Document:

10.10.4 Executive SSP Notice and Release

    

Exhibit 10.10.4

Form of 

EXECUTIVE SELECTIVE SEVERANCE PROGRAM
NOTIFICATION LETTER

To:                                                        Notice Date: 

Due to the restructuring of the organization during [insert date], your employment with the Company will be terminated on [insert date], which shall be your last day of actual work. You will step down as a Named Executive Officer as of [insert date].

As a result, you are eligible for a severance allowance and other benefits under the Company’s 2014-2016 Executive Selective Severance Program (“Program”).

If you meet (and continue to meet) the terms and conditions of the Program, you will be eligible for Program benefits as follows:

Severance Payments

		
	•
	Following the termination of your employment, you will be paid severance equal to [insert amount], in equal installments through [insert date], which is [x] months of your base salary, as in effect on the date of this notice.

		
	•
	Severance payments under the Program will be made on regular paydays, less applicable payroll deductions and in accordance with the Company’s regular payroll practices, for the respective period authorized; there will be no lump sum payments except for vacation pay accrued and unused as of your termination of employment.

		
	•
	In the event of your death at any time during which severance payments remain payable to you hereunder, such payments shall be made to the party or parties identified as your “beneficiary” or “beneficiaries” named in the beneficiary designation most recently filed by you with the Company under the Company’s Basic Life Insurance Group Policy prior to the termination of your employment.  If no such designation is on file with the Company at the time of your death, or if no designated beneficiary has survived you, the terms of the Program will dictate how remaining severance payments, if any, are made.  

		
	•
	The severance payments will be in addition to pension payments if you are eligible and elect to concurrently retire.

    
		
	•
	Participants in the GrafTech International Holdings Inc. Retirement Plan who are terminated under the Program will receive credit (up to a maximum of two years) in order to satisfy the age and/or service requirements under the Retirement Plan.  

Medical, Dental, and EAP Benefits

		
	•
	Medical coverage for you and your eligible dependents:  You may continue group medical coverage under the Consolidated Omnibus Budget Reconciliation Act (“COBRA”) at active employee rates for twelve (12) months following your termination of employment under the same premium arrangements as active employees, but only until eligible for coverage under another group plan and thereafter under applicable COBRA rates, provided you are entitled to continuation coverage at such time under COBRA.  The continuation of medical coverage for employees terminated under the Program will be coordinated with applicable state and federal laws.  Any such continuation of medical coverage will be included as part of the continuation of benefits under COBRA.  

•    Dental coverage for you and your eligible dependents: You may continue group dental coverage under COBRA for twelve (12) months following your termination of employment under the same premium arrangements as active employees, but only until eligible for coverage under another group plan and thereafter under applicable COBRA rates, provided you are entitled to continuation coverage at such time under COBRA.  The continuation of dental coverage for employees terminated under the Program will be coordinated with applicable state and federal laws.  Any such continuation of dental coverage will be included as part of the continuation of benefits under COBRA.

•    Employee Assistance Program: If you elect to participate in this Program but decline medical coverage, you may continue participation in the Employee Assistance Program (EAP) for six (6) calendar months following your termination of employment.  
    
Other Benefits

		
	•
	Incentive Compensation Programs: 

		
	◦
	If you are a participant in the GrafTech International Ltd. Executive Incentive Compensation Program (“EICP”) or employee Incentive Compensation Program (“ICP”) and are on the payroll as of the last day of the applicable performance period and were eligible to receive an Award (as defined in the EICP or ICP) for such performance period, you will have an individual multiplier of 100% of the earned Award based on the results of the business, local, or individual metrics identified for that performance period and will be payable at the same time Awards are payable to active employees of the Company.

		
	◦
	If you are a participant in the GrafTech International Ltd. Equity Incentive Plan (the “EIP”) with an outstanding Award (as defined in the EIP), you shall be entitled to the following:

		
	▪
	Notwithstanding the terms of the applicable Award Agreement (as defined in the EIP), immediate vesting as of termination of employment of Options (as defined in the Plan) that would have vested in 2015 had you remained employed with the Company; all vested Options (including options vesting pursuant to the proceeding clause) remain outstanding for 12 months following the date of such termination (or 36 months, if termination is after you reach age 50 with at least ten years of employment with the Company), but not beyond the original term thereof (after which time they shall expire and be forfeited if unexercised).

		
	▪
	Notwithstanding the terms of the applicable Award Agreement, immediate vesting as of the termination of employment of Restricted Stock Unit Awards (as defined in the EIP) that would have vested in 2015 had you remained employed with the Company; all such awards shall be paid in accordance with the terms of the applicable Award Agreement.

		
	▪
	Performance Share Unit Awards (as defined in the EIP) shall be earned or vested as provided in the applicable Award Agreement and shall be payable in accordance with the terms of the applicable Award Agreement. 

		
	•
	Outplacement Assistance: The Company will provide Outplacement Assistance under an executive level program for six (6) months from the date that you initiate this service with the vendor, provided that you initiate the service within three (3) months following the termination of your employment with the Company. If you are interested in Outplacement Assistance, please contact your Human Resources manager. 

Section 409A

For purposes of this letter, in accordance with the terms of the Program, references to “termination of employment”, “separation from employment” and the like, when referenced for purposes of determining when you are eligible to commence receipt of payments, refers to a “separation from service” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended (“Section 409A”).  The Program is intended to be a “separation pay plan” within the meaning of Section 409A, such that payments made under the Program are exempt from Section 409A.  Each payment or benefit under the Program shall be a separate payment.  Notwithstanding anything in this letter to the contrary, in the event it is determined that the Program, or any payment hereunder, is not a separation pay plan or exempt from the application of Section 409A, then any payments of “deferred compensation” (within the meaning of Section 409A) payable upon your  separation from service if you are a “specified employee” (within the meaning of Section 409A) shall not commence until the first scheduled payroll date following the six month anniversary of your “separation from service” (within the meaning of Section 409A).

