Attached files
Exhibit
10bb
Final
Version
Credit
Agreement
Entered
into in Tel-Aviv on January 31, 2010
by and
among
012 Smile Telecom Ltd.
(formerly, Ampal Investments and Communication 2009 Ltd.) (the
"Borrower") p.c. No. 514350024
and
Bank
Leumi l'Israel Ltd. ("Leumi")
Bank
Discount l'Israel Ltd. ("Discount")
each
individually referred to hereinafter as the "Lender" and together as the
"Lenders"
and
Bank Leumi L'Israel Ltd.
("Bank Coordinator")
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Whereas
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On
November 16, 2009, an agreement was signed between the Borrower (through
its founder – Merhav-Ampal Energy Ltd.) - and 012 Smile Communication Ltd.
and Ampal Energy Ltd., for the sale of the assets, activities and
obligations of Smile 012 Communication Ltd., to the Borrower, that was
amended on January 26, 2010 – all as detailed in the aforesaid agreement
(as amended);
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Whereas
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the
Borrower has approached the Lenders, seeking to enter an agreement with
them whereby they will jointly provide it with part of the Credit required
to finance the above agreement;
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NOW
THEREFORE IT IS DECLARED AND STIPULATED AMONG THE PARTIES AS
FOLLOWS:
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1.
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Definitions and
Interpretation
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1.1
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The
following terms will have the meaning set out opposite them, unless the
context requires otherwise. Terms not defined in this Agreement will be
given the meaning given to them in the Credit Documents (as defined
hereunder).
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1.1.1
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"Institutional
Loan" - a loan from institutional entities (the "Financial Institutions")
in a sum of NIS. 220,000,000 which Merhav intends to take by the Closing,
in order to provide the Independent Resources as defined hereunder, it is
hereby clarified that in the event that the Borrower has obtained sums by
virtue of Section 11.4 of the Acquisition Agreement, then for the purpose
of this Agreement, the amount set out above will decrease by an
amount equal to 22% of the sums that the Borrower has received according
to Section 11.4 hereunder (the "Reduced Total "), and the Loan will be
considered as having been provided, ab initio, at the
Reduced Total and the Financial Institutions' settlement time table as
determined in Section 10.4.2.1 hereunder, will change accordingly. It is
hereby clarified that the above calculations, including the change in the
Financial Institutions' time table, are prepared for the purpose of this
Agreement only and have no bearing or influence on the relationships
between the Financial Institutions and Merhav and on the payments that
Merhav is to pay to the Financial Institutions in accordance with the
Agreement with them.
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1.1.2
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Ampal
American - Ampal American Israel
Corporation.
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1.1.3
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"Independent
Resources" - a sum of NIS.400,000,000 (four hundred million new Israeli
shekels) derived from investment in the Borrower's share capital or from
subordinate loans which the Borrower will use to make the payments to
Smile on account of the purchase
consideration.
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1.1.4
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"Stakeholder"
- As this term is defined in the Securities Law other than the Borrower's
subsidiary companies.
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1.1.5
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"Financial
Statements" - The Borrower's annual or quarterly Financial Statements, as
the case may be, on a consolidated basis, prepared in New Shekels,
consistently in accordance with generally accepted accounting principals,
audited (in respect of periods concluding on December 31) or reviewed (in
respect of periods concluding on other dates) as is customary in respect
of reports of this kind, by the Borrower's accountants and any other
report or explanation required according to relevant standard accounting
procedures or by authorized
authorities.
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1.1.6
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"Financial
Statements - Solo" - The Borrower's annual or quarterly Financial
Statements as the case may be, on an individual basis, prepared in New
Shekels, consistently in accordance with generally accepted accounting
principals, approved on behalf of the Borrower by the Chief Financial
officer of the Company (CFO) or by the
CEO.
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1.1.7
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"The
Credit" - the loans provided to the Borrower from time to time in
accordance with this Agreement by one of the
Lenders.
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1.1.8
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"Provisions
of the Law" - any provision of the law or legislation in Israel or abroad,
a provision from the Bank of Israel, and any other competent authority in
Israel or abroad, agreed to by one of the Lenders and the Bank of Israel
or by one of the Lenders and any other competent authority in Israel or
abroad, as may be in force from time to
time.
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1.1.9
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the
"Holding" - as this term is defined in the Securities
Law.
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1.1.10
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"Subordinated
Loans" - loans provided or to be provided to the Borrower by Merhav,
Stakeholders in Merhav or a corporation controlled by any of the aforesaid
in respect of which Merhav or a Stakeholder or a corporation
controlled by any of them, as the case may be, and the Borrower, undertake
in writing to the Lenders, are not discharged before full settlement of
the Credit, including by way of offset, except in accordance with the
provisions of this Agreement (including by payments to Merhav in
accordance with the provisions of Section 10.4
hereunder).
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1.1.11
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"Known
Agreement Index" means - the monthly Index for December 2009 published on
January 15, 2010 at the level of
105.2.
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1.1.12
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"Acquired
Assets" - as [the term] "Acquired Assets" is defined in the Purchase
Agreement and subject to and in accordance with all provisions of the
Purchase Agreement related thereto.
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1.1.13
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this
"Agreement" - this Agreement and all its annexes, in such form as it will
be from time to time.
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1.1.14
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the
"Purchase Agreement" - the agreement drawn up and entered on November 16,
2009 between the Borrower (through its founder - Merhav Ampal Energy Ltd.)
Smile and Merhav, for the acquisition of part of Smile's operations,
assets and obligations by the Borrower, as amended on January 26,
2010.
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1.1.15
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the
"Guarantor" - each of: Merhav and Ampal
American.
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1.1.16
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"Operating
Profit to service the Debt" (EBITDA) means - the total cumulative
operating profit, according to the Borrower's Financial Statements
(consolidated), in each of the four consecutive calendar quarters, the
conclusion of which is the date for assessing the latest quarterly or
annual Financial Statements, as the case may be (the "Final Date") (for
the avoidance of doubt, operating profit is after payment of management
fees to Merhav), before finance costs/income (interest, linkage
differential, exchange rate differential, commissions and the differential
calculated on the activated loans, at fair value), and before taxes, plus
depreciation and write-downs recorded in that period and after excluding
capital gains/losses, excluding bonuses in respect of options granted to
employees, excluding one-off expenses arising from reorganization; and
with the total of the aforesaid cumulative amount being linked to changes
in the Known Index where the base index is the index known on the Final
Date and the revised index is the index known on the review date or on the
relevant Assessment Date.
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1.1.17
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the
"Licenses" - a general license for the Borrower to provide Bezeq
International services, a general license to 012 Telecom Ltd. to provide
domestic Bezeq land-line services, a special license for the Borrower to
provide internet access services, a special license for the Borrower to
provide end-user services and any other license that may arise in place
thereof, or other license the termination or suspension of which may have
a harmful effect on the Borrower's businesses, but not including a license
whose termination or suspension as aforesaid, has a negligible effect on
the Borrower's businesses.
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1.1.18
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"Subsidiaries"
- as this term is defined in the Securities
Law.
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1.1.19
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"Companies
Law" - the Companies Law, 1999-5759, as amended from time to
time.
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1.1.20
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"Securities
Law" - the Securities Law, 1968-5728, as amended from time to
time.
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1.1.21
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the
"Accounts" - an account as specified below, opened by the Borrower with
each of the Lenders, which serves solely to provide and manage the Credit
as defined above, as well as an account that may replace an account
specified hereunder, but only if it serves solely to manage the Credit, as
defined above:
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1.1.21.1
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Leumi
- account no. 75920/01 at Branch
800
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1.1.21.2
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Discount
- account no. 91885843 at Branch
10.
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1.1.22
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"Business
Day" - any day except Saturday, public holidays, the two days of Rosh
Hashana, the eve of Yom Kippur and Yom Kippur, the first and eight days of
Succoth, Purim, the first and seventh days of the Passover, Independence
Day, Shavuot Festival, the Ninth of Av and also excluding any day that is
determined by the Bank Commissioner not to be a bank Business
Day.
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1.1.23
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"Closing
Day" the day on which the Credit is provided by a Closing in accordance
with this Agreement. It is hereby clarified that the Closing Day will not
take place on a day on which the Index is published or during the two days
prior to or after, a day on which the Index is
published.
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1.1.24
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"Total
Debt Service Ratio" means - the quotient reached by dividing: (A) the
cumulative total of the Borrower's residual obligations (consolidated) to
the Financial Institutions and other Lenders, other than suppliers' credit
provided to the Borrower in its normal course of business, on commercial
terms that are customary in that field, and other than obligations in
respect of Subordinated Loans, as of the Assessment Date, less repayments
made to Lenders, to the extent made, on the Assessment Date, and less cash
and cash equivalents (including negotiable bonds) mortgaged by the
Borrower in favor of one of such entities as such will be on the
Assessment Date (it is hereby clarified that to the extent that the
Assessment Date is a date on which the Borrower will have taken the Loan
(including having made use thereof or withdrawn thereon, on account of the
lines of credit provided to it) from a Financial Institution - the amounts
of the aforementioned loan/usage/withdrawal, will be included in the
balance of the obligations) by (B), the Operating Profit to service the
Debt, according to the data in the Borrower's Financial Statements
(consolidated) to the Final Date, as defined in Section 1.1.16
above.
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1.1.25
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"Debt
Service Ratio" means - the quotient arrived at by dividing: (A), the
difference between the Operating Profit to service the Debt and the lower
of the following amounts: 70 million NIS. linked to the Known Index in the
Agreement or the cumulative total of net cash flow to be utilized for the
investment activities as appears in the Borrower's Financial Statements
(consolidated) in the report on cash flow during the relevant
quarters; where the aforesaid cumulative total is linked to changes in the
Known Index and where the base index is the known index on the Final Date
and the revised index is the index known on the date of checking or on the
relevant Assessment Date. (For this purpose, "net cash flow" means - cash
flow to be used to acquire fixed property, equipment and other assets,
less cash flow arising from the sale of fixed assets, equipment and other
assets), by (B),
the Total for servicing the Debt for the 12 consecutive months commencing
immediately after the Assessment
Date.
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1.1.26
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"Inclusive
Total Debt Service Ratio" means - the quotient arrived at by dividing:
(A), the difference between the Operating Profit to service the Debt and
the lower of the following amounts: 70 million NIS. linked to the Known
Index in the Agreement or the cumulative total of net cash flow to be
utilized for the investment activities as appears in the Borrower's
Financial Statements (consolidated) in the cash flow report during the
relevant quarters; where the aforesaid cumulative total is linked to
changes in the Known Index and where the base index is the Known Index on
the Final Date and the revised index is the Index known on the date of
checking or on the relevant Assessment Date. (For this purpose, "net cash
flow" means - cash flow to be used to acquire fixed property, equipment
and other assets, less cash flow arising from the sale of fixed assets,
equipment and other assets), by (B), the Total for
servicing the inclusive Debt for the 12 consecutive months commencing
immediately after the Assessment
Date.
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1.1.27
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"Index"
means - the Consumer Price Index including fruit and vegetables, issued by
the Central Bureau of Statistics in
Israel.
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1.1.28
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"Financial
Institution" - means any one of the following entities: banks, including
auxiliary corporations as defined in the Banking Law (Licensing)
1981-5741, entities which are subject to the Law of Joint Investment in
Trusts, 1994-5754, corporations which are subject to the Law Controlling
Financial Services (Kupat Gemel) 2005-5765,
an insurance corporation as defined in the Law Supervising Insurance
Businesses 1981-5741, or any corporation similar to the aforementioned
which is incorporated outside Israel and which is supervised by a
competent authority in the country of incorporation and has
debentures.
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1.1.29
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"Assessment
Date" - any date of repayment of interest or principal of the Credit
according to the Credit repayment timetable, 7 days prior to any
settlement date to Financial Lenders as referred to in Section 10.4.2.1,
and on any date on which the Borrower will take Credit (including
utilization or withdrawal on account of the lines of Credit provided to it
(to the extent provided)), in a sum that exceeds 5 million NIS. from a
Financial institution. The first Assessment Date will take place on
December 31, 2010 or 7 Business Days prior to the first date for making
payments to Financial Institutions or the first date of taking Credit from
a Financial Institution as aforesaid, whichever is the
earlier.
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1.1.30
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"Merger"
- a Merger pursuant to the first chapter of the eighth section, or the
third chapter of the ninth section, of the Companies Law, or any act the
result of which is the acquisition of most of the Borrower's assets by an
individual or corporation.
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1.1.31
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"Credit
Documents" - all of the following: (a) This Agreement (with its annexes);
(b) the Securities Documents; (c) all requests to be provided with Credit
A as defined in Section 5.1; (d) all requests to provide Credit B as
defined in Section 5.2; (e) all requests to provide Credit C as defined in
Section 5.3; (f) the General Conditions; (g) all resolutions, approvals,
documents and agreements, relating to the provision of the Credit and its
administration (including with respect to opening the Accounts) signed by
the Borrower or by anyone on its behalf or delivered by the Borrower or by
anyone on its behalf, all of them being in such style, on such conditions
and in such form as is to the Lenders from time to time; and (h) every
agreement or other document signed by the Borrower in favor of any one of
the Lenders in connection with the provision of the Credit by
such Lender.
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1.1.32
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"Securities
Documents" - all of the following: (a) agreements and forms testifying to
the floating charge; (b) documents and forms testifying to a lien on the
Accumulation Account as defined in Section 10.4.2.2; (c) the documents and
forms testifying to a lien on shares in the Borrower in accordance with
Section 8.5; (d) the documents and forms testifying to a lien on shares on
012 Telecom Ltd. in accordance with Section 8.7; (e) Owners Guarantees;
(f) the documents and forms testifying to a lien on certain rights under
the Purchase Agreement in accordance with Section 8.2 hereunder; and the
documents and forms testifying to a lien on the rights to reimbursement of
the Owners Loans in accordance with Section 8.6. And, all documents
related to the aforementioned liens and
guarantees.
