIONS
AND WARRANTIES OF THE SELLERS
Each
of
the Sellers, with respect to itself only and not jointly, represents and
warrants to the Buyer that each of the following representations and warranties
is, as of the date hereof true and correct and in full force and
effect:
SECTION
3.01.
Existence.
The
Sellers are duly organized, validly existing and in good standing under the laws
of their jurisdiction of organization.
SECTION
3.02.
Authorization,
Binding Effect.
The
execution, delivery and performance by each of the Sellers of this Agreement
and
the consummation of the transactions contemplated hereby are within such
Sellers’ powers. The Sellers have been duly authorized by all necessary
corporate action to execute, deliver, perform and consummate the transactions
contemplated in this Agreement. This Agreement constitutes a valid and binding
agreement upon each of the Sellers and is enforceable against each such Seller
in accordance with its terms.
5
SECTION
3.03.
Governmental
Authorization.
The
execution, delivery and performance by each of the Sellers of this Agreement
and
the consummation of the transactions contemplated hereby require no action,
approval, consent or declaration by or in respect of, notice or filing with,
any
Governmental Authority, agency or official other than the filing with
Conselho
Administrativo de Defesa Econômica
- ▇▇▇▇
and the notice to the Agência
Nacional de Telecomunicações
-
ANATEL.
SECTION
3.04.
Noncontravention.
The
execution, delivery and performance by each of the Sellers of this Agreement
and
the consummation of the transactions contemplated hereby do not and will not
(i) violate the organizational documents or bylaws of the Sellers (ii)
assuming any filing required by the antitrust and telecommunications authorities
properly made, violate any material applicable law, rule, regulation, judgment,
injunction, order or decree, or (iii) result in the creation or imposition
of
any Lien on the Shares.
SECTION
3.06.
Litigation.
There
is no action, suit, investigation or proceeding pending against the Sellers
before any court or arbitrator or any Governmental Authority, which in any
manner challenges or seeks to prevent, alter or materially delay the transaction
contemplated by this Agreement.
SECTION
3.07.
Capital
International transaction documents.
Immediately prior to the transfer of the Shares to the Buyer hereunder, each
and
all contract, agreement, document, instrument, obligation, reimbursement
agreement, security agreement, pledge agreement, guaranty, commitment and
arrangement, in each case as amended, supplemented or otherwise modified,
entered into, on one hand, by the Company or any of its Subsidaries and/or
any
of the members of the Control Group, and, on the other hand, the Sellers, any
fund managed and/or controlled by or on behalf of the Sellers, Capital
International, Inc. or any Subsidiaries thereof, the Sellers and any of their
Affiliates have been terminated and have no further force and effect, and any
and all parties thereto have been expressly released from any and all
obligations or liabilities that may have arisen in the past, or that could
arise
in the future, therefrom.
6
SECTION
3.08. No
Other Representations and Warranties.
Except
for the representations and warranties contained in this Article 3, the Sellers
do not make any representation or warranty, express or implied, to the Buyer,
as
to any matter.
ARTICLE
4
REPRESENTATIONS
AND WARRANTIES OF THE BUYER
The
Buyer
represents and warrants to the Sellers that each of the following
representations and warranties is, as of the date hereof true and correct and
in
full force and effect:
SECTION
4.02.
Authorization,
Binding Effect.
The
execution, delivery and performance by the Buyer of this Agreement and the
consummation of the transactions contemplated hereby are within the powers
of
the Buyer and have been duly authorized by all necessary action on the part
of
the Buyer. This Agreement constitutes a valid and binding agreement upon the
Buyer and is enforceable against the Buyer in accordance with its
terms.
SECTION
4.06. Financial
Capacity. MIH
has
the financial capacity whether through its own resources or through credit
facilities from reputable financial
7
institutions
to fulfil all of its obligations under this Agreement. MIH has knowledge and
experience in financial and business matters such that it was capable of
evaluating the risks of the investment in the Shares.