Except as otherwise explicitly indicated, eligibility for the above benefits is subject to the following:

•    You must execute the attached Release and return it to your Human Resources Manager NO EARLIER THAN the last day worked and NO LATER THAN [insert date], which is at least forty-five (45) calendar days after you receive this letter and the Release.  You are advised to review the Release with an attorney.

You will not receive Program benefits if you:

•    Are discharged by the Company prior to the last day of work for Cause.  “Cause” shall exist only if you engaged in conduct demonstrably and materially injurious to the Company, monetarily or otherwise and, after your receipt of a copy of a resolution, duly adopted by the unanimous affirmative vote of the entire membership of the Board of Directors of GrafTech International Ltd. (the “Board”) at a meeting of the Board called and held for such purpose (after reasonable notice to you and an opportunity for you, with your counsel, to be heard before the Board), finding that in the good faith opinion of the Board, you are guilty of the conduct set forth and specifying the particulars thereof in detail.  For purposes of “Cause”, no act, or failure to act, on your part shall be deemed “willful” unless done, or omitted to be done, by you in bad faith and without reasonable belief that your action or omission was in the best interest of the Company. Any act or failure to act based upon authority given pursuant to a resolution duly adopted by the Board or based upon the advice of counsel for the Company shall be conclusively presumed to be done or omitted to be done by you in good faith and in the best interests of the Company.

•    Breach a contractual or legal obligation to the Company, including but not limited to any noncompetition, confidentiality or other restrictive covenant to which you are bound.

		
	•
	Do not acknowledge the Notification Letter by signing and returning it within five (5) business days following the Notice Date, or such other period agreed to by the Company in writing.

		
	•
	Do not sign and return the Release in the time frame specified above, or elect in writing to revoke the Release within seven (7) calendar days after its execution.

Your benefits under the Program will cease if you:

		
	•
	Breach the terms of the restrictive covenants in Exhibit A attached hereto. 

Your benefits under the Program will be forfeited and you will be required to return the benefits you received under the Program in the following circumstances:

		
	•
	You violate the terms of the Release (as set forth in the Release).  

		
	•
	You engage in Detrimental Conduct (as defined in the EIP), whether before, on, or following your last day of work, such that the Company would have the right (as if your employment had not terminated) to forfeit an award granted under the EIP. 

		
	•
	You fail to return to the Company upon request all Company property which is in your possession. 

		
	•
	You fail to continue to respect the trade secrets and other confidential information to which you have had access while employed or fail to abide by all of your contractual and legal obligations related thereto.  

		
	•
	You make any critical or derogatory remarks concerning the management, operation or products of the Company or the Company’s officers, managers, employees, shareholders and affiliates, board members, customers, or vendors, or, without limiting but subject to the foregoing, you take any other action which could reasonably affect the Company’s reputation or the reputation of the previously mentioned persons.  This shall not apply to remarks required by law or given in response to subpoenas, interrogatories, law enforcement, regulatory or administrative requests or the like, in each case which you believe to be truthful.

		
	•
	You fail to cooperate in any legal disputes and/or proceedings and/or business matters relating to issues and/or incidents which took place during the term of your employment.  Any such cooperation may include, without limitation, appearances in court or discovery proceedings.  If the Company makes such a request for cooperation, the Company will reimburse you for reasonable travel, lodging, meal and similar out-of-pocket expenses incurred by you (and that are not reimbursed or paid by a third party) in connection therewith upon submission of appropriate supporting documentation.

The cessation of Program benefits for any reason stated above will not affect the continued validity and enforceability of the Release.

If you elect not to participate in the Program described above, you will remain eligible for other benefits prescribed by law, including:

		
	•
	Payment of any unused accrued vacation pay to which you are entitled; and,

		
	•
	Continuation of health insurance benefits pursuant to COBRA (additional information for which will be provided under separate cover).

The following benefits will terminate upon termination of employment, regardless of whether you elect to participate in the Program: 
 
		
	•
	Benefits under our Basic Life Insurance Group Policy will terminate on your termination of employment, but you may convert the group life policy to a private policy. 

		
	•
	Short and long term disability coverage terminates as of termination of employment. If you become eligible for (and receive) a long term disability benefit following the date of this Notification Letter, such disability benefits may be reduced by Severance Payments, as and when such payments are made, in accordance with the terms of the Long Term Disability Plan.

For the avoidance of doubt, the terms of this Notification Letter are not intended to result in duplication of benefits, if any, payable under any Severance Compensation Arrangement to which you are a party, or under the EICP, the EIP or any other plan, by reason of change in control and this Notification Letter does not replace or supersede the provisions of any such plan or agreement except as explicitly provided herein.
            
                           ______________________________
          (Signature)

Acknowledged and Agreed to by:

________________________________
[Name]
EXHIBIT A

RESTRICTED ACTIVITIES

For a period of two (2) years following the commencement of benefits under the Executive Selective Severance Program (the “Program”), [Name], as an executive selected for eligibility to participate in the Program and receive benefits thereunder (“Executive”), agrees to the following:

(i)    Executive shall not, without the Company’s prior written consent, directly or indirectly, either for himself or on behalf of any other corporation, partnership, company, person, group, or entity, engage in (a) the business of manufacturing, distributing, selling or providing needle coke and/or carbon or graphite products, services, material or equipment of the kind or type which are the same as or similar to those manufactured, distributed, sold or provided by the Company now or at any time while Executive is an employee of the Company, or (b) any other business in which the Company directly or indirectly engages now or at any time while Executive is an employee of the Company.  For purposes of this Exhibit A, Executive shall be deemed to “engage in business” if he, directly or indirectly, engages or invests in, owns, manages, operates, controls or participates in the ownership, management, operation or control of, is employed by, associated or connected in any manner with, or renders services or advice to, any corporation, partnership, company, person, group or entity engaged in the activities identified above; provided, however, that Executive may invest in the securities of any enterprise (but without otherwise participating in the activities of such enterprise) if (x) such securities are listed on any international, national or regional securities exchange or market or have been registered under Section 12(g) of the Securities Exchange Act of 1934 and (y) Executive does not beneficially own (as defined under Rule 13d-3 promulgated under the Securities Exchange Act of 1934) in excess of 5% of the outstanding equity thereof (provided, that Executive shall be deemed not to beneficially own any securities owned by a registered or unregistered investment company with more than $50 million under management).  