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1.1.33
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"Event
of Breach" - any event or circumstance, the happening of which constitutes
grounds for the immediate repayment of the Credit in accordance with the
Credit Documents. It is hereby clarified that if such event is only
determined at the end of a period (to the extent that the situation has
not reverted to its previous condition or the event has not been
rectified) the Lender will be entitled to demand the immediate settlement
of the Credit, such event will be considered as an Event of Breach even
prior to the elapse of the period indicated
therefor.
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1.1.34
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"Merhav"
- Merhav Ampal Energy Ltd.
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1.1.35
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"Free
and Clear" - Free and Clear of any lien, pledge, encumbrance, charge,
debt, claim or any other right of any type or kind of any third party
whatsoever.
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1.1.36
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"Total
Debt Service" means - the cumulative amount of payments of financial
charges to Financial Institutions, in respect of the Borrower's
obligations (consolidated)
existing on the Assessment Date, in respect of anticipated financial
charges for the 12 consecutive months starting immediately after the
Assessment Date, together with the cumulative amount of payments on
account of principal repayments to Financial Institutions the repayment of
which occurs in the aforementioned 12 month period. It is hereby clarified
that payments actually repaid on the Assessment Date will not be reckoned
in the total of Debt servicing.
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1.1.37
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"Inclusive
Total Debt Service" means - the cumulative amount of payments of financial
charges to Financial Institutions, in respect of the Borrower's
obligations (consolidated)
existing on the Assessment Date, together with payments to Lending
Institutions as defined in Section 1.1.46 hereunder, as such are
anticipated for the 12 consecutive months commencing immediately after the
Assessment Date, together the cumulative amount of payments on account of
repayment of principal to Financial Institutions (for the avoidance of
doubt, including in respect of payments to Lending Institutions as defined
in Section 1.1.46 hereunder) the repayment of which occurs in the
aforementioned 12 month period. It is hereby clarified that payments
actually repaid on the Assessment Date and payments to Lending
Institutions effected 7 Business Days after the Assessment Date will not
be reckoned in the total of Inclusive Debt
servicing.
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1.1.38
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"Smile"
- 012 Smile Communications Ltd.
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1.1.39
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"Owners
Guarantees" - the Guarantees specified in Section 8.4, in the format
attached as Annex
1.1.39.
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1.1.40
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"Applicable
Interest" the rate of interest before the addition of any kind of profit,
used by Leumi to establish the interest to its customers for providing
credit - in an amount, of such kind and for such period as are identical
to the amount, kind and period of the relevant Credit, and this on the
date that such credit is provided, renewed or replaced, as the case may be
(the "Determining Date"). The aforesaid applies both in respect of credit
bearing interest at a fixed rate and credit bearing interest at a variable
rate. In the event that the relevant credit bears interest that includes a
component of customarily basic interest whatsoever, that is likely to
change during such credit period (for example - credit based on Prime
interest) the Applicable Interest will be at the aforesaid interest rate
plus or minus the fixed rate (the "Fixed Supplement") when the rate of the
Fixed Supplement will be determined on the Determining Date; thus the
Applicable Interest will be in accordance with the principals detailed
above in this sub-Section and the rate of the Fixed Supplement will vary
above or below the aforementioned basic interest during that credit
period. A notification by Leumi regarding the Applicable Interest will be
binding on the Borrower and may not be protested or
appealed.
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1.1.41
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"Rate
of Participation" - the percentage set out below in respect of each
Lender:
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Bank
Leumi L'Israel Ltd. - 80%
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Bank
Discount L'Israel Ltd. - 20%
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or
as such may vary as stated in Section 2.1.6 or 5.3.5
hereunder.
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1.1.42
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"Control"
- as this term is defined in the Securities
Law.
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1.1.43
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"Related
Corporation" - a corporation, including a partnership or promoter, in
which the Borrower has Control as well as any corporation (including a
partnership or promoter) whose obligations the Borrower guarantees towards
any entity whatsoever or in respect of the failure of such corporation
(including a partnership or promoter) to comply with a debt or
obligations, [the Borrower] has undertaken to indemnify any entity
whatsoever.
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1.1.44
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"Area
of Business" - means the field of communications in Israel only, including
television services through the infrastructure of the internet or a
similar service. It is clarified that apart from television services
through the infrastructure of the internet, any investment or provision of
services in the field of media, including television, will not be included
in the Area of Business.
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1.1.45
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"General
Conditions" - the general conditions of each of the Lenders for opening
and managing the Account, and, also, with respect to Leumi, the
Accumulation Account as defined in Section
10.4.2.2.
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1.1.46
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"Payments
to Financial Institutions" - the cumulative total of payments of interest
and principal that Merhav must pay in respect of the Financial
Institutions' loan, during the relevant
period.
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1.1.47
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"Closing"
- the closing (completion) of the transaction that is the subject of the
Purchase Agreement.
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1.2
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General:
relationship between
documents
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1.2.1
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Headings
in this Agreement are added for the sake of convenience only and are
intended for its interpretation.
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1.2.2
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The
preamble and appendixes to this Agreement constitute an integral part
hereof.
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1.2.3
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Every
reference in this Agreement to an annex or Section will be understood,
except if the context requires otherwise, as a reference to an annex or
Section in this Agreement,
respectively.
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1.2.4
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Any
information, reporting, notice, demand, agreement or application pursuant
to this Agreement, shall be given in writing even if no written request is
specified as aforesaid.
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1.2.5
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Subject
to the provisions of Section 1.2.6 hereunder, the provisions of this
Agreement are in addition to the provisions of other credit agreements and
do not derogate therefrom.
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1.2.6
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In
the event of a specific contradiction between the provisions of this
Agreement and the provisions of any of its annexes or between the
provisions of this Agreement and provisions of any other credit
agreements, the provisions of this Agreement will
prevail.
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2.
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Consortium's
Rules
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Subject
to the fulfillment of the Borrower's undertakings under this Agreement and to
the fulfillment of the preconditions detailed in Section 4 hereunder, in
accordance with the Borrower' requests to be provided with credit according to
this Agreement, each of the Lenders will provide the Borrower, at the
Rate of Participation, the Credit specified in Section 5 hereunder.
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2.1.2
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The
Borrower undertakes that any borrowings in respect of the Credit to be
provided to the Borrower in accordance with the provisions of this
Agreement, will be effected from each one of the Lenders in
parallel and that this will be at the Rate of Participation and on
identical terms. Furthermore, the Borrower undertakes that each repayment
of the Credit (including early settlement under Section 6 hereunder) as
well as any reduction in the outstanding amount or the renewed outstanding
amount as stated in Section 5.3.5 or 5.3.11 hereunder, will be implemented
with each of the Lenders in parallel and at the Rate of
Participation.
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2.1.3
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For
the removal of doubt, the Lenders and the Bank Coordinator are obligated
to verify that the amounts of the Credit provided in accordance with the
provisions of this Agreement or the amounts of repayment, actually comply
with the Rate of Participation that applies to each of the Lenders, or are
on terms that are identical for each of the Lenders and that the
responsibility for this is enforced on the
Borrower.
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2.1.4
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Unless
specifically stated to the contrary, it is hereby clarified that any
payment to the Lenders or to the Bank Coordinator according to
the provisions of this Agreement will be implemented without offset, lien,
cross-claim or any other right from any source and that the sums to be
paid to each of the Lenders or the Bank Coordinator will be
Free and Clear.
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2.1.5
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Unless
specifically stated to the contrary, the obligations and rights of the
Lenders under the Credit Documents are individual, are not reciprocal, are
not inter-connected and are not dependent on one another. None of the
Lenders will bear the costs of a breach of the obligations in this
Agreement by one of the other Lenders. A breach of the obligations
contained in the Credit Documents by one of the Lenders, does not
constitute, of itself, a breach of the other Lenders' obligations, and
unless specifically stated to the contrary, will not affect the
obligations and rights of the other
Lenders.
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2.1.6
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Notwithstanding
the aforesaid, it is hereby agreed that if on the Closing Day, Bank
Discount does not provide its full part of the Credit according to the
Rate of Participation which applies to it, pursuant to a breach of this
Agreement or due to one of the events specified in Section 7 hereunder,
applying to it, or for any other reason - Leumi will provide, in its
place, the full part of credit as aforesaid, Leumi's Rate of Participation
will change accordingly and such Lender will cease to be a party to this
Agreement. It is hereby clarified that an occurrence such as the aforesaid
will not, of itself, constitute a ground for non-provision of the Credit
by the remaining Lenders in accordance with the Rate of Participation for
each Lender.
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2.1.7
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In
any event that the agreement of the Lenders is required according to the
Credit Documents, the notice in respect of agreeing or refusing to give
their agreement, will be issued to the Borrower by the Bank
Coordinator.
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2.1.8
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A
notice concerning exercise of the right to make immediate settlement of
the Credit or part thereof, or the right to increase the rate of interest
according to Section 5.4 hereunder or in the matter of taking measures to
exercise a security out of the Securities, will be issued to the Borrower
or to a Guarantor, as the case may be, by the Bank Coordinator. It is
specifically clarified that notwithstanding anything stated in this
Agreement (including Section 2.15 above), exercise of the rights detailed
above in this Section 2.18, will apply pro rata to all the
Lenders.
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2.1.9
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Each
of the parties will appoint someone to represent it and to act on its
behalf in all matters relating to the implementation of this Agreement
(the "Representatives"). The following persons will serve as the initial
Representatives of the Parties: (a) for Leumi or the Bank Coordinator -
the head of Leumi's communications department; (b) Discount - the business
manager. Details of how to communicate with each of the Representatives
are as specified in Section 19.3
hereunder.
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2.1.10
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Each
of the parties will be entitled to replace its Representative by giving a
notice, in writing, to the other parties which includes contact details
for the new Representative on its behalf, and the date of replacing the
Representatives.
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2.1.11
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Each
of the Lenders and the Bank Coordinator will be entitled to rely on any
notice or instruction given in the name of the Representative. None of the
Lenders or the Bank Coordinator will be required to obtain any further
proof of the genuineness of any fact, issue or calculation included in any
notice or instruction given to it by one of the other Lenders'
Representatives or a Representative of the Bank
Coordinator.
|
|
2.1.12
|
The
Lenders hereby declare to the Borrower that as of the date of entering
this Agreement, there is no restriction or impediment, of any kind
whatsoever, to providing all the amounts of credit under this Agreement to
the Borrower, in full and on the due dates, including on the assumption of
the adoption of any anticipated regulations (including Basel
II).
|
|
2.1.13
|
The
Lenders hereby undertake that exercising their rights under the liens
specified in Sections 8.1, 8.5 and 8.7 hereunder, including their
actualization, will not cause any adverse effect whatsoever to the
provision of services under the Licenses, and in any event, exercise of
their rights as aforesaid will be subject to all the limitations existing
in law and in the Licenses in connection
therewith.
|
|
3.
|
Object
|
The
provision of the Credit to the Borrower on the Closing Day will serve the
Borrower solely for the purpose of acquiring the activities, assets and
obligations of Smile in accordance with the provisions of the Purchase Agreement
and subject to its terms.
|
4.
|
Preconditions
for providing the Credit on the Closing
Day
|
The
provision of any amount on the Closing Day on account of the Credit under the
provisions of this Agreement is conditional upon the fulfillment of all the
following pre-conditions (which, if not stated specifically hereunder are due to
be fulfilled on the Closing Day), to the complete satisfaction of the
Lenders:
|
|
4.1.1
|
The
Borrower will have provided to the Lenders, two Business Days prior to the
Closing Day, a letter from the Borrower's attorney relating to the Loans
and including its confirmation that all consents, authorizations,
approvals and other requirements (to the extent required) have been
received in accordance with the Provisions of the Law and in accordance
with the Borrower' incorporation documents for the purpose of entering the
Purchase Agreement and for the implementation of the Credit Documents in
accordance with and subject to, the provisions
thereof.
|
|
|
4.1.2
|
On
the Closing Day, the Borrower will have deposited the Independent
Resources in its account with the Bank Coordinator and signed on the
irrevocable instructions attached as Annex 4.1.2 to this
Agreement. The Independent Resources will be transferred by the Bank
Coordinator to Smile together with the transfer of the amounts of the
Credit, as stated in Section 5
hereunder.
|
|
|
4.1.3
|
The
Borrower will have effected (signed on) the Securities, as detailed in
Section 8 hereunder, in favor of the
Lenders.
|
|
|
4.1.4
|
The
Guarantors will have signed the Owners Guarantees, as detailed in Section
8.4 hereunder, in favor of the
Lenders.
|
|
|
4.1.5
|
Merhav
will have activated the liens as detailed in Sections 8.5 and 8.6
hereunder, in favor of the Lenders.
|
|
|
4.1.6
|
The
Borrower will have fulfilled all its obligations under the Credit
Documents.
|
|
|
4.1.7
|
Cancelled
|
|
4.1.8
|
No
Event of Breach will have taken place and/or will there be, to the
Lenders' knowledge, any great likelihood of there being an Event of
Breach.
|
|
4.1.9
|
The
Borrower's board of directors will have passed the resolution in the form
attached as Annex
4.1.9 and the Borrower's attorney will have signed a confirmation
in the form and on the terms that are acceptable to the
Lenders.
|
|
4.1.10
|
The
Borrower will have opened the Accounts and signed on the authorizations,
confirmations and declarations required by any of the Lenders to that
end.
|
|
4.1.11
|
The
Closing Day will be not later than
22.6.2010.