SECTION
4.07.
Brokers
and Finders.
MIH has
engaged Citigroup as its financial advisor in connection with the transaction
contemplated in this Agreement. MIH shall bear all the expenses, including
any
commission or fee, to be paid to such financial advisor in connection with
this
Agreement.
SECTION
4.08.
No
Other Representations and Warranties.
Except
as expressly provided in Article 3, no Seller has made any representation,
warranty or statement, express or implied, nor has the Buyer received any
materials, written, electronic or oral, from or attributed to any Seller. The
Buyer has conducted its own due diligence investigation of the Company, has
formed an independent judgment concerning its investment and has not relied
in
any way on Sellers, except as expressly provided in Article 3.
SECTION
4.09.
Purchase
Price.
Each
Seller is receiving a Purchase Price per Share that is not lower than the
purchase price that each member of the Control Group is receiving for their
Shares, and there is no other consideration directly or indirectly being paid
by
the Buyer.
ARTICLE
5
COVENANTS
OF ALL PARTIES
SECTION
5.01.
▇▇▇▇
Submission.
(a) MIH
agrees to make appropriate filings pursuant to applicable antitrust laws to
obtain ▇▇▇▇’▇ approval of the transactions contemplated by this Agreement and
the other Transaction Documents within 15 (fifteen) Business Days following
the
execution of this Agreement. MIH and the Sellers agree to respond as promptly
as
practicable to any inquiries received from the notified authorities and agree
to
supply promptly any additional information and documentary material that may
be
requested by such notified authorities.
(b)
The
Sellers shall cooperate in obtaining any information required for the ▇▇▇▇
filing and to supply any information requested by any of the antitrust
authorities.
SECTION
5.03. Confidentiality.
From
and after the date hereof, the Parties agree to hold, and to use their best
efforts to cause their Affiliates and respective officers, directors, employees,
accountants, counsel, consultants, advisors and agents to hold, in confidence,
any and all information regarding the terms and conditions of this
8
Agreement.
The terms and conditions of this Agreement may only be disclosed in the event
that any of the Parties is compelled to disclose such information by law, rule,
regulation, order or decree enacted by a Governmental Authority to which the
Party is subject or as a result of judicial or administrative process in
connection with any action, suit, proceeding or investigation. In any event
the
terms and conditions of this Agreement are disclosed, the Party concerned shall
take all such steps as may be reasonable in the circumstances to agree the
contents of such disclosure with the other Party before making such
disclosure.
CONDITIONS
TO CLOSING
(i)
Closing
of the Purchase of the CG Acquisition Shares.
The
Parties to the CG Stock Purchase Agreement shall have executed the CG Stock
Purchase Agreement and shall be in a position to close the purchase of the
CI
Acquisition Shares simultaneously with the execution of this Agreement and
the
closing of the transaction contemplated hereby.
(ii)
Closing
of the Subscription of the Subscription Shares.
The
Parties to the Subscription Agreement shall have executed the Subscription
Agreement and shall be in a position to close the subscription of the
Subscription Shares simultaneously with the execution of this Agreement and
the
closing of the transaction contemplated hereby.
ARTICLE
7
CLOSING
SECTION
7.01. Closing.
The
purchase and sale of the Shares and payment of the Purchase Price shall take
place at the head offices of the Company, at ▇▇. ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇,
25th
floor,
in the City of São Paulo, State of São Paulo (“Closing”),
on
the date hereof (the “Closing
Date”).
9
SECTION
7.02. Actions
by the Sellers at Closing.
On the
Closing Date, each of the Sellers shall take the following actions:
(i)
Execution and delivery of the term for transfer of the Shares in the Company’s
Share Transfer Registry Book in a manner sufficient to transfer ownership of
the
Shares to the Buyer; and
(ii)
Delivery of an opinion of counsel to the Sellers confirming the enforceability
and validity of this Agreement, in the form of Schedule 7.02
hereto.