(ii)    The provisions set forth in Section (i) above shall apply only to the reasonable and limited geographic area consisting of (a) any state, country, possession, or territory in which the Company directly or indirectly has offices, operations, or customers, or otherwise conducts business and (b) during Executive’s period of employment, any state, country, possession, or territory in which the Company planned to conduct business.

(iii)    Executive shall not, directly or indirectly, call on, solicit or take away any of the customers or potential customers of the Company on whom Executive called or with whom Executive became acquainted or of which Executive learned during employment with the Company.

(iv)    Executive shall not, directly or indirectly, solicit for employment any employee of the Company or encourage, induce, attempt to induce, or assist another to induce or attempt to induce any employee of the Company to terminate his or her employment with the Company.

(v)    Executive shall not interfere, in any manner, with the business, trade, goodwill, sources of supply, or customers of the Company.  

(vi)    If a court of competent jurisdiction determines that the length of time, geographic scope or other restrictions, or any portion thereof, set forth in this Exhibit A is overly restrictive and unenforceable, the court may reduce or modify the same to the maximum limitations permitted by law, and, as so reduced or modified, the restrictions herein shall remain in full force and effect.  If a court of competent jurisdiction determines that any provision of this Exhibit A is invalid or against public policy, the remaining provisions shall not be affected thereby and shall remain in full force and effect.  

(vii)    Executive acknowledges and agrees that the business of the Company is international in scope and that the restrictions imposed by this Exhibit A are legitimate, reasonable and necessary to protect the Company’s investment in its businesses and the goodwill thereof.  The scope and duration of the restrictions contained herein are reasonable in light of the time that Executive has been engaged in the business of the Company, Executive’s reputation in the markets for the Company, and Executive’s relationship with the suppliers and customers of the Company.  The restrictions contained herein are not burdensome to Executive in light of the consideration provided hereunder.  Moreover, Executive has other means available to him for the pursuit of his livelihood.  

(viii)    Executive acknowledges and agrees that in the event of any violation by Executive of the provisions set forth in this Exhibit A, the Company will sustain serious, irreparable and substantial harm to its business, the extent of which will be difficult to determine and impossible to fully remedy by an action at law for money damages.  Accordingly, in the event of such violation or threatened violation by Executive, the Company shall be entitled to an injunction before trial by any court of competent jurisdiction as a matter of course, in addition to all such other legal and equitable remedies as may be available to the Company.  No bond or security needs to be furnished for such injunctive relief.  If the Company is required to enforce the provisions set forth above by seeking an injunction, the relevant time periods set forth in this Exhibit A shall commence with the entry of the injunction.  In addition to any and all of the rights and remedies which the Company may have against Executive, Executive will be liable to and pay the Company its court costs and reasonable attorneys’ fees incurred in enforcing Executive’s covenants hereunder.
EXECUTIVE SELECTIVE SEVERANCE PROGRAM RELEASE

In consideration of, but subject to, my receipt of Executive Selective Severance Program benefits as described in the Executive Selective Severance Program Notification Letter (“Notification Letter”) to me dated [insert date], I release and discharge GrafTech International Holdings Inc.,  its parents, subsidiaries and affiliates, and its and their respective successors, assigns, directors, officers, employees, representatives, consultants, advisors, counsel and agents (collectively, the “Company”) from all claims and causes of action whatsoever (whether known or unknown) arising out of my employment or separation from employment through the effective date of this Release.  These include, but are not limited to:

		
	1.
	claims and causes of action arising under the Age Discrimination in Employment Act, as amended (29 U.S.C. Section 621-634) (the “ADEA”), and any other federal, state or municipal employment discrimination statutes pursuant to which claims based on age may be asserted against the Company; and/or

		
	2.
	claims and causes of action arising under any federal, state or municipal employment discrimination statutes, as amended, including, but not limited to:

		
	a.
	claims of race, color, sex, national origin and religious discrimination or harassment in employment or other claims arising under Title VII of the Civil Rights Act of 1964, 42 U.S.C. §2000e et seq., 

		
	b.
	the Americans With Disabilities Act, 42 U.S.C. §12101 et seq., 

		
	c.
	the Labor Management Relations Act, 29 U.S.C. § 141 et seq., 

		
	d.
	the Family and Medical Leave Act, 29 U.S.C. § 5601 et seq.,

		
	e.
	the Employee Retirement Security Income Act, 

		
	f.
	the Equal Pay Act, 

		
	g.
	the Civil Rights Act of 1866,

		
	h.
	the Civil Rights Act of 1991,

		
	i.
	the Ohio Civil Rights Act, Ohio Rev. Code §4112.01 et seq. or other state’s equivalent statute, 

		
	j.
	the Ohio Whistleblower Protection Act, Ohio Rev. Code 4113.51 et seq. or other state’s equivalent statute, and/or

		
	3.
	any other claim or cause of action whatsoever, including, but not limited to, any statutory or common law claim or cause of action, whether arising at law or in equity, including, but not limited to those sounding in tort, estoppel, public policy, waiver, personal injury, contract, breach of the implied covenant of good faith and fair dealing, fraud, misrepresentation, defamation, libel, slander, retaliation, wrongful discharge, infliction of emotional distress, invasion of privacy, breach of duty, and/ or negligence.   

