EXH10-32
JOINT VENTURE AGREEMENT
THIS JOINT VENTURE AGREEMENT is made and entered to this 11th day of Ramadan,
1416H (corresponding to the 31st day of January, 1996G) by and among:
1. XX. XXXXXXX XXXXXXX ABDULLAH AL NAMLA a Saudi National having identity card
No. 17719 dated 29/611379, issued in Riyadh, with an occupation as a
businessman, born in 1377H, residing in Riyadh with an address at X.X. Xxx
000 Xxxxxx 00000 (the "First party");
2. MR. .XXXXXXX XXX ABDULLAH AL SOWAILEM a Saudi National having identity card
No. 7, dated 13/9/1386H~ issued in Bakriyah, with an occupation as a
businessman, born in 1346H, residing in Riyadh, with an address at X.X. Xxx
0000 Xxxxxx 00000 (the "Second Party");
3. XX. XXXXXX XXXXX XXXXXX XXX XXXXXX a Saudi National having identity card
No. 464 dated 28/12/1384H, issued in Jeddah, with an occupation as a
businessman born in 1349H, residing in Riyadh, with an address at X.X. Xxx
0000 Xxxxxx 00000 (the "Third Party");
4. XX. XXXXXXX XXXXX XXXX XXXXXXX a Saudi National having identity card No.
103582 dated 21/12/1385H, issued IN Mekkah, with an occupation as a
businessman, born in 1374H, residing in Riyadh. with an address at X.X. Xxx
00 Xxxxxx 0 0000 (xxx "Fourth Party");
5. ROYLE MID EAST LTD., a company organized and existing under the laws of the
Cayman Islands with an address of X.X. Xxx 0000) S.M.B. Xxxxxx Town. Grand
Cayman. Cayman Islands. BWI (the "Fifth Party); and
6. FIBERCORE MID EAST LTD., a company organized and existing under the laws of
the Cayman Islands with an address of P.O. Bow 30592 S.M.B. Xxxxxx Town,
Grand Cayman, Cayman Islands, BWI (the "Sixth Party").
WHEREAS, the First, Second. Third and Fourth Parties formed and are the sole
owners of Middle East Fiber Optic Cable Manufacturing Company Limited, a Saudi
Arabian limited liability company with Commercial Registration No. 1010136511
issued in Riyadh on 11/3/1416H, with an address of X.X. Xxx 00000, Xxxxxx 00000,
Xxxxx Xxxxxx (the Company"), pursuant to an industrial license issued under
Resolution of the Minister of Industry & Electricity No. 895/S dated 1/11/1415H,
which authorized the Company to manufacture optical fibers and fiber optic
cables (the "Products") with a share capital of Six Million Three Hundred Fifty
Thousand Saudi Rivals (SR6,350,000);
WHEREAS, the First, Second, Third and Fourth Parties wish to increase their
respective contributions to the Company's capital and to include foreign
partners who have technical and commercial experience and expertise from which
the Company can benefit;
WHEREAS the Fifth Party possesses or has access to substantial experience and
expertise in connection with the manufacture of production lines in relation to
the Products and the Operation of facilities for the manufacture of the Products
and wishes to invest in and participate in the ownership of the Company, and the
Fifth Party's parent company has agreed to provide a complete production line
for the Company pursuant to the terms and conditions of the Production Line
Supply Agreement to be entered into concurrently with this Agreement (the
"Production Line Agreement");
WHEREAS the Sixth Party possesses or has access to substantial experience and
expertise in the manufacture of optical fiber and in the manufacture and use of
preforms required for the manufacture of the Products ("Preforms") wishes to
invest in and participate in the ownership of the Company and is prepared to
commit to supply or arrange for the supply of optical fiber and Preforms to the
Company pursuant to the terms and conditions set forth in this Agreement and to
market Products manufactured by the Company pursuant to the terms and conditions
set forth in the Commission Agency Agreement attached hereto as Exhibit I (the
"Commission Agency Agreement");
WHEREAS the Fifth and Sixth Parties have decided to make the necessary
investment to join in the ownership of the Company, and the First, Second, Third
and Fourth Parties have consented to the participation of the Fifth and Sixth
Parties in the Company and have agreed to increase their own contributions to
the capital of the Company and a license has been issued pursuant Minister of
Industry & Electricity No. 98 dated 17/7/1416H to authorize the participation of
the Fifth and Sixth Parties in the Company; and
WHEREAS the above-mentioned Parties (hereinafter collectively referred to
collectively as the "Partners" and each individually as a "Partner") have
entered into this Agreement in Order to make clear the terms and conditions upon
which the Fifth and Sixth Parties will acquire equity in the Company and upon
which the Company shall be operated;
NOW THEREFORE, in consideration of the mutual promises and covenants contained
in this Agreement, the Parties hereby agree as follows:
1. Amendment of Articles of Association
1.1 As soon as practicable following the execution of this Agreement. the
Partners shall use their best efforts to cause the license issued under
Resolution of the Minister of Industry & Electricity No. 98 dated
17/7/1416H to be amended so as to reflect the Ownership structure set
forth in Article 2.3 below and to correctly identify the parent company
of the Sixth Party.
1.2 The Partners shall use their best efforts to cause the articles of
association of the Company to be amended and restated in their entirety
in accordance with the draft first amendment to the Company's articles
of association which is attached hereto as Exhibit I (hereinafter
referred to as the "Articles of Association"). The Articles of
Association shall be submitted to the Ministry of Commerce for approval
as soon as practicable following the execution of this Agreement and,
if necessary, the amendment of the license issued under Resolution of
the Minister of Industry & Electricity No. 98 dated 17/7/1416H as
provided in Article 1. 1.
1.3 If the Ministry of Commerce requests any changes in the Articles of
Association they shall be revised and resubmitted only after all
Partners have agreed to the changes in writing. The Partners shall
execute, or cause their duly authorized representatives to execute, the
Articles of Association, in the form agreed by the Partners and
approved by the Ministry, before the competes Notary Public in the
Kingdom and take such further actions as are necessary to amend the
Commercial Registration of the Company as soon as reasonably
practicable thereafter.
2. Capitalization
2.1 The Company's share capital shall be increased to twelve million five
hundred thousand Saudi Rivals (SR12,500,000).
2.2 The capital shall be divided into twelve thousand five hundred (12,500)
cash shares each having a value of one thousand Saudi Rivals (SAR
1,000).
2.3 The capital of the Company, expressed as cash shares, will be
apportioned among the Partners as follows:
--------------------------------- ----------- --------- ---------------- ----------------
PERCENTAGE IN
THE
PARTNER NO. OF SHARE TOTAL SHARES COMPANY'S
SHARES VALUE VALUE CAPITAL
--------------------------------- ----------- --------- ---------------- ----------------
Xx. Xxxxxxx Xxxxxxx 3625 1000 3,625,000 29%
Abdullah Al Namla
--------------------------------- ----------- --------- ---------------- ----------------
Xx. Xxxxxxx Xxx 2250 1000 2,250,000 18%
Abdullah Al Sowailem
--------------------------------- ----------- --------- ---------------- ----------------
Xx. Xxxxxx Xxxxx Xxxxxx 1375 1000 1,375,000 11%
Xxx Xxxxxx
--------------------------------- ----------- --------- ---------------- ----------------
Xx. Xxxxxxx Xxxxx 1500 1000 1,500,000 12%
Xxxx Xxxxxxx Al Kaaki
--------------------------------- ----------- --------- ---------------- ----------------
Royle Mid East Limited 1875 1000 1,875,000 15%
--------------------------------- ----------- --------- ---------------- ----------------
Fibercore Mid East Limited 1875 1000 1,875,000 15%
--------------------------------- ----------- --------- ---------------- ----------------
TOTAL 12500 12,500,000 100%
--------------------------------- ----------- --------- ---------------- ----------------
2.4 Each Partner shall deposit in cash the full value (or. in respect of
the Firsts Second, Third and Fourth Parties, the difference between the
amount already deposited by such Partner and the full value) of the
cash shares apportioned to him or it at a bank in the Kingdom to be
agreed by the partners, in the name of the Company, no later than seven
(7) days following signature by all Partners of the Articles of
Association before the Notary Public.
2.5 The transfer, assignment, encumbrance or other disposal of shares shall
be governed by the terms and conditions of the Articles of Association
and this Agreement related thereto.
2.6 New shares may be issued or the initial capital of the Company
increased or decreased only with the prior unanimous written consent of
all Partners in accordance with the terms and conditions of the
Articles of Association related thereto.
2.7 A Partner may not pledge his or its shares (or interest) in the Company
or otherwise use such shares (or interest) as security, unless he or it
first obtains the prior written consent of the other Partners
3. Financial Requirements
3.1 In order to finance the startup costs related to the construction and
establishment of the manufacturing facilities, the Partners agree that
they shall cause the Company to apply for and use its best efforts to
obtain a loan from the Saudi Industrial Development Fund in the
approximate amount of eighteen million seven hundred fifty thousand
Saudi Rivals (SAR 18,750,000) and credit and other banking facilities
from one or more commercial banks in the approximate amount of six
million two hundred fifty thousand Saudi Rivals (SAR 6,250,000).
3.2 The Partners agree that. as a general rule, following the start-up
period, the financial requirements of the Company for its day-to day
operations shall be met from the paid-m capital and cash flow, but that
if additional financing is required, it shall be obtained through
commercial bank credit facilities or loans from the Partners, as
determined by the Partners.
3.3 All banking and credit facilities,. whether obtained in the Kingdom or
abroad. shall be managed in accordance with normal and sound business
principles and the terms and conditions of any such facilities shall
require prior writben approval of the Partners in accordance with
Article 5. If guarantees are required from the Partners in connection
with such facilities, each Partner shall issue a guarantee in
proportion to his or its interest in distributions of the Company's
profits provided, however, that neither the Fifth nor the Sixth Party
shall be required to guarantee any facility necessary to fund the
letter of credit to be issued under the Production Line Agreement,
which shall be fully guaranteed (if necessary) by the First, Second,
Third and Fourth Parties.
3.4 In the event the Partners agree that additional financing shall be
obtained through loans from them, then, unless the Partners agree
otherwise on a case-by case basis, each Partner's share of the loan
shall be in proportion to the Partner's percentage interest in
distributions of the Company's profits. Loans advanced by the Partners
shall be repaid prior to the distribution of any profits, unless agreed
otherwise
3.5 For the avoidance of doubt, no Partner shall be required to provide a
guarantee in respect of any loan or other credit facility which may
create any form of indebtedness which that Partner has not approved nor
shall any Partner be required to participate in a Partner loan which he
or it has not approved.
4. Budgets
4.1 Prior to the Company transacting any additional business, the Partners
shall jointly prepare a capital and operating budget (an "Annual
Budget") for the remainder of the Company's first fiscal year.
Thereafter, the Manager of the Company shall, at least sixty (60) days
prior to the conclusion of each fiscal year, prepare and submit an
Annual Budget for the next fiscal year to the Partners for their review
and approval.
4.2 Without otherwise limiting the ultimate content of any Annual Budget,
the Partners agree that each Annual Budget shall contain:
(a) the estimated cash disbursements which the Company will be
required to incur for capital expenditures during each month
for the period covered by the Annual Budget and details of the
items in respect of which the disbursements will be made;
(b) the estimated cash disbursements which the Company will be
required to incur for its day-to day capital and operating
expenditures during each month for the period covered by the
Annual Budget and details of the items in respect of which the
disbursements will be made;
(c) the extent to which such disbursements will be satisfied by
cash on hand or income to be received;
(d) the extent, if any, to which additional financing will be
required and the proposed source for such financing;
(e) if it is expected that loans from the Partners may be
required, details of the amounts which may be required during
the period covered by the Annual Budget and the anticipated
date or dates in each month of that period in which payments
from the Partners would be required; and
(f) such other information as any Partner may request.
4.3 Without the prior written approval of the Partners, the Company shall
not: (i) exceed the budgeted cost for an item by more than ten percent
(10%) or (ii) incur any extraordinary expenditure (pertaining to an
item not included in an Annual Budget).
5. Partners Meetings
5.1 Except for those matters expressly placed under the authority and
control of the Manager of the Company, the general meeting of Partners
shall have ultimate responsibility for the management and operation of
the Company. The Partners shall act through meetings and resolutions
duly held and adopted in accordance with the terms and conditions of
the Articles of Association.
6. Manager of the Company
6.1 The Partners shall appoint an individual of sufficient experience and
expertise to act as the Manager of the Company. The Partners shall do
all things necessary to implement the provisions of the Company's
Articles of Association dealing with the appointment and powers of the
Manager of the Company and to enable the Manager to carry out his
responsibilities and exercise his authorities in a proper and efficient
manner.