|
|
4.1.12
|
If
and to the extent that the Borrower is aware, that one of the conditions
of the conditions prescribed in this Section has not been fulfilled, the
Borrower will give notification thereof to the Lenders immediately after
it becomes aware of the non-fulfillment of such
condition.
|
|
5.
|
The
Credits and their Conditions
|
Subject
to that stated heretofore and hereinafter in this Agreement, at the behest of
the Borrower, the Lenders will provide the Borrower, on the Closing Day, credit
in NIS up to a total cumulative amount (for each of the Lenders) of NIS 800
million, split as detailed below. Each Lender will provide the Borrower with a
portion of any credit in accordance with the Rate of Participation of such
Lender:
|
|
5.1
|
Loan
A, in the amount of (overall for each of the Lenders) NIS 500 million
which will be provided on the Closing
Day.
|
|
|
5.1.1
|
The
principal of Loan A will be linked to the Index and will be settled in 14
continuous and equal, semi annual instalments (with the addition of
linkage differences for each instalment). The first principal payment with
respect to Loan A will apply upon the lapse of 6 months from the date of
providing Loan A and the final payment will apply upon the lapse of 84
months from the date of the provision up thereof (“The Final Credit
Settlement Date”).
|
|
|
5.1.2
|
Loan
A will bear annual interest at a fixed rate of 2% above the Applicable
Interest with the addition of index linkage differences. As an indication
only, the Lenders confirm that as at the date of the signing of this
Agreement, the Applicable Interest is [2.2]
%.
|
|
|
5.1.3
|
The
interest on Loan A will be paid every three months, commencing from the
lapse of three months from the date of providing the
loan.
|
|
|
5.1.4
|
The
remaining terms and conditions of Loan A will be as detailed in the Loan
Application, Annex
5.1.4 to this Agreement.
|
|
|
5.2
|
Loan
B, in the overall cumulative amount (for all the Lenders) of NIS 200
million which will be provided on the Closing
Day.
|
|
|
5.2.1
|
The
principal of Loan B will be linked to the index and will be settled in one
instalment at the final credit settlement
date.
|
|
|
5.2.2
|
Loan
B will bear annual interest at a fixed rate of 2% above the Applicable
Interest with the addition of index linkage differences. As an indication
only, the Lenders confirm that as at the date of the signing of this
Agreement, the Applicable Interest is [3.1]
%.
|
|
|
5.2.3
|
The
interest on Loan B will be paid every three months, commencing from the
lapse of three months from the date of providing the
Loan.
|
|
|
5.2.4
|
The
remaining terms and conditions of Loan B will be as detailed in the Loan
Application, Annex 5.2.4 to this
Agreement.
|
|
|
5.3
|
The
line of Credit C, under the terms and conditions as detailed below, and in
an overall and cumulative amount (for all Lenders) of NIS 100 million (the
“Outstanding Renewed Amount”), which will be exploited in full, on the
Closing Day.
|
|
|
5.3.1
|
Line
of Credit C will be exploited by the Borrower by means of taking out an
unlinked loan in NIS, (each loan will be designated a “Loan C”) for a
period of 3, 6 or 12 months, at the Borrower's choice (each of the periods
will hereinafter be designated – “The period of Loan C”) as long as the
date of final settlement of the loans that will be provided within the
line of Credit C, will commence after the lapse of 42 months from the
Closing Day (the “Final Loan C Settlement
Date”).
|
|
|
5.3.2
|
Each
application to be provided with a Loan C will be submitted by the Borrower
to the Lenders at least 4 Business Days prior to the date requested for
providing the loan.
|
|
|
5.3.3
|
The
total cumulative amount of the unpaid balance of Loan C will not exceed,
at any time whatsoever, the Outstanding Renewed Amount or the Revised
Outstanding Renewed Amount, as the case may
be.
|
|
|
5.3.4
|
At
the behest of the Borrower, as detailed above, the Lenders will put at the
disposal of the Borrower the requested amount (each Lender in accordance
with its Rate of Participation) as long as in addition to that stated in
the sub-section of Section 5.3, the following terms and conditions will
ensue cumulatively: a) If upon the date of providing the (new) loan, there
is an unpaid balance of Loan C, the settlement date of which occurs at
that time, the (new) loan will be initially used to settle the principal
of Loan C, the settlement date of which occurs at that time, and if the
amount of the (new) loan will be higher than the unpaid balance of Loan C,
the settlement date of which occurs at that time, or, at that time, there
is no applicable date of settlement of Loan C; then the balance of the
(new) loan will serve the Borrower solely for the execution of investments
in the Area of Business and b), up to that point in time, no instance of a
breach has occurred and c) the cumulative amount of the unsettled balance
of Loan C that will be conducted by each Lender immediately after
providing the requested (new) loan, will not exceed the Rate of
Participation of each Lender of the cumulative unsettled balance of Loan C
that will be conducted by each Lender immediately after providing the
requested (new) loan, and d) at that time, there is no limitation, as
detailed in Section 7 below, on the part of any of the
Lenders.
|
|
|
5.3.5
|
It
is hereby agreed that, other than at the time of providing the loans on
the Closing Day, with respect to which that stated in Section 2.1.6 above
applies, should any of the Lenders not put at the disposal of the
Borrower, the loan as detailed in Section 5.3 above, (whether as a result
of the breach of this contract by the Borrower or whether a limitation, as
detailed in Section 7 below, exists), this fact in itself will not
constitute a ground for non-provision of the Credit by the remaining
Lenders. It is hereby clarified that should an event as stipulated above
occur, as of that date, the Outstanding Renewed Amount or the Revised
Outstanding Amount, as the case may be, will automatically be reduced by
the total of the amount not provided by the Lender as stated above, as
well as, commencing from such date, the Rate of Participation of the
Lenders will be updated in accordance with the ratio that will be in place
at that time (immediately after providing the loan by the remaining
Lenders, or part thereof), whether the unsettled balance of the Credit
with each of the Lenders or the total amount of the unsettled balance of
the Credit.
|
|
|
5.3.6
|
The
principal of each Loan C will be settled in one instalment at the end of
the period of the respective Loan
C.
|
|
|
5.3.7
|
Loan
C will bear annual interest at a fixed rate of 2% above the Applicable
Interest.
|
|
|
5.3.8
|
The
interest on Loan C will be paid every three months, commencing from the
lapse of three months from the date of providing the applicable
loan.
|
|
|
5.3.9
|
The
remaining terms and conditions of Loan C that will be provided on the
Closing Day will be as detailed in the Loan Application, Annex 5.3.9 to
this Agreement. The remaining terms and conditions of Loan C that will be
provided thereafter will be as detailed in the Loan Application to be
signed by the Borrower with each Lender as is acceptable at that time to
such Lender.
|
|
|
5.3.10
|
The
Borrower will pay the Lenders (to each Lender in accordance with the rate
of the Lender’s Participation), with respect to the unexploited balance of
Line of Credit C, non exploitation commission as detailed in Annex 12 of
this Agreement. The commission will be calculated on the balance of the
unexploited Line of Credit C. The checking of the total unexploited Line
of Credit C will be carried out on a daily basis and the payment of the
commission with respect thereto, will be carried out retrospectively at
the end of each calendar quarter. It is hereby clarified that should that
stated in Section 5.3.5 be upheld, then commencing from that date, the
Borrower will cease paying non exploitation commission to the Lender who
has not provided its share in the new Loan C, as detailed in the above
stated Section 5.2.5.
|
|
|
5.3.11
|
At
any time at which there will be an unexploited balance of Line of Credit
C, the Borrower will be at liberty to notify the Lenders in writing that
it is the Borrower’s desire to reduce the amount of the Line of Credit C
by the amount of the unexploited balance or part thereof. Commencing from
the date of the receipt of the above stated notification, the amount of
the Outstanding Renewed Amount will be irreversibly reduced accordingly.
(the “Revised Outstanding Renewed
Amount”).
|
|
|
5.4
|
Notwithstanding
the aforesaid, should an instance of a breach occur, in respect of which a
period [to remedy] is determined, only at the end of that period (to the
extent that the situation has not reverted to its former state or the
incident has not been rectified), will the Lender be entitled to demand
the immediate settlement of the Credit, then, commencing from the date of
the occurrence of the incident as stated and up to the earliest of the
following dates: the date upon which the situation reverted to its former
situation, or the date upon which the incident was rectified or the date
upon which the Lenders issued a Letter of Waiver with respect to the
breach (should such have been issued), or the date upon which the Lenders
demanded the immediate settlement of the Credit, the interest rate
determined for Loan A, Loan B and Loan C will increase by 2% per annum
above the rate of interest determined for such loan, in accordance with
Section 5.1.2 or 5.2.2. above, respectively, as such will be at that point
in time. That stated in this sub-section above will not apply in the case
of that stipulated in Section 11.3 or 11.2
occurring.
|
|
|
5.5
|
It
is hereby clarified that in any case that the immediate settlement of the
Credit will be demanded, on any date whatsoever, then, from that date, the
unexploited balance of the Credit will bear arrears
interest.
|
|
|
5.6
|
The
Bank Coordinator will inform the Borrower and each of the Lenders
regarding the change in the rate of interest by virtue of Section 5.4
above and the Bank Coordinator’s notification obligates the Borrower and
the Lenders.
|
|
6.
|
Early
Settlement of the Credit
|
|
|
It
is hereby agreed that Article 13 (b) of the Mortgage Law, 5727 – 1967 will
not apply and that the Borrower will be at liberty to settle, by means of
early settlement, the lines of Credit or any part thereof, subject to the
following cumulative terms and
conditions:
|
|
|
6.1
|
The
order of the execution of early settlement will be as
follows:
|
|
|
6.1.1
|
The
settlement of Loan C.
|
|
|
6.1.2
|
If,
at the date of the execution of the early settlement, there is no
unsettled balance of Loan C – the settlement of Loan
B.
|
|
|
6.1.3
|
If,
at the date of the execution of the early settlement, there is no
unsettled balance of Loan C or Loan B, the settlement of Loan A by means
of settlement on account of each of the outstanding principal instalments
of Loan A in an equal manner, thus each instalment will be reduced by an
identical amount. In the stated case, no changes in the dates of the
payments and in the period of Loan A, will apply. Upon the execution of
early settlement the Lenders will provide the Borrower with a new
settlement time-table and this will obligate the
Borrower.
|
|
|
6.2
|
The
amount that will be settled by means of early settlement will not be less
than NIS 5 million.
|
|
|
6.3
|
The
early settlement will only be done upon a date for the payment of
interest.
|
|
|
6.4
|
The
early settlement of the New Israeli Shekel, index linked credit can only
be executed after the lapse of one year from the date of providing the
Credit, and this on a calendar date that overlaps with the date of the
provision thereof (and should this date not be a Business Day, then the
general terms informing the matter of the bringing forward or moving back
to coordinate a Business Day, will
apply.).
|
|
|
6.5
|
The
Borrower will notify the Lenders in writing regarding the execution of the
early settlement, 7 Business Days in
advance.
|
|
|
6.6
|
On
the date of the early settlement, the Borrower will pay the Lenders the
full amounts of the interest and the commissions that have accumulated up
to that time.
|
|
|
6.7
|
On
the date of the execution of the early settlement, commission that will be
calculated in accordance with the formula appearing in Annex 6.7, will be
paid to each of the Lenders.
|
|
|
6.8
|
The
early settlement by the Borrower will be carried out in a manner that will
maintain the relevant Rate of Participation of each of the Lenders in the
remaining credit.
|
|
|
6.9
|
Any
notification issued by the Borrower regarding the intention of the
Borrower to carry out early settlement will be non-revolving and
irreversible.
|
|
|
6.10
|
With
the exception of amounts that will settle Loan C, by means of early
settlement and which, at the behest of the Borrower, will be provided anew
[by the Lenders], subject to and in accordance with that stated in Section
5.3.2 above, any amount that will be settled by means of early settlement
will not be provided anew [by the
Lenders].
|
|
7.
|
Change
in the Ownership of the Borrower
|
|
|
7.1
|
In
any case that as a result of any change in the Provisions of the Law (as
defined hereinafter), as well as in any case that as a result of the
fulfilment of a demand, provision or request of any kind – issued to or
referred to any of the Lenders by the Bank of Israel or by any other
qualified Authority, or as a result of the fulfilment of any undertaking
on the part of any of the Lenders to the Bank of Israel or to any other
qualified Authority, whether the fulfilment of the stated undertaking, the
provision, the demand or the request results from any change whatsoever in
the law as stated or whether it results from an agreement that has been
drawn up or will be drawn up from time to time, between any of the Lenders
and the Bank of Israel, or other qualified
Authority:
|
|
|
7.1.1
|
The
Lenders, all or part thereof, will be obligated to hold or deposit liquid
assets of any type or the amounts or value of the liquid assets, that any
of the Lenders is obligated to hold or deposit, will be raised;
or
|
|
|
7.1.2
|
The
amounts of the Credit that any of the Lenders is at liberty to grant or to
continue to maintain will be limited or reduced, or the amounts of the
deposits that any of the Lenders is at liberty to deposit with others
[will be limited or reduced]; or
|
|
|
7.1.3
|
Any
demands whatsoever will be imposed or will apply to any of the Lenders (or
there is a change that, in the opinion of any of the Lenders, results in,
from the point of view of the Lender, stricter requirements whatsoever)
with respect to the ratio of the reserves of the relevant Lender, on the
one hand, to the Credit the relevant Lender is at liberty to grant or to
continue to maintain, or to the assets or deposits that the relevant
Lender is permitted to hold or to receive – on the other hand;
or
|
|
|
7.1.4
|
Should
interest payments, fines, levies, or other payments be imposed or apply to
any of the Lenders, or should any of the Lenders be required to pay such
(or, should a change occur that, in the opinion of any of the Lenders,
constitutes, from that Lender’s point of view, stricter requirements for
these payments).
