0000909518-01-500304.txt : 20011009
0000909518-01-500304.hdr.sgml : 20011009
ACCESSION NUMBER: 0000909518-01-500304
CONFORMED SUBMISSION TYPE: SC 13D/A
PUBLIC DOCUMENT COUNT: 5
FILED AS OF DATE: 20010921
GROUP MEMBERS: OLIMPIA S.P.A.
FILED BY:
COMPANY DATA:
COMPANY CONFORMED NAME: PIRELLI S P A
CENTRAL INDEX KEY: 0001156964
STANDARD INDUSTRIAL CLASSIFICATION: []
FILING VALUES:
FORM TYPE: SC 13D/A
BUSINESS ADDRESS:
STREET 1: VIALE SARCA 222 20126
CITY: MILAR ITALY
STATE: L6
ZIP: 00000
MAIL ADDRESS:
STREET 1: VIALE SARCA 222 20126
CITY: MILAR ITALY
STATE: L6
ZIP: 00000
SUBJECT COMPANY:
COMPANY DATA:
COMPANY CONFORMED NAME: TELECOM ITALIA S P A
CENTRAL INDEX KEY: 0000948642
STANDARD INDUSTRIAL CLASSIFICATION: COMMUNICATION SERVICES, NEC [4899]
IRS NUMBER: 000000000
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: SC 13D/A
SEC ACT: 1934 Act
SEC FILE NUMBER: 005-61827
FILM NUMBER: 1742446
BUSINESS ADDRESS:
STREET 1: CORSO D ITALIA 41
CITY: ROME 00198
STATE: L6
BUSINESS PHONE: 2123088799
MAIL ADDRESS:
STREET 1: 400 PARK AVENUE
CITY: NEW YORK
STATE: NY
ZIP: 10022
FORMER COMPANY:
FORMER CONFORMED NAME: STET SOCIETA FINANZIARIA TELEFONICA PA
DATE OF NAME CHANGE: 19950727
SC 13D/A
1
mv-13da2.txt
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
(Rule 13d-101)
(Amendment No. 2)
------------------------------
TELECOM ITALIA S.P.A.
(Name of Issuer)
ORDINARY SHARES OF EURO 0.55 PAR VALUE EACH 87927W10
(Title of class of securities) (CUSIP number)
ALEXANDER ROSENZWEIG, ESQ.
VICE PRESIDENT AND CHIEF LEGAL OFFICER
PIRELLI NORTH AMERICA, INC.
246 STONERIDGE DRIVE
SUITE 400
COLUMBIA, SOUTH CAROLINA 29210
(803) 951-1040
WITH A COPY TO:
ELLEN J. ODONER, ESQ.
WEIL, GOTSHAL & MANGES LLP
767 FIFTH AVENUE
NEW YORK, NEW YORK 10153
(212) 310-8000
(Name, address and telephone number of person authorized
to receive notices and communications)
SEPTEMBER 14, 2001
(Date of event which requires filing of this statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition that is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box
[ ].
Note: Schedules filed in paper format shall include a signed original
and five copies of the schedule, including all exhibits. See Rule
13d-7 for other parties to whom copies are to be sent.
(Continued on following pages)
(Page 1 of 10 Pages)
NY2:\1080170\03\N5GQ03!.DOC\67793.0060
-------------------------------------------------------------- -----------------------------------------------------
CUSIP No. 87927W10 13D Page 2 of 10
-------------------------------------------------------------- -----------------------------------------------------
--------------------- -----------------------------------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON PIRELLI S.p.A.
I.R.S. IDENTIFICATION NO. Not Applicable
OF ABOVE PERSON
--------------------- -----------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [X]
(b) [ ]
--------------------- -----------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------- ---------------------------------------------------------------------------- ------------------------------
4 SOURCE OF FUNDS: BK, WC
--------------------- -----------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e): [ ]
--------------------- -----------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION: Italy
--------------------- -----------------------------------------------------------------------------------------------------------
7 SOLE VOTING POWER: 0
NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON WITH
---------------------- ------------------------------------------------- ------------------------------
8 SHARED VOTING POWER: 2,891,656,682
(See Item 5)
---------------------- ------------------------------------------------- ------------------------------
9 SOLE DISPOSITIVE POWER: 0
---------------------- ------------------------------------------------- ------------------------------
10 SHARED DISPOSITIVE POWER: 2,891,656,682
(See Item 5)
--------------------- -----------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON: 2,891,656,682
(See Item 5)
--------------------- -----------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES: [ ]
--------------------- -----------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 54.96%
(See Item 5)
--------------------- -----------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON: CO
--------------------- -----------------------------------------------------------------------------------------------------------
-------------------------------------------------------------- -----------------------------------------------------
CUSIP No. 87927W10 13D Page 3 of 10
-------------------------------------------------------------- -----------------------------------------------------
--------------------- -----------------------------------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON Olimpia S.p.A.
I.R.S. IDENTIFICATION NO. Not Applicable
OF ABOVE PERSON
--------------------- -----------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [X]
(b) [ ]
--------------------- -----------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------- -----------------------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS: WC
--------------------- -----------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e): [ ]
--------------------- -----------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION: Italy
--------------------- -----------------------------------------------------------------------------------------------------------
7 SOLE VOTING POWER: 0
NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON WITH
---------------------- ------------------------------------------------- ------------------------------
8 SHARED VOTING POWER: See Item 5
---------------------- ------------------------------------------------- ------------------------------
9 SOLE DISPOSITIVE POWER: 0
---------------------- ------------------------------------------------- ------------------------------
10 SHARED DISPOSITIVE POWER: See Item 5
--------------------- -----------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON: See Item 5
--------------------- -----------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES: [ ]
--------------------- -----------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): See Item 5
--------------------- -----------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON: CO
--------------------- -----------------------------------------------------------------------------------------------------------
This Amendment No. 2 amends the Statement on Schedule 13D
dated August 9, 2001, as amended (as previously amended, the "Statement on
Schedule 13D"), filed by Pirelli S.p.A., a company incorporated under the laws
of the Republic of Italy ("Pirelli"), and, commencing with Amendment No. 1
thereto, Olimpia S.p.A., a company incorporated under the laws of the Republic
of Italy (the "Purchaser"), with respect to the ordinary shares, euro 0.55 par
value per share, of Telecom Italia S.p.A., a company incorporated under the laws
of the Republic of Italy. Capitalized terms used in this Amendment without
definition have the meanings ascribed to them in the Statement on Schedule 13D.
Pirelli, the Purchaser, Edizione Holding and, as discussed
in Items 3 and 6 below, UniCredito Italiano S.p.A. ("UCI") and IntesaBCI S.p.A.
("BCI") are members of a group with respect to the Telecom Italia Shares. This
Amendment constitutes a separate filing on Schedule 13D by Pirelli and the
Purchaser in accordance with Rule 13d-1(k)(2) under the Securities Exchange Act
of 1934. Pirelli and the Purchaser are responsible solely for the information
contained in their separate filing, except that information contained in the
Statement on Schedule 13D concerning the directors and officer of the Purchaser
nominated by Edizione Holding has been provided by Edizione Holding.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
On September 14, 2001, Pirelli, UCI and BCI entered into an
exchange of letter agreements (the "New Partners Agreement"), copies of which
are filed as Exhibits 8(a) and 8(b). Pursuant to the New Partners Agreement,
each of UCI and BCI (together, the "New Partners") severally agreed to purchase
from Pirelli shares of the Purchaser representing 10% of the Purchaser's present
share capital (and one-eighth of the number of shares of the Purchaser presently
held by Pirelli) for approximately euro 120 million. After giving effect to
these transactions, the share capital of the Purchaser will be held by Pirelli,
Edizione Holding, UCI and BCI, respectively, in the following proportions: 60%,
20%, 10% and 10%. As of September 14, 2001, it was contemplated that the
Purchaser would obtain the following funding on or before the Closing: (i) each
of the four shareholders of the Purchaser would participate, proportionately, in
a capital increase of approximately euro 5.2 billion (including paid-in-capital)
and (ii) Pirelli and Edizione Holding would provide shareholder financing of
approximately euro 800 million (in the respective proportions of 80% and 20%) on
the same terms as the Purchaser will obtain from external financial
institutions. The definitive funding arrangements for the Purchaser will be
provided by amendment.
On September 19, 2001, Pirelli, Edizione Holding and the
Purchaser entered into an agreement (the "Agreement with Bell Shareholders")
with the following shareholders of Bell who, between them, hold a majority of
the share capital of Bell (collectively, the "Majority Bell Shareholders"): Hopa
S.p.A., Interbanca S.p.A., G.P.P. International S.A., Banca Antoniana Popolare
Veneta Sarl. ("BAPV"), G.P. Finanziaria S.p.A., Monte dei Paschi di Siena S.p.A.
("MPS") and Unipol S.p.A. A copy of a joint press release issued by the
Purchaser and the Majority Bell Shareholders on September 19, 2001 is filed as
Exhibit 9. Pursuant to the Agreement with Bell Shareholders, the Purchaser's
4
acquisition of the Olivetti Securities from Bell will occur in two stages. On
September 27, 2001, the Purchaser will purchase from Bell 552,000,000 of the
Olivetti Shares covered by the Purchase Agreement and, on or before October 12,
2001, the Purchaser will purchase from Bell the remaining 1,000,662,120 Olivetti
Shares covered by the Purchase Agreement and all 68,409,125 Olivetti Warrants
covered by the Purchase Agreement. The prices to be paid for the Olivetti
Securities remain as set forth in the Purchase Agreement.
In the Agreement with Bell Shareholders, the Majority Bell
Shareholders agreed that, on the day on which the Purchaser purchases the second
tranche of Olivetti Securities (the "Second Closing Date"), they will cause Bell
to purchase and pay for bonds to be issued by the Purchaser in the aggregate
principal amount of the euro equivalent of Lit. 2 billion. The bonds will mature
on the sixth anniversary of the Second Closing Date and bear interest at an
annual rate of 1.5%, payable in cash at maturity. At maturity, the principal
amount of the bonds is to be repaid by delivery to Bell of an aggregate of
approximately 263,000,000 Olivetti Shares owned by the Purchaser.
In addition, the BAPV group has agreed to make a loan to
the Purchaser on the Second Closing Date of an amount which is the euro
equivalent of Lit. 500 billion and the MPS group has agreed to use its best
endeavors to arrange a loan to the Purchaser on the Second Closing Date of an
amount which is the euro equivalent of between Lit. 1.0 billion and 1.5 billion.
Each of these loans, which will be unsecured and non-recourse to the
shareholders of the Purchaser, will mature on the sixth anniversary of the
Second Closing Date and bear interest at an annual rate of Euribor plus 0.50.
On September 20, 2001, the European Commission approved the
transaction. In order to address the European Commission's competition concerns
arising from the transaction, Edizione Holding has undertaken to make certain
divestitures.
ITEM 4. PURPOSE OF TRANSACTION
On September 20, 2001, the Purchaser publicly announced
that, approval from the European Commission having been received, an outline of
the industrial and financial plan for the Olivetti-Telecom Italia group would be
presented to the financial community and the press on September 27, 2001. The
announcement also stated that the details of the strategic plan for the
Olivetti-Telecom Italia group would be completed and presented to the financial
community before the end of the year.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
(a) In the New Partners Agreement, UCI and BCI represented
that, as of September 13, 2001, UCI, including through its subsidiaries, owned
not more than 6,616,827 Olivetti Shares and held as pledgee, with the right to
vote, not more than 46,694,466 Olivetti Shares and BCI, including through its
subsidiaries, owned not more than 15,129,380 Olivetti Shares and held as
pledgee, with the right to vote, not more than 13,865,712 Olivetti Shares. These
5
shares represent approximately 2.1% and 1.9%, respectively, of the total number
of Olivetti Shares reported by Consob to be outstanding as of August 28, 2001.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUER
AGREEMENT WITH BELL SHAREHOLDERS
The description of the Agreement with Bell Shareholders
contained in Item 3 above is incorporated herein by reference.
AMENDMENT TO SHAREHOLDERS AGREEMENT
On September 14, 2001, concurrently with the execution of
the New Partners Agreement, Pirelli and Edizione Holding entered into a
conforming amendment to the Shareholders Agreement (the "Shareholders Agreement
Amendment"), a copy of which is filed as Exhibit 10. The Shareholders Agreement
Amendment amends the definition of a "Key Event" entitling one party to require
the other to purchase all its shares in the Purchaser at the price set forth in
the Shareholders Agreement (300% of the Transfer Price). As amended, a "Key
Event" is a substantial change, compared to the situation existing on September
14, 2001, in the structure of the control of Edizione Holding or Pirelli
(including, for these purposes, Pirelli & C.), so that persons, other than those
who currently have such power, have the power to appoint a majority of the
members of its Board of Directors, with a consequent potential change in the
strategic policies.
NEW PARTNERS AGREEMENT
Pursuant to the New Partners Agreement, Pirelli and each of
the New Partners have agreed that during the initial three year term of the New
Partners Agreement (described below), and to the extent permitted by law, each
of the New Partners will have the right to designate one of the members of the
Board of Directors of each of the Purchaser, Olivetti, Telecom Italia, Seat and
TIM. During any subsequent period during which the New Partners Agreement
remains in effect, the New Partners will each maintain the right to designate
one member to each Board of Directors provided that they collectively hold more
than 10% of the share capital of the Purchaser, but will be entitled to appoint,
between them, only one member to each Board of Directors if they collectively
hold 10% or less of the Purchaser's share capital.