6.2 The Partners shall cause the Manager to enter into a contract of
employment with the Company which shall specify the Manager's
authorities and responsibilities (which shall be in accordance with
this Agreement and the Articles of Association), and all Other terms
and conditions of his employment.
6.3 In addition to such other reports as may be required of the Manager
pursuant to this Agreement or the Articles of Association, the Partners
shall require the Manager to deliver to each Partner the following
periodic financial reports:
(a) as soon as available, but in any event within one hundred
twenty (120) days after the end of each fiscal year of the
Company, a copy of the audited balance sheet of the Company as
of the end of such year and the related statements of income
and cash flows for such year, setting forth in each case in
comparative form the figures for the previous year;
(b) as soon as available, but in any event not later than forty
"five (45) days after the end of each fiscal quarter of the
Company, the unaudited balance sheet of the Company as at the
end of each such quarter, and the related unaudited statements
of income and cash flows of the Company for such quarter and
the portion of the fiscal year through such date, setting
forth in each case in comparative form the figures for the
previous year;
(c) as soon as practicable, but in any event within thirty (30)
days after the end of each fiscal month, a copy of the
unaudited balance sheet of the Company as at the end of such
month and the related unaudited statements of income and cash
flows of the Company for such month and the portion of the
fiscal year of the Company through the end of such date,
setting forth in each case in comparative form the figures for
the previous year;
(d) concurrently with the delivery of the financial statements
referred to in (a) and (b) above, a certificate of the Manager
of the Company stating that all such financial statements are
complete and correct in all material respects and have been
prepared in reasonable detail and in accordance with generally
accepted accounting principles applied consistently throughout
the periods reflected therein; and
(e) such additional financial and other information as any Partner
may request from time to time.
6.4 The Partners acknowledge and agree that the Manager must manage the
Company for the mutual benefit and to the full satisfaction of the
Partners. Should any Partner be dissatisfied with the Manager's
performance of his duties and so notify the other Partners, the
Partners shall convene a Partners meeting within thirty (30) days to
consider whether to replace the Manager. If one or more Partners
holding (in the aggregate) at least thirty percent (30%) of the capital
of the Company so request following the conclusion of such meeting, the
Partners agree that they shall promptly cause the Manager to be
replaced in accordance with the Articles of Association and any
relevant provisions of the Manager's employment contract.
7. Warranties Representations and Undertakings
7.1 Each of the First, Second, Third and Fourth Parties represents and
warrants that he is a Saudi Arabian national who is not a government
official and no government official has any interest in his interest in
this Agreement or the transactions contemplated hereby.
7.2 Each of the Fifth Party and the Sixth Party represents and warrants
that it is a duly existing corporation formed and in good sanding under
the lass of the Cayman Islands and that no governmental official has
any interest in the such Party or in its interest herein or in the
transactions contemplated hereby.
7.3 Each Partner undertakes to advise the other Partners and take
appropriate remedial action in the event that any representation or
warrant by such Partner contained in Articles 7.1 and 7.2 become untrue
during the term of this Agreement.
7.4 The First, Second, Third and Fourth Parties further represent and
warrant that:
(a) the Company is a duly formed and validly organized and
registered limited liability company under the laws of Saudi
Arabia;
(b) the Company's initial capital, in the amount of Six Million
Three Hundred Fifty Thousand Saudi Rivals (SR6,350,000) has
been fully paid;
(c) the 31 December 1995 balance sheet of the Company attached
hereto as Exhibit in (the "test Balance Sheet") accurately
and completely reflects the financial condition, assets,
liabilities and results of operations of the Company as of 31
December 1995 and has been prepared in accordance with
generally accepted accounting principles applied on a
consistent basis, and since the date of the Last Balance Sheet
there has been no maternal change in the financial condition.
assets, liabilities or operations of the Company;
(d) the Company has not committed any act (including any failure
to act) which constitutes (or, with the lapse of time or
giving of notice, would constitute) a default of any
regulatory requirements or contractual undertakings made by or
on behalf of the Company or any act which could result in any
Partners being deemed personally liable for the obligations of
the Company;
(e) they have or will have taken all necessary acts to enable the
Fifth and Sixth Parties to acquire an interest in the Company
such that, upon signature of the Articles of Association and
deposit of their respective contributions to the Company's
capital, the Fifth and Sixth Parties will acquire their shares
in the Company free and clear of any further assessment,
encumbrance, charge or claim by any party; and
(f) they are not aware of any information which has not been
disclosed to the Fifth and Sixth Parties which, if disclosed,
could reasonably be expected to influence the decision of
someone deciding whether or not to acquire an interest in the
Company.
7.5 Recognizing the reliance of the Fifth and Sixth Parties on the
representations and warranties contained in Article 7.1, the First,
Second, Third and Fourth Parties undertake (i) that the Company shall
take no action prior to the Fifth and Sixth Parties acquiring their
respective shares in the Company which would cause of such
representations and warranties to be untrue, and (ii) that, from the
date hereof, the Company shall enter into no contracts and incur no
liabilities except as approved by the Partners in accordance with this
Agreement and the Articles of Association. The First, Second, Third and
Fourth Parties hereby agree to indemnify and hold harmless the Fifth
and Sixth Parties against any and all liabilities which relate to the
conduct of the Company's business prior to the Fifth and Sixth Parties
acquiring their respective shares in the Company and participating in
the decision-making process, regardless of when such liabilities
actually arise or come to the attention of the Partners except for
those liabilities disclosed in the Latest Balance Sheet.
7.6 Under no circumstances will the any of the Partners take any action or
cause the Company to take any action if either the Fifth or the Sixth
Party advises the other Partners that the taking of such action would
cause it or any person or company affiliated or
associated with it to be deemed in violation of the United States
Export Administration Act or those provisions of the Federal Income
Tax Law or Regulations, noncompliance with which would increase or
accelerate its U.S. tax liability or that of any person or company
affiliated or associated with it with respect to income earned under
this Agreement or pursuant to the transactions contemplated by this
Agreement.
7.7 Each Partner undertakes and agrees that he or it shall not, and shall
not permit the Company directly or indirectly to, offer, pay, promise
to pay or authorize the payment or giving of any money, or anything of
value (i) to any official of any government or any instrumentality
thereof, or (ii) to any person, while knowing or having reason to know
that all or a portion of such money or thing of value will be Offered,
given, or promised, directly or indirectly, to any official of any
government or any instrumentally thereof, for the purposes of:
(a) influencing any act or decision of such official in his
official capacity, including a decision to fail to perform his
official functions: or
(b) inducing such official to use his influence with any
government or any instrumentality thereof to affect or
influence any act or decision of such government or
instrumentality, in order to obtain or retain business for or
with, or direct business to, any person.
7.8 Under no circumstance may any Partner sign any document, perform any
act, or make any commitment, undertaking, warranty or representation on
behalf of ~e other Partners without the express written consent of such
other Partners. No Partner may sign any document, perform any act, or
make any commitment, understanding, warranty or representation on
behalf of the Company without the express prior written consent of the
Company.
7.9 The Partners, in their capacity as owners of the Company, shall
exercise the voting rights attached to their shares in a manner
consistent with the terms and conditions of this Agreement the
Production Line Agreement, the Commission Agency Agreement and the
Articles of Association, and which ensures that the Company conducts
all of its operations in accordance with those terms and conditions.
7.10 Each Partner agrees to indemnify and hold harmless the other Partners
and the Company from and against any loss, liability, cost or expense
any of them may suffer or incur as a result of the indemnifying
Partner's breach of any representation warranty or undertaking
contained in this Agreement.
8. Mutual Covenants Regarding Business Opportunities and Dealings with the
Company
8.1 The Partners shall in all cases treat the Company as a separate and
important profit center and make every reasonable effort to conduct the
affairs of the Company and their own dealings with the Company in a
manner which maximizes the net profits of the Company.
The Partners therefore agree that in their business transactions with the
Company, be it directly or indirectly, they shall neither receive any
unusual benefits nor fix prices or other terms which are consistent
with business principles which are normal and acceptable in that field.
None of the Partners, however, makes any representation to any of the
others as to the likely success or profitability of the Company and no
Partner shall be responsible to any other for any losses suffered or
liabilities incurred by the Company, except to the extent he or it is
liable therefor by virtue of holding his or its interest in the
Company.
8.2 Subject to the provisions of this Article 8, the Company may contact,
upon terms which are commercially competitive, with any Partner for the
supply of goods and services including without limitation:
(a) design, engineering and construction services;
(b) construction equipment, materials, supplies and tools;
(c) housing and office space;
(d) translation services; and
(e) technical assistance and consulting.
8.3 Each Partner shall have the right to review and approve any proposed
agreements between the Company and any other Partner or any person or
company affiliated with another Partner.
8.4 The Partners acknowledge that their participation in the Company should
not prevent the Partners or their Affiliates (as defined in 10.1(b)
below) from participating in other companies having different
objectives. The Partners hereby consent to the participation of the
Fifth Party and/or the Sixth Party or an Affiliate of either in other
companies at any time in the future, whether or not any Partner is a
partner in any such other companies, provided that such other companies
have objectives which are separate and distinct from the objectives of
the Company. The Partners undertake and agree to provide the Fifth
Party and the Sixth Party with such letters of no objection or other
documentation as the Fifth Party and/or the Sixth Party may reasonably
require in order to evidence such consent and enable the Fifth Party
and/or the Sixth Party or an Affiliate of either to form or participate
in such other companies.
8.5 Immediately following the commencement of commercial production of any
Product by the Company the Partners shall cause the Company to enter to
the Commission Agency Agreement with the Sixth Party.
9. Assistance by the Partners
9.1 The First, Second. Third and Fourth Parties will provide the following
assistance in connection with the start-up and operation of the
Company, subject to such additional terms and conditions as the
Partners may from time to time agree:
(a) on behalf of the Company and for the Company's account, seek
to obtain the credit and other banking facilities referred to
in Article 3.1;
(b) on behalf of the Company and at the Company's cost, arrange
with the relevant Saudi Arabian governmental entities for the
Company to lease the land required for the manufacturing
operations of the Company.
(c) on behalf of the Company and at the Company's cost, seek to
obtain from the appropriate Saudi Arabian government agency
any licenses or permits necessary for the operation of the
Company.
(d) participate in the management of the Company through the
partners meetings.
(e) upon the request of the Manager of the Company, provide
consultation and advice to the Manager of the Company as to
how problems involving any Saudi governmental official or
entity should best be handled and in those cases an which the
Company is unable to resolve a problem, render whatever direct
assistance he or it is able to render in liaising with the
concerned Saudi governmental official or entity in attempting
to resolve the problem.
(f) upon the request of the Manager of the Company, provide
consultation and advice to the responsible official of the
Company as to how any problem, dispute or controversy
involving a Saudi national or local resident (including, but
not limited to, employees of the Company) should best be
handled and in those cases in which the Company is unable to
resolve a problem, render whatever assistance he or it is able
to render in attempting to resolve the problem, dispute or
controversy.
9.2 The Fifth Party will provide or arrange for an affiliated company to
provide the following assistance in connection with the start up and
operation of the Company, subject to such additional terms and
conditions as the Partners may from time to time agree:
(a) supply production equipment for the Company's manufacturing
facility as provided in the Production Line Agreement;
(b) provide technical advice and assistance as provided in the
Production Line Agreement;
(c) nominate qualified individuals to fill agreed
technical/managerial positions within the Company;
(d) upon request of the Manager of the Company, provide on-going
advice and assistance with respect to technical matters on the
same terms and conditions that such assistance is normally
provided by the Sixth Party to it subsidiaries and affiliates;
and
(e) participate in the management of the Company through the
partners meetings.
9.3 The Sixth Party will provide or arrange for an affiliated company to
provide the following assistance to the Company, subject to such
additional terms and conditions as the Partners may from time to time
agree:
(a) supply the company pursuant to its usual terms and conditions
of sale, with Optical Fiber and Preforms in the quantities and
for the prices indicated in Exhibit IV;
(b) upon request of the Manager of the Company provide technical
advice and assistance in the use of such preforms on the same
terms and conditions that such advice and assistance is
normally provided by the Sixth Party to its subsidiaries and
affiliates;
(c) promote the sale of the Company's Products pursuant to the
Commission Agency Agreement, which the Partners agree shall be
renewed for so long as the Sixth Party is a partner in the
Company unless terminated pursuant to Clauses 2.2, 2.3 or 2.4
thereof; and
(d) participate in the management of the Company through partners
meetings.