|
|
|
And
such Lender will determine that, as a result of the above stated, the cost
or the expenses of such Lender will increase with respect to the provision
of the Credit (in whole or in part) or with respect to the continued
existence of the Credit (in whole or in part), or should the amounts of
the principal and the interest that that Lender is entitled to receive
with respect to the loan, will decrease, then such Lender will be at
liberty to refuse to put the Credit, in whole or in part, at the disposal
of the Borrower – the Borrower will pay such Lender, from time to time,
upon the first demand, such an amount which will, in the opinion of the
Lender, indemnify for the increase in the costs and expenses of such
Lender with respect to the Credit or regarding the reduction in the
principal and the interest as stated, and the amount of the
indemnification, as will be determined by such Lender, from time to time,
as stated, will obligate the Borrower. It is clarified that the Lender in
this matter will be at liberty to make use of its rights in accordance
with the above stated, on condition that at the same time, the Lender will
make use of the identical rights granted to the Lender with respect to
other customers who were granted credit of such type, by such Lender, in a
similar scope to the Credit and which was characterized in a similar
classification in all matters related to the matter of requirements for
reporting to the Bank of Israel.
|
|
|
For
the purpose of this Section 7, the term “any change in the Provisions of
the Law” – including a change as stated in the interpretation of the
Provisions of the Law, by the Court or other Authority of the State as
stated, qualified to this end or charged with the execution or the
upholding of the Law, Regulation or Provision or Rule as
stated.
|
|
|
7.2
|
If,
at any time whatsoever, any of the Lenders will determine (and the stated
determination of such Lender will obligate the Borrower) that as a result
of any amendment whatsoever to the Law, the provision of the Credit, in
whole or in part, at the disposal of the Borrower, or – if the Credit, in
whole or in part, has been put at the disposal of the Borrower – the
continued existence of the Credit, will become, for such Lender, illegal,
then such Lender is at liberty to refuse to put the Credit, in whole or in
part, at the disposal of the Borrower, or – if the Credit, in whole or in
part, has already been put at the disposal of the Borrower – such Lender
will be entitled to demand, of the Borrower, the settlement of the
unsettled portion of the Credit (together with interest up to the actual
date of settlement) and the Borrower hereby undertakes to repay all the
above stated amounts, to such Lender, within 90 days of the date of first
demand in writing on the part of such Lender as long as in the above
stated demand, it will be stipulated that it is based on the provisions of
this Section and an appropriate explanation will be attached to it. It is
clarified that in the stated case, the Borrower will not be required to
pay early settlement commission or other payments with respect to the
early settlement. It is also explicitly clarified that, in the above
stated case, the Borrower will not be required to also settle the parallel
credit granted by the remaining Lenders should the illegality not be
relevant to them.
|
|
8.
|
Guarantees
|
|
|
The
guarantees detailed in this Section below, that will be produced for the
Lenders, will serve to guarantee the full and precise settlement of the
Credit and of all the remaining amounts owing and that will be owing to
any of the Lenders by the Borrower, in accordance with the Credit
Documents and also to guarantee any debt or other undertaking, from any
source whatsoever, of the Borrower with respect to any of the
Lenders:
|
|
|
8.1
|
General
first ranking floating charge, without limitations on the amount, on all
the existing and future assets and rights of the Borrower and a first
ranking fixed charge, without limitation in the amount, on the unpaid
share capital and the equity of the Borrower (the "Floating Charge”). The
Charge will be imposed on the assets, the rights, the unpaid share capital
and the equity, they being free and clear, with the exception of
“Permitted Liens”, as this term is defined in the Purchase
Agreement.
|
|
|
8.2
|
First
ranking fixed charge on all the rights of the Borrower in accordance with
the Purchase Agreement to receive amounts of indemnification in accordance
with the provisions of Section 11.4 of the Purchase Agreement as well as
the receipt of indemnity amounts in accordance with alternatives (i) and
(ii) of Section 11.2 of the Purchase Agreement. The Borrower will
transfer, to each of the Lenders, irrevocable instructions signed by the
Borrower and referred to Smile and authorized by its signature, in the
wording attached hereto as Annex 8.2, to transfer any amount that will be
owing to the Borrower in accordance with the stated clauses of the
Purchase Agreement, directly to the Borrower' account with each of the
Lenders in accordance with its Rate of Participation. It is agreed that
amounts that will be received in accordance with Section 11.4 of the
Purchase Agreement will be handled as follows – a total of 66.66% of this
amount will be used for the early settlement of the Credit under the terms
and conditions as detailed in Section 6 above, with the following change:
The Credit that will be settled against Loan C that was granted within the
framework of Credit C will not be provided anew, and the Outstanding
Amount or the Revised Outstanding Amount, as is appropriate, will be
reduced accordingly, and the balance can be used by the Borrower for any
purpose whatsoever, including distribution to shareholders, directly or
indirectly, in the Borrower, in any manner whatsoever, and without any
limitations whatsoever. Amounts that will be received in accordance with
the alternatives (i) and (ii) of Section 11.2 of the Purchase Agreement
will be used in full for the early settlement of the Credit under the
conditions as detailed in Section 6 above with the following change: The
Credit that will be settled against Loan C that was granted within the
framework of Credit C will not be provided anew, and the Outstanding
Amount or the Outstanding Renewed Amount, as is appropriate, will be
reduced accordingly.
|
|
|
8.3
|
First
ranking fixed charge on account of the accumulation as defined in Section
10.4.2.2. below, on all the monies credited or to be credited in favor of
the accumulation account and all the Borrower's rights in respect thereof.
As well as a first ranking fixed charge on account of the securities
linked to the accumulation account on all the securities and the rights
charged and which will be charged to the credit of the securities account
and all the Borrower's rights with respect
thereto.
|
|
|
8.4
|
Unlimited
permanent guarantee of the amount that will be signed on by Merhav and
unlimited permanent guarantee of the amount that will be signed on by
Ampal American Israel Corporation in the wording attached as Annex 1.1.39, which, in
spite of that stated at the beginning of this Section 8, will only
guarantee the amounts as will be detailed in the letter of guarantee. The
Borrower undertakes to produce to the Lenders by no later than March 15,
2010, an authorization from Ampal American Israel Corporation's lawyer
attesting to the fact that the guarantee is valid and obligates Ampal
American Israel Corporation under the applicable
law.
|
|
|
8.5
|
Second
ranking fixed charge after charges that will be created for the benefit of
the Institutions, on all Merhav shares existing on the Closing Day, and on
all the rights derived therefrom and relating thereto, including and
without derogating from the stated generality, the rights to receive
dividends or any other distribution with respect to the shares as well as
the undertaking on the part of Merhav to create, for the benefit of the
Lenders, a charge of the ranking as detailed above, on all additional
shares that it will receive (directly or indirectly) in the Borrower and
this together with the receipt thereof. It is hereby agreed that the
charge will be subject to the limitations detailed in Annex 8.5 to this
Agreement; it is clarified that as long as the Lenders have not realized
the above stated charge, all the amounts or assets that Merhav will
receive from the Borrower in the wake of a “distribution” (as defined in
the Companies Law), with respect to Merhav’s shares in the Borrower, will
be released to Merhav for its
requirements.
|
|
|
8.6
|
First
ranking fixed charge on all the rights of Merhav to the Borrower with
respect to the loans provided by Merhav to the Borrower as well as the
undertaking by Merhav to create, for the benefit of the Lenders, a charge
of the ranking as detailed above, on all the rights for the repayment of
the additional loans that will be granted to the Borrower, and this
together with their being provided. It is agreed that Merhav will be at
liberty to use the amounts received under the provisions of Section 10.4.2
below for the purpose of the payments to the Financial
Institutions.
|
|
|
8.7
|
First
ranking fixed charge on all the shares that will be transferred on the
Closing Day to the ownership of the Borrower in 012 Telecom Ltd. and all
the rights derived therefrom and related thereto, including, and without
derogating from the stated generality, the rights to receive dividends or
any other distribution with respect to the shares. It is hereby agreed
that as long as no Instance of Breach has occurred, the Borrower will be
at liberty to use the cash dividend amounts that will be transferred to
the Borrower from 012 Telecom Ltd., for any purpose, subject to the
provisions of this Agreement.
|
|
|
8.7.1
|
The
Borrower undertakes that by no later than the lapse of 30 days from the
Closing Day, Article 37a will be added to the 012 Telecom Ltd. Articles of
Association, in the following wording: “That stated in Articles 36 and 37
will not apply to the realization of any charge whatsoever created and /
or which will be created with respect to the shares in the company, in
whole or in part, for the benefit of a banking institution. For the
avoidance of doubt, it is clarified that any realization of a charge as
stated, will be executed subject to obtaining the approval of the Minister
as defined in the special general license issued to the company for the
provision of internal land line based Bezeq services on December 21, 2005,
as amended and / or will be amended from time to time.” “Banking Institution” –
as defined in the Banking Law (Licensing) 5741 –
1981.
|
|
9.
|
Declarations
by the Borrower
|
|
|
The
Borrower declares and undertakes to the Lenders as
follows:
|
|
|
9.1
|
The
Borrower is a private company incorporated and registered in accordance
with the laws of the State of
Israel.
|
|
|
9.2
|
On
the Closing Day, there are no claims, arbitration, discussions or
administrative process pending against the Borrower, with the exception of
an application to authorize an arrangement under Article 350 of the
Companies Law 5759 – 1999, of December 15, 2009 and the Borrower is not
aware of any claim, arbitration, discussions or administrative process
pending against Smile with the exception of the above stated application
and the claims detailed in the Purchase Agreement and all its appendixes
and with the exception of that as detailed in Annex 9.2 of this Agreement.
Furthermore, no information has been received by the Borrower with respect
to the intention to open a process, as stated, against the Borrower or
against Smile.
|
|
|
9.3
|
On
the Closing Day, there is no lien or mortgage of any kind on the assets of
the Borrower, (subject to that stated in Section 8.1 above), there is no
undertaking on the part of the Borrower to create a lien or mortgage of
any kind on any of the assets of the Borrower, and no entity whatsoever
has a right of financial security or other right in any of the assets of
the Borrower and there is no undertaking on the part of the Borrower to
impart, to any entity whatsoever, rights of financial security or similar
right in any of the assets of the Borrower, with the exception of liens
created and / or which will be created by the Borrower in favor of the
Lenders under the terms of this Agreement, and the current second ranking
charge in favor of the Institutions with respect to the loan by the
Institutions that will be subject to limitations as detailed in Annex 9.3 to this
Agreement.
|
|
|
9.4
|
Neither
the Borrower nor Merhav have any ground for the cancellation of the
Purchase Agreement in accordance with the grounds for cancellation
detailed therein. It is clarified that should the Borrower and / or Merhav
are aware of a ground as stated up to the Closing Day, then even if the
Borrower will decide to not realize its right to cancel the Purchase
Agreement, the Borrower must inform the Lenders in writing regarding the
ground as soon as possible after becoming aware of the ground for the
first time, and the Lenders will be entitled not to provide credit and to
cancel this Agreement.
|
|
|
9.5
|
As
at the Closing Day, all the agreements, the permits and the authorizations
required with respect to the execution of the Purchase Agreement, have
been given to the Borrower by the Anti Trust Authority as well as by the
Ministry of Communications and no additional authorizations whatsoever are
required from other regulatory
authorities.
|
|
|
9.6
|
Merhav
is the holder of 100% of the issued share capital of the Borrower, and is
the sole direct controlling shareholder in the
Borrower.
|
|
|
9.7
|
The
Borrower has the legal powers, the authority and the rights to
contractually associate under this Agreement and to fulfil all its
provisions and conditions, and all the Borrower's undertakings under this
Agreement which are, in the framework thereof or in connection therewith,
are legal, effective, valid, obligating and enforceable on the Borrower in
accordance with all its terms and
conditions.
|
|
|
9.8
|
All
the agreements, the authorities, the permits and the authorizations
required under the Provisions of the Law, in accordance with the
Borrower’s documents of incorporation, in accordance with the Purchase
Agreement, and in accordance with any other agreement that the Borrower or
the controlling shareholders in the Borrower is a party to, for the
purpose of contractually associating in the Purchase Agreement and the
execution thereof in accordance with the provisions thereof, for the
purpose of the signing of this Agreement by the Borrower, for the purpose
of obtaining credit from each of the Lenders in accordance with this
Agreement, for the purpose of creating the Securities in favor of each of
the Lenders as detailed in this Agreement and for the purpose of granting
priorities to the Lenders over third parties with respect to the above
stated Securities (with the exception of the permitted liens existing over
the mortgaged assets within the framework of the floating charge as
stipulated in Section 8.1 above and with the exception of the lien on the
Borrower’s shares, as stated in Section 8.5 above, which will be only of
second ranking) and for the purpose of the execution of all that stated in
this Agreement.
|
|
|
9.9
|
That
by the Closing Day, the authorization of the Court will be obtained with
respect to the application of December 15, 2009, submitted by the Borrower
under Article 350 of the Companies Law and that the confirmation of the
Borrower’s attorney of the fact that up to the Closing Day, no objections
to the execution of the arrangement were submitted to the Court and that
the period for the submission thereof, by law, has ended, will also be
obtained. That the Borrower has carried out all the actions and has taken
all the decisions and authorizations required for the purpose of the
signing the Credit Documents and the execution thereof, and that the
signing on the part of the Borrower on these documents obligates the
Borrower to all intents and purpose. That each of the Credit Documents,
after they will be signed by the other parties to the Agreement, will
constitute an obligating and valid legal undertaking on the part of the
Borrower, and will be enforceable on the Borrower in accordance with the
terms and conditions thereof.