As used herein, “claim” and “cause of action” also include all rights, obligations, liabilities, losses, damages, costs and expenses of any kind.

Except as expressly stated in this Release, I understand and agree that I am waiving and releasing any and all claims or causes of action that I may ever have had or that I now have against the Company, regardless of their nature or origin, and that the fact that such claim or cause of action is not listed above does not mean that such claim or cause of action is not included in this Release. This Release does not apply to any claim or cause of action which, under applicable law, cannot be released or waived. If any claim or cause of action is not subject to release or waiver, then, to the extent permitted by applicable law, I waive any right or ability to be (and agree not to act as) a class or collective action representative and to participate (and agree not to participate) in any putative or certified class, collective or multi-party action or proceeding, in each case in respect of a claim in which the Company is a party. It is expressly understood that I do not waive claims or causes of action that may arise after the effective date of this Release and which are not the subject of this Release.  Notwithstanding anything in this Release to the contrary, (i) I am not releasing or waiving any claim or cause of action to indemnification, advancement of expenses or insurance coverage to which I may be entitled under statutes, insurance policies, articles or certificates of incorporation or bylaws, or agreements to which I am a party, as a former director or officer of the Company, (ii) I am not releasing or waiving any claim or cause of action to share in recovery as a member of a class of stockholders of the Company in respect of actions and other proceedings not initiated, commenced or encouraged by me and (iii) to the extent that I may have existing, vested rights under the terms of ERISA plans sponsored by the Company, I understand that my rights to such vested benefits are not released or waived and shall continue to be governed by the terms of the applicable plans, if any.  Giving testimony and information and providing documents in response to subpoenas, interrogatories, law enforcement, regulatory or administrative requests and the like shall not constitute initiation, commencement or encouragement of any action or other proceeding.

I understand that, if I do not revoke the Release within seven (7) days after signing it (as provided in the last paragraph of this Release) and later assert any claim or cause of action covered by this Release, I will forfeit all the Executive Selective Severance Program benefits, and must reimburse the Company for all such benefits received.  I agree to further reimburse the Company for all reasonable attorneys’ fees and costs it incurs to obtain such reimbursement.  I understand that this forfeiture of benefits and reimbursement provision does not apply to any claim or cause of action under the ADEA.

I represent, promise and agree that: (i) neither I nor any agent acting on my behalf has commenced or prosecuted or will commence or prosecute any civil action in any court against the Company on the basis of any claims or causes of action within the scope of this Release; and (ii) if I do commence such a civil action, I will not oppose a motion to dismiss filed by the Company based on this Release. Civil action does not include any administrative proceeding or government action. For the avoidance of doubt, I acknowledge that nothing in this Release shall prohibit me, if I am covered by the SEC’s whistleblower policies under the Sarbanes-Oxley Act of 2002 and the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, from reporting and providing information regarding alleged wrongdoing or securities law violations at the Company to the SEC. I do not waive or release my right to challenge the validity of this Release under the Older Workers Benefit Protection Act of 1990, 29 U.S.C. §626(f), in an appropriate proceeding.  I acknowledge that neither this paragraph nor this Release as a whole are intended to be retaliatory.

I agree that, when requested to do so by the Company, I will cooperate in any legal disputes and/or proceedings and/or business matters relating to issues and/or incidents which took place during the term of my employment.  I acknowledge that such cooperation may include, without limitation, appearances in court or discovery proceedings. If the Company makes such a request, I understand that the Company will reimburse me for reasonable travel, lodging, meal and similar out-of-pocket expenses incurred by me (and that are not reimbursed or paid by a third party) in connection therewith upon submission of appropriate supporting documentation.

Without violating the terms of this Release, I understand and agree that I will discuss the terms of this Release only with my attorney, my tax advisor and members of my immediate family, provided that they agree to keep the information in this Release strictly confidential and not disclose it to any other person.

In addition, I understand that this Release is intended to avoid any disputes and it shall not be construed by any person or entity as an admission of any liability or wrongdoing of any kind.  I further agree that, upon the Company’s request, I will return to the Company all records, files, equipment, desk or office or file keys, credit cards, computer programs and disks, or other Company property which is in my possession. I agree to continue to respect the trade secrets and other confidential information to which I have had access while employed and will abide by all of my contractual obligations with respect thereto. Furthermore, I agree that, except as otherwise required by law or to give testimony or information in response to subpoena, interrogatories, law enforcement, regulatory or administrative request and the like, in each case that I believe to be truthful, I will not make any critical or derogatory remarks concerning the management, operation or products of the Company or the Company’s officers, managers, employees, shareholders and affiliates, board members, customers, or vendors. Without limiting but subject to the foregoing, I agree not to take any other action which could reasonably affect the Company’s reputation or the reputation of the previously mentioned persons.

I have carefully read and fully understand all the provisions of the Notification Letter and this Release, and I have signed this Release knowingly and voluntarily.  I acknowledge that I have (i) been given at least forty-five (45) calendar days to review and consider this Release and accompanying material, (ii) been advised to consult with an attorney before executing this Release, (iii) have had any questions answered to my satisfaction, and (iv) have not relied upon any representation or statement, written or oral, not set forth in this Release or the Notification Letter.  

I acknowledge that this Release and the Notification Letter (including Exhibit A thereto) contain the entire understanding between the Company and me, and supersedes all prior agreements and understandings, if any, regarding the subject matter of this Release and the Notification Letter. If any provision of this Release is deemed to be invalid, the remainder of this Release is enforceable in all other respects.