10. Competition
10.1 For purposes of this Article 10:
(a) the "Territory" shall mean and include:
(i) at any time following the commencement of commercial
production of any Product by the Company, the Kingdom
of Saudi Arabia, Yemen, the United Arab Emirates,
Iraq, Lebanon, Syria, Egypt, Mauritania, Palestine,
Jordan, Oman, Kuwait, Bahrain, Qatar, Libya, Morocco,
Tunisia, Algeria, Sudan, Somalia and Iran;
(ii) for two (2) years only following the commencement of
commercial production of any Product by the Company,
all countries local on the continent of Africa except
those mentioned in (a) above; and
(iii) for one (l) year only following the commencement of
commercial production of any Product by the Company's
Turkey (excepting the following customer: XXXX
Hacilar Elektrik Sahayi VE Ticaret A.S.); and
(b) a Partner's "Affiliates" shall mean and include its
shareholders (in respect of a Partner which is a company) and
any entity in which a Partner, or any shareholder of a Partner
which a company, or any combination of Partners or
shareholders of Partners has a direct or indirect ownership
interest of fifty percent (50%) or more.
10.2 No Partner and no Affiliate of a Partner shall invest in any venture
for the manufacture of Products within the Territory (a "Venture")
except after offering the other Partners the opportunity to participate
in the Venture as follows:
(a) The Partner who (or whose Affiliate) wishes to participate in
a Venture (the "Initiating Partner") shall send the other
Partners a written notice describing the Venture in sufficient
detail to permit the other Partners to determine, on a
preliminary basis, whether they would be interested in
participating in the Venture and offering to enter into good
faith negotiations respecting the participation by all
interested Partners in the Venture as equal partners (after
satisfying any legal requirements as to equity ownership in
the venture by venture of the country in which the Venture is
located.)
(b) Upon receipt of the above-mentioned notice from the Initiating
Partner, the other Partners shall each have the option, but
not the obligation, to accept the offer to enter into good
faith negotiations respecting their possible participation in
the Venture. Any such acceptance must be in writing and
delivered to the Initiating Partner within thirty (30) days
after the date of the Initiating Partner's notice. Failure by
any Partner to give timely notice of its acceptance (m whole
or in part) shall be deemed an election by him or it not to
exercise his or its option. A Partner may accept to enter into
negotiations for less than an equal equity ownership with the
other Partners, in which case the equity not taken up by that
Partner shall be offered to each of the other Partners
equally.
(c) If the other Partners fail to exercise their option to enter
into good faith negotiations, or such negotiations do not
result in a binding agreement among all interested Partners
within one (1) year of the date by which the Partners were
required to give notice to the Initiating Partner of their
acceptance to enter to such negotiations, the Initiating
Partner (or his or its Affiliate) be free to proceed with the
Venture as initially described to the other Partners.
10.3 In order to compensate the Firsts Seconds Third and Fourth Parties for
potential loss of income from the Company due to activities by the
Fifth or Sixth Party (or Affiliates of either) in the Territory which
may compete or result in competition with the Company - without in any
way restricting the Fifth or Sixth Party (or their respective
Affiliates) from selling in the Territory - the Partners agree as
follows:
(a) The Fifth Party shall pay to the First Party for the account
of and for distribution to the First, Second, Third and Fourth
Parties as agreed by those parties a fee equal to five percent
(5%) of the ex-works invoice price of any Preform preparation
equipment and/or draw towers sold by it or any of its
Affiliates to customers in the Territory other than customers
in which each of the Partners (or Affiliates of each Partner)
hold all interest. No fee shall & payable in respect of the
sale of any other equipment or services.
(b) The Sixth Party shall pay to the First Party for the account
of and for distribution to the First, Second, Third and Fourth
Parties as agreed by those parties a fee equal to five percent
(5%) of the ex-work; invoice price of any optical fiber or
Preforms sold by it or any of its Affiliates to customers in
the Territory (excluding Iran), other than customers in which
each of the Partners (or Affiliates of each Partner) hold an
interest, plus an additional three percent (3%) fee insofar as
any such sales result from orders referred to the Sixth Party
by the Company in writing and accepted by the Sixth Party or
one of its Affiliates within six (6) months of the referral,
provided. however, that if the Company fails during its first
three years of production to purchase from the Sixth Party or
its Affiliates 225.000 kilometers of optical fiber and
Preforms in the aggregate, then the Sixth Party shall have no
further obligation to pay such fees to the First Party unless
such failures due to the Sixth Party's failure to supply fiber
and Preforms in accordance with Article 9.3(b).
(c) All fees payable hereunder shall be paid on a pro-rata basis
within thirty (30) days of actual receipt by the Fifth or
Sixth Party (or an Affiliate of either) from a customer of a
payment on which such fee is due. Payments to the First Party
as provided herein shall fully satisfy the Fifth or Sixth
Party's payment obligations vis-a-vis all Parties entitled to
share in such fees.
10.4 Each Party other than the Fifth and Sixth Parties undertakes that,
except as otherwise provided in this Article 10, he or it shall not and
his or its Affiliates shall not directly or indirectly engage in any
business activity relating to the manufacture or sale of the Products
or Preforms or other equipment for the manufacture of the Products,
within the Territory or elsewhere, which competes with the Company, or
with the Fifth Party or the Sixth Party or any Affiliates of the Fifth
or Sixth Parties without the prior written consent of the Company, the
Fifth Party or the Sixth Party, as the case may be.
11. Confidentiality
11.1 The Fifth Party and the Sixth Party have developed in the course of
their respective businesses a number of trade secrets including
formulas, methods, processes, techniques, designs, information,
knowledge know-how and trade practices in various forms, including
computer software (hereinafter referred to as Proprietary
Information"). The
Partners agree that all Proprietary Information shall remain in the
exclusive ownership of the Fifth and/or Sixth Party, as the case may
be, and shall be for the Company's temporary use only and shall be
returned as provided in Article 13.l(e). None of the Partners or the
Company shall disclose Proprietary Information except as permitted in
Article 11.2 below. Proprietary Information shall not include any
information which is generally available for public use, unless such
information has become available to the public due to the unauthorized
disclosure of such information by a Partner or the Company.
11.2 If any Proprietary Information is (or has, prior to the date of this
Agreement, been) communicated by the Fifth Party, the Sixth Party or
the Company to another Partner the following provisions shall apply:
(a) the receiving party shall take every reasonable precaution to
safeguard and keep secret all such Proprietary Information and
will comply with all reasonable and specific precautions which
may be requested by the disclosing Partner or the Company as
to its nondisclosure; and
(b) the receiving party will disclose Proprietary Information only
to such of his or Its employees who require the information in
the performance of their duties, and all personnel likely to
receive Proprietary Information shall be advised of its secret
and confidential nature and of the restrictions on its use and
further disclosure.
11.3 No Partner shall knowingly take any action or cause the Company to take
any action which would infringe the rights of any Partner under any
patent, regardless of where such patent is registered.
11.4 The Partners' undertakings in this Article 11 shall survive the
termination of this Agreement and the dissolution of the Company and
shall continue to apply to a Partner even if the Partner transfers his
or its shares.
12. Duration: Termination
12.1 This Agreement shall remain in full force and effect with respect to
each Partner until such time as this Agreement is terminated pursuant
to Clause 12.2 or that Partner ceases to have an inters in the Company
or the Company's dissolved, whichever occurs first. Unless otherwise
herein expressly provided, no Partner that has transferred his or its
shares in accordance with the provisions of this Agreement shall be
bound by its terms and conditions after the date of such transfer,
provided that the party to which such shares have been transferred
agrees in writing with the other Partners, in a form reasonably
acceptable to the other Partners, that the transferee shall be bound by
the terms and conditions of this Agreement.
12.2 If any Partner shall be in material default of this Agreement (the
"Defaulting Partner") and shall not remedy such default within a period
of ninety (90) days after receiving written notice of such de-fault ~m
any of the Partners which are not in default (the "Non-
Defaulting Partners"), which notice shall also be copied to the other Partners,
the Non-Defaulting Partners may exercise either of the following
options:
(a) if all Non-Defaulting Partners so agree, one or more of the
Non-Defaulting Partners may purchase all or any portion of the
shares in the Company then held by the Default Partner at
ninety percent (90%) of the par value or book value of said
shares determined pursuant to Article 12.5 whichever is lower,
provided that if more than one Non-Defaulting Partner wishes
to purchase the Default Partner's shares, each such purchasing
Partner shall be entitled to purchase that percentage of the
Defaulting Partners shareholding which is equal to the
percentage that purchasing Partner's shareholding comprises of
the total shareholdings of all purchasing Partners; or
(b) if all Non-Defaulting Partners so agree, the Non-Defaulting
Partners may require that the Default Partner sign whatever
resolutions and documents and take whatever action may be
necessary to promptly liquidate the Company, including without
limitation, voting in favor of liquidation at a general
meeting of the Partners.
The options stated above shall be exercisable within ninety (90) days
after the expiration of the aforementioned notification period of
ninety (90) days by written notice by the Non-Defaulting Partners to
the Defaulting Partner. If all option is exercised, the Default Partner
shall promptly thereafter take whatever action is necessary and sign
whatever documents or agreements the Non-Defaulting Partners provides
to him or it in order to effectuate the appropriate share transfer or
liquidation, as the case may be.
12.3 If the Non-Defaulting Partners do not agree to exercise either option
provided under Article 12.2 above within the time periods specified
therein, any Non-Defaulting Partner who has notified the other
Non-Defaulting Partners at least thirty (30) days before the expiration
of such time periods of his or its desire to exercise either such
option may, by written notice to the other Non-Defaulting Partners
within thirty (30) days after the expiration of such time periods,
offer to sell his or it; shares to the such other Partners at a price
equal to the book value of his or its shares determined in accordance
with Article 12.5 below. If none of the other Partners accept the offer
within a further period of thirty (30) days, then the Company must be
liquidated. If several Partners accept the offer, each of them shall
purchase a percentage of the shares of the withdrawing Partner which is
equal to the percentage such purchasing Partner's shareholding
comprises of the total shareholdings of all purchasing Partners.
12.4 The rights as provided for in Articles 12.2 and 12.3 above shall be in
addition to and not in substitution for all other remedies that may be
available to the No-Defaulting Partners hereunder and any exercise of
such rights shall not relieve the Defaulting Partner from any
obligations accrued prior to the date of termination or from any
liability or damage to the Non-Defaulting Partners for breach of this
Agreement.
12.5 The book value of the shares as stipulated in Articles 12.2 and 12.3
above shall be based on the financial status of the Company on the last
day of the calendar month immediately preceding the date of the
exercise of any option regarding such shares and shall be determined
and certified by the Company's then appointed independent auditors.
12.6 If the Company is dissolved or liquidated for any reason, this
Agreement shall be terminated automatically at the end of such
liquidation except for the obligations under any provisions hereof
which are expressed to survive this Agreement.
12.7 The failure of any Partner to attend, by a representative or proxy,
after two (2) successive calls a properly called and convened partners
meeting of the Company, which failure is not attributable to force
majeure as described in Article 14 below or to the failure or inability
to obtain any necessary Saudi Arabia visa, shall constitute a default
by such Partner and the Non-Defaulting Partners shall have the right to
exercise all or any remedies provided for under Article 12.2 above or
any other provision of this Agreement.
13. Procedure Upon Termination
13.1 In the event of the withdrawal of a Partner or termination of this
Agreement under the provisions hereof, the Partners agree to cooperate
to arrange for appropriate settlements between the Partners on a fair
and equitable basis and. if the Company is being liquidated, the
orderly winding up of the Company's operations, in accordance with the
following guidelines:
(a) amounts due to one Partner for the transfer of his or it
shares in the Company are to be paid promptly upon signing the
instrument of transfer;
(b) where appropriate, any loans made by a withdrawing partner to
the Company shall also be repayable with accrued commission
according to their terms up to the date of transfer of the
shares in the Company;
(c) where one Partner makes a claim for damages against another,
the Partners will use their best endeavors to reach an
amicable agreement, provided, however, that in the event the
claim is subject to arbitration or other legal process, the
claim shall only be settled after due process and may not be
set off against other amounts due to be pad upon termination;
(d) upon the transfer of the shares of the Partner withdrawing
from the Company and in the event the withdrawing Partner is
not in default of this Agreement, the other Partner(s) shall
cause appropriate actions to be taken to transfer or discharge
any guarantees or other security given by the withdrawing
Partner to secure loans raised by the Company in the course of
its business to the extent that such guarantees do not relate
to the withdrawing Partner's unfulfilled obligations which had
arisen before the date of withdrawal; and
(e) m the event this Agreement is terminated or the Fifth Party
and/or the Sixth Party withdraws from the Company, all
Proprietary Information provided to the Company or any Partner
shall, at the Fifth Party's and/or the Sixth Party's option,
as the case may be, forthwith be returned to the Fifth Party
and/or the Sixth Party, as the case may be, or destroyed.