|
|
|
9.10
|
There
is no limitation or exclusion under the law or in accordance with any
agreement for the upholding of all the undertakings of the Borrower in
accordance with this Agreement, and there is no limitation and / or
exclusion as stated for the provision of the Securities in accordance with
this document and that there are no limitations to the realization of the
Securities in accordance with this document, on the part of any of the
Lenders, with the exception of limitations in accordance with the Licenses
and the limitations as stated in Annex 8.5 to this
Agreement.
|
|
|
9.11
|
The
Purchase Agreement has been legally signed and, as at the Closing Day, is
valid, to all intents and the purpose, and obligates all the parties to it
in accordance with its terms and
conditions.
|
|
|
9.12
|
That
all the information and the documents handed over to the Lenders or to the
Bank Coordinator or to anyone acting of their behalf, in accordance with
the Credit Documents, were correct, in full and precise at the time of the
handing over thereof.
|
|
|
9.13
|
With
the exception of their undertakings in accordance with the Purchase
Agreement, no undertaking has been given on the part of the Borrower and /
or on the part of the controlling shareholders in the Borrower, with
respect to Smile, and the purchase consideration will be paid in full by
means of the Credits and by means of the Independent
Resources.
|
|
|
9.14
|
The
Borrower is not in possession of information, that is not in the public
domain, with respect to Smile or with respect to the Acquired Assets and /
or with respect to the Purchase Agreement, which was not brought to the
attention of the Lenders, and which, to the best of the Borrower’s
understanding, if it had been brought to the attention of any of the
Lenders, would have lead to the Lenders, all or some thereof, to refrain
from providing the Credit for the benefit of the Borrower, or would have
lead to their not agreeing to rely on the Securities detailed in this
Agreement.
|
|
|
9.15
|
To
the best of the Borrower’s knowledge, no Instance of Breach has
occurred.
|
|
|
9.16
|
As
at the date of the signing of this Agreement, all the terms and conditions
and all the representations detailed therein, with the exception of the
terms and conditions that are to be upheld after this date, are being
upheld. The Borrower is not in breach of the terms and conditions and
undertakings detailed in this Agreement. With respect to all the terms and
conditions that must be upheld in accordance with this Agreement, after
the date of the signing of this Agreement, there is no exclusion to
executing and / or upholding them in full and on
time.
|
|
10.
|
Additional
Undertakings on the Part of the
Borrower.
|
|
|
Without
derogating from the Provisions of the Law and the provisions of the Credit
agreement, the Borrower undertakes, to each of the Lenders, to uphold the
following undertakings, at all times up to the settlement of all the
Credit amounts:
|
|
|
10.1
|
Financial
Information
|
|
|
The
Borrower undertakes to submit to each of the
Lenders:
|
|
|
10.1.1
|
No
later than April 7 each year, the annual Financial Statements as at
December 31 of the previous year. The following will be attached to the
above stated Financial Statements: a). A confirmation, in the name of the
Borrower, from the Chief Financial Officer (CFO) or from the Chief
Executive Officer (CEO) of the Borrower, in accordance with which, the
Borrower has complied with all the financial bench marks detailed below.
b). Details of the relevant data and an exhaustive explanation with
respect to the manner of the calculation of the Borrower complying with
the financial bench marks. c). Solo Financial Statements referring to
December 31 of the previous year, insofar as the Borrower customarily
does, during the period related to the matter, draw up solo Financial
Statements as stated, including for its internal use and d). Details of
the Related Corporations existing as at December 31 of the previous
year.
|
|
|
10.1.2
|
No
later than 61 days after the end of each quarter, the Financial Statements
relating to the preceding quarter, as well as: Details of the unsettled
balance of Loan A, of Loan B and of Loan C as was the situation on the
last day of the preceding quarter, with respect to each of the Lenders
separately, details of the management fees paid by the Borrower during the
course of the preceding quarter, insofar as this is not detailed in the
Financial Statements relating to the matter, and insofar that, at the
Closing Day, the Borrower selected the alternative as detailed in Section
5.3.2 – details of the unexploited balance of the Line of Credit C that
was (insofar as it was), on the last day of the preceding quarter, with
respect to each of the Lenders separately. Furthermore, the following will
be attached to the above stated Financial Statements: a). A confirmation,
in the name of the Borrower, from the Chief Financial Officer (CFO) or
from the Chief Executive Officer (CEO) of the Borrower, in accordance with
which, the Borrower has complied with all the financial bench marks
detailed below. b). Details of the relevant data and an exhaustive
explanation with respect to the manner of the calculation of the Borrower
complying with the financial bench marks. c). Details of the Related
Corporations existing as at the end of the quarter to which the Financial
Statements refer, as stated.
|
|
|
10.1.3
|
No
later than 2 days prior to the Assessment Date, all the relevant data for
the purpose of the calculation of the compliance of the Borrower with the
benchmarks stipulated in Sections 10.3 and 10.4.2, signed, in the name of
the Borrower, by the Chief Financial Officer (CFO) or by the Chief
Executive Officer (CEO) of the
Borrower.
|
|
|
10.1.4
|
Should
the Borrower not draw up solo Financial Statements, for any particular
fiscal year, then the Lenders will be at liberty to demand of the
Borrower, and the Borrower will be obliged to arrange for the Lenders, a
presentation – on a date that will be set in coordination with the Lenders
and the Borrower, but no later than May 31 – with respect to the solo
financial data of the Borrower for such fiscal year, accompanied by
explanations and notes insofar as will be demanded by the Lenders in that
context.
|
|
|
10.1.5
|
Should
one of the Lenders notify the Borrower that, in accordance with the
demands of the Bank of Israel, the submission of Financial Statements is
required at an earlier date than any date stipulated above, the Borrower
undertakes to bring the submission of the Financial Statement forward to
such date.
|
|
|
10.1.6
|
The
Borrower confirms that it has been informed of the demands of the Bank of
Israel with respect to the submission of Financial Statements on time and
that a delay in the submission of the Statements is likely to cause any of
the Lenders, inter alia additional costs and / or to obligate any of them
to make a provision in their books.
|
|
|
10.1.7
|
The
Borrower will submit, to the Lenders, a report regarding any management
agreement or other agreement that gives the controlling shareholders in
the Borrower the right to any payment whatsoever from the Borrower or from
the companies under its control, immediately after the signing thereof.
For the avoidance of doubt, it is hereby clarified that there is nothing
stated in this Section to permit the payment of any payment whatsoever to
the controlling shareholders in the Borrower, except in accordance with,
and subject to, the limitations detailed in Section 10.4
below.
|
|
|
10.1.8
|
The
Borrower will submit, to the Lenders, a copy of every authorization,
notification, report or any other document that the Borrower is obliged to
submit to the Registrar of Companies and / or to the Securities Authority
and / or to the Stock Exchange in Tel Aviv and / or to the Ministry of
Communications and / or to any other Authority and which is intrinsic for
the purpose of examining capability of the Borrower to meet its
obligations in accordance with this Agreement and this as soon as possible
after the producing thereof to such entity. If the notification or the
report are published on the date of the submission thereof to the relevant
Authority, on the Authority’s website, the Borrower will inform the
Lenders in writing regarding the submission of the report or notification,
as stated, to the relevant Authority and submit a copy thereof to any of
the Lenders, at its behest.
|
|
|
10.1.9
|
The
Borrower will submit to the Lenders, at the end of 30 days after the
Closing Day, a proforma report of the Borrower that will reflect the
execution of the Purchase Agreement, signed in the name of the Borrower,
by the Chief Financial Officer (CFO) or by the Chief Executive Officer
(CEO) of the Borrower.
|
|
|
10.1.10
|
The
Borrower will submit to any of the Lenders, at the reasonable demand of
the Lender, subject to and in accordance with the Provisions of the Law,
reports, documents, information and clarifications which, in the opinion
of such Lender, are relevant for the purpose of the management of the
Credits, the charges and the Securities, insofar as will be demanded by
the Lenders including, but without derogating from the generality of the
above stated, any information and documents with respect to the business
and the financial state of the Borrower and of the corporations under its
control and the Financial Statements of the corporations under the control
of the Borrower, insofar as the above stated corporations generally draw
up, at that time, Financial Statements on a separate
basis.
|
|
|
10.1.11
|
The
Borrower undertakes to transfer to the Lenders, a notification, in any
case that the Borrower will become aware of the occurrence of an Instance
of Breach, and this close to the time of the Borrower becoming aware of
the breach.
|
|
|
10.1.12
|
The
Borrower will submit, to the Lenders, a copy of every notification or
essential material that the Borrower will submit to its shareholders in
their capacity as shareholders in the Borrower (that is, any material that
the shareholders in the company have a right to peruse, as stated in
Article 184 of the Companies Law), close to the time of the stated
submission.
|
|
|
10.1.13
|
The
Borrower will transfer to the Lenders, any notification in writing
received from a Government or Administrative Authority, with respect to
the Licenses or any one thereof, with respect to a breach or apparent
breach of the terms and conditions of the Licenses or any one thereof, the
cancellation, suspension thereof or intrinsic change thereto, and this
immediately after the receipt of the above stated
notification.
|
|
|
All
the documents and the data required of the Borrower in accordance with
this Section 10.1 will be drawn up to the satisfaction of the Bank
Coordinator. In order only to eliminate doubt, it is hereby clarified
that, subject to the remaining provisions of this Agreement, the handing
over of the above stated documents and information is subject to the
obligation of banking confidentiality customary in
Israel.
|
|
|
10.2
|
Access
to Data
|
|
|
The
Borrower will enable the Lenders, including their employees and office
holders (hereinafter – the “Representatives of the Lenders”), access to
the books, documents, data or other information whatsoever in its
possession, and the Borrower will also enable the Lenders or the
representatives of the Lenders as stated, to obtain copies of the stated
material, insofar as the matter will be deemed by the Lenders or their
Representatives required to execute this Agreement or to manage the Credit
and the Securities or to protect the rights of the Lenders in accordance
with the Credit Documents.
|
|
|
In
addition, the Borrower will enable the Lenders' professional consultants
nominated with the consent of the Borrower who have entered into
confidentiality undertakings towards it, access to its books, documents,
data or information of any kind in its possession, and will also enable
the aforesaid consultants to be provided with copies of such material to
the extent that it seems to the consultant, a relevant requirement for the
purpose of providing the services that they have agreed with it, to the
Lenders in connection with its executing this Agreement or managing the
Credit and Securities or protecting the Lenders' rights according to the
Credit Documents.
|
The
Borrower will not refuse to give its agreement to the appointment of any
consultant whatsoever for reasons that are not reasonable. Furthermore, in any
case of refusal, the Borrower will justify its refusal in writing. The Borrower
hereby agrees in advance that Leumi Partners Investigations Ltd., will serve as
an consultant subject to its signature on a non disclosure agreement in a
wording acceptable to the Borrower and to that fact that the workers who will be
employed to this end at Leumi Partners Investigations Ltd. will not carry out
work for, or with respect to, any of the Borrower’s competitors, within the
framework of which, the above stated workers will be in contact with any of the
competitors or the office holders therein.
|
|
In
addition, the Borrower will cooperate and will cause the office holders,
consultants and relevant workers acting on behalf of the Borrower, to
cooperate with the Lenders, their consultants or representatives of the
Lenders as stated, will meet with them from time to time and will transfer
to them any information or material as stated, all as the Lenders, their
consultants, or representatives will deem necessary for them, and subject
to the above stated limitations.
|
|
|
The
Borrower declares that there is nothing in the appointment of the
consultants acting on behalf of the Lenders as stated, and in the reports
or information of any kind whatsoever, that will be handed over by those
same consultants to the Lenders, in order to release the Borrower from any
obligation whatsoever imposed on the Borrower, with respect to the
Lenders, in accordance with the Credit Documents, whether an undertaking
to transfer reports and information or with respect to any other
undertaking whatsoever, or in order to impose on the Lenders or on the
representatives of the Lenders or on the consultants acting on their
behalf, any obligation whatsoever, or any liability with respect to the
Borrower – with the exception of the obligation of confidentiality imposed
on the consultants as will be detailed in the non disclosure agreement
that will be signed by them as stated above – or in order to constitute a
waiver of any kind on the part of the Lenders, or any estoppel whatsoever
with respect to the Lenders or other allegations and such
forth.
|
|
|
In
order to only eliminate doubt, it is hereby clarified that, subject to the
remaining provisions of this Agreement, the handing over of the documents
and the information as stated above is subject to the obligation of
banking confidentiality applicable in
Israel.
|
|
|
10.3
|
Undertaking to Comply
with the Financial Benchmarks (an Example of the Manner of the Examination
Attached as Annex 10.3)
|
|
|
The
Borrower undertakes to the Lenders to comply with each of the financial
benchmarks detailed in this sub-section below, which will be examined at
each Assessment Date:
|
|
|
10.3.1
|
The
Operating Profit to service the Debt (EBITDA) of the Borrower will not be
less than a total of NIS 220 million, this amount being linked to the
index, commencing from the Known Agreement
Index.
|
|
|
10.3.2
|
In
accordance with the data of each of the calendar quarters detailed below,
the Debt Service Ratio of the Borrower will not be less than the value
stipulated in the following table with respect to such
quarter.