I acknowledge receipt of the Notification Letter and Attachment 1, which contains additional information regarding those eligible and those not selected for the Executive Selective Severance Program benefits as described therein. 

I agree and understand that this Release will be binding not only on me but also on my heirs, administrators and assigns with respect to the claims and causes of action covered by this Release.  As of the date of my signing of this Release, I have made no assignment of any claims or causes of action against the Company.

Finally, I understand that I can revoke this Release, but only by doing so in writing within a period of seven (7) calendar days following its execution.  This Release shall be effective on the eighth calendar day following its execution by me.

_____________________________             ________________________________
Date                        [Name]      

IF YOU HAVE QUESTIONS CONCERNING THE EXECUTIVE SELECTIVE SEVERANCE PROGRAM BENEFITS OFFERED TO YOU OR THIS RELEASE, YOU MAY WISH TO CONSULT YOUR BENEFITS ADMINISTRATOR, TAX CONSULTANT, AND/OR ACCOUNTANT BEFORE YOU SIGN IT.  SIGNING THIS DOCUMENT WAIVES CERTAIN LEGAL RIGHTS, AND YOU ARE THEREFORE ALSO ADVISED TO CONSULT AN ATTORNEY BEFORE SIGNING IT.

ATTACHMENT 1 TO SELECTIVE SEVERANCE PROGRAM RELEASE

The Company hereby informs you that you will be released from employment with the Company due to the [insert date] restructuring of the organization.  You are eligible for a severance allowance and other benefits under the Executive Selective Severance Program.  The following information is provided to you in accordance with law.

(a)        Severance has been offered to the senior executives of GrafTech International Ltd., and/or its U.S. affiliates whose employment is being terminated.

(b)        The eligibility factors for severance are as follows:  you must be a senior executive of GrafTech International Ltd., and/or its U.S. affiliates whose employment is being terminated other than for Cause. 

(c)        The time limits are as follows:  you must submit a signed Release NO EARLIER than your last day of work, and NO LATER than [insert date], which is at least forty-five (45) calendar days after you receive the Notification Letter and this Release. 

(d)        The job titles and ages of all individuals in your organizational unit or group who were and were not selected for termination and offered Executive Selective Severance Program benefits for signing a Release are as follows:

      
   Job Title            Selected              Not Selected        Agespag.htm

SALE AND PURCHASE AGREEMENT

 

Entered into by and between

MR. SERGI VARGAS VILA

as “Seller”

and

ZD VENTURES CORP.

as “Purchaser”

Barcelona, February 25, 2015

  

  

  

TABLE OF CONTENTS

 

	
1.

	
DEFINITIONS

	4

 

	
2.

	
PURPOSE

	8

 

	
3.

	
DETERMINATION AND PAYMENT OF THE PRICE

	8

 

	
4.

	
CONSUMMATION OF THE SALE AND PURCHASE AND TRANSFER OF THE SHARES     8

	
 

 

	
5.

	
RELATIONSHIP WITH IBM

	10

 

	
6.

	
REPRESENTATIONS AND WARRANTIES

	11

 

	
7.

	
INDEMNIFICATION

	16

 

	
8

	
ASSIGNMENT OF RIGHTS

	16

 

	
9

	
CONFIDENTIALITY

	17

 

	
10.

	
EXPENSES AND TAXES

	
17

 

	
11.

	
NOTICES

	
17

 

	
12.

	
DISPUTES RESOLUTION

	
18

 

	
13.

	
APPLICABLE LAW AND JURISDICTION

	
[18

 

	
14.

	
SEVERABILITY

	
19

 

	
15.

	
MISCELLANEOUS

	
19

  

  

  

SALE AND PURCHASE AGREEMENT

 

Barcelona, February 25, 2015

 

 

THE PARTIES

 

On the one side,

 

Mr. SERGI VARGAS VILA, of Spanish nationality, divorced, of legal age, with address in Barcelona, c/ Sardenya 68-72, and holder of Spanish National Identification Card (DNI) number 43,682,304-Z (the “Seller”).

On the other side,

ZD VENTURES CORP., a United States company, incorporated under the laws of the State of Nevada (U.S.), and with executive office in 47 Avenue Road, Suite 200 Toronto, ON M5R 2G3, with CIK number 0001334589 and Spanish tax identification number (NIF) N4041468B; represented by Mr. Terence Robinson, of Canadian nationality, of legal age, resident in Barcelona, and holder of passport of his Canadian nationality number 514125338, in his condition of Director, Chief Executive Officer and President and duly authorised according to the faculties delegated by the board of directors on September 30, 2014 (the “Purchaser” or “ZD Ventures”).

The Seller and the Purchaser are hereinafter jointly referred to as the “Parties”, and individually as a “Party”.

The Parties, in the capacity in which they act, state that they have the necessary legal capacity to be bound in the terms of this sale and purchase agreement (the “Agreement”), and

THEY STATE

	
I.  

	
Bluesence Innovation Group, S.L., sole-shareholder company, is a Spanish company with registered office in Barcelona, c/ Casanovas, 199, 2o 1a, registered in the Barcelona Commercial Registry, in tome 44,165, sheet 184 and page B-448,486, entry 1st, and Spanish tax identification number (NIF) B-66,216,235 (the “Company” or “Bluesence”).

 

	
II.  

	
The business of the Company is the commercialization of software and the provision of services related to IT consulting, among others (the “Business”).

	
III.  

	
As of the date hereof and in accordance with the incorporation deed of Bluesence, the share capital of the Company amounts to Euro 3,000 and is represented by 3,000 shares, numbered from 1 to 3,000, both inclusive, with a nominal value of Euro 1 each (the “Shares”), which are entirely owned by the Seller.

 

	
IV.  