14. Force Majeure
14.1 None of the Partners shall be liable for the non-performance or for
delays in the performance of this Agreement due to compliance with the
laws, orders or regulations of Saudi Arabia, or the United States of
America or due to acts of God, wars, armed conflicts, riots embargoes,
sabotage, blockades, epidemics, hijackings, kidnappings, other acts of
terrorism, strikes and other labor disturbances or any other cause
beyond the reasonable control of that Partner.
15. Fees and Costs: Taxes
15.1 All costs, fees and expenses paid in connection with the preparation of
this Agreement applications for and the licensing, registration and
qualification of the Company and the amendment of its licenses and
registrations in accordance with this Agreement, shall be borne by the
Company.
15.2 Except as otherwise expressly agreed in writing:
(a) each Partner shall be solely responsible for the payment of
any zakat or any Saudi Arabian income tax which imposed on (i)
his or its respective share of the Company's profit, or (ii)
his or its respective ownership in the Company, or (iii) any
other payments made to him or it by the Company, and no
Partner shall be entitled to reimbursement by the Company or
the other Partners for the income tax, deemed profit tax or
zakat that he or it is obligated to pay;
(b) each Partner shall authorize the Company to withhold from any
payments to be made to him or it any Saudi Arabian income tax
or zakat that is due from him or it and to pay such amounts
directly to the Department of Zakat & Income Tax (the "DZIT")
in Saudi Arabia for the account of that Partner so that the
Company can obtain the necessary tax clearance certificate;
and
(c) if at any time additional amounts are required from a Partner
to cover any income tax, deemed profit tax or Zakat for which
he or it is responsible, that Partner shall pay such amounts
to the Company for payment to the DZIT so as to enable the
Company to obtain its tax clearance certificate.
16. Governing Law
16.1 This Agreement shall be governed by and construed in accordance with
the laws of the Kingdom of Saudi Arabia. However, nothing in this
Agreement shall be construed to require the Fifth or the Sixth Party to
take or omit to take any action if such act or omission is contrary to
the laws of the United States of America.
17. Dispute Resolution
17.1 Any disputes arising under this Agreement which cannot be settled
amicably among the Partners shall, unless otherwise agreed at the time,
be referred to the appropriate tribunal of the Board of Grievances for
a final and binding decision.
18. Notices
18.1 Any notices given hereunder shall be deemed to be sufficiently given if
in writing and delivered by postpaid registered mail or international
air courier or facsimile addressed as follows
(i) in the case of The First Party: Xxxxxxx Xxxxxxx Abdullah A1 Namla
X.X. Xxx 000
Xxxxxx 00000
Xxxxxxx xx Xxxxx Xxxxxx
Fax: (000-0) 000-0000
(ii) in the case of the Second Party: Xxxxxxx Xxx Abdullah A1 Sowailem
X.X. Xxx 0000
Xxxxxx 00000
Xxxxxxx xx Xxxxx Xxxxxx
Fax: (000-0) 000-0000
(iii) in the case of the Third Party: Ismail Xxxxx Xxxxxx Xxx Xxxxxx
X.X. Xxx 0000
Xxxxxx 00000
Xxxxxxx xx Xxxxx Xxxxxx
Fax: (000-0) 000-0000
(iv) in the case of the Fourth Party: Xxxxxxx Xxxxx Xxxx Xxxxxxx Xx Xxxxx
X.X. Xxx 00
Xxxxxx 00000
Xxxxxxx xx Xxxxx Xxxxxx
Fax: (000-0) 000-0000
(v) in the case of the Fifth Party: Royle Mid East Ltd.
0000 Xxxxxxxxxx Xxxx
Xxxxxxx Xxxxx, XX 00000
Xxxxxx Xxxxxx of America
Fax: (0-000) 000-0000
Attention: Xxxx X. Xxxxxx
(vi) in the case of the Sixth Party: Fibercore Mid East Ltd.
X.X. Xxx 000
000 Xxxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
Xxxxxx Xxxxxx of America
Fax: (0-000) 000-0000
Attention: Xxxxxxx X. Xxxxxx
or to such other address or facsimile number or person as a Partner
may hereafter designate.
18.2 A notice shall be deemed to have been given and received: (i) when left
at the appropriate address if sent by registered mail or international
air courier; or (ii) when actually received or when dispatched and safe
receipt is acknowledged by the receiving facsimile machine, if sea by
facsimile.
19. Effect of Headings
19.1 The headings used throughout this Agreement are inserted for reference
purposes only and are not to be considered or taken into account in
construing the terms and provisions of any paragraph nor to be deemed
in any way to qualify, modify or explain the effects of any such
provisions or terms.
20. Miscellaneous
20.1 In the event of any conflict or inconsistency between the provisions of
this Agreement and the Articles of Association of the Company's the
following order of precedence shall prevail as between the Partners:
this Agreement and then the Articles of association.
20.2 If any provisions of this Agreement are found to be inconsistent with
or void under applicable law, the validity of the remaining provisions
shall not be adversely affected. In such case the Partners shall
re-negotiate in good faith concerning the ineffective provision with
the object of replacing it as closely as possible with a provision
affording the same basic rights, obligations and economic effects, both
to the Partners and to the Company.
20.3 This Agreement constitutes the full understanding and entire agreement
among the Partners and defines all rights granted herein and all
obligations assumed by each Partner at the date of execution of this
Agreement. No modification or amendment to this Agreement shall be
effective as to any Partner who has not consented thereto in the form
of a written addendum to this Agreement signed by the authorized
representative of that Partner.
20.4 This Agreement shall inure to the benefit of and be binding upon the
Partners and their respective heirs, successors and assigns.
20.5 The Partners declare that they have not concluded, and shall not
conclude any contracts or agreements which are inconsistent with the
provisions of this Agreement.
20.6 This Agreement has been prepared and executed by the Partners in the
English language in seven (7) original counterparts. Unless mutually
agreed otherwise, the English text shall govern and each document,
certificate, statement, report, accounts, agenda, minutes and other
written material referred to in this Agreement, shall be in the English
language or shall be accompanied by a certified English translation
thereof.
20.7 For purposes of this Agreement, the passage of time shall be construed
according to the Gregorian calendar.
IN WITNESS WHEREOF, the Partners have caused this Agreement to be executed as of
the day and year first above written.
The First Party The Second Party
___/s/___________________ ___/s/_____________________
The Third Party The Fourth Party
___/s/___________________ ___/s/_____________________
The Fifth Party The Sixth Party
___/s/___________________ ___/s/_____________________
Name: X.X. Xxxxxx Name: Xxxxxxx X. Xxxxx
Title: President Title: Vice President
Exhibit I
DRAFT FIRST AMENDMENT
TO THE ARTICLES OF ASSOCIATION
OF
MIDDLE EAST FIBER OPTIC CABLE MANUFACTURING COMPANY LIMITED
(A Limited Liability Company)
THIS FIRST AMENDMENT TO THE ARTICLES OF ASSOCIATION has been made and entered
into this day of , 1416H (corresponding to the day of , 1995G) by and among:
1. XX. XXXXXXX XXXXXXX ABDULLAH AL NAMLA a Saudi National having identity card
No. 17719 dated 29/6/1379, issued in Riyadh, with an occupation as a
businessman, born in 1377H, residing in Riyadh. with an address at X.X. Xxx
000 Xxxxxx 00000
(First Party);
2. XX. XXXXXXX XXX XXXXXXXX AL SOWAILEM a Saudi National having identity card
No. 7, dated 13/9/1386H, issued in Bakriyah, with an occupation as a
businessman born in 1346H, residing in Riyadh, with an address at X.X. Xxx
0000 Xxxxxx 00000
(Second Party);
3. XX. XXXXXX XXXXX XXXXXX XXX XXXXXX a Saudi National having identity card No
. 464 dated 28/12/1384H, issued in Jeddah. with an occupation as a
businessman, born in 1349H, residing in Riyadh, with an address at X.X. Xxx
0000 Xxxxxx 00000
(Third Party);
4. XX. XXXXXXX XXXXX XXXX XXXXXXX XX XXXXX a Saudi National having identity
card No. 103582, dated 1/12/1385H, issued in Mekkah, with an occupation as
a businessman, born in 1374H, residing in Riyadh. with an address at X.X.
Xxx 00 Xxxxxx 00000
(Fourth Party);
5. ROYLE MID EAST LTD a company organized and existing under the laws of the
Cayman Islands with an address of X.X. Xxx 00000 X.X.X. Xxxxxx Xxxx. Grand
Cayman. Cayman Islands. BWI
(Fifth Party); and
6. FIBERCORE MID EAST LTD a company organized and existing under the laws of
the Cayman Islands with an address of X.X. Xxx 00000 X.X.X. Xxxxxx Xxxx,
Xxxxx Xxxxxx. Cayman Islands. BWI
(Sixth Party).
Recitals
WHEREAS, the First, Second, Third and Fourth Parties formed and are the sole
owners in of Middle East Fiber Optic Cable Manufacturing Company Limited
(hereinafter referred to as the "Company"), a Saudi Arabian limited liability
company formed pursuant to an industrial license issued under Resolution of the
Minister of Industry & Electricity No. 895/S dated 1/11/1415H, whose Articles of
Association were recorded by the Riyadh Notary Public on pages 165 and 166 of
Volume 26 under number 2446 on 15/1/1416H, and which was registered in the
Commercial Register of the city of Riyadh under number 1010136511 on 11/2/1416H,
with a capital of Six million three hundred fifty thousand Saudi Rivals (SR
6,350.000) which has been allocated among the above-mentioned four (4) partners;
WHEREAS, the Company has to date not conducted any business activity, and the
First, Second, Third and Fourth Parties wish to enlarge its financial resources
and shareholding base and admit foreign companies to benefit from their
experience in the company's field of activities and accordingly have agreed to
admit the Fifth and Sixth Parties as new partners in the company and to increase
the Company's capital to twelve million five hundred thousand Saudi Rivals (SR
1'.500,000);
WHEREAS, the Fifth and Sixth Parties wish to join as new partners in the
Company;
WHEREAS, the parties have obtained Resolution No. _ dated from the Minister of
Industry & Electricity authorizing the participation of the Fifth and Sixth
Parties in the Company; and
WHEREAS the parties wish to amend and restate the Articles of Association of the
Company in their entirety:
NOW, THEREFORE the parties agree as follows:
First: The above recitals shall constitute an integral part of this Amendment.
Second: The partners in the Company shall be the following:
1. Xx. Xxxxxxx Xxxxxxx Abdullah Al Namla:
2. Xx. Xxxxxxx Xxx Xxxxxxxx Xx Xxxxxxxx;
3. Xx. Xxxxxx Xxxxx Xxxxxx Xxx Xxxxxx:
4. Xx. Xxxxxxx Xxxxx Xxxx Xxxxxxx Xx Xxxxx:
5. Royle Mid East Limited; and
6. Fibercore Mid East Limited.
Third: The Articles of Association of the Company are hereby amended and
restated to read in their entirety as follows:
Article 1: Name of the Company
The name of the Company is "Middle East Fiber Optic Cable Manufacturing Company
Limited" a limited liability company.
Article 2: Objectives of the Company
The objectives of the Company shall be: the manufacture of optical Fiber and
fiberoptic cable.
The Company shall carry out its activities after obtaining any necessary
licenses from the relevant authorities.
Article 3: Participation in Other Companies
The Company may own shares in other existing companies or consolidate therewith.
The Company may also participate with others in setting up joint ventures and
limited liability companies to conduct similar or supplementary activities after
satisfying the relevant laws and regulations.
Article 4: Head Office
The head office of the Company shall be in the City of Riyadh, Kingdom of Saudi
Arabia. The Company may transfer its head office to any other place in the
Kingdom of Saudi Arabia and may establish branches within and/or outside the
Kingdom if the interests of the Company so require. subject to the approval of
all of the partners and the receipt of any necessary governmental approvals.
Article 5: Duration of the Company
The Company has been formed for a period of fifteen (15) years starting from the
date of its registration in the Commercial Register in the Kingdom of Saudi
Arabia. The duration of the Company will automatically be extended for similar
periods unless one of the partners notifies the others of his or its desire not
to continue the Company at least six (6) months prior to the
expiration of the initial period or an! subsequent period. by a registered
letter sent to their addresses.