Pirelli and each of the New Partners have agreed to consult
with each other (and, in doing so, to act in good faith and to take all
reasonable measures to reach consensus) with respect to the following (each, a
"Key Issue"):
(a) any issue that is to be determined by an extraordinary
general meeting of the Purchaser's shareholders;
(b) any resolution of the Board of Directors of the
Purchaser with respect to (i) a determination as to how the Purchaser will vote
its Olivetti Shares in any extraordinary general meeting of Olivetti's
6
shareholders, (ii) a determination as to how the Purchaser will vote its
Olivetti Shares with respect to certain resolutions relating to a tender offer
for Olivetti Shares proposed in any ordinary general meeting of Olivetti's
shareholders, (iii) any acquisition or disposition by the Purchaser of its own
shares, (iv) any acquisition or disposition by the Purchaser of securities
(including securities of Olivetti, Telecom Italia, Seat or TIM) with a value in
excess of euro 100,000,000, (v) any borrowings by the Purchaser from third
parties or (vi) any proposal to be submitted to any extraordinary general
meeting of the Purchaser's shareholders; and
(c) any resolution of the Board of Directors of Olivetti or
Telecom Italia with respect to (i) individual investments with a value in excess
of euro 300,000,000, (ii) any acquisition or disposition by Olivetti or Telecom
Italia, as applicable, of its own shares, (iii) any acquisition or disposition
of the securities of any affiliate of Olivetti or Telecom Italia, as applicable,
with a value in excess of euro 300,000,000, (iv) the disposition of any business
unit with a value in excess of euro 300,000,000, (v) any proposal to convene an
extraordinary general meeting of the shareholders of Olivetti or Telecom Italia,
as applicable, for certain specified purposes, including proposing to issue
securities, alter the company's share capital, effect any merger or dissolution
of the company or amend its corporate purposes, (vi) transactions with related
parties or (vii) transactions involving affiliates of Pirelli with a value in
excess of euro 50,000,000.
If, despite consulting with each other as required under
the New Partners Agreement, Pirelli and either or both of the New Partners are
unable to reach consensus with respect to any Key Issue, then such dissenting
New Partner will be required to abstain (or to cause its nominee to abstain)
from voting or otherwise participating at the relevant extraordinary general
meeting of shareholders or meeting of the Board of Directors. In that event, the
dissenting New Partner will have the option to require Pirelli to purchase all
(but not less than all) of the shares in the Purchaser that such New Partner
acquired pursuant to the New Partners Agreement (the "Applicable Holding") at a
price (the "Put Price") to be agreed by Pirelli and each of the New Partners, or
in the absence of such agreement, to be determined by two investment banks (one
of which is to be nominated by Pirelli, and the other to be nominated by the
dissenting New Partner) after reflecting both the economic value of the shares
and a control premium. If those two investment banks do not agree upon the Put
Price within 30 business days of their appointment, it is to be determined by a
third investment bank (to be selected by the other two investment banks or, in
the event that they are unable to agree, by the President of the Milan
Tribunal). In no event is the Put Price to be (i) lower than the price paid by
the New Partner to acquire the Applicable Holding, less the aggregate amount of
any dividends received from the Purchaser with respect thereto (the "Floor
Limitation") or (ii) higher than a price calculated on the assumption that the
Purchaser has experienced an annual gross internal rate of return of 15%, before
tax, less the aggregate amount of dividends received from the Purchaser with
respect to the Applicable Holding (the "Cap Limitation").
Pirelli and its affiliates are prohibited from acquiring
shares in Olivetti (or certain other securities that are convertible into, or
exercisable for, such shares). Each of the New Partners and their respective
affiliates are prohibited from acquiring and holding any such shares or other
7
securities (not already held) which represent in excess of 0.4% of the share
capital of Olivetti. In addition, the Purchaser is prohibited from purchasing
any such shares or other securities if, as a result thereof, the aggregate
number of such shares or other securities held, or deemed to be held under
Italian law, by the Purchaser would exceed the threshold (which is currently 30%
of the share capital of Olivetti) that, under Italian law, would require the
Purchaser to make a public offer for the securities of Olivetti.
The New Partners Agreement will become void ab initio if
the Closing Date has not occurred by January 31, 2002. Otherwise, the New
Partner Agreement will remain in effect for a period of three years, and if no
party thereto gives a notice of withdrawal in the manner prescribed in the New
Partners Agreement, it shall automatically be renewed for successive periods of
two years.
If Pirelli notifies the New Partners of its intention to
withdraw from the New Partners Agreement, then each of the New Partners will
have the option to require Pirelli to purchase all (but not less than all) of
its Applicable Holding at a price equal to the Put Price and subject to the
Floor Limitation and the Cap Limitation. If either (or both) of the New Partners
notifies Pirelli of its intention to withdraw from the New Partners Agreement
upon the expiration of the initial three year term of the New Partners
Agreement, then Pirelli will have the option to require such withdrawing New
Partner to sell to Pirelli all (but not less than all) of such withdrawing New
Partner's Applicable Holding at a price to be determined in the same manner as
the Put Price, except that the calculation of such price shall not take any
control premium component into account. If either (or both) of the New Partners
notifies Pirelli of its intention to withdraw from the New Partners Agreement
upon the expiration of any subsequent two year term of the New Partners
Agreement, then Pirelli will have the option to require such withdrawing New
Partner to sell to Pirelli all (but not less than all) of such withdrawing New
Partner's Applicable Holding at a price to be determined in the same manner as
the Put Price and subject to the Floor Limitation and the Cap Limitation.
If Pirelli & C. ceases to be in a position to control
Pirelli, then each of the New Partners will have the right to sell to Pirelli
all (but not less than all) of such New Partner's Applicable Holding at a price
equal to the Put Price, subject to the Floor Limitation and the Cap Limitation.
In the event that Pirelli intends to dispose of any of its shares in the
Purchaser with the result that Pirelli would hold less than a majority of the
Purchaser's share capital, each of the New Partners will be entitled to (i)
receive notice of such intention and (ii) require Pirelli to purchase from it
all (but not less than all) of such New Partner's Applicable Holding at a price
to be determined in the same manner as the Put Price, except that the
calculation of such price will be subject to the Floor Limitation, but not the
Cap Limitation.
Additional information about the New Partners Agreement
contained in Item 3 above is incorporated herein by reference.
8
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
8. (a) Letter, dated September 14, 2001, from UCI and BCI to
Pirelli [English translation];
(b) Letter, dated September 14, 2001, from Pirelli to UCI and
BCI [English translation];
9. Joint Press Release, dated September 19, 2001, issued by the
Purchaser and the Majority Bell Shareholders [English
translation]
10. Amendment, dated September 14, 2001, to the Shareholders
Agreement among Pirelli and Edizione Holding [English
translation]
9
SIGNATURE
After reasonable inquiry and to the best knowledge and
belief of the undersigned, the undersigned certifies that the information set
forth in this statement is true, complete and correct.
Date: September 21, 2001
PIRELLI S.p.A.
By: /s/ Anna Chiara Svelto
------------------------------------------
Name: Anna Chiara Svelto
Title: Attorney-in-fact
OLIMPIA S.p.A.
By: /s/ Luciano Gobbi
------------------------------------------
Name: Luciano Gobbi
Title: Director and Attorney-in-fact
10
EXHIBIT INDEX
Exhibit No. Description
----------- -----------
8. (a) Letter, dated September 14, 2001, from UCI and BCI to
Pirelli [English translation];
(b) Letter, dated September 14, 2001, from Pirelli to UCI and
BCI [English translation];
9. Joint Press Release, dated September 19, 2001, issued by the
Purchaser and the Majority Bell Shareholders [English
translation]
10. Amendment, dated September 14, 2001, to the Shareholders
Agreement among Pirelli and Edizione Holding [English
translation]
EX-99
3
ibp.txt
8(A)
Exhibit 8(a)
Milan, September 14, 2001
PIRELLI S.p.A.
Viale Sarca, 222
20126 - MILAN
Dear Sirs,
Pursuant to our conversations, we propose the following:
"INSTRUMENT BETWEEN PARTNERS
Between Pirelli S.p.A., with headquarters in Milan, Viale Sarca 222,
company capital 1,043,094,358.28 Euros, recorded with the Register of Companies
of Milan, Tax Code and VAT No. 00886890151, in the person of the chairman of the
Board of Directors, Dr. Marco Tronchetti Provera, in possession of the necessary
powers of attorney following the decision by the Board of Directors of July 28,
2001 (hereinafter "Pirelli")
- Party of the first part -
and
UniCredito Italiano S.p.A., with headquarters in Genoa, Via Dante 1,
Central Management in Milan, Piazza Cordusio, company capital 2,523,215,059
Euros, recorded with the Register of Companies of Genoa, Tax Code and VAT No.
00348170101, in the person of the Deputy General Director, Dr. Pietro Modiano,
in possession of the
necessary powers of attorney following the decision by the Board of Directors of
August 3, 2001 (hereinafter "UCI") and IntesaBCI S.p.A., with headquarters in
Milan, Piazza Paolo Ferrari 10, company capital 3,488,995,258.84 Euros, recorded
with the Register of Companies of Milan, Tax Code 00799960158, VAT No.
10810700152, in the person of Managing Director Lino Benassi, in possession of
the necessary powers of attorney following the decision by the Board of
Directors of September 14, 2001 (hereinafter "BCI")
- Party of the second part -
Given that
(a) on July 30, 2001, Pirelli and Edizione Holding S.p.A. (hereinafter
"Edizione") signed an offer for the acquisition, directly or through
subsidiaries to be designated by the Execution Date, as indicated
herein, by BELL S.A. of Olivetti Shares and Olivetti Warrants (as
defined in paragraphs 1.05 and 1.27, respectively);
(b) the offer of Pirelli and Edizione was accepted on the same date by BELL
S.A. and therefore the Contract (as defined in paragraph 1.06) was
drawn up. UCI and BCI (the "New Partners") took note of the Contract;
(c) in order to proceed with the acquisition of the Olivetti Shares and the
Olivetti Warrants, Pirelli and Edizione Finance International S.A.
(hereinafter "Edizione Finance" and together with Pirelli, the "Current
Partners") constituted, on August 3, 2001, the Company (as defined in
paragraph 1.22), held 20% (twenty percent) by Edizione Finance, a
company controlled by Edizione, and 80% (eighty percent) by Pirelli;
the Company is governed by the bylaws enclosed herewith under A (the
"Bylaws");
2
(d) on August 7, 2001, Pirelli and Edizione signed an Instrument for the
regulation of their mutual relations as partners of the Company. The
New Partners took note of the aforementioned agreement;
(e) based on the agreements between the Current Partners, dated August 9,
2001, the Company received a transfer from Kallithea S.p.A. (a
subsidiary of Pirelli) of 147,337,880 Olivetti common shares--equal to
approximately 2% of Olivetti's company capital--as well as from Pirelli
Finance (Luxembourg) S.A. (a subsidiary of Pirelli) and from Edizione,
for a total of 265,302,250 Olivetti common shares, equal to 3.64% of
Olivetti's company capital;
(f) on August 29, 2001, the Current Partners formally designated the
Company as a vehicle for the acquisition of the Olivetti Shares and the
Olivetti Warrants;
(g) on August 29, 2001, the shareholders' meeting of the Company decided,
among other things, on a capital increase (of 15,000 Euros--represented
by 15,000 shares with a par value of 1 Euro each, assigned to Pirelli
in the proportion of 80% (equal to 12,000 shares) and Edizione Finance
in the proportion of 20% (equal to 3,000 shares) to 576,936,635 Euros,
to take place including in several stages, and with split-up being
permitted, by allocating 576,921,635 Euros in cash and the issue of
576,921,635 new common shares with a par value of 1 Euro each, reserved
under option to shareholders in proportion to the number of shares
owned, with an issue premium of 9.40 Euros per share;
(h) the Current Partners have immediately underwritten and paid part of the
capital increase and respective issue premium, for a total of
1,199,985,020 Euros;
(i) following such underwriting and payment, 92,306,540 shares will be
issued in favor of Pirelli for a par value of 92,306,540 Euros,
3
and 23,076,635 shares in favor of Edizione Finance with a par value of
23,076,635 Euros;
(j) Pirelli has offered to UCI and BCI that each purchase a minority
interest in the Company; each of the New Partners wishes to purchase,
individually, a holding of 10% of the company's capital and therefore
to purchase from Pirelli, respectively, 11,539,817 shares and
11,539,817 shares of the Company, including the option rights
concerning the capital increase referred to in recital (g) so as to
allow for the underwriting and payment, under the conditions decided
upon by the Shareholders' Meeting referred to in item (g) of the
recitals, by each of the New Partners of 38,460,183 shares of the
Company with an expenditure of 399,985,903.20 Euros;
(k) Pirelli and the New Partners intend to agree on the principles of
acquisition and underwriting of a capital portion of the Company, as
well as the mutual relations as partners of said Company;
(l) Pirelli commits to obtain from Edizione Finance an irrevocable waiver
declaration in favor of UCI and BCI concerning all its rights and
claims in connection with the acquisition, respectively, of the Olimpia
UCI Holding and of the Olimpia BCI Holding (as defined below), as well
as a declaration of awareness, with waiver of any reservation,
concerning the commitments made by Pirelli versus the New Partners and
the rights and powers of the latter, acknowledged under this
Instrument, in particular with waiver by Edizione Finance, as of now,
of the preferred rights on the transfers under the sale and
acquisitions rights governed by this Agreement; this declaration will
be given by Pirelli to both New Partners as of the Execution Date.
Given these recitals,
4
which are an integral and essential part of the Agreement, it is set forth and
agreed as follows:
ARTICLE I
DEFINITIONS
In addition to the terms defined in other clauses of the Instrument (as defined
in paragraph 1.19), for the purposes thereof, the terms listed below have the
meaning specified next to it for each of them:
1.01 "Olimpia Capital Increase": the capital increase referred to in recital
(g) above.
1.02 "Current Partners": Edizione Finance and Pirelli, jointly.
1.03 "Olimpia BCI Shares": the shares of Olimpia acquired by BCI pursuant to
Article II, referred to in recital (j).
1.04 "Olimpia UCI Shares": the shares of Olimpia acquired by UCI pursuant to
Art. II, referred to in recital (j).
1.05 "Olivetti Shares": 1,552,662,120 common shares of Olivetti S.p.A.,
subject of the Contract.
1.06 "Contract": the offer dated July 30, 2001, from Pirelli and Edizione to
BELL S.A., accepted on the same date, concerning the purchase and sale
of the Olivetti Shares and the Olivetti Warrants.
1.07 "Execution Date": the second Business Day (as defined in paragraph
1.11) prior to the Closing Date of the Contract.