SECTION
7.03. Actions
by the Buyer at Closing.
On the
Closing Date, the Buyer shall take the following actions:
(i)
Execution and delivery of the term for transfer of the Shares in the Company’s
Share Transfer Registry Book in a manner sufficient to acquire ownership of
the
Shares; and
(ii)
Payment of the Purchase Price, by international wire transfer, in immediately
available funds, to the Sellers’ Bank Accounts.
SECTION
7.04. Simultaneous
transactions at Closing.
All of
the transactions to occur at the Closing shall be deemed to occur
simultaneously. The Parties shall have no obligation to consummate any of the
transactions referred to in Sections 7.02 and 7.03 unless all shall have been
consummated.
ARTICLE
8
INDEMNIFICATION
SECTION
8.02.
Indemnification Procedures. In the event that any action, suit, proceeding,
demand, assessment or other notice of claim (“Claim”)
is
filed against or made upon any Indemnified Party during the 5 (five) year period
specified in Section 8.01, for which indemnification may be due from the
applicable Sellers pursuant to
10
Section 8.01
above, such Indemnified Party shall notify the Sellers in writing as soon as
reasonably practical but in no event later than 1/3 of the legal term to present
a defence for the respective claim, which notice shall contain in reasonable
detail, a description of the amounts being claimed and the basis therefor.
The
Sellers may either decide to present a defence or counterclaim or pay the amount
sought under the Claim (including to post a bond for such a defence, if so
required). The Sellers shall bear any and all costs incurred, including
reasonable attorney’s fees and court fees, guarantees, as well as expenses
incurred by them in relation to the defence of the Claim and during the course
of the Claim. In the event that the Sellers do not present a defence,
counterclaim or pay the amount sought under the Claim within the 2/3 of the
period available for the presentation of the relevant defence, MIH shall assume
the defence of the Claim. The Sellers shall promptly and immediately reimburse
MIH for any and all expenses incurred in relation to said Claim, whether during
an administrative or judicial proceeding, including, but not limited to
attorneys’ expenses, court fees, administrative fees and penalties.
SECTION
8.03.
Payment
of Losses.
The
Sellers shall pay the amount of the Loss to the relevant Indemnified Party
within 10 Business Days counted as of the receipt, by the Sellers, of written
notification from the Indemnified Party in this regard containing a copy of
a
final and non-appealable decision rendered with respect thereto. All transfers
to the Indemnified Party shall be in immediately available funds and any
indemnification payment relating to a non-deductible expense of the Indemnified
Party (including direct tax and social contribution) must be grossed up to
cover
any and all taxes payable by the Indemnified Party on account of such
payment.
SECTION
8.04.
MIH
Indemnification.
MIH and
its shareholders shall defend, indemnify and hold the Sellers and its
shareholders, officers, directors and employees harmless from and against and
in
respect of any and all Losses incurred or suffered by any of the Sellers in
connection with, relating to or as a result of (i) any misdisclosure or breach
of any representations and warranties given by MIH in Article 4 hereof; and/or
(ii) any breach by MIH of any covenant or agreement contained in this Agreement.
The procedures set forth in Section 8.02 shall apply equally to any
indemnification obligation of MIH, mutatis mutandis, interchanging “Sellers” for
“MIH” where such terms appear in Section 8.02.
TERMINATION
SECTION
9.01.
Right
to Terminate.
This
Agreement may not be terminated except by the mutual written consent of the
Parties. After the Closing has taken place, the indemnification rights provided
for in Article 8 of this Agreement shall be the sole and exclusive remedy
available to the Parties with respect to any breach of the representations
and
warranties of the Parties in this Agreement, and/or any breach of any covenant
or other term in this Agreement.
11
ARTICLE
10
DISPUTE
RESOLUTION
SECTION
10.01.