Article 6: Capital of the Company
The Company's share capital shall be twelve million five hundred thousand Saudi
Rivals (SR12,500,000), divided into twelve thousand five hundred (12,500) cash
shares of equal value, the value of each share being one thousand Saudi Rivals
(SR1,000), apportioned among the partners as follows:
--------------------------------- ----------- --------- ---------------- ----------------
PERCENTAGE IN
THE
PARTNER NO. OF SHARE TOTAL SHARES COMPANY'S
SHARES VALUE VALUE CAPITAL
--------------------------------- ----------- --------- ---------------- ----------------
Xx. Xxxxxxx Xxxxxxx 3625 1000 3,000,000 29%
Abdullah Al Namla
--------------------------------- ----------- --------- ---------------- ----------------
Xx. Xxxxxxx Xxx 2250 1000 2,250,000 18%
Abdullah Al Sowailem
--------------------------------- ----------- --------- ---------------- ----------------
Xx. Xxxxxx Xxxxx Xxxxxx 1375 1000 1,375,000 11%
Xxx Xxxxxx
--------------------------------- ----------- --------- ---------------- ----------------
Xx. Xxxxxxx Xxxxx 1500 1000 1,500,000 12%
Xxxx Xxxxxxx Al Kaaki
--------------------------------- ----------- --------- ---------------- ----------------
Royle Mid East Limited 1875 1000 1,875,000 15%
--------------------------------- ----------- --------- ---------------- ----------------
Fibercore Mid East Limited 1875 1000 1,875,000 15%
--------------------------------- ----------- --------- ---------------- ----------------
TOTAL 12500 12,500,000 100%
--------------------------------- ----------- --------- ---------------- ----------------
The partners declare that the original capital of the Company. in the amount of
six million three hundred fifty Thousand Saudi Rivals (SR 6,350,000) was fully
paid at the time of the Company's formation and that the increase in the capital
of the Company, in the amount of twelve million one hundred fifty thousand Saudi
Rivals (SR 6,150,000), has been fully paid and deposited in one of the approved
banks in the Kingdom in the name of the Company, as evidenced by the certificate
of the said bank in this regard.
Article 7: Increase or Reduction of Capital
The capital of the Company may be increased only with the unanimous consent of
the partners.
The capital of the Company may also be decreased by a decision of the general
meeting, provided that the capital may not become less than the minimum amount
allowed. and in accordance with the following guidelines:
(a) If the capital is decreased because it is in excess of the
Company's needs the Company's creditors must be notified
pursuant to a notice to be posted in a paper published in the
city where the head office of the Company is
established. The creditors may object to such decrease within
sixty (60) days of the publication date. In the event one of
the creditors objects and presents to the Company documents
substantiating Its claim within the above-mentioned period of
time the Company must either pay the debt if it is due at that
time or provide an adequate guarantee of payment if the debt
is due at a later date.
(b) In the event the Company has incurred losses totaling
three-fourths (3/4) of its capital, its capital may not be
decreased.
Article 8: Rights of Partners
Except as the partners may otherwise agree in writing all shares confer equal
rights and obligations upon their holders and each share in the capital of the
Company shall entitle its holder to one vote and an equal proportionate share in
the assets of the Company upon liquidation. Each partner shall be entitled to
participate in the deliberations of the general meetings and to use and enjoy
his or its voting and other rights in accordance with the provisions of these
Articles and the Companies Regulations.
If any shares are transferred in accordance with Article 9 hereof, all rights
and obligations attached to a share shall be automatically transferred to the
new owner. Ownership of shares and the determination of rights and obligations
arising therefrom shall be governed by the provisions of these Articles and the
decisions of the general meetings.
Each partner shall have the right to examine all books records. accounts,
inventors lists and other documents of the Company during normal working hours.
It is the responsibility of the Manager of the Company to facilitate the
exercise of this right by the partners.
Article 9: Shares
The shares shall be freely transferable among the partners. However, no partner
may assign one or more of his or its shares to a third party. with or without
consideration. except with the prior written consent of the other partners.
Nevertheless. every partner shall have the right to recover such shares pursuant
to Article 165 of the Companies Regulations at the net book value thereof as
determined by the Company's auditor as of the end the last fiscal month prior to
the date notice of the intended share transfer was given.
No partner may pledge, mortgage or otherwise encumber any of his or its shares
without the prior written consent of all the partners and no such action shall
be binding on the Company or the other partners in the absence of such consent.
A share in the capital of the Company is indivisible. If for any reason the
ownership of a share is vested in more than one person the Company shall be
entitled to suspend the enjoyment of rights conferred by such share until the
joint owners have chosen from among themselves one person to be considered as
sole owner of such share in relation to the Company. The Company may fix a
period within which the joint owners shall make this choice. If they fail to do
so within the period specified. the Company may offer the share for sale for the
account of the joint owners to the other partners or a third party.
Article 10: Share Register
The Company shall establish and keep at its head office a share register in
which it shall enter the names of the partners. the number of shares owned by
each and all transactions affecting the shares. No transfer of ownership of such
shares shall be effective vis-a-vis the Company or any third party unless the
reason for the transfer of ownership is entered in the aforementioned register.
The register must contain all of the following information:
(a) the name of each partner and his occupation, nationality,
address and identity card (or passport) number;
(b) the number and value of the shares owned by each partner;
(c) the number and value of shares which have been transferred,
along with a description of the manner in which the shares
were transferred - whether by sale, purchase, inheritance,
gift or otherwise:
(d) the name and signature of the transferor and ~e transferee;
(e) the date of the transfer; and
(f) the number and value of shares owned by each partner after any
such transfer.
The pages of the share register shall be numbered sequentially. No page may be
deleted nor any erasure or revision made to the information contained therein.
Each partner shall have the right to examine the share register during the
normal working hours of the Company.
Article 11: Management of the Company
The management of the Company shall be delegated to a Manager appointed by a
resolution of the partners duly adopted in accordance with Article 12.
The Manager of the Company shall have the following responsibilities and
authority:
(a) managing and controlling the day-to-day operations of the
Company and causing the Company to carry out its operations in
accordance with his best professional judgment and approved
policies and guidelines these Articles and the laws and
regulations of the Kingdom:
(b) managing and controlling all capital and revenue expenditures
within the scope of budgets approved by the partners;
(c) representing and acting on behalf of the Company vis-a-vis
third parties and before all governmental and official bodies.
including courts and tribunals;
(d) operating bank accounts in accordance with guidelines
established by the partners;
(e) entering into contracts and agreements on behalf of the
Company provided that contracts whose value is greater than
one hundred thousand Saudi Rivals (SR100,000) or whose
duration is longer than one (1) year shall require the prior
approval of the partners.
(f) utilizing credit facilities, subject to approval of the
partners;
(g) hiring and firing the agents and employees of the Company and
determining their wages. benefits and other terms and
conditions of employment; granting work visas. exit and
re-entry and final exit visas to the Company's employees and
sponsors and transferring and assigning their sponsorship; and
(h) within the scope of his authority and responsibility,
delegating power to others and revoking such delegations and
taking whatever actions may be necessary to ensure that the
Company is run as efficiently and profitably as possible.
The partners shall execute such powers of attorney or other documents as may be
necessary to allow the Manager of the Company to fulfill his responsibilities
and obligations specified in this Article or otherwise required of him in
accordance with these Articles of Association.
The employment of the Manager of the Company may be terminated by a resolution
of the partners. In the event the employment of the Manager of the Company is
terminated his successor shall be appointed in the manner set forth in this
Article. The partners agree that the manager shall be replaced if partners
holding at least thirty percent (30%) of the capital so request in writing.
Article 12: Partners' Meetings
The duly authorized representatives of each partner shall have the right to
attend and to take part in the deliberations of and to vote at all general
meetings. Each partner shall provide the other partners in writing from
time-to-time with the names of the individuals appointed to represent him or it
at the general meeting and to cast a vote on his or its behalf.
General meetings shall be held at the head office of the Company or at such
other places as may be agreed by the partners. General meetings shall be held at
least once every six (6) months and at such additional times as the Manager of
the Company and/or any partner may require on at
least fifteen (15) days prior notice To the partners. Notice of each partners'
meeting shall include the agenda and all documents concerning the business to be
transacted at the meeting. The partners may waive these requirements for notice
by a vote at the beginning of a meeting and before any other business is
transacted. The partners may designate. from among those appointed to represent
each of them at general meetings, one person who shall chair general meetings.
The chairman shall select a person to act as the secretary of the Company and
the person will ensure that an adequate and accurate record of partners'
meetings is made and kept.
The Manager of the Company shall convene an annual general meeting within six
(6) months following the close of each fiscal year of the Company to:
(a) review and approve a report from the Manager of the Company
concerning the management and administration of the Company;
(b) review and approve the auditor's report for the preceding
fiscal year;
(c) consider and take any appropriate decision in relation to any
of the foregoing matters;
(d) appoint or reappoint auditors to audit the Company's accounts
for the ensuing fiscal year and determine their fees and
choose the legal advisors and banks to be used by the Company;
and
(e) discuss and decide upon any other business or matter relating
to the Company.
The presence of the duly authorized representatives of all partners shall be
necessary to constitute a valid quorum. If, however a quorum is not achieved at
any validly called meeting, the meeting shall be postponed for seven (7) days at
the same time and place and the duly authorized representatives of the partners
present for the postponed meeting shall constitute a valid quorum provided that
they represent partners holding at least seventy-five percent (75%) of the
Company's capital.
Article 13: Partners' Decisions
Each partner shall have a number of votes equal to the number of shares he or it
has in the Company on each matter presented to the partners for decision.
Partners' decisions relating to any change in the nationality of the Company or
any increase in the financial burdens of the partners shall be unanimous. .411
other decisions shall require the affirmative vote of those representing at
least seventy-five percent (75%) of the capital of the Company.
After circulation. a resolution in writing signed by the requisite number of
partners shall be as valid and effective as if it had been passed at a partners
meeting duly convened and held.
Any such resolution may consist of several documents in like form each signed by
the duly authorized representatives of one or more of partners wherever they may
be situated.
Except for matters expressly placed under the authority of the Manager of the
Company pursuant to these Articles or pursuant to a resolution of the partners,
decisions related to the management and operation of the Company may be made
only by a partners' resolution adopted in accordance with Article 12 above and
this Article.
Article 14: Books of Accounts and Annual Financial Statements
The Manager of the Company shall cause the Company to maintain proper books of
accounts and complete and accurate records regarding:
(a) all income and expenditures of the Company,
(b) all contracts entered into by the Company;
(c) all purchases and sales made by the Company; and
(d) the assets and liabilities of the Company.
All books of account and records shall be maintained in accordance with
generally accepted accounting principles and the regulations of the Kingdom and
kept at the head office of the Company.
Article 15: Auditor
The partners shall cause an auditor to be appointed annually by a partners
resolution adopted at a general meeting. The auditor must be licensed to
practice in the Kingdom in accordance with the Auditors Regulations. The auditor
shall ensure that the Articles of Association of the Company and the Companies
Regulations are being applied. He shall review all inventories and final annual
accounts and inspect the balance sheet and submit an annual report to each
partner and to the Manager. For that purpose he may review all the Company's
books. documents and contracts entered into with third parties and may request
clarification and information as he deems necessary. The partners shall
determine the auditor's remuneration on an annual basis.
Article 16: Fiscal Year
(a) The first fiscal year of the Company shall commence on the
date of its registration in the Commercial Register and end on
22 Shaaban 1417H corresponding to 31 December 1996G. The
duration of each subsequent fiscal year shall be twelve (12)
months.
(b) The Manager of the Company shall. within four (4) months
following the end of such fiscal year, prepare a balance
sheet. profit and loss account, and a report describing the
Company's activities and financial position and containing his
recommendations as to the distribution of profits. The Manager
shall send to each partner and to the Companies' Department at
the Ministry of Commerce a copy of these documents, together
with a copy of the auditor's report.
within two (2) months of their date of preparation.
Article 17: Distribution of Profits
The annual net profits of the Company, after deduction of general costs and
expenses shall be distributed in the following manner:
(a) The Company shall set aside ten percent (10%) of its annual
net profits to constitute the statutory reserve required under
Article 176 of the Companies Regulations. The Company may
cease setting aside this reserve when it reaches one-half
(1/2) of the Company's capital.
(b) The partners may resolve to establish additional reserves or
to carry forward the profits in whole or in part to the next
fiscal year.
(c) The remainder of the net profits shall be distributed to the
partners in proportion to their respective shares in the
capital unless the partners unanimously resolve on an
alternative method of distribution.
Article 18: Losses
If losses are incurred, they shall be borne by the partners to the extent of
each partner's ownership of shares in the Company's capital or carried over to
the next fiscal year. No profits shall be distributed until the losses are fully
covered. If the Company's losses reach three-quarters (3/4) of its capital the
Manager of the Company must summon the partners to a meeting within a period not
to exceed thirty (30) days from the date on which the losses reach this level in
order to consider whether to continue the Company, in which case the partners
must pay its debts, or to dissolve it. The resolution of the partners in this
respect shall not be valid unless it is issued in accordance with Article 173 of
the Companies Regulations and the resolution must in all cases be published in
the manner provided in Article 164 of the Companies Regulations. If the Company
continues to pursue its business without the issuance of a decision to continue
it pursuant to the foregoing conditions, or to dissolve it. the partners shall
become jointly and severally liable to pay all of the Company's debts and any
interested party may request that it be dissolved.