	
Bluesence has legalized its shareholders’ registry book before the Commercial Registry of Barcelona and duly updated its content to reflect the current structure, as of the Agreement Date, of the share capital of the Company.

 

	
V.  

	
The Purchaser is ZD Ventures Corp. and is interested in expanding its business through investments or acquisitions of related and/or linked business, such as the Business of the Company. In particular, the Purchaser is interested in acquiring each and every one of the Shares, free and clear from Charges and Encumbrances, and the Seller, in turn, is interested in selling to the Purchaser each and every one of the Shares.

 

	
VI.  

	
The Purchaser has decided to acquire the Shares on the terms established in the Agreement and on the basis of the representations made by the Seller during the negotiations that have led to, or are set forth in, the Agreement.

 

Now therefore, the Seller and the Purchaser have agreed to the Sale and Purchase of the Shares in accordance with the terms of the Agreement.

 

CLAUSES

 

	
1.  

	
Definitions

 

	
1.1

	
Unless the context requires otherwise, the following capitalized terms and expressions in the Agreement are defined terms and expressions which shall have the meaning ascribed herein below:

	
“Adverse Consequence(s)”

	
means all actions, suits, proceedings, hearings, audits, investigations, charges, complaints, claims, demands, injunctions, judgments, orders, decrees, rulings, damages, diminution in value, dues, penalties, fines, costs, amounts paid in settlement, liabilities, obligations, taxes, liens, losses, expenses, and fees, including court costs and reasonable and documented attorneys’ fees and expenses.

	
“Agreement”

	
means this agreement, its annexes and appendices.

	
“Agreement Date”

	
means the date hereof.

	
“Bluesence”

	
means the Company.

	
“Business”

	
means the commercialization of software and the provision of services related to IT consulting carried out by the Company.

	
“Business Day”

	
means any day except Saturday, Sunday and any other day which is a public holiday in the city of Barcelona.

	
“By-laws”

	
means the restated by-laws of the Company to be approved by means of the Sole Shareholder’s Decisions referred to in Clause 4.4(iii)(c).

	
“Charges and Encumbrances”

	
means any charge, claim, encumbrance, ancillary obligation, option, retrospective right of acquisition, retention of title, pooling agreement, third-party right, including preemptive rights of acquisition or transfer, or restrictions on the transferability of the Shares or rights in favor of any person other than the Purchaser that may restrict the disposition, use or exploitation of the Shares or, as the case may be, the assets and rights of the Company.

 

	
“Company”

	
means Bluesence Innovation Group, S.L., a Spanish company with registered office in Barcelona, c/ Casanovas, 199, 2o 1a, registered in the Barcelona Commercial Registry, in tome 44,165, sheet 184 and page B-448,486, entry 1st, and Spanish tax identification number (NIF) B-66,216,235.

 

	
“Current By-laws”

	
means the current by-laws approved by the Company and registered at the Barcelona Commercial Registry, whose copy is attached as Annex 6.3(i).

	
“IT Systems”

	
means the necessary exploitation rights in the systems, software and IT developments used by them in the pursuit of the Business.

	
“Parties”

	
means, jointly, the Seller and the Purchaser.

	
“Person”

	
means any individual, corporation, partnership, firm, joint venture association, trust, unincorporated organisation, governmental or regulatory body or other entity.

	
“Price”

	
means the price agreed by the Parties for the Shares as defined in Clause 3.

	
“Purchaser”

	
means ZD Ventures Corp., a United States company, incorporated under the laws of the State of Nevada (U.S.), and with executive office in 47 Avenue Road, Suite 200 Toronto, ON M5R 2G3, with CIK number 0001334589 and Spanish tax identification number (NIF) N4041468B.

	
“Related Party”

	
means any shareholder, director, officer or agent of the Company; and any corporation, partnership, firm, joint venture association, trust, unincorporated organization, individual or other entity in which any of the Seller and/or of the foregoing have a direct or indirect economic interest.

	
“Representations and

	
means as defined in Clause 6.

	
  

	
Warranties”

	
“Sale and Purchase”

	
means as defined in recital VI above.

	
“Seller”

	
means Mr. Sergi Vargas Vila.

 

	
“Shares”

	
means all the shares (“participaciones sociales”) owned by the Seller and transferred to the Purchaser as of the date hereof by virtue of this Agreement, which as of today’s correspond to 100% of the stake of the Company’ share capital.

	
“Sole Shareholder’s Decisions”

	
means the decisions of the sole shareholder of the Company referred to in Clause 4.4(iii).

	
“Taxes”

	
means any and all taxes, whether direct or indirect and whether levied by reference to income, profits, gains, capital contributions, net wealth, asset values, turnover, added value or other reference and statutory, governmental, state, provincial, local governmental or municipal impositions, duties, contributions, rates and levies (including without limitation social security contributions and any other payroll taxes), whenever and wherever imposed (whether imposed by way of a withholding or deduction for or on account of tax or otherwise) and in respect of any person and all penalties, charges, costs and interest relating thereto.

	
“Technology”

	
means any technological devices and software necessary for carrying out the Business in the highest standards of quality and which (i) has been/will be developed by the Seller and/or the Company and/or for the Company; and (ii) is/will be owned by the Company.

	
“ZD Ventures”

	
means the Purchaser.

	
1.2

	
The preamble, the annexes and the appendices form an integral part of the Agreement and references to this Agreement shall include the preamble, the annexes and the appendices. Any definition used in the Agreement shall have the same meaning when used in the annexes and/or appendices, unless explicitly stipulated otherwise.

	
1.3

	
The headings used in this Agreement are included for reference purposes only and shall not constitute a part of the Agreement for any other purpose and shall particularly not affect the interpretation or construction of any of the provisions of the Agreement.