1.08 "Signing Date": date of signing of this Instrument.
1.09 "BCI Option Rights": the Option Rights of Olimpia acquired by BCI
pursuant to Art. II.
1.10 "UCI Option Rights": the Option Rights of Olimpia acquired by UCI
pursuant to Art. II.
5
1.11 "Business Day": any calendar day except Saturdays, Sundays and days the
banks are closed in the market of Milan for performance of their normal
activity.
1.12 "IRR" (gross Internal Rate of Return): discount rate on an annual base
and under compound capitalization, which makes the value of all
incoming cash flows equal to the value of the outgoing cash flows
related to the investment.
1.13 "New UCI Shares": shares arising from the Olimpia capital increase
underwritten by UCI pursuant to Article II below.
1.14 "New BCI Shares": shares arising from the Olimpia capital increase
underwritten by BCI pursuant to Article II below.
1.15 "Olivetti": the company Olivetti S.p.A., with headquarters in Ivrea,
Via Jervis No. 77.
1.16 "Olimpia UCI Holding": Olimpia UCI Shares and New Olimpia UCI Shares.
1.17 "Olimpia BCI Holding": Olimpia BCI Shares and New Olimpia BCI Shares.
1.18 "Party or Parties": Pirelli, UCI and BCI, jointly or separately.
1.19 "Instrument": the present Instrument, signed today between Pirelli, UCI
and BCI.
1.20 "Seat": the company Seat-Pagine Gialle S.p.A., with headquarters in
Milan, Corso di Porta Vigentina No. 33/35.
1.21 "Olivetti Companies": the companies Olivetti S.p.A., Telecom Italia
S.p.A., Telecom Italia Mobile S.p.A. and Seat-Pagine Gialle S.p.A.
1.22 "Company" or "Olimpia": the company Olimpia S.p.A., with headquarters
in Milan, Via Sarca, 122 (formerly Olimpia S.r.l.), which the Current
Partners constituted on August 3,
6
2001, for the acquisition of the Olivetti Shares and the Olivetti
Warrants.
1.23 "Telecom Italia": the company Telecom Italia S.p.A., with headquarters
in Turin, Via Bertola No. 34.
1.24 "TIM": the company Telecom Italia Mobile S.p.A., with headquarters in
Turin, Via Bertola No. 34.
1.25 "Olimpia BCI Securities": Olimpia BCI Shares and BCI Option Rights.
1.26 "Olimpia UCI Securities": Olimpia UCI shares and UCI Option Rights.
1.27 "Olivetti Warrants": 68,409,125 Olivetti 2001-2002 warrants, subject of
the Contract.
ARTICLE II
TRANSFER OF OLIMPIA UCI SECURITIES AND OLIMPIA BCI SECURITIES
AND UNDERWRITING OF THE NEW UCI SHARES AND THE NEW BCI SHARES
2.00 Without prejudice to the provisions of paragraph 10.1 below
concerning the perfecting and complete and regular closing of the
Contract as an essential condition of the agreements referred to in
this Instrument, the commitments made by UCI and BCI referred to
below are also subject to the condition that, on the Execution Date,
the Current Partners, pursuant to the provisions of paragraph 2.03
below, (i) have underwritten and paid the shares arising from the
Olimpia Capital Increase and (ii) have perfected and executed with
the Company the "subordinated partner financing."
2.01 Without prejudice to the provisions of paragraph 10.1 below, UCI and
BCI pledge, not jointly, to purchase from Pirelli, as of the
Execution Date, respectively, the UCI Olimpia Shares and the UCI
7
Option Rights (hereinafter the "Olimpia UCI Securities") as well as
the Olimpia BCI Shares and the BCI Option Rights (hereinafter the
"Olimpia BCI Securities") under the following terms and conditions:
2.01.01 Total Price of Olimpia UCI Securities and Olimpia BCI
Securities.
(a) Olimpia UCI Securities will be sold by Pirelli and
purchased by UCI at the total price agreed upon, including
in an aleatory manner, of 120,014,096.8 Euros (the "Total
UCI Price").
(b) The Olimpia BCI Securities will be sold by Pirelli and
purchased by BCI at the total price agreed upon, including
in an aleatory manner, of 120,014,096.8 Euros (the "Total
BCI Price").
2.01.02 Payment Time and Terms.
On the Execution Date, UCI and BCI will pay to Pirelli,
respectively, the Total UCI Price and the Total BCI Price
by separate fund credits, valued as of the Execution Date,
to the checking account with Banca Nazionale del Lavoro,
No. 28301 ABA 01005 CAB 01600 in the name of "Pirelli
S.p.A."
2.01.03 Transfer of Olimpia UCI Securities and Olimpia BCI
Securities.
The Transfer of the Olimpia UCI Securities and Olimpia BCI
Securities will take place, simultaneously on the
Execution Date, at the same time with the payment of the
Total UCI Price and the Total BCI Price, without need for
any further expression of will between the parties, and
will be valid between the parties as of that moment.
8
On the same date, at the same tine, all acts necessary or
appropriate will be carried out pursuant to applicable
law--including tax law--in order to perform the transfer
of the Olimpia UCI Securities and the Olimpia BCI
Securities, making it valid for third parties as well,
including the following actions: (a) Pirelli:
(i) will deliver to UCI and BCI the certificates
representing, respectively, the Olimpia UCI
Shares and the Olimpia BCI Shares, duly
endorsed in favor of UCI and BCI, by
appropriate methods, based on applicable laws
in the matter, to transfer to UCI and BCI full
title and full availability of the Shares and
allow the registration of UCI and BCI in the
book of partners of Olimpia, as well as the
option warrants representing the BCI Option
Rights and the UCI Option Rights;
(ii) will sign and exchange and/or cause signature
and exchange of all other acts and documents
(including tax stamps, whenever necessary) that
may be required pursuant to the law;
(iii) will deliver to each of the New Partners an
original of the declaration under the signature
of Edizione Finance, as referred to in recital
(l);
(b) UCI and BCI, each to the extent applicable:
(i) will pay to Pirelli, respectively, the Total
UCI Price and the Total BCI Price;
9
(ii) will sign and exchange all other acts and
documents (including tax stamps, whenever
necessary) that may be required pursuant to the
law;
2.01.04 Expenses and charges.
All expenses, costs and charges, including those of a
fiscal nature, related to the transfer of the Olimpia UCI
Holding and of the Olimpia BCI Holding will be borne half
by UCI and BCI, and the other half by Pirelli.
2.02 Without prejudice to the provisions set forth in paragraph 10.1
below, on the Execution Date, UCI and BCI pledge, non-jointly, to
underwrite and pay the Capital Increase of Olimpia, respectively, (i)
with a par value of 38,460,183 Euros, equal to 38,460,183 new Olimpia
shares (the "New UCI Shares") with a total disbursement of
399,985,903.2 Euros, and (ii) with a par value of 38,460,183 Euros,
equal to 38,460,183 new Olimpia shares, with a total disbursement of
399,985,903.2 Euros (the "New BCI Shares").
2.03 At the same time with the underwriting of the Capital Increase of
Olimpia, (i) each of the New Partners, to the extent applicable,
pledges to pay fully the New Olimpia BCI Shares and the New Olimpia
UCI Shares, and (ii) Pirelli and Edizione Finance (whose performance
is guaranteed by Pirelli pursuant to Art. 1381 of the Civil Code), to
the extent applicable, will waive and refrain from underwriting and
paying the residual portion of the Capital Increase, with a par value
of 76,936,635 Euros, equal to 76,936,635 shares, so as to assure
that, at the end of the execution of the Capital Increase, Pirelli
will hold 60%, Edizione
10
Finance 20%, and each of the New Partners 10% of the new capital of
the Company. Pirelli and Edizione Finance will pay to the Company, in
the form of "subordinated partners financing" under the same rate
conditions as those established for the financing granted by the pool
of banks, an amount equal to 800,141,004 Euros.
2.04 Pirelli will take steps so that, within 30 (thirty) Business Days of
the Execution Date, the Bylaws are amended so as to set forth the
qualified quorum of 91% of the capital for the validity of the
decisions to amend or eliminate the list voting clause for the
appointment of the directors, as well as to modify the number of the
members of the Board of Directors.
ARTICLE III
MANAGEMENT OF THE COMPANY
3.01 Composition of the Board of Directors.
It is understood that, within the limits allowed by law and for the
entire term of this Instrument:
(i) the Board of Directors of the Company will be made up of
10 (ten) members;
(ii) 1 (one) director out of 10 (ten) will be appointed at the
request and indication of UCI;
(iii) 1 (one) director out of 10 (ten) will be appointed at the
request and indication of BCI;
(iv) should an Executive Committee be created, UCI and BCI will
have, respectively, the right to request at any time the
inclusion of the directors designated by them in said
committee.
11
The new Board of Directors, with the composition indicated
above, must be appointed by the Execution Date of the
Contract. It is understood that the power of UCI and BCI to
designate, each, a member of the Board of Directors of the
Company will remain valid even after the first expiration
of this Instrument, if it is extended pursuant to Art. 10.2
(a), provided UCI and BCI hold, jointly, a percentage of
the company capital above 10%. However, if the joint
holding of BCI and UCI in the company capital is 10% or
less, then BCI and UCI may designate, jointly, only one
director.
3.02 Suspension from Office.
Whenever, for any reason, including death, resignations or revocation
by the shareholders' meeting, one of the directors appointed pursuant
to the preceding provisions is suspended from office, within the
limits allowed by law, the replacing director must be appointed by
the Company's Shareholders' Meeting (and prior to this, by
co-optation of the Board of Directors) in the person indicated by the
New Partner which had previously designated the suspended director.
ARTICLE IV
MANAGEMENT OF THE OLIVETTI COMPANY
4.01 Composition of the Board of Directors of the Olivetti Company.
12
It is understood that, within the limits allowed by law and for the
entire term of this Instrument, in the Board of Directors of
Olivetti, Telecom, Seat and TIM (the "OLIVETTI COMPANIES"), one
director must be appointed at the request and designation of UCI and
another director at the request and designation of BCI.
The new Board of Directors of the Olivetti Companies, with the
composition established above, will be appointed as soon as possible,
and in any case within 120 (one hundred twenty) days of the Execution
Date of the Contract. It is understood that the power of UCI and BCI
to designate, each, a member of the Board of Directors of Olivetti
Companies will remain valid even after the first expiration of this
Instrument, if it is extended pursuant to Art. 10.2 (a), provided UCI
and BCI hold, jointly, a percentage of the company capital above 10%.
However, if the joint holding of BCI and UCI in the company capital
is 10% or less, then BCI and UCI may designate, jointly, only one
director.
4.02 Suspension from Office.
Whenever, for any reason, including death, resignations or revocation
by the shareholders' meeting, one of the directors appointed pursuant
to the preceding provisions is suspended from office, within the
limits allowed by law, the replacing director must be appointed by
the Company's Shareholders' Meeting (and prior to this, by
co-optation of the Board of Directors) in the person indicated by the
New Partner which had previously designated the suspended director.
13
ARTICLE V
BOARD OF AUDITORS OF THE COMPANY
Upon the first renewal, the Parties will consider introducing a principal
auditor of the Company, designated jointly by the New Partners.
ARTICLE VI
KEY ISSUES
Pursuant to Art. VII below, the following will be deemed Key Issues:
a) the decisions of the Extraordinary Shareholders' Meeting and those of
the Board of Directors of the Company, the latter referring to the
following:
- indication as to how to vote in Olivetti's Ordinary
Shareholders' Meeting on Key Issues, for the purposes of
the application of Articles 104 or 107 T.U. No. 58 of
February 24, 1998, and in matters of acquisition of own
shares, as well as voting in Olivetti's Extraordinary
Shareholders' Meeting;
- acquisition, sale and acts of disposal under any status
(i) of own shares in any amount and (ii) holdings
(including shares and financial instruments of any type
issued by Olivetti and/or the Olivetti Companies) at a
value, by individual operation, above 100,000,000 Euros;
- determination of the ratio between equity and debt
of the Company and methods, terms and conditions for
resorting to outside financing sources;
- draft proposals to be submitted to the Company's
Extraordinary Shareholders' Meeting;
14
b) resolutions of the Board of Directors of Olivetti and Telecom,
referring to:
- individual investments above 300 million Euros;
- acquisition, sale and acts of disposal under any status
(i) of own shares in any amount and (ii) affiliate and
subsidiary holdings (including shares and other financial
instruments issued by the Company or the Olivetti
Companies) at a value, by individual operation, above 300
million Euros;
- acts of disposal under any status of companies or branches
thereof, with an individual value above 300 million Euros;
- proposals to call the Extraordinary Shareholders' Meeting
for resolutions in matters of modification of the
corporate purpose, capital operations of any nature,
merger, spin-off, transformation and dissolution;
- operations between Olivetti, Telecom and Gruppo Pirelli,
with an individual value above 50 million Euros;
- operations with related parties.
ARTICLE VII
PROVISIONS ON DEADLOCK
7.01 Obligation to Consult.
Pirelli and the New Partners, the latter jointly between them, pledge
to consult each other previously whenever a decision on one of the
Key Issues must be discussed or decided upon.
7.02 Identification of Deadlock Situations.
For the purposes of this Article VII, "DEADLOCK" is defined as a
situation of disagreement, expressed in the previous consultation
15
between Pirelli, on the one hand, and one or both of the New
Partners, on the other hand, on a Key Issue that must be discussed by
one of the corporate management bodies referred to in item (a) or (b)
of Article VI above.
7.03 Procedure.
(a) For compliance with the obligation referred to in paragraph
7.02 above, Pirelli and the New Partners, jointly, pledge to
meet or to consult each other previously by telephone
conference or video conference by the Business Day preceding
the day scheduled for the meeting of the Board or of the
shareholders of the Company, or of the Board of Olivetti or
Telecom, or, immediately, as soon as the news arrive, in the
event of urgent call (or extraordinary urgency, if applicable)
of the meeting of the board of the Company or of Olivetti or
Telecom, pursuant to the applicable bylaws provisions.