Arbitration.
(a) Any
dispute arising between the Parties in connection with this Agreement, its
interpretation, validity, performance, enforceability, breach or termination,
shall be settled in an amicable way by the Parties by direct negotiations held
in good faith for a term not exceeding 30 (thirty) calendar days.
(b)
If,
upon expiration of the 30-days period, the Parties have not reached an amicable
settlement, the dispute must be submitted to the decision of an arbitration
panel and shall be finally settled under the rules of the Chamber of Mediation
and Arbitration of São Paulo - Centro
das Indústrias do Estado de São Paulo - CIESP
(“CIESP”).
(c)
The
arbitrators shall be in the number of 3 (three). MIH shall appoint 1 (one)
arbitrator and the Sellers shall appoint 1 (one) arbitrator. The Parties
designated arbitrators shall appoint the third arbitrator, who will be the
chairman of the arbitration panel
(d)
The
arbitration shall be conducted in accordance with the CIESP rules.
(e)
The
arbitration shall take place in the city of São Paulo and shall be conducted in
the English language.
(f)
To
the fullest extent permitted by law, the Parties waive their right to file
any
remedies against (including, but not limited to) the arbitration award and
any
defences against its enforcement. The arbitration award shall be final and
binding for the Parties. Specifically for purposes of any injunction procedure,
whether of preventive, provisional or permanent nature, or even for purposes
of
the enforcement of the arbitration award, the Parties hereby elect the
jurisdiction of the Central Courts of the City of São Paulo, State of São Paulo,
with the exclusion of any other jurisdictions, no matter how privileged they
may
be.
ARTICLE
11
MISCELLANEOUS
SECTION
11.01.
Binding
Effect.
This
Agreement will be binding and inure to the benefit of the Parties, their
respective legal successors and permitted assignees.
SECTION
11.02.
Assignability.
The
rights and obligations set forth in this Agreement must not be assigned, except
with the written consent of the other Parties.
SECTION
11.03.
Severability.
In case
any term or provision set forth in this Agreement is considered invalid, illegal
or not applicable, due to any legal provision or
12
final
court decision, all the other conditions and provisions hereto will remain
in
full force and effect. In case any term or provision is considered invalid,
illegal or inapplicable, the Parties will negotiate, in good faith, the
amendment of this Agreement, so as to effect the original intent of the Parties
hereto as closely as possible.
SECTION
11.04.
Waiver;
Amendment.
(a) No
failure of delay in exercising any right, power or privilege hereunder will
be
considered as a waiver thereof, nor will any single or partial exercise thereof
prevent the future exercise thereof or the exercise of any other right, power
or
privilege.
(b)
Any
provision of this Agreement may only be amended or waived if through written
form and signed by all the Parties hereto.
SECTION
11.05.
Notices.
All
notices and communications required or allowed pursuant to this Agreement,
will
be made in written form, in English, and will be sent by registered mail, by
fax
(receipt confirmed) or e-mail (receipt confirmed), to the following
addresses:
If
to
MIH:
MIH
Brazil Participações Ltda.
▇/▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇
▇▇-▇▇
▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇
Hoofddop
The
Netherlands
Fax
No.:
▇▇▇ ▇▇ ▇▇▇▇-▇▇▇
Attn.:
Messrs. ▇▇▇▇ ▇▇▇▇▇▇ / ▇▇▇▇▇ ▇▇▇▇▇▇▇
e-mail:
▇▇▇▇▇▇▇@▇▇▇▇▇▇▇.▇▇▇ / ▇▇▇▇▇▇▇▇@▇▇▇.▇▇▇
with
copy
to (which shall not constitute a notice):
▇▇▇▇▇▇
Filho, ▇▇▇▇▇ Filho, Marrey Jr. e ▇▇▇▇▇▇▇ Advogados
Al.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇, ▇▇▇
▇▇▇
▇▇▇▇▇
– SP –
Brazil
Fax:
(▇▇
▇▇) ▇▇▇▇-▇▇▇▇
Attn.:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
e-mail:
▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇.▇▇▇.▇▇
if
to the
Sellers:
c/o
Capital International Research, Inc.