Article 19: Dissolution and Liquidation of the Company
The Company may be dissolved for any of the reasons for dissolution contained in
Article 15 of the Companies Regulations. Upon the Company's dissolution it shall
enter the stage of liquidation in accordance with the provisions of Chapter 11
of the Companies Regulations. In case of voluntary liquidation, the partners
shall appoint one or more liquidator(s) for purpose of liquidating the Company
and shall determine their authority and fees and the following must be observed:
(a) A report certified by a chartered accountant licensed to
practice in the Kingdom shall be prepared regarding the
financial status of the Company as of the date of issuance of
the partners resolution to dissolve and liquidate the Company
which establishing the Company's ability to discharge its
obligations and its debts vis-a-vis third parties.
(b) All entitlements of creditors must be paid in full or a
settlement entered into with them. Otherwise, the Company
shall not be liquidated until after a decision is issued by
the Board of Grievances announcing the bankruptcy of the
Company pursuant to a request by the creditors or the Company
in accordance with the Commercial Court Regulations.
Subject to the provisions of the Companies Regulations, the Company shall be
automatically dissolved upon the occurrence of any of the following:
(a) the dissolution or death of a partner; or
(b) the Company or any partner becomes bankrupt, insolvent,
applies for or consents to the appointment of a receiver or a
liquidator for his or its assets, or seeks relief under any
law for the aid of debtors or takes or permits any action
under the laws of Saudi Arabia or under other applicable laws
similar to the foregoing; or
(c) any other event occurs which the partners shall have agreed
should cause the Company to be dissolved.
Notwithstanding the above. after the occurrence of any of the events referred to
in the preceding paragraph that result in an automatic dissolution of the
Company, the remaining partners may agree to continue the Company.
Article 20: Company Documents
The Company's letterhead shall clearly show the name of the Company. followed by
the phrase 'a limited liability company," as well as the address of Its head
office. its commercial registration number and Its capital. All other documents
shall comply with any applicable rules and regulations.
Article 21: Notices
Any notices given hereunder shall be deemed to be sufficiently given if in
writing and delivered by postpaid registered mail or international courier or
facsimile addressed as follows or as may be advised by one party to the company
in writing from time-to-time and registered in the partners registry:
(a) in the case of The First Party: Xxxxxxx Xxxxxxx Abdullah A1 Namla
X.X. Xxx 000
Xxxxxx 00000
Kingdom of Saudi Arabia
Fax: (966-1)
(b) in the case of the Second Party: Xxxxxxx Xxx Abdullah A1 Sowailem
X.X. Xxx 0000
Xxxxxx 00000
Xxxxxxx xx Xxxxx Xxxxxx
Fax: (966-1)
(c) in the case of the Third Party: Ismail Xxxxx Xxxxxx Xxx Xxxxxx
P.O. Box 1799
Riyadh 11441
Kingdom of Saudi Arabia
Fax: (966-1)
(d) in the case of the Fourth Party: Xxxxxxx Xxxxx Xxxx Xxxxxxx Xx Xxxxx
X.X. Xxx 00
Xxxxxx 00000
Xxxxxxx xx Xxxxx Xxxxxx
Fax: (966-1)
(e) in the case of the Fifth Party: Royle Mid East Ltd.
0000 Xxxxxxxxxx Xxxx
Xxxxxxx Xxxxx, XX 00000
Xxxxxx Xxxxxx of America
Fax: (0-000) 000-0000
Attention: Xxxx X. Xxxxxx
(f) in the case of the Sixth Party: Fibercore Mid East Ltd.
X.X. Xxx 000
000 Xxxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
Xxxxxx Xxxxxx of America
Fax: (0-000) 000-0000
Attention: Xxxxxxx X. Xxxxxx
A notice shall be deemed to have been made and received: (i) when delivered to
the appropriate address. if sent by registered mail or international courier or
(ii) when received or when dispatched and sate receipt is acknowledged by the
receiving facsimile machine if sent by facsimile.
Article 22: General Provisions
(a) The Company shall be subject to all laws in effect in the Kingdom of
Saudi Arabia.
(b) All matters not governed by these Articles of Association shall be
governed by the Companies Regulations.
Article 23: Counterparts
These Articles of Association have been executed in several counterparts of
which each partner shall receive one counterpart. The remaining counterparts
shall be submitted to the concerned authorities for purposes of registering the
Company in the Commercial and Companies Registers.
IN WITNESS WHEREOF, this First Amendment to the Articles of Association has been
executed as of the date first written above.
The First Party The Second Party
---------------------- ------------------------
The Third Party The Fourth Party
---------------------- ------------------------
The Fifth Party The Sixth Party
---------------------- ------------------------
Name: Name:
Title: Title:
Exhibit II
COMMISSION AGENCY AGREEMENT
THIS COMMISSION AGENCY AGREEMENT is entered into as of the _________ day of
_________ 1996, by and between:
(i) MIDDLE EAST FIBER OPTIC CABLE MANUFACTURING COMPANY LIMITED, a
limited liability company organized and existing under the
laws of the Kingdom of Saudi Arabia, having Commercial
Registration No. 1010136511 issued at Riyadh on 11/2/1416H
("MEFC"); and
(ii) FIBERCORE MID EAST LTD., a company organized and existing
under the laws of the Cayman Islands with an address of X.X.
Xxx 00000 X.X.X., Xxxxxx Xxxx. Grand Cayman, Cayman Islands.
BWI ("Agent").
1. Appointment
MEFC hereby appoints Agent and Agent hereby accepts such appointment.
subject to the provisions of this Agreement. as the sole commission
agent in the countries listed in Appendix A hereof (the "Territory")
for optical fiber and fiberoptic cable products produced by MEFC (the
"Products").
2. Term and Termination
2. 1 This Agreement will take effect on the date hereof and shall continue
through the third anniversary of such date unless earlier terminated as
provided in this Agreement. MEFC shall not be responsible to Agent for
any costs or damages resulting from the termination of this Agreement.
This Agreement shall automatically be renewed for successive one (1)
year periods unless either party sends the other written notice of an
intention not to renew. which notice must be given no less than one
hundred eighty (180) days prior to each anniversary date of this
Agreement provided. however, that in no event shall the term of this
Agreement exceed fifteen (15) years from the date hereof
2.2 Either party may terminate this Agreement at any time in the event the
other party breaches any of its obligations contained herein. Such
termination shall be effective thirty (30) days after written notice is
given to the party in breach specifying the claimed breach(es) The
party in breach may avoid termination if it cures the breach(es) prior
to the end of such thirty (30) day period.
2.3 MEFC may terminate this Agreement with immediate effect if at the end
of the third year from the date hereof or at the end of any subsequent
year the aggregate ex-works value of orders referred by the Agent to
the Company in the Territory are less than seventy-five percent (75%)
of the target amount appearing in the annual budget of the Company in
respect of such year.
2.4 Either party may terminate this Agreement with immediate effect if the
other party becomes bankrupt or insolvent or is placed in liquidation
or receivership.
3. Orders and Commissions
3. 1 Agent has no authority to accept orders on behalf of MEFC and therefore
agrees that it must promptly refer all orders to MEFC in writing. All
orders are subject to approval and acceptance, either entirely or
partially, by MEFC in writing. MEFC shall have no liability to Agent or
any third party if it declines to accept an order. Unless MEFC agrees
otherwise in writing, all sales will be made upon MEFC's then current
standard sales terms and conditions and list prices. Except as
otherwise agreed between MEFC and Agent, MEFC reserves the right to
alter its standard sales and conditions and list prices from
time-to-time, provided that it shall not change prices or orders
already accepted and shall give Agent at least thirty (30) days prior
written notification of any price change.
3.2 MEFC agrees to pay Agent commissions equal to:
(a) ten percent (10%) of MEFC's ex-works invoice price of any
Products sold by MEFC to a customer in the Territory as a
result of an order referred to MEFC by the Agent pursuant to
Clause 3.1 and accepted by MEFC within six (6) months of such
referral; and
(b) five percent (5 %) of MEFC's ex-works invoice price of any
Products sold by MEFC to a customer in the Territory otherwise
than in accordance with (a) above ("Direct Sales"), provided
that no commission shall be payable in respect of direct sales
of Products to customers in Italy.
3.3 Commissions shall be payable within thirty (30) days from when MEFC
receives payment for Products. If partial payments are received by
MEFC, the commission payable shall be appropriately pro rated.
Commission shall be paid to Agents bank account, as notified by the
Agent to MEFC pursuant to Clause 10.
4. Delay in Performance
Neither party shall be liable for failure or delay in the performance
of any of its obligations under this Agreement. if such delay or
failure is caused by circumstances beyond the control of the party
affected.
5. Waiver
None of the provisions of this Agreement shall be deemed to have been
waived by any act of or acquiescence on the part of MEFC its agents or
employees. but only by an instrument in writing signed by an authorized
officer of MEFC. No waiver of any
provisionof this Agreement shall constitute a waiver of any other
provision or of the same provision on another occasion.
6. No Partnership or Power of Attorney
It is expressly declared that this Agreement and relationships between
the parties established hereby does not constitute a partnership, joint
venture. power of attorney or contract of employment between them. For
the avoidance of doubt, Agent shall have no authority to accept orders
on behalf of MEFC or to enter into any contract or undertaking or on
behalf of .MEFC and covenants not to purport to do so.
7. Arbitration
7. 1 MEFC and Agent agree that they will attempt in good faith to resolve
any disagreement or dispute arising under, by reason of, or in any way
connected with this Agreement by negotiation. In the event that either
party in its sole discretion believes that such negotiation is not
likely to resolve such disagreement or dispute, that party may send a
notice to the other party requesting arbitration of the dispute. MEFC
and Agent both agree that all such disagreements or disputes shall,
following notice, be subject to binding arbitration in London. England
under international arbitration rules and consent to jurisdiction and
venue there for that purpose. Arbitration is to be conducted solely in
the English language. MEFC and Agent agree that an arbitral award may
be entered as a final judgment in any appropriate court and be enforced
by or through such court(s).
7.2 In the event an arbitration is commenced to enforce a party's rights
under this Agreement. the prevailing party in such action shall be
entitled to recover its costs and reasonable attorneys' fees.
8. Assignment
This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns, except that
Agent may not assign or transfer its rights or obligations under this
Agreement in any way without the prior written consent of MEFC.
9. Severability
Except as otherwise provided herein, if any provision of this Agreement
shall be held by a court of competent jurisdiction to be illegal,
invalid or unenforceable, the remaining provisions shall remain in full
force and effect.
10. Notices
10.1 Any notices given hereunder shall be deemed to be sufficiently given if in
writing and delivered by postpaid registered mail or international courier or
facsimile addressed as follows:
If to MEFC: _____________________________
Telephone:
Fax:
Attention:
If to Agent: Fibercore Mid East Ltd.
X.X. Xxx 000
000 Xxxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
Xxxxxx Xxxxxx of America
Telephone:
Fax: (0-000) 000-0000
Attention:
or to such other address or facsimile number either party may designate in
writing.
10.2 A notice shall be deemed to have been given and received: (i) when left
at the appropriate address if hand-delivered or sent by registered
mail; or (ii) when actually received. or when dispatched and safe
receipt is acknowledged by the receiving facsimile machine
MIDDLE EAST FIBER CABLE FIBERCORE MID EAST LTD
COMPANY
---------------------------- -----------------------------
By By
---------------------------- -----------------------------
Name (Print) Name (Print)
---------------------------- -----------------------------
Title Title
---------------------------- -----------------------------
Date Date
Appendix A
Territory
The Territory comprises: the United States of America and all territories on the
continent of Europe, excluding any part of Turkey.
TABLE - BALANCE SHEET
TABLE - BALANCE SHEET
TABLE - MIDDLE EAST FACTORY BUILDING
TABLE - MIDDLE EAST VEHICLES
TABLE - MIDDLE EAST FURNITURE AND FIXTURES
TABLE - MIDDLE EAST OFFICE EQUIPMENT
TABLE - MIDDLE EAST PLANT SERVICES EQUIPMENT
TABLE - MESC PAYABLES
Exhibit IV
SALES OF FIBER and PREFORMS
The Third Party will supply or arrange for an affiliate to supply Single Mode
Fiber ("SMF") and Single Mode Preforms ("SMP") to the Company in the following
maximum quantities during the following periods, starting on the date on which
the Company commences commercial production of any Products ("CCP"):
First six (6) months after CCP 12,500 km/SMF
12,500 km/SMP
Next twelve (12) months 90,000 km/SMP'
Next twelve (12) months 135,000 km/SMP
Next twelve (12) months 180,000 km/SMP
Each twelve (12) months thereafter 225,000 km/SMP
The above quantities assume approximately equal monthly shipments. The Company
shall have absolute discretion to adjust quantities ordered below the above
limits, but will endeavor to do so not more frequently than quarterly.