	
1.4

	
In this Agreement, references to a person include any individual, company or corporation, partnership, trust or other entity, organization or unincorporated association, as well as any governmental authority.

	
1.5

	
Whenever used in this Agreement, the words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”.

	
1.6

	
Any reference in this Agreement to any gender shall include all genders, and words importing the singular only shall include the plural and vice versa, unless explicitly specified otherwise.

	
1.7

	
In this Agreement Spanish terms and legal concepts are expressed in English and not in their original Spanish terms. Where indicated in italics, Spanish equivalents of these English terms have been given.

 

	
2.  

	
Purpose

 

By virtue of this Agreement, the Purchaser purchases and acquires from the Seller, which sells and transfers, each and every one of the Shares in the terms and conditions contained herein.

The Shares are sold and purchased free and clear from any Charges and Encumbrances, are fully subscribed and paid in and fully enjoy the rights inherent in them by reason of statute and the bylaws.

 

	
3.  

	
Determination and payment of the Price

 

The Parties agree to set the Price for the Sale and Purchase of the Shares at Euro forty thousand (€ 40,000). Both the parties acknowledge that the agreed price has been fully paid by way of an offset against loan of the same amount given by the Purchaser to the Seller between July 2014 and September 2014. The Purchaser agrees to forgive any and all interest due on such loan to date.

 

The Parties agree that the Price is considered fair and thus waiving any actions contained in articles 1,290 et seq of the Spanish Civil Code.

 

 

	
4.  

	
Consummation of the Sale and Purchase and transfer of the Shares

 

	
4.1  

	
The Sale and Purchase hereunder is formalized with the signature of the Agreement on the Agreement Date. The Shares are transferred on the Agreement Date by way of the delivery and transfer of the Shares to the Purchaser and the assumption by the Purchaser of all rights and obligations relating to Shares.

	
4.2  

	
The Seller expressly undertakes to grant his consent and approval (including the corresponding waiver of his pre-emptive assumption right, if applicable) in order to carry out, in accordance with the terms and conditions contained herein, the Sale and Purchase for the purpose that the Purchaser effectively becomes the owner of the Shares representing 100% of the share capital of the Company.

	
4.3  

	
The Sale and Purchase of the Shares contemplated herein is formalized in the offices of J&A Garrigues, S.L.P., or in the corporate offices of the Purchaser in Barcelona.

	
4.4  

	
On the date hereof, the following actions will simultaneously (en unidad de acto) be carried out by the Parties:

	
  

	
(i)

	
The Seller will deliver or show to the Purchaser:

 

	
(a)  

	
The original public deed evidencing the Seller’s ownership of all the Shares, so that the Notary can record the relevant notes on such deed.

	
(b)  

	
A certificate issued by the sole director of the Company evidencing that, as of the date hereof, the Company’s Shares are duly and entirely owned by the Seller.

	
(c)  

	
A certificate issued by the sole director of the Company evidencing that, since its formation as of the date hereof, Bluesence has only engaged in the Business and has not pursued any other business or has encountered any contingency, claim or liability that jeopardize the intended Business.

	
(d)  

	
The Shareholders’ registry book of the Company duly legalized before the Commercial Registry of Barcelona.

	
(e)  

	
The letter of resignation of the sole director of the Company, as of the date hereof, in form and substance satisfactory to the Purchaser.

	
(ii)  

	
The Parties will grant before the Notary of Barcelona, Mr. Ramón García-Torrent Carballo, or any other notary accepted by both the parties,  the relevant public deed notarizing the Agreement.

	
(iii)  

	
The adoption of the decisions of the sole shareholder of the Company relating to the following matters (the “Sole Shareholder’s Decisions”):

	
(a)  

	
the change of the management body of the Company, currently managed by a sole director (including its resignation), so that it will consist of a board of directors comprised of three (3) members designated by the Purchaser;

	
(b)  

	
the appointment of Messrs. Terence Robinson, Mr. Alberto Tintore and Mr. Serge Vargas to the office as new members of the board of directors of the Company; and

	
(c)  

	
the approval of By-laws in the form set out in Annex 4.4(iii)(c).

	
(iv)  

	
The new members of the board of directors of the Company (appointed by virtue of the Sole Shareholder’s Decisions) will hold a meeting in order to adopt the following resolutions (the “Board of Directors Meeting”):

	
a)  

	
the appointment of Mr. Terence Robinson as the chairman of the board of directors of the Company;

	
b)  

	
the appointment of Mr. Alberto Tintore as the secretary of the board of directors of the Company;

	
c)  

	
the appointment of Mr. Sergi Vargas Vila as the managing director (consejero delegado); and

	
d)  

	
the appointment of Mr. Sergi Vargas Vila to be responsible for day to day management as Chief Executive Officer (director general) of the Company for a period of five (5) years, subject to the continuity and terms of his Consulting Agreement as set out in Annex 4.4(iv) (d) .

	
(v)  

	
The secretary of the board of directors of the Company or any person with certifying authorities shall grant before the Notary of Barcelona, Mr. Ramón García-Torrent Carballo, or any other Notary acceptable to both the parties, the relevant public deed in order to notarize the resolutions adopted by the Sole Shareholder’s Decisions and the Board of Directors Meeting of the Company.

	
(vi)  

	
The secretary of the board of directors of the Company or any person with certifying authorities shall grant before the Notary of Barcelona, Mr. Ramón García-Torrent Carballo, or any other Notary acceptable to both the parties, the relevant public deed in order to notarize the change of the sole shareholder of the Company.

	
(vii)  

	
The secretary of the board of directors or any person with certifying authorities will record the Purchaser as new sole shareholder of the Company at the Company shareholders’ registry book by virtue of the Sale and Purchase.