▇
▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇
Attention:
▇▇▇▇▇▇▇▇▇ ▇▇▇▇
Fax:
(▇▇▇
▇▇) ▇▇▇ ▇▇▇▇
13
with
copies to (which shall not constitute a notice):
Capital
International, Inc.
▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇,
▇▇▇▇
▇▇▇▇▇
▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention:
Legal Department
Fax:
(▇▇
▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇▇
▇▇▇▇ Advogados
Attention:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ dos ▇▇▇▇▇▇
Fax:
(▇▇▇
▇▇) ▇▇▇▇-▇▇▇▇
The
Parties are entitled to amend, by means of written communication, pursuant
to
this section 11.05, the addresses above.
SECTION
11.06.
Expenses.
All
costs and expenses incurred in connection with this Agreement and the
transactions contemplated hereby will be paid by the Party incurring such cost
or expense.
SECTION
11.07.
Headings.
The
headings of the sections of this Agreement are included for convenience purposes
and will not in any way affect the meaning or the interpretation of this
Agreement.
SECTION
11.08.
Counterparts;
Third Party Beneficiaries.
This
Agreement may be signed in any number of counterparts, each of which will be
an
original, with the same effect as if the signatures thereto and hereto were
upon
the same instrument. This Agreement will become effective when each Party hereto
will have received a counterpart hereof signed by the other Party hereto. No
provision of this Agreement is intended to confer upon any Person other than
the
Parties hereto any rights or remedies hereunder.
SECTION
11.09.
Entire
Agreement.
This
Agreement (including the Exhibits hereto) constitute the entire agreement
between the Parties with respect to the subject matter of this Agreement and
supersede all prior agreements, understandings and offers, both oral and
written, between the Parties with respect to the subject matter of this
Agreement.
SECTION
11.10.
Language.
This
Agreement is executed in the English language.
SECTION
11.11.
Applicable
Law.
This
Agreement is governed and interpreted in accordance with the laws of the
Federative Republic of Brazil.
14
IN
WITNESS WHEREOF, the Parties hereto have caused this Agreement to be duly
executed by their respective authorized officers, as of the day and year first
above written, in the presence of the two witnesses named below.
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| MIH BRAZIL PARTICIPAÇÕES LTDA. | ||
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| By: | /s/ ▇▇▇▇▇▇▇ ▇. ▇. ▇▇▇▇▇▇▇▇ | |
|
Name: ▇▇▇▇▇▇▇ ▇. ▇. ▇▇▇▇▇▇▇▇ |
||
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Title: Manager | |
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||
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BRAZIL APRIL LLC | |
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| By: | /s/ ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇ Lins | |
|
Name: ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇ ▇▇▇▇ |
||
| Title: Attorney-in-fact | ||
| BRAZIL MAY LLC | ||
| |
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| By: | /s/ ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇ Lins | |
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Name: ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇ ▇▇▇▇ |
||
| Title: Attorney-in-fact | ||
Witnesses:
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1.
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||
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Name:
ID
No.:
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2.
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Name:
ID No.:
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15
Schedule
2.03
Seller’s
Bank Accounts; Number of Shares to be sold
Brazil
April LLC
No.
of
Shares being sold: 1,483,767 common and 1,483,766 preferred
Bank:
▇▇
▇▇▇▇▇▇ Chase Bank, NY
CHIPS
ABA: 0002
FED
ABA:
▇▇▇-▇▇▇-▇▇▇
Swift
Code: ▇▇▇▇▇▇▇▇
A/C:
▇▇▇-▇▇▇▇-▇▇▇
Further
Credit: Brazil April, LLC (acct. # 304252298)
Brazil
May LLC
No.