|
|
With
Respect to Q1
|
With
Respect to Q2
|
With
Respect to Q3
|
With
Respect to Q4
|
|||||||||||||
|
2010
|
1.230 | 1.230 | 1.251 | |||||||||||||
|
2011
|
1.251 | 1.281 | 1.281 | 1.322 | ||||||||||||
|
2012
|
1.322 | 1.361 | 1.361 | 1.434 | ||||||||||||
|
2013
|
1.434 | 1.510 | 1.510 | 1.547 | ||||||||||||
|
2014
|
1.547 | 1.582 | 1.582 | 1.614 | ||||||||||||
|
2015
|
1.614 | 1.648 | 1.648 | |||||||||||||
|
|
It
is clarified that the unsettled balance of the principal of Loan C will be
deducted from the Debt Service
Ratio.
|
|
|
10.3.3
|
In
accordance with the data of each of the calendar quarters detailed below,
the Debt Service Ratio of the Borrower will not exceed the value
stipulated in the following table with respect to such
quarter.
|
|
With
Respect to Q1
|
With
Respect to Q2
|
With
Respect to Q3
|
With
Respect to Q4
|
|||||||||||||
|
2010
|
3.830 | 3.830 | 3.651 | |||||||||||||
|
2011
|
3.651 | 3.425 | 3.425 | 3.208 | ||||||||||||
|
2012
|
3.208 | 2.981 | 2.981 | 2.786 | ||||||||||||
|
2013
|
2.786 | 2.111 | 2.111 | 1.936 | ||||||||||||
|
2014
|
1.936 | 1.752 | 1.752 | 1.587 | ||||||||||||
|
2015
|
1.587 | 1.410 | 1.410 | 1.246 | ||||||||||||
|
|
It
is clarified that for the purpose of the examination of the compliance on
the part of the Borrower with all of the financial benchmarks detailed in
Sections 10.3.1, 10.3.2 and 10.3.3 above, in each of the quarters in 2010,
the cumulative Operating Profit to service the Debt (EBITDA) as at the
Closing Day, will be taken when adjusted by an annual
calculation.
|
|
|
The
financial benchmarks laid down in Sections 10.3.1, 10.3.2 and 10.3.3 above
(“The
Benchmarks”), are based on accounting standards, accounting rules,
estimates and accounting policies (“Financial Reporting”) as
implemented in the most recent Financial Statements of the Borrower, as at
the date of this document (“The Most Recent
Statements”).
|
|
|
A
different financial reporting from that on which the drawing up of the
most recent Statements was based, including, but not limited to, in the
wake of the implementation of the International Financial Reporting
Standards (IFRS), new / other / any financial reporting standards in
Israel or abroad, a change in estimates and / or a change in financial
reporting policies (all the above stated will be hereinafter called,
jointly and severally - “New Financial
Reporting”), is likely to bring about changes which will have
ramifications on the benchmarks.
|
|
|
Therefore,
the Borrower agrees as follows:
|
|
|
At
any time that it will transpire in the perception of the Lenders, at their
sole discretion, that changes have been made and / or are about to be made
to the Borrower’s Financial Statements, in the wake of the New Financial
Reporting, they will be at liberty, after consulting with the Borrower and
upon obtaining the agreement of the Borrower, to determine what are the
changes required in the benchmarks (“The Amended Benchmarks”)
in order to adjust them to the stated changes, and this with the intention
of adjusting them to the original financial purpose for which the
benchmarks were determined.
|
|
|
Should
the Bank Coordinator inform the Borrower what the amended benchmarks are –
these will obligate the Borrower commencing from the date of the
submission of the notification by the Bank Coordinator and will view this
appendix as if it includes, commencing from the date of the submission of
the notification by the Bank Coordinator, the Amended
Benchmark.
|
|
|
It
is hereby agreed that in any case that a difference of opinion between the
Borrower and the Lenders will become apparent, with respect to the changes
required in the benchmarks in the wake of the New Financial Reporting, the
parties will appoint an expert who is an independent auditor, belonging to
one of the big five auditing firms in Israel, who will determine what the
Amended Benchmarks are and his ruling will obligate the parties. The
Borrower will bear the cost of the fees of the above stated
expert.
|
|
|
10.4
|
Undertakings
with respect to Payments to
Stakeholders
|
|
|
10.4.1
|
With
the exception of that detailed in Sections 10.4.2 and 10.4.3 below, the
Borrower and any Related Corporation, will not pay, directly or
indirectly, in any manner whatsoever, to any of the Stakeholders in the
Borrower or to a relative of an Stakeholder and / or to a corporation
(including a partnership or enterprise) under the control of any of them,
(not through the Borrower) and / or to a corporation (including a
partnership or enterprise) under the control of any of them together with
others (not through the Borrower) and / or to a third party who will
replace them or act on their behalf, dividends, repayments of owners
equity, salary, expenses, management fees, consultancy fees, participation
fees, commissions or and amount owing and / or will be owing to them, with
respect to any other ground whatsoever, whether in money or money
equivalents, and will also not allow then to withdraw a monetary amount or
monetary equivalent amount, as stated, without obtaining the prior written
agreement of the Lenders. In spite of that stated in this Section above,
it is hereby agreed that the Borrower as well as a Related Corporation,
will be entitled to pay the CEO of the Borrower or of a Related
Corporation, salary with respect to his office at the Borrower or at a
Related Corporation and also to pay a director in the Borrower or in the
Related Corporation, or to a Stakeholder or to the relatives of the
Stakeholder, as the case may be, acceptable salary with respect to his
position as a director or other officer in the Borrower or in the Related
Corporation. Furthermore, the Borrower or the Related Corporation will be
at liberty to pay amounts to the Stakeholders and their relatives, as
stated above, with respect to transactions and contractual associations
that are conducted in the course of the regular business of the Borrower
or the Related Corporation and of the Stakeholder and under market
conditions.
|
|
|
10.4.2
|
It
is hereby agreed that the Borrower will be at liberty to pay Merhav
payments as detailed below subject to the upholding of all the following
terms and conditions in
accumulation:
|
|
|
10.4.2.1
|
On
every date of institutional payments as detailed in the settlement table
attached as Annex 10.4.2.1 to this Agreement, or as will be amended in
accordance with that stated in Section 1.1.1. (“Financial Institutions
Settlements Time Table”), the amount of payment to Financial
Institutions relevant at that date. It is hereby agreed that in the case
that Merhav will alter the terms and conditions of the Financial
Institutions loan and, as a result thereof, the amounts that will be
required to be settled with the Financial Institutions every three months
will be lower than the amounts detailed in the Financial Institutions
Settlements Time Table, and also in the case that Merhav will replace the
loan from the Financial Institutions with credit from another financial
institution, and the amounts that it will be required to settle with
respect thereto, every three months, will be lower than the amounts
detailed in the Financial Institutions Settlements Time Table, the
Financial Institutions Settlements Time Table will be replaced in
accordance with the amended or replaced credit terms and conditions as is
appropriate, and the new Financial Institutions Settlements Time Table
will apply and obligate from such date. At the date of the replacement of
the Financial Institution Settlements Time Table as stated above, the
parties will sign on an amendment to this Agreement for the purpose of
changing the definition of the loan from the Financial Institutions and
the institutional payments
accordingly.
|
|
|
10.4.2.2
|
By
no later than 2 Business Days prior to the date of the execution of the
payments to Financial Institutions in accordance with sub-section 10.4.2.1
above, the Borrower will deposit, in a separate account, (the
“Accumulation Account”) which will be conducted in the name of the
Borrower at the Central Tel Aviv Branch (800) of the Bank Coordinator, an
identical amount to the amount of the payments to the Financial
Institutions for such date. The obligation of the Borrower to deposit the
amounts as stated in the sub-section will be until the amounts that will
be accumulated in the accumulation account will reach the accumulated
amount – as the above stated amount will be estimated by the Bank
Coordinator – of the interest that the Borrower will have to pay to the
Lenders with respect to Loan A, Loan B and Loan C at two consecutive
payments dates of each of the above stated loans, that apply after the
date of the execution of the payment to the Financial Institutions related
to the matter.
|
|
|
10.4.2.3
|
Together
with the first deposit in favor of the accumulation account, the Borrower
will create, in favor of the Lenders, a fixed charge of first ranking, on
the accumulation account and on all the monies that will be deposited into
the stated account and all the rights with respect thereto, for the
purpose of guaranteeing its debts and undertakings with respect to the
Lenders regarding the Credit Documents. The charge will be in the wording
and under the terms and conditions as will be acceptable to the Bank
Coordinator and the company will produce for the Bank Coordinator, upon
the creation of the lien, any authorization and agreement as will be
demanded by the Bank Coordinator.
|
|
|
In
this matter it is clarified that:
|
|
|
The
Borrower will be at liberty to invest the monies in the accumulation
account in short term banking deposits, short term loans, or negotiable
securities or negotiable Exchange Traded Notes issued by the State of
Israel. To this end, the values of the short term banking deposits and /
or the securities and / or the Exchange Traded Notes will be considered in
accordance with their closing price on the Tel Aviv Stock Exchange, 2
Business Days prior to each payment date to Financial Institutions.
Surpluses that will accumulate over and above the amounts required as
stated in Section 10.4.2.2. above, will be able to be withdrawn by the
Borrower.
|
|
|
10.4.2.4
|
As
at the [date of the] Financial Statements known at the date of the
relevant payment to the Financial Institutions, the overall Debt Service
Ratio will not be less that the value stipulated in the following table,
with respect to the quarter that is the subject of the above stated
Financial Statements:
|
|
With
Respect to Q1
|
With
Respect to Q2
|
With
Respect to Q3
|
With
Respect to Q4
|
|||||||||||||
|
2010
|
1.293 | 1.293 | 1.209 | |||||||||||||
|
2011
|
1.209 | 1.146 | 1.146 | 1.183 | ||||||||||||
|
2012
|
1.183 | 1.161 | 1.161 | 1.216 | ||||||||||||
|
2013
|
1.216 | 1.274 | 1.274 | 1.306 | ||||||||||||
|
2014
|
1.306 | 1.336 | 1.336 | 1.365 | ||||||||||||
|
2015
|
1.365 | 1.394 | 1.394 | |||||||||||||
|
|
It is hereby clarified that the unsettled balance of the principal of Loan C will be offset from the Debt Service Ratio. |
|
|
10.4.2.5
|
As
at the [date of the] Financial Statements known at the date of the
relevant institutional payment, the total Debt Service Ratio will not
exceed the value stipulated in the following table, with respect to the
quarter that is the subject of the above stated Financial
Statements:
|
|
With
Respect to Q1
|
With
Respect to Q2
|
With
Respect to Q3
|
With
Respect to Q4
|
|||||||||||||
|
2010
|
3.377 | 3.377 | 3.219 | |||||||||||||
|
2011
|
3.219 | 3.043 | 3.043 | 2.850 | ||||||||||||
|
2012
|
2.850 | 2.801 | 2.801 | 2.619 | ||||||||||||
|
2013
|
2.619 | 1.999 | 1.999 | 1.833 | ||||||||||||
|
2014
|
1.833 | 1.672 | 1.672 | 1.514 | ||||||||||||
|
2015
|
1.514 | 1.356 | 1.356 | 1.199 | ||||||||||||
|
|
10.4.2.6
|
As
at the date of the payment of the relevant Institutional payments, the
amount of the Operating Profit to service the Debt will not be less than
an amount of NIS 230 million, with this amount being linked to the Known
Agreement Index.
|
|
|
It
is clarified that for the purpose of the examination of the compliance of
the Borrower with each of the financial benchmarks detailed in Sections
10.4.2.4, 10.4.2.5, 10.4.2.6 above, in each of the quarters applicable
during 2010, the cumulative Operating Profit to service the Debt (EBITDA)
from the Closing Day will be taken, it being adjusted by an annual
calculation.
|
|
|
10.4.2.7
|
Commencing
from the lapse of 36 months from the Closing Day (and after the payment to
the Financial Institutions and the payment to the Lenders due at that
point in time) and as long as Loan C, insofar as such exists, has not been
settled, the payment to the Financial Institutions will be dependent, in
addition to that stated heretofore and hereinafter, upon obtaining the
prior authorization of the Lenders, in writing, for the execution thereof.