(b) In the consultation referred to in this paragraph, Pirelli and
the New Partners will take all reasonable steps to reach an
agreement and/or identify common grounds for the issues
submitted for their examination, pledging, for this purpose,
to act in good faith.
(c) The unjustified absence of a single New Partner or both the
New Partners in the previous consultation stage implies
acceptance of the decisions made by the other subjects and
imposes on the absent subject the obligation of accepting and
respecting such decisions.
7.04 Manifestation of Will.
16
(a) Whenever, in the previous consultation referred to in
paragraphs 7.02 and 7.03 above, Pirelli and the New Partners
reach an agreement concerning the issues under consultation,
they are obligated to manifest their will in the competent
venues pursuant to the provisions below:
(i) by giving a common representative delegation to
participate in the Company's Extraordinary
Shareholders' Meeting and casting the vote in said
meeting, in accordance with the decision reached;
(ii) causing their own representatives in the Board of
Directors of the Company and of Olivetti or Telecom to
participate in the meeting of the board, casting the
vote in this venue in accordance with the joint
decisions reached in the previous consultation.
(b) However, in the absence of agreement of the issues under
consultation, the New Partners, if both are dissenting will be
jointly obligated, or the single dissenting New Partner will
be obligated, to abstain or cause abstention from
participating in the shareholders or board meeting and to vote
in this venue or cause voting and/or abstain from manifesting
its will, in any venue and mode, or from taking a position in
the issue under the previous consultation, without prejudice
to the provisions of item (c) below.
(c) Whenever the situation described in item (b) above occurs, the
dissenting New Partners, separately or jointly, will have, or
the single dissenting New Partner will have, the right to send
to Pirelli, by telegram or registered letter, pursuant to
17
paragraph 12.02, a "NOTICE OF DEADLOCK" within 15 (fifteen)
days of the end of the consultation referred to in paragraph
7.03.
7.05 Rights of the New Partners.
(a) Whenever UCI and/or BCI send a Notice of Deadlock pursuant to
item (c), paragraph 7.04, the New Partner which sent the
Notice of Deadlock will have the right (which is deemed
exercised by Pirelli's receipt of the Notice of Deadlock,
pursuant to item (c), paragraph 7.04 above) to sell to
Pirelli, which will have the corresponding obligation to buy
from the respective New Partner, respectively, all but not
part of the Olimpia UCI Holding and/or all but not part of the
Olimpia BCI Holding at a price determined pursuant to the
provisions in item (b) below.
(b) For the purposes of item (a) above, the Parties agree,
including in an aleatory manner, that the object of the
decision must be: (x) the price of the Olimpia BCI Holding
and/or Olimpia UCI Holding, corresponding proportionately to
the value of the Company's economic capital ("Price of the
Olimpia UCI Holding" and/or "Price of the Olimpia BCI
Holding"), as well as (y) an increase expressing the
proportion of the increase premium, as if the Olimpia BCI
Holding and/or Olimpia UCI Holding were the expression of
Olivetti's control, assuming that the latter controls Telecom
and the companies controlled by the latter ("Premium"). The
"Price of the Olimpia UCI Holding" and/or "Price of the
18
Olimpia BCI Holding" and the Premium to be proportionately
allocated to both the Holdings will be determined by mutual
consent between Pirelli and each of the New Partners within 10
(ten) Business Days of the date Pirelli received from one of
the New Partners the notice pursuant to item (a) above or, in
the absence of such agreement, from two "investment banks"
with international standing, chosen one by Pirelli (paying the
respective costs) and one by the New Partner that sent the
Notice of Deadlock (paying the respective costs), with the
understanding that if an agreement on the valuation is not
reached within 30 (thirty) Business Days of their appointment,
it will be made by a third and additional "investment bank"
(the costs of which will be paid half by Pirelli and the other
half by the Seller(s)/New Partner(s) of a similar standing,
chosen by agreement of those already appointed at the time the
task is assigned by Pirelli and by the New Partner that sent
the Notice of Deadlock or, in the absence of agreement, by the
Chief Justice of the Court of Milan. The Chief Justice of the
Court of Milan (in the order and in the terms indicated above)
will also be asked to appoint the "investment banks" that
Pirelli or the New Partner that sent the Notice of Deadlock
failed to appoint or replace in the event of subsequent
termination of the task. Whenever both New Partners sent the
Notice of Deadlock, the New Partners will be obligated to
appoint a single "investment bank" by mutual consent.
(c) The valuations referred to in item (b) above and therefore
the Price of the Olimpia BCI Holding and/or the Price of the
19
Olimpia UCI Holding and the Premium determined on that basis
will be definitively binding for the Parties, pursuant to
Articles 1349 and 1473 of the Civil Code for the purchase and
sale referred to in item (a) above.
(d) It is furthermore agreed, including in an aleatory manner,
that the price owed by Pirelli will not be lower than the
amounts paid by the New Partner for the acquisition and
underwriting of shares in the Company, less any dividends
received ("FLOOR"), nor higher than an amount which implies,
in connection to the same amounts, less any dividends
received, an annual IRR, including taxes, equal to 15%
("CAP").
(e) The purchase and sale will be closed within 30 (thirty)
Business Days of the Parties' receipt of the communication
concerning the valuation referred to in item (b) above, and
the price referred to in items (b) and (d) above must be paid
in cash, at the same time with the transfer of the Olimpia BCI
Holding and/or the Olimpia UCI Holding referred to in
paragraph 7.06.
7.06 Transfer.
If the Olimpia BCI Holding and/or the Olimpia UCI Holding should be
purchased and sold pursuant to paragraph 7.05 (a), the following
provisions will apply:
(i) the Olimpia BCI Holding and/or the Olimpia UCI Holding will be
deemed transferred with regular enjoyment as of the date
referred to in item (iii) below;
(ii) the ownership right in the Olimpia BCI Holding and/or the
Olimpia UCI Holding purchased and sold will be deemed
20
transferred to the buyer as of the date referred to in item
(iii) below;
(iii) the transfer of the Olimpia BCI Holding and/or the Olimpia UCI
Holding and the payment of the respective price will take
place at the headquarters of the Company, at 11:00 a.m. on the
5th (fifth) Business Day after the date the purchase and sale
is deemed closed pursuant to paragraph 7.05 (e), in
compliance, whenever applicable, with the possible
authorizations from the competent authorities with
jurisdiction over the Parties in connection with the purchase
and sale;
(iv) in the act of transfer and payment referred to in item (iii)
above, the Olimpia BCI Holding and/or the Olimpia UCI Holding
will be free of prejudicial pledges, liens, encumbrances or
rights of third parties of any nature; including in light of
the absence of any managerial role of the New Partners and in
an aleatory manner, the purchase and sale will take place
without any further and different guarantee and responsibility
of UCI and/or BCI, including the value, situation and
activities of the Companies and their affiliates;
(v) the expenses, charges and indirect taxes levied on the
purchase and sale of the Olimpia BCI Holding and/or the
Olimpia UCI Holding will be paid by the buyer;
(vi) however, the taxes on any capital gains obtained by the seller
will be paid by the latter;
(vii) at the time of the transfer of the Olimpia BCI Holding and/or
the Olimpia UCI Holding and the payment of the respective
price, the seller will deliver to the buyer the resignations
of
21
the directors and, whenever possible, of the auditors of the
Company and of the Olivetti Companies designated by it.
ARTICLE VIII
COLLATERAL ACQUISITIONS
8.01 Commitment of the Parties.
(a) UCI and BCI declare that, as of September 13, 2001, including
through their respective subsidiaries, pursuant to Art. 2359,
first paragraph, c.c., they own Olivetti shares (including
Olivetti's voting rights held under any status), in an amount
not exceeding, respectively, 6,616,827 Olivetti shares in
ownership and 46,694,466 Olivetti shares in pledge with voting
right, concerning UCI, and 15,129,380 Olivetti shares in
ownership and 13,865,712 Olivetti shares in pledge with voting
right, concerning BCI.
(b) For the entire term of this Instrument, the parties, including
through their respective subsidiaries and/or parent companies,
pursuant to Art. 2359, first paragraph, c.c., may not acquire
Olivetti shares, bonds convertible to Olivetti shares and/or
Warrants giving right to acquire shares or bonds convertible
to Olivetti shares, issued by Olivetti or by the Olivetti
Companies (including Olivetti's voting rights held under any
status). It is, however, permitted to UCI and BCI to acquire
and hold such securities within said limit, for each of them,
of 0.40% of Olivetti's capital, as of the Execution Date.
(c) Unless otherwise agreed upon in writing between the Parties,
the Company may not purchase shares and bonds and instruments
indicated in item (a) above in excess of the
22
threshold set forth therein, currently established at 30%
(thirty percent), while also taking into account the incidence
for this purpose of the securities referred to in item (b)
above, held by BCI and UCI, as well as own shares held
directly and indirectly, as set forth in the current laws and
regulations, including the instructions issued by CONSOB.
ARTICLE IX
PENALTY FOR BREACH
In the event of breach of one or several commitments made pursuant to the
provisions of this Instrument, the breaching Party, at the simple written
request of the Parties or of the other Party, and without prejudice to any other
of its/their rights (including the right to higher damages), will be obligated
to pay, as penalty, to the complying party or complying Parties, which will take
care of distribution internally, a single and total amount equal, for each
breach, to 5% (five percent) of the amounts paid by the breaching Party for the
acquisitions and subscriptions of shares made in the Company as of that date.
ARTICLE X
TERM
10.01 Effective Date.
The efficacy and validity of this Instrument are subject to complete
and regular execution of the Contract and therefore,
23
secondary to obtaining the necessary authorizations, including in
compliance with antitrust regulations, for the acquisition by the
Company of the entire holding in Olivetti represented by the Olivetti
Shares and Olivetti Warrants as set forth therein. It is, however,
understood that in the event of failure to execute the Contract
completely and regularly by January 31, 2002, this Instrument will be
deemed cancelled ipso jure, effective ex tunc and, at the simple
request of UCI and/or BCI, Pirelli will be obligated (i) to acquire
the entire Olimpia BCI Holding and the entire Olimpia UCI Holding at
a price exactly identical to that possibly already paid by UCI and
BCI for the acquisition of the Olimpia UCI Shares, Olimpia BCI
shares, the new UCI Shares and the New BCI Shares, as well as (ii) to
release UCI and BCI from any commitment possibly already made to the
Company.
10.02 Term.
(a) This Instrument will have a term of three years from the
Execution Date of the Contract and will be deemed tacitly
renewed from time to time on expiration for the following two
years, in the absence of an opt-out notice from one of the
Parties, without prejudice to the provisions of paragraph
10.03 below.
(b) Except in the cases required by law, each of the Parties may
opt out of this Instrument before every expiration, with
notice sent 6 (six) months in advance.
10.03 Absence of Renewal.
(a) If, before the first expiration of this Instrument or
successive ones, Pirelli should send to the New Partners,
jointly or
24
separately, in the terms set forth in paragraph 12.02, the
opt-out notice referred to in item (ii), paragraph 10.02 (b)
above, UCI and BCI will individually have the right to send to
Pirelli which, upon simple request, will have the
corresponding obligation to acquire, respectively, all but not
part of the Olimpia UCI Holding and Olimpia BCI Holding held
by the New Partner which exercised the option right set forth
herein, under terms and conditions determined, mutatis
mutandis, pursuant to paragraph 7.05 (b) above (and the
provisions mentioned therein), giving notice to Pirelli within
30 (thirty) Business Days.
In all events, it is agreed, including in an aleatory manner,
that the price owed by Pirelli will not be lower than the
amounts paid by the New Partner for the acquisitions and
subscriptions of shares in the Company, less any dividends
received ("FLOOR"), nor higher than an amount which implies,
in connection to the same amounts, less any dividends
received, an annual IRR, including taxes, equal to 15%
("CAP"). The aforementioned price will be paid in cash.
(b) If, on the first expiration date of this Instrument, both or
one of the New Partners should, jointly or separately, send to
Pirelli, in the terms set forth in paragraph 12.02, the
opt-out notice referred to in item (i), paragraph 10.02 (b)
above, Pirelli will have the right to acquire from both New
Partners opting out, or from the single New Partner opting
out, which, upon simple request, will have the corresponding
obligation to sell, respectively, all but not part of the
Olimpia UCI
25
Holding and Olimpia BCI Holding held by the New Partner which
exercised the opt out right set forth herein, under terms and
conditions determined, mutatis mutandis, pursuant to paragraph
7.05 (b) above (and the provisions mentioned therein), less
the Premium, giving notice to the New Partner which sent the
opt-out notice, within 30 (thirty) Business Days.
(c) If both or one of the New Partners should send to Pirelli, in
the terms set forth in paragraph 12.02, on the expiration of
the first renewal in the following two years, the opt-out
notice referred to in paragraph 10.02 (a) above, and
therefore, on the expiration of the fifth year after the
effective Date of this Instrument, or on the successive
additional expiration dates, both New Partners opting out,
jointly or separately, or the single New Partner opting out,
will have the right to sell to Pirelli, which, upon simple
request, will have the corresponding obligation to acquire,
respectively, all but not part of the Olimpia UCI Holding
and/or all but not part of the Olimpia BCI Holding held by the
New Partner which exercised the opt out right set forth
herein, under terms and conditions determined, mutatis
mutandis, pursuant to paragraph 7.05 (b) above (and the
provisions mentioned therein), giving notice to the New
Partner that sent the opt-out notice, within 30 (thirty)
Business Days.
In all events, it is agreed, including in an aleatory manner,
that the price owed by Pirelli will not be lower than the
26
amounts paid by the New Partner for the acquisitions and
subscriptions of shares in the Company, less any dividends
received ("FLOOR"), nor higher than an amount which implies,
in connection to the same amounts, less any dividends
received, an annual IRR, including taxes, equal to 15%
("CAP").
(d) The payment of the amount referred to in item (a), (b) or (c)
above must be made (i) immediately, at the simple written
request of UCI and/or BCI to be sent to Pirelli at the end of
the term of 30 (thirty) days from the communication sent to
the Parties as to the decision made by the procedure referred
to in paragraph 7.05 (b) above, and (ii) at the same time with
the transfer of the Olimpia UCI Holding and/or the Olimpia BCI
Holding.