Pricing of SMF shall be 10% less than proven competitive prices for SMF
delivered in Saudi Arabia with equivalent specifications.
Pricing of SMP shall be $42.50 per km ex-works Jena, Germany for the period
ending in December 1995. and thereafter at a price at least US$15.00 per
kilometer (ex-works) less than any bona fide fiber prices with equivalent
specifications available for delivery to the Kingdom, from either Corning, Inc.
or AT&T.
SMF and SMP will be sold to the Company on the Third Party's standard terms and
conditions of sale a copy of which is attached hereto and made a part hereof.
SHARE PURCHASE AGREEMENT
THIS AGREEMENT made as of this 13th day of April, 1995 between MIDDLE
EAST SPECIALIZED CABLES CO. ("the Purchaser") and FIBERCORE, INCORPORATED ("the
Company") a Nevada Corporation.
WHEREAS the Purchaser with others entered into a Joint Venture
Agreement Term Sheet dated March 14th, 1995 (the "JV Term Sheet") for the
formation of Middle East Fiber Cables Co. ("MEFC") in the Kingdom of Saudi
Arabia to engage in the manufacture and sale of fiber optic cable products and
to sell and distribute such products throughout the Middle East, Africa and
Turkey; and
WHEREAS pursuant to the JV Term Sheet MEF is required to confirm the
purchase of shares of the Company's common stock (the "Shares") and the
Purchaser and MEF desire that the Purchaser acquire such Shares pursuant to the
terms and conditions of this agreement;
NOW THEREFORE in consideration of the premises and the mutual covenants
and agreements herein contained the parties agree as follows:
1. Offer.
1.1 The Purchaser hereby agrees to subscribe for and purchase 200,000 shares of
the Company at the purchase price of $5.00 per share in two blocks of 100,000
shares subject to the conditions hereinafter set forth;
1.2 Upon execution and delivery of this agreement by both parties the Purchaser
will pay to the Company the sum of $500,000 against delivery of the first block
of 100,000 shares of the Company subject to the terms and conditions of this
offer (the "first closing").
1.3 Upon acceptance of the offer and in addition to the delivery of the 100,000
shares of FiberCore to the Purchaser, the Company shall:
a) deliver into escrow 85,000 shares of FiberCore in
consideration of the Purchaser and its partners agreeing to
enter into a contract for the exclusive supply of FiberCore
products to the MEFC Joint Venture. The escrowed shares are to
be released to the Purchaser upon the completion and execution
of the product supply contract between the Company and MEFC.
b) deliver into escrow 150,000 warrants, granting the Purchaser
the right to purchase 150,000 common shares of FiberCore for a
purchase price of $6.00 per share exercisable in whole or in
part at any time within a 2 year period. The escrowed warrants
to be delivered as further consideration for the purchaser and
its partners agreeing to enter into the contract for the
exclusive supply of FiberCore products to the MEFC Joint
Venture. The warrants are to be delivered to the Purchaser
immediately following execution of the product supply
agreement by the MEFC Joint Venture.
c) deliver into escrow 65,000 shares of FiberCore to be released
to the purchaser immediately upon the Purchaser exercising its
rights to purchase shares pursuant to the terms of the
warrants referred to in clause 1.3 (b).
1.4 The offer for the second block of shares is conditional upon the parties
hereto reaching an agreement as to the terms of a joint venture company, Middle
East Fiber Cables Co. ("MEFC") to be formed in the Kingdom of Saudi Arabia to
engage in the manufacture and sale of fiber optic products and to sell and
distribute such products throughout the Middle East, Africa and Turkey.
1.5 Upon execution by all of the partners of MEFC of all of the documents
required to complete the formation MEFC and to define the respective interests,
obligation and restrictions on each of the joint venture partners including the
exclusive product supply agreement with the Company, Purchaser will pay to the
Company the further sum of $500,000 against delivery of the second block of
100,000 shares subject to the terms and conditions of this offer (the "second
closing") and the Vendor shall cause to be delivered to the Purchaser:
a) the 85,000 shares of the Company referred to in clause 1.3 (a);
b) the 150,000 warrants referred to in clause 1.3 (b);
c) confirmation by the escrow agent that the 65,000 shares of the
Company are being held for release to the purchaser pending
exercise of the warrants referred to in clause 1.3 (b).
2. Acceptance.
2.1 The Company agrees to sell to the Purchaser 200,000 Shares at the
subscription price of $5.00 per Share in two blocks of 100,000 Shares each
subject to the terms and conditions of this offer and to deliver the 150,000
shares of the Company and the 150,000 warrants referred to in clause 1.3 (a) (b)
and (c) to an escrow agent approved by the purchaser. The Company further agrees
that upon receipt of the purchase price of the second block of 100,000 shares
the entire amount of the said purchase price ($500,000.00) for the said block of
shares shall be invested in MEFC as a capital contribution to the joint venture
by Company or its wholly owned subsidiary and the company or its subsidiary
shall acquire a 20% interest in MEFC upon payment of the said funds.
3. Delivery of Shares and Warrants.
3.1 At the first closing upon payment of the purchase price for the first block
of 100,000 shares, the Company shall deliver to the Purchaser one or more stock
certificates registered in the name of the Purchaser, an executed escrow
agreement and a confirmation from the escrow agent that the shares and the
warrants referred to in clause 1.3 have been delivered to the escrow agent for
release pursuant to the terms of this Agreement.
Within two business days prior to the first
closing, the Purchaser shall notify the Company in writing of the names in which
all shares and warrants are to be registered.
3.2 At the second closing and upon payment of the purchase price for the second
block of Shares, the Company shall deliver to the Purchaser one or more stock
certificates registered in the name of the Purchaser or in such name or names as
may be designated by the Purchaser and delivery of the shares referred to in
clause 1.3 (a) and the warrants referred to in clause 1.3 (b) registered in the
name of the Purchaser or in such name or names as may be designated by the
Purchaser . 4. Representations and Warranties of the Company.
4.l The Company hereby represents and warrants to, and covenants with the
Purchaser as follows:
(a) Organization and Standing of the Company. The Company is a
corporation duly organized and validly existing under the laws of the state of
Nevada and is in good standing under such laws. The Company is not in violation
of its Certificate of Incorporation or Bylaws. The Company has all requisite
corporate power and authority for the ownership and operation of its properties
and assets, and to carry on its business as presently conducted or now proposed
to be conducted. The Company is duly qualified as a foreign corporation in each
jurisdiction in which ownership of its property or the nature of its business
requires such qualification and where the failure to be so qualified would be
material to the Company.
(b) Corporate Action. The Company has all the necessary corporate power
and has taken the corporate action required to enter into this Agreement and to
consummate the transactions contemplated hereby. All corporate action on the
part of the Company, its Director and Stockholders necessary for the
authorization, execution, delivery, and performance of this Agreement by the
Company, the authorization, sale, issuance, and delivery of the Shares and the
performance of the Company's obligations hereunder has been taken. This
Agreement has been duly executed and delivered by the Company and constitutes a
legal, valid and binding obligation of the Company enforceable in accordance
with its terms. The issuance of the securities does not require any further
corporate action, will not be subject to preemptive rights or other preferential
rights in any present stockholders of the Company and will not conflict with any
provisions of any agreement to which the Company is a party or by which it is
bound.
(c) Capitalization, Status of Capital Stock. The Company has a total
authorized capitalization consisting of 20,000,000 shares of Common Stock, $.01
par value, of which 6,594,264 shares are issued and outstanding. All outstanding
shares of Common Stock have been duly and validly authorized and issued, are
fully paid and nonassessable and were not issued in violation of or subject to
any preemptive or other similar rights to subscribe for or purchase any
securities. The Shares, when issued and delivered in accordance with the terms
hereof will be duly authorized, validly issued, fully-paid and non-assessable.
The Company will reserve 400,000 shares of its common stock for issuance under a
Stock Option Plan. All issued and outstanding warrants options or other
agreements to acquire shares of the Company are set forth
in Schedules "A" and "B" hereof and these shares, when issued and delivered in
accordance with the terms of the warrants, options or other agreements will be
duly authorized, validly issued, fully paid and non-assessable. AMP Incorporated
is lending $5,000,000 to the Company and has the right to convert the loan into
common stock pursuant to the term sheet attached hereto as Schedule "B" subject
to the approval of the Board of Directors of the both companies. Except as
provided or described in this Stock Purchase Agreement, there is no other
option, warrant, conversion privilege, or other contractual rights presently
outstanding to purchase or otherwise acquire any authorized but unissued shares
of the company's capital stock or other securities of the Company.
(d) Disclosure. To the Company's knowledge and belief, neither this
Agreement, the Private Placement Memorandum dated October 12th, 1994 (the
"Memorandum") as supplemented by this Agreement nor any other agreement,
document, certificate or written statement furnished to the Purchaser by or on
behalf of the Company in connection with the transaction contemplated hereby
contains any untrue statement of a material fact or omits to state a material
fact necessary in order to make the statements contained herein or therein not
misleading. There is no material fact within the special knowledge of any of the
executive officers of the Company which has not been disclosed herein or in
writing by them to the Purchaser and which materially adversely affects the
business, properties, assets or condition of the Company.
(e) Government Approvals. No authorization, consent, approval, license,
exemption, from or filing of registration with any court of governmental
department, commission, board, bureau, agency or instrumentality, domestic, or
foreign, is or will be necessary for the execution and delivery by the Company
of this Agreement, for the offer, issue, sale and delivery of the shares, or for
the performance by the Company of its obligations under this Agreement, except
for certain filing under state securities laws, the offer and sale of the shares
will be exempt from the registration requirements of applicable federal and
state securities laws.
(f) Litigation. There is no material litigation or governmental
proceeding or investigation pending or, to the knowledge of the Company,
threatened against the Company affecting any of its properties or assets, or
against any officer, key employee or the Company, nor, to the knowledge of the
Company, has there occurred any event or does there exist any condition on the
basis of which any litigation, proceeding or investigation might properly be
instituted. The Company is not in default with respect to any order, writ,
injunction, decree, ruling or decision of any court, commission, board or other
government agency applicable to it. There are no actions or proceedings pending
or threatened or any basis therefore known to the Company which might result,
either in any case or in the aggregate, in any material adverse change in the
business, operations, affairs or condition of the Company or in any of its
properties or assets, or which might call into question the ability of the
Company to consummate the transactions contemplated by this Agreement.
(g) Compliance with Other Instruments. Neither the execution, issuance
and delivery of this Agreement or the shares, nor the consummation by the
Company of any transaction contemplated hereby or thereby, constitutes or
results in or will constitute or result in a default or
violation of any term or provision of the charter and By-laws of the Company, as
amended and in effect, and the terms and provisions of the mortgages,
indentures, leases, agreements, and other instruments and of all judgments,
decrees, governmental orders, statutes rules, or regulations by which the
Company or its properties are bound.
(h) Taxes. The Company has prepared and timely filed all federal, state
and other tax return required by law to be filed by it, has paid or made
provisions for the payment of all taxes known to be due and all additional
assessments, and adequate provision has been made for all current taxes and
other charges to which the Company is subject.
(i) Indebtedness. Except for the accrued expenses of this offering,
patent reviews and filing, or expenses incurred in the ordinary course of
business since December 31, 1994, the Company has no outstanding indebtedness
and it is not in default of any contract or agreement of the Company.
(j) Financial Statements. The audited financial statements for the
period ending December 31, 1993 attached to the Memorandum and the related
statements of shareholders equity and cash flows and notes thereto, all of which
are accompanied by the related audit opinion of the Company's independent
certified public accountants, Mottle, XxXxxxx & Company and unaudited Balance
Sheet, Income Statement, Cash Flow and Administrative Expenses for period ending
December 31st, 1994 have been prepared in accordance with generally accepted
accounting principals applied on a consistent basis throughout the period
covered by such statements and present fairly the Company's financial condition
and results of operations and statements of cash flows as of the dates
indicated. Except as otherwise disclosed herein, since December 31st, 1994 there
has not been:
(i) any change in the assets, liabilities, financial
condition, or operations of the Company from that reflected in the Financial
Statements except changes in the ordinary course of business which have not
been, either in any individual case or in the aggregate, materially adverse;
(ii) any change, except in the ordinary course of business, in
the contingent obligations of the Company, whether by way of guaranty,
endorsement, indemnity, warranty, or otherwise;
(iii) any damage, destruction, or loss, whether or note
covered by insurance, materially and adversely affecting the properties or
business of the Company;
(iv) any declaration or payment of any dividend or other
distribution of the assets of the Company;
(v) any labor organization activity; or
(vi) to the best of the Company's knowledge, any other event
or condition of any character which has materially and adversely affected the
Company's assets, liabilities, financial condition, or operations.