The Lenders will not withhold such authorization, provided that the
Borrower satisfies them, prior to the execution of the payments to the
Financial Institutions, with respect to the Borrower’s ability to settle
the unsettled balance of the principal of Loan C, in full and on
time.
|
|
|
10.4.2.8
|
At
the first date upon which the payment to the Financial Institutions will
be executed, the Lenders will be in possession of the Financial Statements
referring to the preceding quarter, and the data that will be included in
the Financial Statements as stated, will indicate the fact that the
Borrower was an active company during a minimum period of three
months.
|
|
|
10.4.2.9
|
The
Borrower has complied with all its obligations to each of the Lenders in
accordance with the Credit
Documents.
|
|
|
10.4.2.10
|
No
Instance of Breach has occurred.
|
|
|
10.4.3
|
Furthermore,
it is hereby agreed that the Borrower will be entitled to pay Merhav, a
Stakeholder in the Borrower (as defined in the Securities Law) or bodies
related to them, management fees, the cumulative total of which, in a
calendar year, will not exceed NIS 15 million, linked to the Known
Agreement Index (the “Maximum Management Fee Amount”) as well as the
payment of the Value Added Tax, against an invoice that Merhav will
produce to the Borrower, with respect to the interest paid on the
Subordinate Loans, subject to all the following terms and conditions: (a)
The terms and conditions detailed in Sections 10.4.2.9 and 10.4 2 10 will
be upheld, (b) the Lenders will be in possession of Financial Statements
indicating the fact that the Borrower was an active company during a
minimum period of three months. It is hereby clarified that the amount of
the management fees refers to each calendar year separately. Should
management fees not be paid in a particular year – not as result of the
Borrower failing to comply with the terms and conditions detailed in
Sections 10.4.2.9 and 10.4 2 10 above – all or part thereof, the Borrower
will be entitled to pay them subject to the upholding of the terms and
conditions as stated above, only in the subsequent
year.
|
|
|
10.4.4
|
The
Borrower and any Related Corporation will not carry out, directly or
indirectly, exceptional transactions as defined in the Companies Law
(including provision of loans by the Borrower or a Related Corporation),
with any of the Stakeholders in the Borrower, or a relative of a
Stakeholder and / or with a corporation under the control of any of them
(not through the Borrower) and / or with a corporation under the control
of any of them together with others (not through the Borrower) and / or
with a third party that will replace them or act on their behalf, without
obtaining the prior authorization of the Lenders. It is clarified that, in
the matter of the definition of “exceptional transactions”, the market
conditions and the regular course of business will be examined relative to
each of the parties to the
transaction.
|
|
|
10.5
|
Conducting
the Business of the Borrower.
|
|
|
10.5.1
|
The
Borrower will not alter the field of its activities from the Area of
Business except subject to that stated in Section 10.5.2
below.
|
|
|
10.5.2
|
The
Borrower undertakes that, without the prior written agreement of the
Lenders, the Borrower will not carry out significant investments that are
not in the Area of Business, except after obtaining the prior written
agreement of the Lenders. In the matter of this Section 10.5.2,
“significant investments” – investments of an annual cost of a cumulative
total exceeding NIS 5 million (linked to the Known Agreement Index), in
each calendar year.
|
|
|
10.5.3
|
For
the avoidance of doubt, and without derogating from the obligations of the
Borrower detailed in the remaining Sections of this Agreement, or in the
Security Documents, it is hereby clarified that all the activities
purchased by the Borrower in accordance with the Purchase Agreement will
be carried out and managed by the Borrower directly and will, at all
times, be under the ownership of the
Borrower.
|
|
|
10.5.4
|
The
Borrower undertakes that any corporation that the Borrower is, or will be,
a Stakeholder therein, including partnerships that the Borrower will,
directly or indirectly, be the owners thereof, at a rate of 5% and over,
will only deal in activities in the Area of
Business.
|
|
|
10.5.5
|
The
Borrower undertakes not to execute, not to undertake to execute, and not
to institute any procedures whatsoever to execute a Merger (with the
exception of in accordance with the application submitted to the Court on
December 12, 2009, for an arrangement in accordance with Article 350 of
the Companies Law 5759 – 1999) without obtaining the prior written
authorization of the Lenders for this purpose. To this end, the Borrower
undertakes to transfer to the Lenders, immediately, any information and
document, required by the Lenders, at their discretion, with respect to
the requested Merger, in order for them to determine their position with
respect to the Merger.
|
|
|
10.5.6
|
The
Borrower undertakes that no Related Corporation will create, for the
benefit of any entity whatsoever, a lien of any kind whatsoever, on its
assets or on part thereof, including on equity and non-paid up share
capital.
|
|
|
10.5.7
|
The
Borrower undertakes that it will not sign any guarantee to secure debts or
undertakings of a corporation (including a partnership or venture) in
which the Borrower is not a controlling shareholder, with respect to any
entity, and neither will the Borrower undertake to indemnify any entity
whatsoever with respect to the non-upholding of a debt or undertaking of
the corporation (including a partnership or venture) as stated, with
respect thereto, without obtaining the prior written authorization of the
Lenders.
|
|
|
10.6
|
Undertaking to Produce
Valuation
|
|
|
The
Borrower will produce for the Lenders, at their behest, in which the
Lenders will stipulate that it derives from a provision or demand from the
Bank of Israel, and no more than once a year, an assessment of the value
of the Borrower, (by cash flow capitalization, DCF, and in accordance with
additional requirements that will be laid down by the Bank Coordinator in
light of the provisions or demands of the Bank of Israel, as such will be
from time to time), by an independent value assessor, who will be agreed
upon by the Lenders in advance. For the avoidance of doubt, it is
clarified that the Borrower will bear all the costs related to the value
assessment as stated.
|
|
11.
|
Immediate
Settlement
|
It is
agreed that in each of the events detailed hereunder, the Lenders (as required
by each of them) are entitled to adopt one or more of the reliefs detailed
hereunder. For the avoidance of doubt, it is clarified that if the Lenders
abstain from adopting a specific relief, this will not detract from their right
to do so on any future occasion; all at their discretion and without time
limitation. Notwithstanding the aforesaid, it is hereby agreed that
notwithstanding the occurrence of an Event of Breach, the Lenders, not having
adopted any of the reliefs available to them and the Event of Breach having been
rectified or no longer subsisting by the date on which the Lenders seek to adopt
any of the reliefs available to them, then the Lenders will not be entitled to
adopt such reliefs. It is clarified that nothing in the aforesaid shall derogate
from the Lenders' rights to adopt any relief whatsoever in respect of another
Event of Breach, if and to the extent there is such:
|
|
(a)
|
Not
to provide the Borrower with any additional credit that they have
undertaken to provide under this
Agreement;
|
|
|
(b)
|
To
demand the immediate payment of the balance of the undischarged Credit or
part thereof, together with linkage differentials, exchange rate
differentials, interest cumulative up to such time and not yet paid,
expenses, other obligations and commission that have accumulated up to
such time and have not been paid, plus arrears of interest applicable to
such credit (but arrears of interest will only be paid on the Credit
actually provided up to immediate settlement and applicable from such date
to the extent that it has not been paid), as well as any additional sum
which is, in the Lenders' opinion, available to them in respect of any
damage caused to them pursuant to early settlement of the
Credit;
|
|
|
(c)
|
To
increase the rate of interest applicable to the Credit, or any part
thereof, as specified in Section 5.4
above;
|
It is
further clarified that the Events/circumstances specified above in the
sub-sections of this Section 11 (as may be amended by the parties in writing
from time to time) and the Events entitling the demand for immediate settlement
as detailed in the debenture charge entered into by Telecom under Section 8.7
above and the floating debenture charge entered into under Section 8.1 above as
amended by the parties from time to time (the "Credit Grounds"), are the sole
grounds for establishing the right of the Lenders to demand immediate
settlement. It is hereby clarified that if grounds are found other than the
Credit Grounds, in other documents that are not referred to above, they will not
be applicable in respect of the Credit.
These are the
Events:
|
|
11.1
|
If
the Borrower does not pay to any of the Lenders any amount whatsoever that
is due to any of them according to the Credit Documents on the date
determined for its payment and if such amount is not paid within 7
Business Days from the payment
date.
|
|
|
11.2
|
If a
sequestration or any action by the Execution Office is imposed on the
Borrower's assets or the assets of any Related Corporation or on part
thereof or if the Execution Office initiates any action in respect
thereof, in a sum that exceeds 20 million NIS., linked to the Known
Agreement Index and it is not rescinded within 45 days, of if the sum is
less than 20 million NIS. linked to the Known Agreement Index, and it is
not rescinded within 90 days.
|
|
|
11.3
|
If
an application is issued for a liquidation or the prior appointment of a
provisional liquidator, receiver, special administrator or freezing
processes or the granting of an order to seize assets, and no objection to
such application is submitted within 30 days, or the objection is
overruled, or if a winding-up order is issued against the Borrower or a
Related Corporation, or a freezing
order.
|
|
|
11.4
|
If
the Borrower or a Related Corporation requests that a winding-up order be
served on it, or a freezing order, or if the Borrower or a Related
Corporation convenes a meeting of creditors for an arrangement with it,
(unless the Lenders' prior written agreement has been given for a meeting
of creditors in order to make a change in structure or for reorganization)
or if the Borrower or a Related Corporation resolves on dissolution, or
commits an act of bankruptcy.
|
|
|
11.5
|
If
the Borrower or a Related Corporation resolves on a Merger, or a division
or an arrangement, or if control or ownership of the Borrower changes,
directly or indirectly compared with that which is detailed in Section 9.5
above, without the Borrower having obtained the prior written agreement
therefore, of the Lenders.
|
|
|
"Splitting"
- as defined in Part E(2) of the Income Tax Ordinance (New Version) or any
Provision of the Law that succeeds
it.
|
|
|
"Arrangement"
- as defined in Sections 350 and 351 of the Companies Law 1999-5759, or
any Provision of the Law that may succeed
it.
|
|
|
11.6
|
If
the Borrower's or a Related Corporation's business activities or
commercial activity is discontinued and not recommenced within six months
from the date of discontinuation.
|
|
11.6a
|
If
the Borrower or a Related Corporation infringes or fails to fulfill the
undertakings under the Credit Documents in a way that is not mentioned in
any of the other sub-Sections of this Section 11 and which, in the opinion
of one of the Lenders, is a fundamental undertaking towards it, and the
breach thereof is not rectified within 30 days from the date on which the
Lenders give warning thereof in
writing.
|
|
|
11.7
|
If
is clarified that there is a declaration or confirmation by the Borrower
contained in the Credit Documents, that is "fundamental" in the sense that
had the Lender been aware of it on the date of providing the Credit to the
Borrower, the Lenders would not have given the Credit, whether contained
above in this Agreement or contained in any of the other Credit
Documents.
|
|
|
11.8
|
If
the Borrower issues bearer securities without the Lenders' prior written
agreement.
|
|
|
11.9
|
If
a License/franchise that the Borrower or a Related Corporation has
received, is rescinded or postponed, or if there is any change is made in
the conditions of the License/franchise that the Borrower of the Related
Corporation has received, which is, in the opinion of the Lenders,
fundamental, and, in the opinion of any of the Lenders, pursuant to such
change or rescission, as the case may be, there is less likelihood of the
Credit being repaid in full and on
time.
|
|
|
11.10
|
If
at any time, an event or circumstance should occur that would, in the
opinion of the Lenders, threaten or endanger, in a fundamental way, the
likelihood of full and timely repayment of the Credit to the Lenders,
including the aforesaid circumstances that could result in there being a
high probability of an adverse effect on the financial position and/or the
activities and/or the businesses of the Borrower, or if, in the opinion of
the Lenders, there is a high probability that such event or circumstance
is expected to occur, whether the occurrence of the event or circumstances
as aforesaid is dependent on the Borrower or not; but only if,
to the extent that the event or circumstance is dependent on the Borrower,
after the lapse of 30 days from the date on which the Lenders have given
the Borrower notification of its existence, the Borrower has failed to
establish, to the Lenders' complete satisfaction, that the measures
required to assure the likelihood of the Lenders' being repaid in full and
on time, have been adopted.
|
|
|
11.11
|
If
an event of any kind occurs, the result of which could entitle a Financial
Institution, in accordance with any document whatsoever signed and/or to
be signed by the Borrower or by a Related Corporation, to require the
immediate settlement of the indebtedness and obligations of the Borrower
or of a Related Corporation towards such entity, the cumulative total of
which is not lower than 50 million NIS., and also if such entity does not
exercise the aforesaid entitlement - on condition that the Financial
Institution has not issued to the Borrower or the Related Corporation,
within 25 days from the occurrence of the event, a written confirmation
according to which it does not require immediate settlement of the Credit
due to the occurrence of the event.
|
|
|
11.12
|
If
a Financial Institution has required immediate settlement of the
indebtedness and obligations of the Borrower or of a Related Corporation
towards such entity, the cumulative total of which is not lower than 10
million NIS. (linked to the Known Agreement
Index).
|
|
|
11.13
|
If
an application is submitted against any one of the Guarantors, for
liquidation or the prior appointment of a provisional liquidator, a
receiver, a special administrator or the freezing of proceedings or the
granting of an order for the appropriation of assets, and an objection to
such request is not submitted within 30 days or if the objection is
rejected, or if a winding-up order or an order to freeze proceedings is
issued against any of the
Guarantors.
|
|
|
11.14
|
If
Ampal American adopts a resolution regarding Merger, Splitting or
Arrangement without obtaining the prior written approval of the Lenders
therefore. In this regard, "Arrangement" is as defined in Section 11.5
above and "Splitting", as defined in Part E(2) of the Income Tax Ordinance
(New Version) or any Provision of the Law that succeeds it, excluding
however, transactions in the normal course of Ampal American's
business.
|
|
|
11.15
|
If
Ampal American breaches or does not fulfill any of its obligations
whatsoever towards the Lenders, detailed in Annex 11.15 of this
Agreement and the breach is not remedied within 30 days from the date on
which the Lenders give warning thereof in
writing.
|
|
|
11.16
|
In
the event that a Financial Institution requires immediate settlement of
the indebtedness and obligations of Ampal American towards such entity,
the cumulative total of which is not lower than 100 million NIS. (linked
to the Known Agreement Index).
|
If any of
the events whatsoever detailed in Section 11 above, should occur, for which a
remedial period is determined, the Bank will give its clients prior written
notice of its requirement for immediate settlement, and the Bank will be
entitled to require immediate settlement only if the Event of Breach has not
been remedied by the end of the remedial period. However, if the Bank is of the
opinion that its rights under the Credit Agreement are likely to be materially
impaired as a result of its postponing its actions during the remedial period,
the Bank will be entitled to require immediate settlement immediately upon the
occurrence of the Event of Breach. For the avoidance of doubt, the remedial
period will be calculated from the date on which the Event of Breach occurs and
not from the date of the Bank's notification, except in cases specifically noted
to the contrary in Section
11.
| 12. |
Commission
|
The
Borrower will pay the Lenders the commissions specified in Annex 12 to this Agreement. In
addition, the Borrower will pay to each of the Lenders, the other commissions
involved in the management of the Borrower's Accounts and in managing the
amounts of Credit and the Securities, as is customary from time to time with the
Lenders.