ARTICLE XI
CHANGES IN STOCKHOLDING
11.1 For the purposes of this paragraph, "Change of Control" means a
substantial modification in the direct and indirect stockholding
control of Pirelli, which means the stoppage of the control of
Pirelli & C s.a.p.a. over Pirelli S.p.A., as exercised today. If the
Change of control occurs, each of the New Partners will have the
right to transfer, respectively, all but not part of the Olimpia UCI
Holding and/or all but not part of the Olimpia BCI Holding owned by
Pirelli which, upon simple request, will have the obligation to
acquire, under terms and conditions determined, mutatis mutandis,
pursuant to paragraph 7.05 (b) above (and the
27
provisions mentioned therein), giving notice to Pirelli within 30
(thirty) Business Days of the date the New Partners, separately or
jointly, declared in writing that they have learned about the Change
of Control, or received written communication about this
circumstance. It is, however, agreed, including in an aleatory
manner, that the price owed by Pirelli will not be lower than the
amounts paid by the New Partner for the acquisitions and
subscriptions of shares in the Company, less any dividends received
("FLOOR"), nor higher than an amount which implies, in connection to
the same amounts, less any dividends received, an annual IRR,
including taxes, equal to 15% ("CAP").
11.2 If Pirelli intends to divest, in any form, part of its holding in the
Company, so that Pirelli would hold less than a majority of the
capital thereof, Pirelli may not sign any agreement in this sense,
being first obligated to give prior timely notice to both the New
Partners about the planned transfer, fully indicating the terms and
conditions of the transfer operation and any possible outside
agreements (of blockage and vote) with the buyers. Within 30 (thirty)
Business Days of receipt of the aforementioned communication, UCI
and/or BCI will, individually, have the right to sell to Pirelli,
which, upon simple request, will have the corresponding obligation to
acquire, respectively, all but not part of the Olimpia UCI Holding
and/or all but not part of the Olimpia BCI Holding held by the New
Partner that exercised the Option
28
Right set forth herein, under terms and conditions determined,
mutatis mutandis, pursuant to paragraph 7.05 (b) above, with the
understanding, including in an aleatory manner, that the price owed
by Pirelli will not be lower than the amounts paid by the New Partner
for the acquisitions and subscriptions of shares in the Company, less
any dividends received ("FLOOR").
ARTICLE XII
GENERAL PROVISIONS
12.01 Amendments.
Any amendment to this Instrument will be valid and binding only if it
arises from a written document signed by each of the Parties
concerned.
12.02 Communications and Notices.
Any communication required or allowed by the provisions of this
Instrument must be made in writing, and will be deemed efficiently
and validly made upon its receipt, if sent by letter or telegram, or
at the time of the acknowledgement of receipt by the appropriate
declaration (including by fax), if by fax, provided it is addressed
as follows:
(i) if to UCI, to the following address:
Via San Protaso No. 3
20121 MILAN
Attn.: Dr. Pietro Modiano
Fax No. 02-88622196
29
(ii) if to BCI, to the following address:
Piazza Paolo Ferrari No. 11
20121 MILAN
Attn.: Managing Director Lino Benassi
Fax No. 02-88503086
(iii) if to Pirelli, to the following address:
Viale Sarca No. 222
20126 MILAN
Attn.: Dr. Carlo Buora
Fax No. 02-64423454
or to a different address, which each Party has the right to
communicate to the other, by the methods set forth in this paragraph
12.02; it is understood that the aforementioned addresses or
different addresses that may be communicated in the future, are also
elected by the Parties as their own domicile for al aspects related
to this Instrument, including possible legal notices or notices
related to the arbitration proceeding referred to in Article XIII
below.
12.03 Tolerance.
Any possible tolerance of acts committed in violation of the
provisions hereof does not constitute a waiver of the rights arising
from the provisions violated, nor of the right to require exact
performance of all terms and conditions hereof.
12.04 Headings.
The headings of the individual articles are included for the sole
purpose of facilitating their reading and therefore must not be
30
taken into consideration in any way for the interpretation of this
Instrument.
12.05 Allocation of Option Rights.
The Parties mutually acknowledge and agree that the compensation for
the mutual rights to buy and sell governed by this Instrument was
considered in the framework of the transfer values and prices of the
respective holdings, so that, for the allocation of said rights, no
further and other compensation is planned or intended.
12.06 Exercise of Rights and Performance of Obligations.
It is understood that (i) all rights allocated under this Instrument
to UCI and BCI must be deemed enforceable also individually, whenever
not otherwise specified in this Instrument, and the failure to
exercise its right by one of the New Partners may not be interpreted
as a waiver thereof; (ii) in the event of failure to exercise or
waiver by one of the New Partners of the right to designate a
director, this right may be exercised in its stead by the other New
Partner, in addition to its own right; (iii) all obligations
undertaken by the New Partners in this Instrument are individual and
not joint.
ARTICLE XIII
DISPUTES
13.01 Arbitration.
Any dispute arising from this Instrument, or from possible execution,
amendment or expending agreements, will be
31
submitted to the unappealable judgment of an Arbitration Board made
up of five arbitrators, who will decide without procedural
formalities, in compliance with the principle of hearing both
parties, but will apply Italian substantive law. The arbitration will
be formal pursuant to the provisions of the Code of Civil procedure
and will be conducted in Milan.
13.02 Appointment of the Arbitrators.
(a) The Party which requests the beginning of the arbitration
proceeding must indicate its claims, at least in general
lines.
(b) The Party which begins the arbitration proceeding must
designate its own arbitrator at the same time, under penalty
of invalidity. Each of the Parties called to arbitration must
designate its own arbitrator within twenty (20) calendar days.
The three arbitrators of the parties will designate the fourth
and fifth arbitrator by mutual consent, indicating the
arbitrator who will fill the position of President of the
Arbitration Board. Whenever the arbitrators appointed as
indicated above cannot reach an agreement on the appointment
of the fourth and/or fifth arbitrator within twenty (20)
calendar days of the appointment of the second arbitrator, he
(they) will be appointed by the Chief Justice of the Court of
Milan, who will take the position if the Party(s) called to
arbitration fails (fail) to appoint its (their) own arbitrator
within the aforementioned term.
If the dispute concerns only two parties, the Parties calling
the arbitration proceeding must designate its own arbitrator
at the same time, under penalty of invalidity. The Party
called to arbitration must designate its own arbitrator within
32
twenty (20) calendar days. The arbitrators so appointed will
designate the third arbitrator by mutual consent, to fill the
position of President of the Arbitration Board. Whenever one
of the parties fails to appoint its own arbitrator in a timely
fashion, or whenever the two arbitrators appointed fail to
designate the third arbitrator within twenty (20) calendar
days of the appointment of the second arbitrator, he will be
appointed by the Chief Justice of the Court of Milan.
Whenever the dispute involves more than two parties, the Board
will be made up of three arbitrators appointed by the same
methods indicated in the preceding section, in the event that
the parties spontaneously regroup into two opposed centers of
interest.
13.02 Court of Jurisdiction.
Without prejudice to the above, it is agreed that any lawsuit related
to this Instrument will be under the exclusive jurisdiction of the
Court of Milan."
***
If you agree with all of the above, please send us a letter
reproducing the content hereof, signed by you in token of confirmation and
agreement. Best regards.
UniCredito Italiano S.p.A. IntesaBCI S.p.A.
-------------------------- ----------------------
33
EX-99
4
ex-8b.txt
8(B)
Exhibit 8(b)
Milan, September 14, 2001
INTESABCI S.p.A.
Piazza Paolo Ferrari, 10
20121 - MILAN
UNICREDITO ITALIANO S.P.A.
Piazza Cordusio
20121 - MILAN
Dear Sirs,
we have received your letter dated September 14, 2001, which we
transcribe below in its entirety:
***
Milan, September 14, 2001
PIRELLI S.p.A.
Viale Sarca, 222
20126 - MILAN
Dear Sirs,
Pursuant to our conversations, we propose the following:
"INSTRUMENT BETWEEN PARTNERS
Between Pirelli S.p.A., with headquarters in Milan, Viale Sarca 222,
company capital 1,043,094,358.28 Euros, recorded with the Register of Companies
of Milan, Tax Code and VAT No. 00886890151, in the person of the chairman of the
Board of Directors, Dr. Marco Tronchetti Provera, in possession of the necessary
powers of attorney following the decision by the Board of Directors of July 28,
2001 (hereinafter "Pirelli")
- Party of the first part -
and
UniCredito Italiano S.p.A., with headquarters in Genoa, Via Dante 1,
Central Management in Milan, Piazza Cordusio, company capital 2,523,215,059
Euros, recorded with the Register of Companies of Genoa, Tax Code and VAT No.
00348170101, in the person of the Deputy General Director, Dr. Pietro Modiano,
in possession of the necessary powers of attorney following the decision by the
Board of Directors of August 3, 2001 (hereinafter "UCI")
and IntesaBCI S.p.A., with headquarters in Milan, Piazza Paolo
Ferrari 10, company capital 3,488,995,258.84 Euros, recorded with the Register
of Companies of Milan, Tax Code 00799960158, VAT No. 10810700152, in the person
of Managing Director Lino Benassi, in possession of the necessary powers of
attorney following the decision by the Board of Directors of September 14, 2001
(hereinafter "BCI")
- Party of the second part -
Given that
(a) on July 30, 2001, Pirelli and Edizione Holding S.p.A. (hereinafter
"Edizione") signed an offer for the acquisition, directly or through
subsidiaries to be designated by the Execution Date, as indicated
herein,
2
by BELL S.A. of Olivetti Shares and Olivetti Warrants (as defined in
paragraphs 1.05 and 1.27, respectively);
(b) the offer of Pirelli and Edizione was accepted on the same date by
BELL S.A. and therefore the Contract (as defined in paragraph 1.06)
was drawn up. UCI and BCI (the "New Partners") took note of the
Contract;
(c) in order to proceed with the acquisition of the Olivetti Shares and
the Olivetti Warrants, Pirelli and Edizione Finance International
S.A. (hereinafter "Edizione Finance" and together with Pirelli, the
"Current Partners") constituted, on August 3, 2001, the Company (as
defined in paragraph 1.22), held 20% (twenty percent) by Edizione
Finance, a company controlled by Edizione, and 80% (eighty percent)
by Pirelli; the Company is governed by the bylaws enclosed herewith
under A (the "Bylaws");
(d) on August 7, 2001, Pirelli and Edizione signed an Instrument for the
regulation of their mutual relations as partners of the Company. The
New Partners took note of the aforementioned agreement;
(e) based on the agreements between the Current Partners, dated August 9,
2001, the Company received a transfer from Kallithea S.p.A. (a
subsidiary of Pirelli) of 147,337,880 Olivetti common shares--equal
to approximately 2% of Olivetti's company capital--as well as from
Pirelli Finance (Luxembourg) S.A. (a subsidiary of Pirelli) and from
Edizione, for a total of 265,302,250 Olivetti common shares, equal to
3.64% of Olivetti's company capital;
(f) on August 29, 2001, the Current Partners formally designated the
Company as a vehicle for the acquisition of the Olivetti Shares and
the Olivetti Warrants;
(g) on August 29, 2001, the shareholders' meeting of the Company decided,
among other things, on a capital increase (of 15,000
Euros--represented by 15,000 shares with a par value of 1 Euro each,
assigned to Pirelli in
3
the proportion of 80% (equal to 12,000 shares) and Edizione Finance
in the proportion of 20% (equal to 3,000 shares) to 576,936,635
Euros, to take place including in several stages, and with split-up
being permitted, by allocating 576,921,635 Euros in cash and the
issue of 576,921,635 new common shares with a par value of 1 Euro
each, reserved under option to shareholders in proportion to the
number of shares owned, with an issue premium of 9.40 Euros per
share;
(h) the Current Partners have immediately underwritten and paid part of
the capital increase and respective issue premium, for a total of
1,199,985,020 Euros;
(i) following such underwriting and payment, 92,306,540 shares will be
issued in favor of Pirelli for a par value of 92,306,540 Euros, and
23,076,635 shares in favor of Edizione Finance with a par value of
23,076,635 Euros;
(j) Pirelli has offered to UCI and BCI that each purchase a minority
interest in the Company; each of the New Partners wishes to purchase,
individually, a holding of 10% of the company's capital and therefore
to purchase from Pirelli, respectively, 11,539,817 shares and
11,539,817 shares of the Company, including the option rights
concerning the capital increase referred to in recital (g) so as to
allow for the underwriting and payment, under the conditions decided
upon by the Shareholders' Meeting referred to in item (g) of the
recitals, by each of the New Partners of 38,460,183 shares of the
Company with an expenditure of 399,985,903.20 Euros;
(k) Pirelli and the New Partners intend to agree on the principles of
acquisition and underwriting of a capital portion of the Company, as
well as the mutual relations as partners of said Company;
4
(l) Pirelli commits to obtain from Edizione Finance an irrevocable waiver
declaration in favor of UCI and BCI concerning all its rights and
claims in connection with the acquisition, respectively, of the
Olimpia UCI Holding and of the Olimpia BCI Holding (as defined
below), as well as a declaration of awareness, with waiver of any
reservation, concerning the commitments made by Pirelli versus the
New Partners and the rights and powers of the latter, acknowledged
under this Instrument, in particular with waiver by Edizione Finance,
as of now, of the preferred rights on the transfers under the sale
and acquisitions rights governed by this Agreement; this declaration
will be given by Pirelli to both New Partners as of the Execution
Date.
Given these recitals,
which are an integral and essential part of the Agreement, it is set forth and
agreed as follows:
ARTICLE I
DEFINITIONS
In addition to the terms defined in other clauses of the Instrument (as defined
in paragraph 1.19), for the purposes thereof, the terms listed below have the
meaning specified next to it for each of them:
1.01 "Olimpia Capital Increase": the capital increase referred to in
recital (g) above.
1.02 "Current Partners": Edizione Finance and Pirelli, jointly.
1.03 "Olimpia BCI Shares": the shares of Olimpia acquired by BCI pursuant
to Article II, referred to in recital (j).