(k) Patents and Other Intangible Rights. The Company owns, or is
licensed to use, rights to all patents, trade names, service marks, trademarks,
copyrights, and other intellectual property necessary to carry on its business
as currently conducted or proposed to be conducted as described in the
Memorandum, with any such licensed rights being adequate both in scope and
duration for such purposes. Except as may be disclosed in the Memorandum, to the
best of its knowledge the Company is not infringing upon or otherwise acting
adversely to any right or claimed right of any person under or with respect to
any patents, patent rights, trademarks, service marks, copyrights, trade names,
or any other third-party rights except for such infringement or other adverse
action which would not, individually or in the aggregate, have a material
adverse effect on the financial condition or business of the Company.
5. Purchaser Representations
5.1 In connection with this subscription, the Purchaser hereby makes the
following acknowledgment and representations:
(a) The execution of this Share Purchase Agreement has been duly
authorized by all necessary action on the part of the Purchaser, has been duly
executed and delivered, and constitutes a valid, legal, binding, and enforceable
agreement of the Purchaser;
(b) The Purchaser is acquiring the Shares for it own account, for
investment, and not with a view to any "distribution" thereof within the meaning
of the Securities Act of 1933, as amended (the "Act");
(c) The Purchaser understands that because the Shares have not been
registered under the Act, it cannot dispose of any of the Shares unless such
Shares are subsequently registered under the Act or exemptions from such
registration are available. The Purchaser acknowledges, and understand that, it
has no right to require the Company to register the Shares. The Purchaser
further understands that the Company may, as a condition to the transfer of any
of the Shares, require that the request for transfer be accompanied by an
opinion of counsel, in form and substance satisfactory to the Company, to the
effect that the proposed transfer does not result in a violation of the Act,
unless such transfer is covered by an effective registration statement under the
Act. The Purchaser understands that each certificate representing the Securities
will bear the following legend or one substantially similar thereto:
The securities represented by this certificate have not been
registered under the Securities Act of 1933. These securities
have been acquired for investment and not with a view to
distribution or resale, and may not be sold, mortgaged,
pledged, hypothecated or otherwise transferred without an
effective registration statement
for such shares under the Securities Act of 1933, or an opinion of
counsel satisfactory to the corporation that registration is
not required under such Act.
(d) The Purchaser understands the offering is being made pursuant to
the exemption from registration with the Securities and Exchange Commission (the
"Commission") afforded by Section 4 (2) of the Act and/or Regulation D adopted
by the Commission relating to transactions by an issuer not involving any public
offering, and similar federal, state, and foreign laws or policies.
Consequently, the memorandum and related offering materials have not been
subject to review and comment by the staff of the commission or by any state or
foreign securities commission.
(e) The Purchaser acknowledges that during the course of this
transaction and prior to sale, it has had the opportunity to ask questions of
and receive answers from the Company concerning the terms and conditions of its
investment, and to obtain any additional information of the same kind that is
specified in Part I of a Registration Statement on Form SB-2 under the Act, or
that is necessary to verify the accuracy of the other information obtained. The
Purchaser or its purchaser representative has examined the Memorandum and other
information furnished by the Company and, through discussions and examination of
such materials as the Purchaser has requested, has obtained sufficient
information upon which to make an investment decision. The Purchaser is familiar
with the type of investment which the shares constitute, and has reviewed the
merit and risks of this investment to the extent deemed advisable by the
Purchaser. The Purchaser has such knowledge and experience in financial and
business affairs that it is capable of evaluation the merits and risks of
investing in the shares, and acknowledges that it is able to bear the economic
risks of this investment. Further, the Purchaser understands all matters in this
Agreements.
(f) The investment in the Company by the Purchaser does not constitute
a principal portion of the Purchaser's total assets and the Purchaser is able to
afford a complete loss of the investment contemplated herein.
6. Covenants of the Company
6.1 Annual Reports. The Company agrees to use its best efforts to deliver to the
Purchaser, as soon as practicable after the end of each fiscal year and in any
event within 120 days thereafter, a consolidated balance sheet of the Company as
at the end of such fiscal year, a consolidated Statement of Cash Flow of the
Company for such year, prepared in accordance with generally accepted accounting
principles consistently applied and setting forth in each case in comparative
form the figures for the previous fiscal year, all in reasonable detail and
certified by independent public accountants selected by the Company.
6.2 Quarterly Reports. The Company agrees to deliver to the Purchaser as soon as
practicable after the end of each of the first three quarterly fiscal periods in
each fiscal year and in any event within 60 days thereafter, a consolidated
balance sheet of the Company as at the end of such period, a consolidated
statement of operations and a consolidated statement of Cash Flow of the Company
for such period, in each case prepared in accordance with generally accepted
accounting principles consistently applied and setting forth in comparative form
the figures for the corresponding periods of the previous fiscal year, all in
reasonable detail and certified, subject to changes resulting from audit
adjustments, by the principal financial or accounting officer of the Company.
6.3 Inspection. The Company agrees to permit any authorized representative of
the Purchaser to visit the Company to discuss its affairs and finances with its
officers, all upon reasonable notice to the Company, at such reasonable times
and as often as may be reasonably requested.
6.4 Purchaser's Right to Receive Reports. The Company shall deliver the reports
or give the rights specified in Paragraph 6.1, 6.2, and 6.3 to the Purchaser
until the earlier of: (i) the closing date of the Company's first underwritten
public offering pursuant to an effective registration statement filed under the
Act; or (ii) until the Purchaser no longer holds any shares.
7. No Waiver
7.1 Notwithstanding any of the representations, warranties, acknowledgments or
agreements made herein by the Purchaser, the Purchaser does not thereby or in
any other manner waive any rights granted to it under federal and state
securities laws.
8. Survival of Representation Warranties and Agreements
Notwithstanding any investigation made by any party to this Agreement,
all covenants, agreements, representations, and warranties made by the Company
and the Purchaser herein shall survive the execution of this Agreement, the
delivery to the Purchaser of the shares being purchased and the payment
therefor.
9. Conditions to Obligations of Purchaser
The obligation of the Purchaser to purchase the Shares on the dates of
the first closing and the second closing is subject to the fulfillment on or
prior to each such closing of the following conditions, any or all of which may
be waived at the option of the Purchaser:
9.1 Representations and Warranties Correct. The representations and warranties
made by the Company in Section 4 hereof shall be true and correct in all
material respects on the date of the first closing and the second closing with
the same force and affect as if they had been made on and as of the said dates.
9.2 Covenants. All covenants, agreements and conditions contained in this
Agreement to be performed by the Company on or prior to the date of the first
closing and second closing shall have been performed or complied with in all
material respects.
9.3 Opinion of Company's Counsel. The Purchaser shall have received from
Cadwalader, Xxxxxxxxxx & Xxxx, counsel to the Company, an opinion addressed to
it, dated the date of each closing substantially to the effect that:
(a) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Nevada, and has all
requisite corporate power and authority to own its properties and conduct its
business;
(b) The authorized capital stock of the Company consists of 20,000,000
shares of Common Stock, $0.01 per value per share;
(c) The certificates evidencing the Shares to be delivered hereunder
are in due and proper form under Nevada law, and when duly authorized and
delivered to the Purchaser or upon the Purchaser's order against payment of the
agreed consideration therefor in accordance with the provision of this
Agreement, the Shares represented thereby will be duly authorized and validly
issued, fully paid and nonassessable, will not have been issued in violation of
or subject to any preemptive rights or, to such counsel's knowledge, in
violation of any other rights to subscribe for or purchase securities;
(d) Assuming compliance by the Company and by the Purchaser with this
Agreement, the offer, sale and issuance of the Shares in conformity with the
terms of the Agreement will not require registration under the U.S. Securities
Act of 1933 as amended;
(e) The Company has the requisite corporate power and authority to
enter into this Agreement and to sell and deliver the Shares to be sold by it;
this Agreement has been duly and validly authorized by all necessary corporate
action by the Company, has been duly and validly executed and delivered by and
on behalf of the Company, and is a valid and binding agreement of the Company,
enforceable in accordance with its terms;
(f) The execution and performance of this Agreement and the
consummation of the transactions herein contemplated will not violate any
statute, rule or regulation, or, to such counsel's knowledge, any judgment,
decree or order of any court or governmental body having jurisdiction over the
Company or any of its property;
9.4 No Order Pending. There shall not then be in affect any order enjoining or
restraining the transactions contemplated by this Agreement.
9.5 No Law Prohibiting or Restricting Such Sale. There shall not be in effect
any law, rule or regulation prohibiting or restricting such sale, or requiring
any consent or approval of any person which shall not have been obtained to
issue the Shares.
9.6 Certificate Regarding Corporate Authority. The Company shall have delivered
to the Purchaser the resolutions of the company's Board of Directors authorizing
the execution and performance of this Agreement, in each case certified to be a
true and correct copy by the Secretary of the Company, together with the
certification that each resolution and actions have not been modified or amended
and remain in full force and effect.
9.7 Compliance Certificate. The Company shall have delivered to the Purchaser a
certificate executed on behalf of the Company by the Chairman of the Board and
Chief Executive Officer and Chief Financial Officer of the Company on each
closing date certifying to the fulfillment of the conditions specified in
Sections 9.1 and 9.2.
10. Conditions to Obligations of the Company.
The Company's obligation to sell and issue the shares at each Closing
is subject to the fulfillment on or prior to such closing of the following
conditions, any or all of which may be waived at the option of the Company:
10.1 Representations and Warranties Correct. The representations and warranties
made by the Purchaser in Section 5 hereof shall be true and correct in all
material respects on the date of such closing with the same force and affect as
if they had been made on and as of that date.
10.2 Covenants. All covenants, agreements and conditions contained in this
Agreement to be performed by the Purchaser on or prior to the date of such
closing shall have been performed or complied with in all material respects.
10.3 No Order Pending. There shall not then be in affect any order enjoining or
restraining the transactions contemplated by this Agreement.
10.4 No Law Prohibiting or Restricting Such Sale. There shall not be in effect
any law, rule or regulation prohibiting or restricting such sale, or requiring
any consent or approval of any person which shall not have been obtained to
issue the Shares.
11. Transferability
11.1 The Purchaser agrees not to transfer or assign this Share Purchase
Agreement, or any of its interest herein, and further agrees that any assignment
or transfer of the shares shall be made only in accordance with applicable
securities laws and that an appropriate legend with respect there to may be
placed by the Company on any certificate evidencing such Shares.
12. Miscellaneous
12.1 Notices. All notices or other communications given or made hereunder shall
be in writing and shall be delivered to the Purchaser at:
Middle East Specialized Cables Co.,
X.X. Xxx 00000
Xxxxxx 00000, Xxxxx Xxxxxx
or sent by facsimile transmission to #966-1-493-5818
and to the Company at:
000 Xxxxxxxx Xxxx
X.X. Xxx 000
Xxxxxxxxxx, XX 00000
or sent by facsimile transmission to (000) 000-0000
12.2 Governing Law. This Share Purchase Agreement shall be construed in
accordance with the governed by the laws of the Commonwealth of Massachusetts
without giving effect to the conflict of laws.
12.3 Entire Agreement. This Share Purchase Agreement constitutes the entire
agreement between the parties hereto with respect to the subject matter hereof
and may be amended only by a writing executed by all parties.
12.4 Changes. This Agreement may not be modified or amended except pursuant to
an instrument in writing signed by the Company and by the Purchaser.
12.5 Headings. The headings of the various sections of this Agreement have been
inserted for convenience of reference only and shall not be deemed to be part of
this Agreement.
12.6 Severability. In case any provision contained in this Agreement should be
invalid, illegal, or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein shall not in any way
be affected or impaired thereby.
12.7 Counterparts. This Agreement may be executed in two or more counterparts,
each of which shall constitute an original, but all of which when taken
together, shall constitute but one instrument, and shall become effective when
one or more counterparts, have been signed by each party hereto and delivered to
the other party.
12.8 Pronouns. All pronouns shall be deemed to refer to the masculine, feminine,
neuter, singular or plural as the identity of the person or persons, firm or
other entity may require in the context thereof.
IN WITNESS WHEREOF that parties hereto have caused this Agreement to be
executed by their duly authorized representatives the day and year first above
written.
MIDDLE EAST SPECIALIZED CABLES CO.
per:___/s/___________________________
FIBERCORE, INC.
per:___/s/___________________________
Witness: ___/s/_______________________
Xxxxxxx XxXxxx