It is
agreed that additional commissions will be charged in the event of any changes
in the Credit Documents after their signing, if any from time to time, and in
such sums as will be agreed between the Lenders and the Borrower.
| 13. |
Authorization
to charge an Account
|
|
|
13.1
|
The
Borrower hereby grants irrevocable consent to debit the Accounts at each
of the Lenders with the amounts due therefore according to the provisions
of this Agreement, whether the relevant Account is in credit or in
debit.
|
|
|
13.2
|
If
one of the Lenders implements a right of offset available to it under one
of the Credit Documents or under any other source, in respect of the
amounts lodged with such Lender, (a) it will use the offset amount to
settle the Credit, in respect of which it has exercised the right to
offset as aforesaid, with all the Lenders at the Rate of Participation of
each of them, and (b) the offset amount will not reduce the amount of
Credit with the Lender that exercises the right of offset, by an amount
that exceeds the Rate of Participation of such Lender in its amount of
Credit.
|
The
provisions of this Section constitute an irrevocable instruction by the Borrower
to transfer offset sums to the other Lenders for settlement of the balance of
the relevant undischarged amounts of Credit at the Rate of Participation of each
of the Lenders.
| 14. |
Management
of the Accounts and their
computation
|
|
|
14.1
|
Each
of the Lenders will manage the Accounts and will carry out computations in
accordance with their customary procedures regarding credit and each
amount that is repaid by the Borrower to such Lender. In the absence of
any obvious error, prima
facie, any written notification given by any of the Lenders in
respect of the management of the Accounts and their computation as
specified in this Section, will constitute prima facie evidence of
the accuracy of its content.
|
|
|
14.2
|
The
Borrower declares in respect of the relationship between it and each of
the Lenders, in any legal or administration proceeding regarding the
Credit Documents: (a) in the absence of any obvious error, prima facie, the
Accounts managed by such Lender and the computations carried out by it in
respect of these Accounts constitute prima facie evidence of
the accuracy of their content, and (b) a declaration by an authorized
Representative of the Bank Coordinator in respect of the Applicable
Interest for the periods to which it refers, constitutes a conclusive
presumption of the accuracy of its
content.
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15.
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The
Bank Coordinator
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15.1
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Appointment of the
Bank Coordinator and its
powers
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15.1.1
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Each
of the Lenders appoints the Bank Coordinator to act on its behalf in
accordance with the powers extended to the Bank Coordinator as specified
in the Credit Documents.
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15.2
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The
powers, rights and authority extended to the Bank Coordinator in this
Agreement are solely of an administrative nature. Without derogating from
the generality of the aforesaid, the Bank Coordinator will not have the
power to bind any of the Lenders by any obligation whatsoever under the
Credit Documents and will not be entitled to sign on them on behalf of the
Lenders. The Bank Coordinator will not have the power to represent any of
the Lenders or to bind any of them in any legal or administrative
proceeding related to the Credit
Documents.
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15.1.3 |
The
Bank Coordinator is entitled to exercise its powers in accordance with
this Agreement through its employees or
representatives.
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15.2
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The Bank Coordinator's
responsibilities
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15.2.1 |
The
Bank Coordinator, its employees, functionaries, directors, share holders
or representatives will not be held responsible to any of the Lenders in
any regard of: (a) the validity, reliability or enforceability of the
Credit Documents; (b) the collection of amounts owing to the Lenders under
the Credit Documents; and (c) the accuracy of any declaration or
representation that is given, whether in writing or orally, relating to
the Credit Documents.
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15.2.2 |
The
Bank Coordinator will not be held responsible for its acts or omissions
relating to the Credit Documents, other than an act or omission as
aforesaid that constitutes extreme negligence or is perpetrated
maliciously. The parties undertake not to initiate any proceeding or
request for indemnification or other relief under any law, against the
Bank Coordinator's employees, functionaries, directors, shareholders or
representatives in respect of any claim they may have against any of them
(even if based on extreme negligence or a malicious act by one of them)
under the Credit Documents.
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15.2.3 |
Each
of the Lenders undertakes to indemnify the Bank Coordinator, in accordance
with the Rate of Participation, for any claim, expense, loss or payment
imposed on it that arises, directly or indirectly, from its appointment or
from the performance of its office (except in the event of extreme
negligence or a malicious act by the Bank
Coordinator).
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15.2.4 |
The
Bank Coordinator is entitled to perform any action or to refrain from the
performance of any action, the performance of or refraining from which, as
the case may be, constitutes, in its opinion, a breach of any law applying
to it or which is required for the fulfillment of any condition under law
applying to it. Without derogating from the generality of the aforesaid,
the Bank Coordinator is entitled to refrain from disclosing information in
his possession relating to the Borrower, if, in its opinion, such
disclosure constitutes a breach of the confidentiality undertakings
applying to it or a breach of any law or that could constitute the basis
for a claim against
it.
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16.
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Amendments,
changes and waivers
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16.1
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Except
as specifically stated to the contrary, in every instance where there is a
requirement for the Lenders' agreement or approval under this Agreement or
the Security Documents or in an instance where there is a requirement for
their agreement in respect of a waiver in relation to the provisions of
this Agreement or of the Security Documents, the intention is for
agreement to be given through the Bank Coordinator to implement the action
requiring the agreement of the Lenders. In any instance in which the
Borrower is required to implement an action pursuant to an instruction,
request etc. from the Lenders under this Agreement or the Security
Documents, the intention is for the request, instruction etc. given
through the Bank Coordinator.
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16.2
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It
is specifically clarified that any notice, confirmation or agreement given
by the Bank Coordinator to the Borrower will be conclusively presumptive
as if given on behalf of the
Lenders.
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16.3
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Any
provision included in the Credit Documents can be amended or changed only
in a document testifying to the amendment or change is signed by the
Borrower and by each of the
Lenders.
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16.4
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The
amendment of a provision that bestows rights of any kind to the Bank
Coordinator, a change to or waiver thereof, or an amendment, change or
waiver of additional obligations imposed on the Bank
Coordinator or an extension of the existing obligations, will not come
into effect without the Bank Coordinator's written agreement to the said
amendment, change or waiver.
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16.5
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A
waiver by one of the Lenders of a prior breach or the non-performance of
one or more the Borrower's obligations or the non-fulfillment of any
condition whatsoever under the Credit Documents, will not be considered as
agreeing to a further breach or to the further non-fulfillment of any such
condition or obligation; the failure of the Lenders to exercise any right
whatsoever available to them under the Credit Documents or according to
any law, will not be regarded as a waiver of such
right.
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No
easement or waiver of any condition whatsoever of these conditions, will be
binding on the Lenders, unless given in writing.
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17.
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Change
in the parties; the Bank Coordinator's obligations and
rights
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17.1
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The
Borrower
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The
rights and obligations of the Borrower included in the Credit Documents,
cannot be transferred without the agreement of all the
Lenders.
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17.2
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The
Lenders
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17.2.1 |
Each
of the Lenders is entitled at its exclusive discretion, to transfer its
rights under the Credit Documents, in whole or in part, to Financial
Institutions in Israel (a "Transferee"), on condition that the Transferee,
as aforesaid, is subject to all components of the Credit (Loan A/Loan B/
Loan C and the Outstanding Renewed Amount) and the remaining cumulative
unsettled balances of all credit (plus any Outstanding Renewed Amount or
any of the Revised Outstanding Renewed Amount, as the case may be)
immediately after the implementation of the transfer, both with the
Transferor and the Transferee shall not fall below 12.5% of the balance of
Cumulative unsettled balance of all the Credits plus the total unused
amount of Credit C with each of the Lenders, as it will be at that time.
The Borrower and the other Lenders will take all actions and sign all
documents required to bring the transfer transaction as aforesaid into
effect or to refine it, to release the transferring Lender from its
transferred obligations and to transfer them to the Transferee or to
bestow the transferred rights on the Transferee. It is hereby agreed that
in any event where the Transferee is not a banking corporation in Israel,
the Lenders will be entitled to implement the transfer transaction as
aforesaid only after receiving the Borrower's prior written consent. For
the purpose of this Section 17.2, "transfer" - the transfer of rights or
obligations by a sale, check, endorsement, transfer or lien in any way
whatsoever, either in whole or in part, either directly or indirectly
(including by way of a sale of rights to participate in the above rights
(participations) or in any other manner). The transfer can be made to one
Transferee or to a number of Transferees, on the same date or from time to
time.
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The
transfer as aforesaid in this Section 17.2.1 above, shall not be
implemented unless a prior written notice has been issued to the Borrower
not less than 3 Business Days in advance and the Transferee has accepted
the transferor's obligations under this
Agreement.
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17.2.2 |
A
Lender will be entitled, at any time, to reveal Information, (as defined
hereunder) regarding a transfer transaction to any person or entity that
corresponds to the definition of a "Transferee" when the Lender is
conducting or is likely to be conducting with it, negotiations to
implement a transfer transaction. Furthermore, such Lender will be
entitled to reveal Information to anyone advising him and/or anyone on
behalf of such person or entity and to companies involved in [the field
of] credit rating, for the purpose of rating the rights. Disclosure of
Information will be subject to the recipient of the Information signing a
confidentiality undertaking, in a form that is acceptable to the Lenders
and to the Borrower. For the purpose of this Section, "Information" means
- any information currently in the Lender's possession or that is likely
to be in its possession in the future, including information that is
passed to the Lender by the Borrower, which, in the Lender's opinion, is
essential or desirable to be passed regarding the transfer transaction,
including information regarding the Credit, the Loans and any other
banking service given or to be given to the Borrower, information on the
liens and Securities given or to be given to secure [the Loans] and
information regarding the
Borrower.
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It
is hereby agreed that notwithstanding the aforesaid, the Lender will be
entitled to transfer this Agreement to others without a confidentiality
undertaking needing to be
signed.
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17.2.3 |
In
the event of a transfer of part of the rights of one of the Lenders, the
proportion of the relevant Rate of Participation of such Lender between it
and the Transferee will be pro
rata.
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17.3
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Third
parties
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This
Agreement is not intended to impart, does not impart and shall not be
interpreted as imparting, any right whatsoever to a person who is not a party to
this Agreement, even though it is specifically referred to by name in this
Agreement for any purpose whatsoever. None of this Agreement's provisions shall
be interpreted as applying to the benefit of any person who is not a party to
this Agreement.
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18.
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Expiration
of the validity of the
Agreement
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If, by
and including 22.6.2010, the prior conditions for the provision of the Credit
have not all been fulfilled, this Agreement will be void ab initio, without the
requirement for any action on the part of any of the parties hereto. In such
event, as of the date of expiration, the Lenders will not be obliged to provide
the Credit to the Borrower under this Agreement and all those actions taken up
to such date, to the extent taken, will be annulled ab initio, and no party will
have any claim or demand in respect thereof against the other
parties.
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19.
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Miscellaneous
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19.1
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The
Borrower agrees that the Lenders and the Bank Coordinator may share any
information regarding it amongst and between themselves, including any
document that any one of the Lenders or the Bank Coordinator receives or
any information regarding its commercial situation or its financial
situation, and there will be no contention in respect
thereof.
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19.2
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In
the event that a provision from the Credit Documents' provisions is
determined to have been rescinded, is unlawful or unenforceable, this will
not affect the validity of the remaining provisions in the Credit
Documents.
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19.3
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Any
notice sent by one of the parties to any of the others, will be considered
to have reached its destination on the date of hand delivery, one Business
Day after delivery by facsimile – on condition that confirmation of its
receipt has been confirmed by telephone, or within three Business Days
from the date on which it is sent by registered mail.
|
The parties' addresses for the purpose of this Agreement will be
as specified hereunder (unless advised otherwise):
To
the Lenders:
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Bank
Leumi L'Israel Ltd.
Attention:
Head of Communications Department
Tel:
03-514-8398
Fax:
03-514-9017
Address:
Yehuda Halevi 34, Tel-Aviv
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Bank
Discount L'Israel Ltd.
Attention:
Business Manager
Tel:
03-514 4724
Fax:
03 -514-4053
Address
Yehuda Halevi 23, Tel Aviv
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|
Bank
Coordinator
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Bank
Coordinator – Bank Leumi L'Israel Ltd.
Attention:
Head of Communications Department
Tel:
03-514-8398
Fax:
03-514-9017
Address:
Yehuda Halevi 34, Tel-Aviv
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The
Borrower:
Attention:
Deputy Finance Director
Tel:
072-2002021
Fax:
072-2002060
Address:
Hasivim 25, Petach Tikvah, 49170
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19.4
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This
Agreement may be signed on one page containing the signatures of all the
parties, and may be signed on separate pages which, when attached to this
Agreement, will, together, constitute the parties' valid signing
thereon.
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19.5
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The
Credit Documents will be governed by the laws of the State of Israel and
the courts of Tel-Aviv-Jaffo will have exclusive
jurisdiction.
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19.6
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This
Agreement will be considered as a draft by all the
parties.
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19.7
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This
Agreement and the Credit Documents contain, embody, merge and cause all
the conditions agreed upon by the parties. No pledges, agreements, written
or verbal, undertakings or representations in connection therewith, given
or made by the parties prior to the date of executing this Agreement,
shall increase the parties' obligations and rights as set out in this
Agreement and the other Credit Documents or arising therefrom, or derogate
from or change them, and the parties will not be bound by them as of the
date of signing this Agreement.
|
IN
WITNESS WHEREOF the parties have validly signed on the date set out in the
preamble to this Agreement
|
Bank
Leumi L'Israel Ltd.
By:
/s/ Rina Vahaba
/s/
Gadi Sivani
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Bank
Discount L'Israel Ltd.
By:
/s/ Natalia Hagendorf
/s/
Orit Alster
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Bank
Coordinator - Bank Leumi L'Israel Ltd.
By:
/s/ Rina Vahaba
/s/
Gadi Sivani
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012
Smile Telecom Ltd.
By:
/s/ Irit Eluz
/s/
Yoram Firon
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