1.04 "Olimpia UCI Shares": the shares of Olimpia acquired by UCI pursuant
to Art. II, referred to in recital (j).
5
1.05 "Olivetti Shares": 1,552,662,120 common shares of Olivetti S.p.A.,
subject of the Contract.
1.06 "Contract": the offer dated July 30, 2001, from Pirelli and Edizione
to BELL S.A., accepted on the same date, concerning the purchase and
sale of the Olivetti Shares and the Olivetti Warrants.
1.07 "Execution Date": the second Business Day (as defined in paragraph
1.11) prior to the Closing Date of the Contract.
1.08 "Signing Date": date of signing of this Instrument.
1.09 "BCI Option Rights": the Option Rights of Olimpia acquired by BCI
pursuant to Art. II.
1.10 "UCI Option Rights": the Option Rights of Olimpia acquired by UCI
pursuant to Art. II.
1.11 "Business Day": any calendar day except Saturdays, Sundays and days
the banks are closed in the market of Milan for performance of their
normal activity.
1.12 "IRR" (gross Internal Rate of Return): discount rate on an annual
base and under compound capitalization, which makes the value of all
incoming cash flows equal to the value of the outgoing cash flows
related to the investment.
1.13 "New UCI Shares": shares arising from the Olimpia capital increase
underwritten by UCI pursuant to Article II below.
1.14 "New BCI Shares": shares arising from the Olimpia capital increase
underwritten by BCI pursuant to Article II below.
1.15 "Olivetti": the company Olivetti S.p.A., with headquarters in Ivrea,
Via Jervis No. 77.
6
1.16 "Olimpia UCI Holding": Olimpia UCI Shares and New Olimpia UCI Shares.
1.17 "Olimpia BCI Holding": Olimpia BCI Shares and New Olimpia BCI Shares.
1.18 "Party or Parties": Pirelli, UCI and BCI, jointly or separately.
1.19 "Instrument": the present Instrument, signed today between Pirelli,
UCI and BCI.
1.20 "Seat": the company Seat-Pagine Gialle S.p.A., with headquarters in
Milan, Corso di Porta Vigentina No. 33/35.
1.21 "Olivetti Companies": the companies Olivetti S.p.A., Telecom Italia
S.p.A., Telecom Italia Mobile S.p.A. and Seat-Pagine Gialle S.p.A.
1.22 "Company" or "Olimpia": the company Olimpia S.p.A., with headquarters
in Milan, Via Sarca, 122 (formerly Olimpia S.r.l.), which the Current
Partners constituted on August 3, 2001, for the acquisition of the
Olivetti Shares and the Olivetti Warrants.
1.23 "Telecom Italia": the company Telecom Italia S.p.A., with
headquarters in Turin, Via Bertola No. 34.
1.24 "TIM": the company Telecom Italia Mobile S.p.A., with headquarters in
Turin, Via Bertola No. 34.
1.25 "Olimpia BCI Securities": Olimpia BCI Shares and BCI Option Rights.
1.26 "Olimpia UCI Securities": Olimpia UCI shares and UCI Option Rights.
1.27 "Olivetti Warrants": 68,409,125 Olivetti 2001-2002 warrants, subject
of the Contract.
ARTICLE II
TRANSFER OF OLIMPIA UCI SECURITIES AND OLIMPIA BCI SECURITIES
AND UNDERWRITING OF THE NEW UCI SHARES AND THE NEW BCI SHARES
7
2.00 Without prejudice to the provisions of paragraph 10.1 below
concerning the perfecting and complete and regular closing of the
Contract as an essential condition of the agreements referred to in
this Instrument, the commitments made by UCI and BCI referred to
below are also subject to the condition that, on the Execution Date,
the Current Partners, pursuant to the provisions of paragraph 2.03
below, (i) have underwritten and paid the shares arising from the
Olimpia Capital Increase and (ii) have perfected and executed with
the Company the "subordinated partner financing."
2.01 Without prejudice to the provisions of paragraph 10.1 below, UCI and
BCI pledge, not jointly, to purchase from Pirelli, as of the
Execution Date, respectively, the UCI Olimpia Shares and the UCI
Option Rights (hereinafter the "Olimpia UCI Securities") as well as
the Olimpia BCI Shares and the BCI Option Rights (hereinafter the
"Olimpia BCI Securities") under the following terms and conditions:
2.01.01 Total Price of Olimpia UCI Securities and Olimpia BCI
Securities.
(a) Olimpia UCI Securities will be sold by Pirelli
and purchased by UCI at the total price agreed
upon, including in an aleatory manner, of
120,014,096.8 Euros (the "Total UCI Price").
(b) The Olimpia BCI Securities will be sold by
Pirelli and purchased by BCI at the total price
agreed upon, including in an aleatory manner, of
120,014,096.8 Euros (the "Total BCI Price").
2.01.02 Payment Time and Terms.
On the Execution Date, UCI and BCI will pay to
Pirelli, respectively, the Total UCI Price and the
8
Total BCI Price by separate fund credits, valued as of
the Execution Date, to the checking account with Banca
Nazionale del Lavoro, No. 28301 ABA 01005 CAB 01600 in
the name of "Pirelli S.p.A."
2.01.03 Transfer of Olimpia UCI Securities and Olimpia BCI
Securities.
The Transfer of the Olimpia UCI Securities and Olimpia
BCI Securities will take place, simultaneously on the
Execution Date, at the same time with the payment of
the Total UCI Price and the Total BCI Price, without
need for any further expression of will between the
parties, and will be valid between the parties as of
that moment.
On the same date, at the same tine, all acts necessary
or appropriate will be carried out pursuant to
applicable law--including tax law--in order to perform
the transfer of the Olimpia UCI Securities and the
Olimpia BCI Securities, making it valid for third
parties as well, including the following actions: (a)
Pirelli:
(i) will deliver to UCI and BCI the
certificates representing,
respectively, the Olimpia UCI Shares
and the Olimpia BCI Shares, duly
endorsed in favor of UCI and BCI, by
appropriate methods, based on
applicable laws in the matter, to
transfer to UCI and BCI full title and
full availability of the Shares and
9
allow the registration of UCI and BCI
in the book of partners of Olimpia, as
well as the option warrants
representing the BCI Option Rights and
the UCI Option Rights;
(ii) will sign and exchange and/or cause
signature and exchange of all other
acts and documents (including tax
stamps, whenever necessary) that may
be required pursuant to the law;
(iii) will deliver to each of the New
Partners an original of the
declaration under the signature of
Edizione Finance, as referred to in
recital (l);
(b) UCI and BCI, each to the extent applicable:
(i) will pay to Pirelli, respectively,
the Total UCI Price and the Total
BCI Price;
(ii) will sign and exchange all other
acts and documents (including tax
stamps, whenever necessary) that may
be required pursuant to the law;
2.01.04 Expenses and charges.
All expenses, costs and charges, including those of a
fiscal nature, related to the transfer of the Olimpia
UCI Holding and of the Olimpia BCI Holding will be
borne half by UCI and BCI, and the other half by
Pirelli.
2.02 Without prejudice to the provisions set forth in paragraph 10.1
below, on the Execution Date, UCI and BCI pledge, non-jointly, to
underwrite and pay the Capital Increase of Olimpia, respectively, (i)
with a par value of
10
38,460,183 Euros, equal to 38,460,183 new Olimpia shares (the "New
UCI Shares") with a total disbursement of 399,985,903.2 Euros, and
(ii) with a par value of 38,460,183 Euros, equal to 38,460,183 new
Olimpia shares, with a total disbursement of 399,985,903.2 Euros (the
"New BCI Shares").
2.03 At the same time with the underwriting of the Capital Increase of
Olimpia, (i) each of the New Partners, to the extent applicable,
pledges to pay fully the New Olimpia BCI Shares and the New Olimpia
UCI Shares, and (ii) Pirelli and Edizione Finance (whose performance
is guaranteed by Pirelli pursuant to Art. 1381 of the Civil Code), to
the extent applicable, will waive and refrain from underwriting and
paying the residual portion of the Capital Increase, with a par value
of 76,936,635 Euros, equal to 76,936,635 shares, so as to assure
that, at the end of the execution of the Capital Increase, Pirelli
will hold 60%, Edizione Finance 20%, and each of the New Partners 10%
of the new capital of the Company. Pirelli and Edizione Finance will
pay to the Company, in the form of "subordinated partners financing"
under the same rate conditions as those established for the financing
granted by the pool of banks, an amount equal to 800,141,004 Euros.
2.04 Pirelli will take steps so that, within 30 (thirty) Business Days of
the Execution Date, the Bylaws are amended so as to set forth the
qualified quorum of 91% of the capital for the validity of the
decisions to amend or eliminate the list voting clause for the
appointment of the directors, as well as to modify the number of the
members of the Board of Directors.
11
ARTICLE III
MANAGEMENT OF THE COMPANY
3.01 Composition of the Board of Directors.
It is understood that, within the limits allowed by law and for the
entire term of this Instrument:
(i) the Board of Directors of the Company will be made up of
10 (ten) members;
(ii) 1 (one) director out of 10 (ten) will be appointed at the
request and indication of UCI;
(iii) 1 (one) director out of 10 (ten) will be appointed at the
request and indication of BCI; (iv) should an Executive
Committee be created, UCI and BCI will have, respectively,
the right to request at any time the inclusion of the
directors designated by them in said committee.
The new Board of Directors, with the composition indicated
above, must be appointed by the Execution Date of the Contract.
It is understood that the power of UCI and BCI to designate,
each, a member of the Board of Directors of the Company will
remain valid even after the first expiration of this Instrument,
if it is extended pursuant to Art. 10.2 (a), provided UCI and
BCI hold, jointly, a percentage of the company capital above
10%. However, if the joint holding of BCI and UCI in the company
capital is 10% or less, then BCI and UCI may designate, jointly,
only one director.
12
3.02 Suspension from Office.
Whenever, for any reason, including death, resignations or revocation
by the shareholders' meeting, one of the directors appointed pursuant
to the preceding provisions is suspended from office, within the
limits allowed by law, the replacing director must be appointed by
the Company's Shareholders' Meeting (and prior to this, by
co-optation of the Board of Directors) in the person indicated by the
New Partner which had previously designated the suspended director.
ARTICLE IV
MANAGEMENT OF THE OLIVETTI COMPANY
4.01 Composition of the Board of Directors of the Olivetti Company.
It is understood that, within the limits allowed by law and for the
entire term of this Instrument, in the Board of Directors of
Olivetti, Telecom, Seat and TIM (the "OLIVETTI Companies"), one
director must be appointed at the request and designation of UCI and
another director at the request and designation of BCI.
The new Board of Directors of the Olivetti Companies, with the
composition established above, will be appointed as soon as possible,
and in any case within 120 (one hundred twenty) days of the Execution
Date of the Contract.
13
It is understood that the power of UCI and BCI to designate, each, a
member of the Board of Directors of Olivetti Companies will remain
valid even after the first expiration of this Instrument, if it is
extended pursuant to Art. 10.2 (a), provided UCI and BCI hold,
jointly, a percentage of the company capital above 10%. However, if
the joint holding of BCI and UCI in the company capital is 10% or
less, then BCI and UCI may designate, jointly, only one director.
4.02 Suspension from Office.
Whenever, for any reason, including death, resignations or revocation
by the shareholders' meeting, one of the directors appointed pursuant
to the preceding provisions is suspended from office, within the
limits allowed by law, the replacing director must be appointed by
the Company's Shareholders' Meeting (and prior to this, by
co-optation of the Board of Directors) in the person indicated by the
New Partner which had previously designated the suspended director.
ARTICLE V
BOARD OF AUDITORS OF THE COMPANY
Upon the first renewal, the Parties will consider introducing a principal
auditor of the Company, designated jointly by the New Partners.
14
ARTICLE VI
KEY ISSUES
Pursuant to Art. VII below, the following will be deemed Key Issues:
a) the decisions of the Extraordinary Shareholders' Meeting and those of the
Board of Directors of the Company, the latter referring to the following:
- indication as to how to vote in Olivetti's Ordinary Shareholders'
Meeting on Key Issues, for the purposes of the application of Articles
104 or 107 T.U. No. 58 of February 24, 1998, and in matters of
acquisition of own shares, as well as voting in Olivetti's
Extraordinary Shareholders' Meeting;
- acquisition, sale and acts of disposal under any status (i) of own
shares in any amount and (ii) holdings (including shares and financial
instruments of any type issued by Olivetti and/or the Olivetti
Companies) at a value, by individual operation, above 100,000,000
Euros;
- determination of the ratio between equity and debt of the Company and
methods, terms and conditions for resorting to outside financing
sources;
- draft proposals to be submitted to the Company's Extraordinary
Shareholders' Meeting;
b) resolutions of the Board of Directors of Olivetti and Telecom, referring
to:
- individual investments above 300 million Euros;
- acquisition, sale and acts of disposal under any status (i) of own
shares in any amount and (ii) affiliate and subsidiary holdings
(including shares and other financial instruments issued by the
Company or the Olivetti Companies) at a value, by individual
operation, above 300 million Euros;
- acts of disposal under any status of companies or branches thereof,
with an individual value above 300 million Euros;
15
- proposals to call the Extraordinary Shareholders' Meeting for
resolutions in matters of modification of the corporate purpose,
capital operations of any nature, merger, spin-off, transformation and
dissolution;
- operations between Olivetti, Telecom and Gruppo Pirelli, with an
individual value above 50 million Euros;
- operations with related parties.
ARTICLE VII
PROVISIONS ON DEADLOCK
7.01 Obligation to Consult.
Pirelli and the New Partners, the latter jointly between them, pledge
to consult each other previously whenever a decision on one of the
Key Issues must be discussed or decided upon.
7.02 Identification of Deadlock Situations.
For the purposes of this Article VII, "DEADLOCK" is defined as a
situation of disagreement, expressed in the previous consultation
between Pirelli, on the one hand, and one or both of the New
Partners, on the other hand, on a Key Issue that must be discussed by
one of the corporate management bodies referred to in item (a) or (b)
of Article VI above.