of
Shares being sold: 49,367 common and 49,367 preferred
Bank:
▇▇
▇▇▇▇▇▇ ▇▇▇▇▇ Bank, NY
CHIPS
ABA: 0002
ABA:
▇▇▇-▇▇▇-▇▇▇
Swift
Code: ▇▇▇▇▇▇▇▇
A/C:
▇▇▇-▇▇▇▇-▇▇▇
Further
Credit: Brazil May, LLC (acct. # 304252301)
16
Schedule
2.05
Form
of Capital Gain Tax Withholding Communication
São
Paulo, May [ ], 2006
To
MIH
Brazil Participações Ltda.
▇/▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇
▇▇-▇▇
▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇
Hoofddop
The
Netherlands
Attn.:
Messrs. ▇▇▇▇ ▇▇▇▇▇▇ / ▇▇▇▇▇ ▇▇▇▇▇▇▇
Copy
to
▇▇▇▇▇▇
Filho, ▇▇▇▇▇ Filho, Marrey Jr. e ▇▇▇▇▇▇▇ Advogados
Al.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇, ▇▇▇
▇▇▇
▇▇▇▇▇ –
SP – Brazil
Fax:
(▇▇
▇▇) ▇▇▇▇-▇▇▇▇
Attn.:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Ref.:
Stock
Purchase Agreement
Withholding
of Brazilian Capital Gain Tax - Calculation of Withholding
Amount
Dear
Sirs:
|
1.
Reference is made to Section 2.05 of the Stock Purchase Agreement
(the
“SPA”)
entered into between ourselves and MIH Brazil Participações Ltda.
(“MIH”
or the “Buyer”)
on the date hereof.
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||||
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2.
Unless otherwise defined in this letter, all capitalized terms
used herein
have the meanings attributed thereto in the SPA.
|
||||
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3.
We hereby instruct you to withhold the amount of R$ _______ (_______)
from
the Purchase Price for purposes of paying the Imposto
▇▇ ▇▇▇▇▇ sobre Ganho de Capital,
as per the calculation below:
|
||||
|
A.
Purchase Price in Reais (as per exchange contract - Exhibit
1):
|
R$
____________
|
|||
|
B.
Our Acquisition Cost in Reais (as per Exhibit 2):
|
||||
|
Brazil
April LLC:
|
R$
146.595.599,00
|
|||
|
Brazil
May LLC:
|
R$
4.877.441,00
|
|||
|
Total:
|
R$ 151.473.000,00
|
|||
17
|
C.
Our Capital Gain in Reais (A - B):
|
R$
____________
|
|||
|
D.
Amount to be withheld (15% x C):
|
R$
____________
|
|||
| Very truly yours, | ||
|
|
||
|
|
BRAZIL APRIL LLC | |
|
|
|
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| By: | /s/ ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇ ▇▇▇▇ | |
|
Name: ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇ Lins |
||
| Title: Attorney-in-fact | ||
| BRAZIL MAY LLC | ||
| |
|
|
| By: | /s/ ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇ ▇▇▇▇ | |
|
Name: ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇ Lins |
||
| Title: Attorney-in-fact | ||
18
Schedule
7.02
Form
of Legal Opinion of Sellers’ Counsel
[letterhead
of ▇▇▇▇▇▇▇▇ ▇▇▇▇ –
Advogados]
São
Paulo, May 5, 2006
Ladies
and Gentlemen:
We
have
acted as special Brazilian counsel to Brazil April LLC and Brazil May LLC
(collectively, “Sellers”),
in
connection with a certain Share Purchase Agreement (the “SPA”)
entered into on the date hereof among the Sellers and MIH Brazil Participações
Ltda. (the “Buyer”).
Capitalized
terms not defined herein shall have the meaning given to them in the
SPA.
In
arriving at the opinions expressed below, we have examined executed counterparts
of the SPA,
and
we
have made such investigations of law as we have deemed appropriate for purposes
of this opinion.