16
7.03 Procedure.
(a) For compliance with the obligation referred to in paragraph
7.02 above, Pirelli and the New Partners, jointly, pledge to
meet or to consult each other previously by telephone
conference or video conference by the Business Day preceding
the day scheduled for the meeting of the Board or of the
shareholders of the Company, or of the Board of Olivetti or
Telecom, or, immediately, as soon as the news arrive, in the
event of urgent call (or extraordinary urgency, if applicable)
of the meeting of the board of the Company or of Olivetti or
Telecom, pursuant to the applicable bylaws provisions.
(b) In the consultation referred to in this paragraph, Pirelli and
the New Partners will take all reasonable steps to reach an
agreement and/or identify common grounds for the issues
submitted for their examination, pledging, for this purpose,
to act in good faith.
(c) The unjustified absence of a single New Partner or both the
New Partners in the previous consultation stage implies
acceptance of the decisions made by the other subjects and
imposes on the absent subject the obligation of accepting and
respecting such decisions.
7.04 Manifestation of Will.
(a) Whenever, in the previous consultation referred to in
paragraphs 7.02 and 7.03 above, Pirelli and the New Partners
reach an agreement concerning the issues under consultation,
they are obligated to manifest their will in the competent
venues pursuant to the provisions below:
17
(i) by giving a common representative delegation to
participate in the Company's Extraordinary
Shareholders' Meeting and casting the vote in said
meeting, in accordance with the decision reached;
(ii) causing their own representatives in the Board of
Directors of the Company and of Olivetti or Telecom to
participate in the meeting of the board, casting the
vote in this venue in accordance with the joint
decisions reached in the previous consultation.
(b) However, in the absence of agreement of the issues under
consultation, the New Partners, if both are dissenting will be
jointly obligated, or the single dissenting New Partner will
be obligated, to abstain or cause abstention from
participating in the shareholders or board meeting and to vote
in this venue or cause voting and/or abstain from manifesting
its will, in any venue and mode, or from taking a position in
the issue under the previous consultation, without prejudice
to the provisions of item (c) below.
(c) Whenever the situation described in item (b) above occurs, the
dissenting New Partners, separately or jointly, will have, or
the single dissenting New Partner will have, the right to send
to Pirelli, by telegram or registered letter, pursuant to
paragraph 12.02, a "NOTICE OF DEADLOCK" within 15 (fifteen)
days of the end of the consultation referred to in paragraph
7.03.
18
7.05 Rights of the New Partners.
(a) Whenever UCI and/or BCI send a Notice of Deadlock pursuant to
item (c), paragraph 7.04, the New Partner which sent the
Notice of Deadlock will have the right (which is deemed
exercised by Pirelli's receipt of the Notice of Deadlock,
pursuant to item (c), paragraph 7.04 above) to sell to
Pirelli, which will have the corresponding obligation to buy
from the respective New Partner, respectively, all but not
part of the Olimpia UCI Holding and/or all but not part of the
Olimpia BCI Holding at a price determined pursuant to the
provisions in item (b) below.
(b) For the purposes of item (a) above, the Parties agree,
including in an aleatory manner, that the object of the
decision must be: (x) the price of the Olimpia BCI Holding
and/or Olimpia UCI Holding, corresponding proportionately to
the value of the Company's economic capital ("Price of the
Olimpia UCI Holding" and/or "Price of the Olimpia BCI
Holding"), as well as (y) an increase expressing the
proportion of the increase premium, as if the Olimpia BCI
Holding and/or Olimpia UCI Holding were the expression of
Olivetti's control, assuming that the latter controls Telecom
and the companies controlled by the latter ("Premium"). The
"Price of the Olimpia UCI Holding" and/or "Price of the
Olimpia BCI Holding" and the Premium to be proportionately
allocated to both the Holdings will be determined by mutual
consent between Pirelli and each of the New Partners within 10
(ten) Business Days of the date Pirelli received from one of
the New Partners the notice pursuant to item (a) above or, in
the absence of such agreement, from two "investment banks"
with international standing, chosen one by Pirelli (paying the
respective costs) and one by the New Partner that sent the
Notice of Deadlock (paying the respective costs), with the
understanding that if an agreement on the valuation is not
reached within 30 (thirty) Business Days of their appointment,
it will be made by a third and additional "investment bank"
(the costs of which will be paid half by Pirelli and the other
half by the Seller(s)/New Partner(s) of a similar standing,
chosen by agreement of those already appointed at the time the
task is assigned by Pirelli and by the New Partner that sent
the Notice of Deadlock or, in the absence of agreement, by the
Chief Justice of the Court of Milan. The Chief Justice of the
Court of Milan (in the order and in the terms indicated above)
will also be asked to appoint the "investment banks" that
Pirelli or the New Partner that sent the Notice of Deadlock
failed to appoint or replace in the event of subsequent
termination of the task. Whenever both New Partners sent the
Notice of Deadlock, the New Partners will be obligated to
appoint a single "investment bank" by mutual consent.
(c) The valuations referred to in item (b) above and therefore the
Price of the Olimpia BCI Holding and/or the Price of the
Olimpia UCI Holding and the Premium determined on that basis
will be definitively binding for the Parties, pursuant to
Articles 1349 and 1473 of the Civil Code for the purchase and
sale referred to in item (a) above.
19
(d) It is furthermore agreed, including in an aleatory manner,
that the price owed by Pirelli will not be lower than the
amounts paid by the New Partner for the acquisition and
underwriting of shares in the Company, less any dividends
received ("FLOOR"), nor higher than an amount which implies,
in connection to the same amounts, less any dividends
received, an annual IRR, including taxes, equal to 15%
("CAP").
(e) The purchase and sale will be closed within 30 (thirty)
Business Days of the Parties' receipt of the communication
concerning the valuation referred to in item (b) above, and
the price referred to in items (b) and (d) above must be paid
in cash, at the same time with the transfer of the Olimpia BCI
Holding and/or the Olimpia UCI Holding referred to in
paragraph 7.06.
7.06 Transfer.
If the Olimpia BCI Holding and/or the Olimpia UCI Holding should be
purchased and sold pursuant to paragraph 7.05 (a), the following
provisions will apply:
(i) the Olimpia BCI Holding and/or the Olimpia UCI Holding will be
deemed transferred with regular enjoyment as of the date
referred to in item (iii) below;
(ii) the ownership right in the Olimpia BCI Holding and/or the
Olimpia UCI Holding purchased and sold will be deemed
transferred to the buyer as of the date referred to in item
(iii) below;
20
(iii) the transfer of the Olimpia BCI Holding and/or the Olimpia UCI
Holding and the payment of the respective price will take
place at the headquarters of the Company, at 11:00 a.m. on the
5th (fifth) Business Day after the date the purchase and sale
is deemed closed pursuant to paragraph 7.05 (e), in
compliance, whenever applicable, with the possible
authorizations from the competent authorities with
jurisdiction over the Parties in connection with the purchase
and sale;
(iv) in the act of transfer and payment referred to in item (iii)
above, the Olimpia BCI Holding and/or the Olimpia UCI Holding
will be free of prejudicial pledges, liens, encumbrances or
rights of third parties of any nature; including in light of
the absence of any managerial role of the New Partners and in
an aleatory manner, the purchase and sale will take place
without any further and different guarantee and responsibility
of UCI and/or BCI, including the value, situation and
activities of the Companies and their affiliates;
(v) the expenses, charges and indirect taxes levied on the
purchase and sale of the Olimpia BCI Holding and/or the
Olimpia UCI Holding will be paid by the buyer;
(vi) however, the taxes on any capital gains obtained by the seller
will be paid by the latter;
(vii) at the time of the transfer of the Olimpia BCI Holding and/or
the Olimpia UCI Holding and the payment of the respective
price, the seller will deliver to the buyer the resignations
of the directors and, whenever possible, of the auditors of
the Company and of the Olivetti Companies designated by it.
21
ARTICLE VIII
COLLATERAL ACQUISITIONS
8.01 Commitment of the Parties.
(a) UCI and BCI declare that, as of September 13, 2001, including
through their respective subsidiaries, pursuant to Art. 2359,
first paragraph, c.c., they own Olivetti shares (including
Olivetti's voting rights held under any status), in an amount
not exceeding, respectively, 6,616,827 Olivetti shares in
ownership and 46,694,466 Olivetti shares in pledge with voting
right, concerning UCI, and 15,129,380 Olivetti shares in
ownership and 13,865,712 Olivetti shares in pledge with voting
right, concerning BCI.
(b) For the entire term of this Instrument, the parties, including
through their respective subsidiaries and/or parent companies,
pursuant to Art. 2359, first paragraph, c.c., may not acquire
Olivetti shares, bonds convertible to Olivetti shares and/or
Warrants giving right to acquire shares or bonds convertible
to Olivetti shares, issued by Olivetti or by the Olivetti
Companies (including Olivetti's voting rights held under any
status). It is, however, permitted to UCI and BCI to acquire
and hold such securities within said limit, for each of them,
of 0.40% of Olivetti's capital, as of the Execution Date.
22
(c) Unless otherwise agreed upon in writing between the Parties,
the Company may not purchase shares and bonds and instruments
indicated in item (a) above in excess of the threshold set
forth therein, currently established at 30% (thirty percent),
while also taking into account the incidence for this purpose
of the securities referred to in item (b) above, held by BCI
and UCI, as well as own shares held directly and indirectly,
as set forth in the current laws and regulations, including
the instructions issued by CONSOB.
ARTICLE IX
PENALTY FOR BREACH
In the event of breach of one or several commitments made pursuant to the
provisions of this Instrument, the breaching Party, at the simple written
request of the Parties or of the other Party, and without prejudice to any other
of its/their rights (including the right to higher damages), will be obligated
to pay, as penalty, to the complying party or complying Parties, which will take
care of distribution internally, a single and total amount equal, for each
breach, to 5% (five percent) of the amounts paid by the breaching Party for the
acquisitions and subscriptions of shares made in the Company as of that date.
23
ARTICLE X
TERM
10.01 Effective Date.
The efficacy and validity of this Instrument are subject to complete
and regular execution of the Contract and therefore, secondary to
obtaining the necessary authorizations, including in compliance with
antitrust regulations, for the acquisition by the Company of the
entire holding in Olivetti represented by the Olivetti Shares and
Olivetti Warrants as set forth therein. It is, however, understood
that in the event of failure to execute the Contract completely and
regularly by January 31, 2002, this Instrument will be deemed
cancelled ipso jure, effective ex tunc and, at the simple request of
UCI and/or BCI, Pirelli will be obligated (i) to acquire the entire
Olimpia BCI Holding and the entire Olimpia UCI Holding at a price
exactly identical to that possibly already paid by UCI and BCI for
the acquisition of the Olimpia UCI Shares, Olimpia BCI shares, the
new UCI Shares and the New BCI Shares, as well as (ii) to release UCI
and BCI from any commitment possibly already made to the Company.
10.02 Term.
(a) This Instrument will have a term of three years from the
Execution Date of the Contract and will be deemed tacitly
renewed from time to time on expiration for the following two
years, in the absence of an opt-out notice from one of the
Parties, without prejudice to the provisions of paragraph
10.03 below.
24
(b) Except in the cases required by law, each of the Parties may
opt out of this Instrument before every expiration, with
notice sent 6 (six) months in advance.
10.03 Absence of Renewal.
(a) If, before the first expiration of this Instrument or
successive ones, Pirelli should send to the New Partners,
jointly or separately, in the terms set forth in paragraph
12.02, the opt-out notice referred to in item (ii), paragraph
10.02 (b) above, UCI and BCI will individually have the right
to send to Pirelli which, upon simple request, will have the
corresponding obligation to acquire, respectively, all but not
part of the Olimpia UCI Holding and Olimpia BCI Holding held
by the New Partner which exercised the option right set forth
herein, under terms and conditions determined, mutatis
mutandis, pursuant to paragraph 7.05 (b) above (and the
provisions mentioned therein), giving notice to Pirelli within
30 (thirty) Business Days. In all events, it is agreed,
including in an aleatory manner, that the price owed by
Pirelli will not be lower than the amounts paid by the New
Partner for the acquisitions and subscriptions of shares in
the Company, less any dividends received ("FLOOR"), nor higher
than an amount which implies, in connection to the same
amounts, less any dividends received, an annual IRR, including
taxes, equal to 15% ("CAP"). The aforementioned price will be
paid in cash.
(b) If, on the first expiration date of this Instrument, both or
one of the New Partners should, jointly or separately, send to
Pirelli, in the
25
terms set forth in paragraph 12.02, the opt-out notice
referred to in item (i), paragraph 10.02 (b) above, Pirelli
will have the right to acquire from both New Partners opting
out, or from the single New Partner opting out, which, upon
simple request, will have the corresponding obligation to
sell, respectively, all but not part of the Olimpia UCI
Holding and Olimpia BCI Holding held by the New Partner which
exercised the opt out right set forth herein, under terms and
conditions determined, mutatis mutandis, pursuant to paragraph
7.05 (b) above (and the provisions mentioned therein), less
the Premium, giving notice to the New Partner which sent the
opt-out notice, within 30 (thirty) Business Days.
(c) If both or one of the New Partners should send to Pirelli, in
the terms set forth in paragraph 12.02, on the expiration of
the first renewal in the following two years, the opt-out
notice referred to in paragraph 10.02 (a) above, and
therefore, on the expiration of the fifth year after the
effective Date of this Instrument, or on the successive
additional expiration dates, both New Partners opting out,
jointly or separately, or the single New Partner opting out,
will have the right to sell to Pirelli, which, upon simple
request, will have the corresponding obligation to acquire,
respectively, all but not part of the Olimpia UCI Holding
and/or all but not part of the Olimpia BCI Holding held by the
New Partner which exercised the opt out right set forth
herein,
26
under terms and conditions determined, mutatis mutandis,
pursuant to paragraph 7.05 (b) above (and the provisions
mentioned therein), giving notice to the New Partner that sent
the opt-out notice, within 30 (thirty) Business Days.
In all events, it is agreed, including in an aleatory manner,
that the price owed by Pirelli will not be lower than the
amounts paid by the New Partner for the acquisitions and
subscriptions of shares in the Company, less any dividends
received ("FLOOR"), nor higher than an amount which implies,
in connection to the same amounts, less any dividends
received, an annual IRR, including taxes, equal to 15%
("CAP").