In
our
examination, we have assumed the genuineness of signatures on original
documents, the authenticity of all documents submitted to us as originals,
the
conformity with authentic original documents of all documents submitted to
us as
copies, and the legal capacity of natural persons. As to certificates or
statements or both of public officials, we have assumed that they have been
properly given and are accurate. We have also assumed that:
To
MIH
Brazil Participações Ltda.
▇/▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇
▇▇-▇▇
▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇
Hoofddop
The
Netherlands
Attn.:
Messrs. ▇▇▇▇ ▇▇▇▇▇▇ / ▇▇▇▇▇ ▇▇▇▇▇▇▇
19
(i) each
of
the Sellers is
duly
organized and validly existing under the laws of its jurisdiction of
organization and has the power and authority (corporate or other) to execute
and
perform the SPA;
(ii)
any
governmental or regulatory consents, approvals or authorizations required by
any
of the Sellers under the laws of its respective organization applicable to
it
for its execution and performance of the SPA have been obtained;
(iii)
the
SPA
has been duly authorized and executed by the Sellers; and
(iv)
the
signatory the Sellers has
been
duly authorized.
Based
upon and subject to the foregoing and subject also to the comments and
qualifications set forth below, and having considered such questions of law
as
we have deemed necessary as a basis for the opinions expressed below, we are
of
the opinion that:
1. Validity
of the SPA.
The
SPA
constitutes the legal, valid and binding obligation of the Sellers, enforceable
against the Sellers in accordance with its terms.
2. Enforcement
Under Brazilian Law.
Except
for the need to be accompanied by a sworn translation into Portuguese should
it
be brought to any courts of Brazil, the SPA is in proper legal form under
Brazilian law for the enforcement thereof in Brazil.
(i) The
opinions expressed in this opinion letter are subject to the effect of
applicable bankruptcy, liquidation, insolvency, reorganization, moratorium
or
similar laws now or hereafter in effect relating to or affecting creditors'
rights generally, and claims for salaries, wages, social security, taxes and
other statutory privileges will have preference over any claims, including
secured ones;
(ii) in
the
event that any suit is brought against the Sellers in Brazil, certain court
costs and deposits will be due;
(iii) in
the
event that any suit is brought against the Sellers in Brazil, service of process
upon it must be affected in accordance with Brazilian law;
20
(iv) any
judgment against the Sellers in a foreign court will be enforced in the courts
of Brazil if previously confirmed (homologada)
by the
Superior Court of Justice of Brazil, such confirmation only occurring if such
judgment:
(a) fulfils
all formalities required for its enforceability under the laws of the country
wherein it was issued;
(b) was
issued by a competent court after due service of process on the
parties;
(c) is
not
subject to appeal;
(d) was
authenticated by a Brazilian consulate in the country wherein it was issued
and
accompanied by a sworn translation into Portuguese; and
(e) is
not
against Brazilian public policy.
The
opinions expressed in this letter are limited to questions arising under the
laws of Brazil as in force on the date hereof, and we do not purport to express
an opinion on any question arising under the laws of any other
jurisdiction.
This
opinion is effective only as of the date hereof. We expressly disclaim any
responsibility to advise you of any development or circumstance of any kind,
including any change of law or fact that may occur after the date of this letter
even though such development, circumstance or change may affect the legal
analysis, a legal conclusion or any other matter set forth in or relating to
this letter. Accordingly, any person relying on this letter at any time after
the date hereof should seek advise of its counsel as to the proper application
of this letter at such time.
This
opinion letter is provided
to you
by us in our capacity as special Brazilian counsel to the Sellers and may not
be
relied upon by any other person for any purpose without, in each instance,
our
prior written consent.
|
Very
truly yours,
▇▇▇▇▇▇▇▇
Neto Advogados
By ___________________________________
|
21