(d) The payment of the amount referred to in item (a), (b) or (c)
above must be made (i) immediately, at the simple written
request of UCI and/or BCI to be sent to Pirelli at the end of
the term of 30 (thirty) days from the communication sent to
the Parties as to the decision made by the procedure referred
to in paragraph 7.05 (b) above, and (ii) at the same time with
the transfer of the Olimpia UCI Holding and/or the Olimpia BCI
Holding.
ARTICLE XI
CHANGES IN STOCKHOLDING
11.1 For the purposes of this paragraph, "Change of Control" means a
substantial modification in the direct and indirect stockholding
control of Pirelli, which means the stoppage of the control of
Pirelli & C s.a.p.a. over Pirelli S.p.A., as exercised today.
27
If the Change of control occurs, each of the New Partners will have
the right to transfer, respectively, all but not part of the Olimpia
UCI Holding and/or all but not part of the Olimpia BCI Holding owned
by Pirelli which, upon simple request, will have the obligation to
acquire, under terms and conditions determined, mutatis mutandis,
pursuant to paragraph 7.05 (b) above (and the provisions mentioned
therein), giving notice to Pirelli within 30 (thirty) Business Days
of the date the New Partners, separately or jointly, declared in
writing that they have learned about the Change of Control, or
received written communication about this circumstance. It is,
however, agreed, including in an aleatory manner, that the price owed
by Pirelli will not be lower than the amounts paid by the New Partner
for the acquisitions and subscriptions of shares in the Company, less
any dividends received ("FLOOR"), nor higher than an amount which
implies, in connection to the same amounts, less any dividends
received, an annual IRR, including taxes, equal to 15% ("CAP").
11.2 If Pirelli intends to divest, in any form, part of its holding in the
Company, so that Pirelli would hold less than a majority of the
capital thereof, Pirelli may not sign any agreement in this sense,
being first obligated to give prior timely notice to both the New
Partners about the planned transfer, fully indicating the terms and
conditions of the transfer operation and any possible outside
agreements (of blockage and vote) with the buyers. Within 30 (thirty)
Business Days of receipt of the aforementioned communication, UCI
and/or BCI will, individually, have the right to sell to Pirelli,
which, upon simple request, will have the corresponding obligation to
acquire, respectively, all but not part of the Olimpia UCI Holding
and/or all but not part of the Olimpia BCI Holding held by the New
Partner that exercised the Option Right set forth herein, under terms
and conditions
28
determined, mutatis mutandis, pursuant to paragraph 7.05 (b) above,
with the understanding, including in an aleatory manner, that the
price owed by Pirelli will not be lower than the amounts paid by the
New Partner for the acquisitions and subscriptions of shares in the
Company, less any dividends received ("FLOOR").
ARTICLE XII
GENERAL PROVISIONS
12.01 Amendments.
Any amendment to this Instrument will be valid and binding only if it
arises from a written document signed by each of the Parties
concerned.
12.02 Communications and Notices.
Any communication required or allowed by the provisions of this
Instrument must be made in writing, and will be deemed efficiently
and validly made upon its receipt, if sent by letter or telegram, or
at the time of the acknowledgement of receipt by the appropriate
declaration (including by fax), if by fax, provided it is addressed
as follows:
(i) if to UCI, to the following address:
Via San Protaso No. 3
20121 MILAN
Attn.: Dr. Pietro Modiano
Fax No. 02-88622196
(ii) if to BCI, to the following address:
Piazza Paolo Ferrari No. 11
20121 MILAN
Attn.: Managing Director Lino Benassi
Fax No. 02-88503086
(iii) if to Pirelli, to the following address:
Viale Sarca No. 222
20126 MILAN
Attn.: Dr. Carlo Buora
Fax No. 02-64423454
29
or to a different address, which each Party has the right to
communicate to the other, by the methods set forth in this paragraph
12.02; it is understood that the aforementioned addresses or
different addresses that may be communicated in the future, are also
elected by the Parties as their own domicile for al aspects related
to this Instrument, including possible legal notices or notices
related to the arbitration proceeding referred to in Article XIII
below.
12.03 Tolerance.
Any possible tolerance of acts committed in violation of the
provisions hereof does not constitute a waiver of the rights arising
from the provisions violated, nor of the right to require exact
performance of all terms and conditions hereof.
12.04 Headings.
The headings of the individual articles are included for the sole
purpose of facilitating their reading and therefore must not be taken
into consideration in any way for the interpretation of this
Instrument.
12.05 Allocation of Option Rights.
The Parties mutually acknowledge and agree that the compensation for
the mutual rights to buy and sell governed by this Instrument was
considered in the framework of the transfer values and prices of the
respective holdings, so that, for the allocation of said rights, no
further and other compensation is planned or intended.
30
12.06 Exercise of Rights and Performance of Obligations.
It is understood that (i) all rights allocated under this Instrument
to UCI and BCI must be deemed enforceable also individually, whenever
not otherwise specified in this Instrument, and the failure to
exercise its right by one of the New Partners may not be interpreted
as a waiver thereof; (ii) in the event of failure to exercise or
waiver by one of the New Partners of the right to designate a
director, this right may be exercised in its stead by the other New
Partner, in addition to its own right; (iii) all obligations
undertaken by the New Partners in this Instrument are individual and
not joint.
ARTICLE XIII
DISPUTES
13.01 Arbitration.
Any dispute arising from this Instrument, or from possible execution,
amendment or expending agreements, will be submitted to the
unappealable judgment of an Arbitration Board made up of five
arbitrators, who will decide without procedural formalities, in
compliance with the principle of hearing both parties, but will apply
Italian substantive law. The arbitration will be formal pursuant to
the provisions of the Code of Civil procedure and will be conducted
in Milan.
13.02 Appointment of the Arbitrators.
(a) The Party which requests the beginning of the arbitration
proceeding must indicate its claims, at least in general
lines.
31
(b) The Party which begins the arbitration proceeding must
designate its own arbitrator at the same time, under penalty
of invalidity. Each of the Parties called to arbitration must
designate its own arbitrator within twenty (20) calendar days.
The three arbitrators of the parties will designate the fourth
and fifth arbitrator by mutual consent, indicating the
arbitrator who will fill the position of President of the
Arbitration Board. Whenever the arbitrators appointed as
indicated above cannot reach an agreement on the appointment
of the fourth and/or fifth arbitrator within twenty (20)
calendar days of the appointment of the second arbitrator, he
(they) will be appointed by the Chief Justice of the Court of
Milan, who will take the position if the Party(s) called to
arbitration fails (fail) to appoint its (their) own arbitrator
within the aforementioned term.
If the dispute concerns only two parties, the Parties calling
the arbitration proceeding must designate its own arbitrator
at the same time, under penalty of invalidity. The Party
called to arbitration must designate its own arbitrator within
twenty (20) calendar days. The arbitrators so appointed will
designate the third arbitrator by mutual consent, to fill the
position of President of the Arbitration Board. Whenever one
of the parties fails to appoint its own arbitrator in a timely
fashion, or whenever the two arbitrators appointed fail to
designate the third arbitrator within twenty (20) calendar
days of the appointment of the second arbitrator, he will be
appointed by the Chief Justice of the Court of Milan.
Whenever the dispute involves more than two parties, the Board
will be made up of three arbitrators appointed by the same
methods indicated in the preceding section, in the event that
the parties spontaneously regroup into two opposed centers of
interest.
32
13.02 Court of Jurisdiction.
Without prejudice to the above, it is agreed that any lawsuit related
to this Instrument will be under the exclusive jurisdiction of the
Court of Milan."
***
If you agree with all of the above, please send us a letter
reproducing the content hereof, signed by you in token of confirmation and
agreement. Best regards.
signed UniCredito Italiano S.p.A. signed IntesaBCI S.p.A.
***
We confirm that we agree to the above.
Best regards.
PIRELLI S.P.A.
----------------------
33
EX-99
5
ex-9.txt
9
Exhibit 9
OLIMPIA AND SHAREHOLDERS REPRESENTING THE MAJORITY SHAREHOLDING OF
BELL VERSIONE ITALIANA
Milan, September 19th, 2001 - In the intent of reaching a quick and satisfactory
execution of the agreement ("Agreement") made on July 30th, 2001, between
Pirelli, Edizione Holding and Bell (having as an object the promise of sale of
N. 1,552,662,120 ordinary Olivetti shares and of N. 68,409,125 Olivetti warrants
by Bell to Olimpia, a company as of today owned to an extent of 80% by Pirelli
SpA and to an extent of 20% by Edizione Finance International and of which, as
is known, Banca Intesa and Unicredito will become shareholders by buying 10%
each from Pirelli) on September 19th, 2001 Olimpia and the Shareholders
representing the majority of Bell's share capital reached the following
agreements:
A on September 27th, 2001, Olimpia will buy from Bell N. 552,000,000 of
Olivetti shares, as a part of those object of the Agreement, paying at the
same time the agreed unit share price of (euro)4.175, for a total of
approximately (euro)2,304 million plus interest as detailed in the
Agreement;
B by October 12th, 2001, Olimpia will proceed to buy the remaining N.
1,000,662,120 Olivetti shares and the N. 68,409,125 Olivetti warrants,
obviously subject to the attainment of the EU Commission's antitrust
authorisations, at the agreed unit price of (euro)4.175 and (euro)1.088
respectively, for a total of approximately (euro)4,252 million plus
interest as detailed in the Agreement;
C the majority Shareholders of Bell: Hopa SpA, G.P.P. International SA,
Interbanca SpA, Banca Antoniana Popolare Veneta Scarl, G.P. Finanziaria
SpA, Monte dei Paschi di Siena SpA and Unipol SpA have undertaken,
guaranteeing fulfilment of such undertaking, to ensure that Bell subscribes
and pays, at the time of execution of the sale of the tranche of Olivetti
shares by Bell to Olimpia under B) above, a bond issued by Olimpia itself
for an amount equivalent to the Euro value of Lit. 2,000 bn, the essential
terms and conditions of which are as follows:
- duration 6 years;
- fixed rate of 1,5% yearly, payable in a single solution at maturity;
- reimbursement in the form of approximately N. 263 mln Olivetti shares
with a ratio of 1 Olivetti share for every bond with a par value
of(euro)3,92 each.
The Agreement of July 30th, 2001, with the exception of the above, remains valid
in all its points.
Furthermore, in order to favour the best outcome of the operation in this
difficult moment for the financial markets, the Group Monte dei Paschi has
undertaken to use its best endeavours to supply to Olimpia, at the time of the
payment of the tranche of the acquisition price of the Olivetti shares referred
to under B), a "non recourse" financing for a capital value of an amount
equivalent to the Euro value of Lit. 1'000/1'500 bn, for a time span of six
years, at the rate of Euribor +0,50.
The Group Banca Antonveneta, on the other hand, has undertaken to supply to
Olimpia, always at the time of the payment of the tranche of the acquisition
price of the Olivetti shares referred to under B), a "non recourse" financing
for a capital value of an amount equivalent to the Euro value of Lit. 500 bn,
for a time span of six years, at the rate of Euribor +0,50.
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EX-99
6
aasa.txt
10
Exhibit 10
ACT OF AMENDMENT TO THE SHAREHOLDERS' AGREEMENT
-----------------------------------------------
Between PIRELLI S.P.A, with headquarters in Milan, Viale Sarca 222,
company capital 1,042,775,333.08 Euros, recorded with the Registry of Companies
of Milan, Tax Code and VAT No. 0086890151, in the person of the Chairman of the
Board of Directors, Dr. Marco Tronchetti Provera, in possession of the necessary
powers of attorney (hereinafter "Pirelli")
- Party of the first part -
and EDIZIONE HOLDING S.P.A., with headquarters in Treviso,
Calmaggiore 23, company capital L. 90,692,800,000, recorded with the Registry of
Companies of Treviso under No. 13945, Tax Code and VAT No. 00778430264, in the
person of the Chairman of the Board of Directors, Mr. Gilberto Benetton, in
possession of the necessary powers of attorney (hereinafter "Edizione") - Party
of the second part -
Given that
(a) Pirelli and Edizione signed, on August 7, 2001, a Shareholders'
Agreement (the "Agreement") concerning, among other things, the
discipline of the mutual relationships as shareholders of the joint
company, hereinafter referred to as Olimpia S.p.A.;
(b) Edizione Finance International S.A. has been subrogated in the
rights and obligations of Edizione under the Agreement pursuant to
Article III thereof and, as such, signs the present Act;
(c) without prejudice to any other provision of the Agreement, and with
reference to the Definitions contained in Article I thereof, the
Parties (as defined therein) agree that it is appropriate to proceed
with the amendment of Article XIII of the Agreement in question;
given these recitals,
effective as of the date of this Act of Amendment, the Parties agree that the
Agreement must be deemed amended by adopting the language of Article XIII, as
reported below, in substitution of that agreed upon on August 7, 2001.
ARTICLE XIII
Key Event
(a) A "Key Event" is deemed to have occurred, for the purposes of
this Agreement, if, during the original term or extension thereof, as a result
of one or more acts inter vivos under any status, there is a substantial change,
as compared to the situation existing today, in the structure of the control of
Edizione or Pirelli (including, for these purposes, Pirelli & C Sapa),
understood as the exercise by subjects, other than the current ones, of the
decisive power to appoint the majority of the members of the board of directors,
with a consequent potential change in strategic addresses.
(b) Once the Key Event has taken place regarding one Party, the other
Party will have the right to transfer all (but not part of) its shares of the
Company to the Party affected by the Key Event, under the terms and conditions
determined, mutatis mutandis, pursuant to the previous paragraph 9.05(b) (and
the provisions referred to therein), with notice to such latter Party within 30
(thirty) Business Days of the date the other Party has declared in writing that
it has become aware of the Key Event, or received written communication of such
circumstance. In such case, however, the purchase and sale will take place
against payment of the price referred to in paragraph 9.05(b), plus an amount
equal to double the Price of the Company Shares and Premium.
2