It is expressly put on record that the Purchaser shall not be bound to acquire the Shares unless all the actions reflected in sections (i) and (ii) of this Clause 4.4 are completed on the date hereof in accordance with this Clause 4.

 

	
5.  

	
Relationship with IBM

 

	
5.1  

	
As of today’s date, Bluesence has entered into an agreement with International Business Machines (“IBM”) for the purposes of reselling the IBM’s products as “Business Partner Advanced”. In this connection, it is expressly put on record that it is essential for the Company to maintain and consolidate its current relationship with IBM.

	
5.2  

	
The Seller, in his condition of Chief Executive Officer after the execution of this Agreement, undertakes to carry each and all necessary activities in order to comply with the provisions set forth in paragraph 5.1 above.

 

	
6.  

	
Representations and Warranties

 

	
  

	
The Seller, either in his condition of sole shareholder and sole director of the Company until the Agreement Date, grants the Purchaser the Representations and Warranties described in this Clause 6, which are key to the Purchaser’ decision to undertake the Sale and Purchase and which shall be understood referred as of the Agreement Date. Unless expressly provided herein to the contrary or unless the context otherwise requires, the warranties apply to the Seller.

	
6.1  

	
The Seller

	
(i)  

	
The Seller has sufficient power and authority to enter into and perform its obligations under this Agreement.

	
(ii)  

	
The Agreement and all other agreements and obligations undertaken in connection with the Sale and Purchase contemplated hereby constitute or will constitute, following the execution and delivery thereof, the valid and legally binding obligations of the Seller, enforceable against any of them in accordance with the respective terms.

	
(iii)  

	
The execution, delivery and performance by the Seller of this Agreement, and the agreements contemplated herein shall not conflict with or result in the breach or termination of any material term or provision of, or constitute a default under, any permits or agreements to which the Company is bound.

	
(iv)  

	
The Seller has obtained each and all consents, approvals, orders and authorisations required for the execution and delivery and consummation of this Agreement and/or the agreements contemplated herein.

	
(v)  

	
The Seller acknowledges that he fully understands the terms of this agreement and has had his own independent legal advice on all aspects of this agreement.

	
6.2  

	
Organisation of the Company

	
(i)  

	
The Company is a private limited liability company (sociedad de responsabilidad limitada), which has been duly incorporated and validly exists under the laws of Spain.

	
(ii)  

	
The Company has the necessary full legal capacity and capacity to act to own its assets and Business and engage in the activities typical of its trade or business in the same manner and at the same location as it currently does, in accordance with all the necessary official authorizations, licenses, registrations and permits, which have been validly granted and are in full force and effect.

	
(iii)  

	
Since its formation and up to the Agreement Date, the Company has only engaged in the Business and has not pursued nor does it pursue any business other than that mentioned above.

	
(iv)  

	
In relation to the Company, no proposal has been made or resolution adopted for a statutory merger or division, or a similar arrangement.

	
(v)  

	
No attachment has been made on any of the assets of the Company.

	
6.3  

	
Corporate Governance

	
(i)  

	
The by-laws of the Company currently in force are as registered at the relevant Commercial Registry on the Agreement Date and attached as Annex 6.3(i) (the “Current By-laws”).

	
(ii)  

	
The Current By-laws contain all of the rights and obligations of the sole shareholder of the Company in his capacity as such and there is no other agreement whatsoever besides the Current By-laws that provide for rights, obligations or undertakings that affect the Company, its current shareholder or the acts to be performed pursuant to the provisions of the Agreement that provides for rights, obligations or undertakings that affect the development of the Company’s Business.

	
(iii)  

	
The Company is duly recorded with the Commercial Registry of Barcelona.

	
(iv)  

	
The Company has not granted powers of attorney.

	
6.4  

	
Share capital

	
(i)  

	
The Seller has full right and title to the Shares.

	
(ii)  

	
The Shares are validly created and fully subscribed and paid-up and are free and clear of any Charges and Encumbrances.

	
(iii)  

	
The Company is not subject to any of the grounds for mandatory winding up or capital reduction provided for in articles 317, 327 and 363 of the Spanish Capital Companies Act. The Company is not subject to any net worth imbalance, nor is there any legal obligation to contribute equity. The Company is not subject to any actual or imminent situation of winding up, liquidation, or technical or formal insolvency, nor is it or has it been declared insolvent or been subject to any insolvency proceeding; the Company has not adopted any resolutions or filed any petitions, nor is there any step or proceeding underway for the foregoing purposes, and there are no circumstances that could give rise to a court order for winding up and/or an insolvency order being made against the Company.

	
(iv)  

	
Since the date of the incorporation of the Company, the Company has not distributed any dividends, interim dividends or any equivalent, and it has not adopted as of the Agreement Date any of the foregoing resolutions.

	
6.5  

	
Managing body. Books

	
(i)  

	
As of the date hereof, there are no amounts pending payment that constitute compensation or any other item to which the sole director of the Company may be entitled.

	
(ii)  

	
The Company keeps its shareholders’ registry book and the minutes books duly legalized with their content duly updated to the date hereof and in compliance with the applicable legislation. The referred books are kept at the premises of the Company.

	
6.6  

	
Litigation and compliance

There are no claims, suits, actions or proceedings pending against, relating to, affecting the Company or initiated by the Company before any court, arbitrator, (semi) governmental department, commission, agency, instrumentality or authority.

	
6.7  

	
Employees, account payables and tax

	
(i)  

	
Bluesence has not had any employees since its incorporation.

	
(ii)  

	
The accounts payables of the Company as of today’s date are reflected in Annex 6.7(ii) herein.

	
(iii)  

	
The financial statements of Bluesence as of February 24, 2015, which appear in Annex 6.7(iii), (a) are true, exact and complete and present a true and fair view of the Company, of their net worth and financial position and of their results on the date and during the indicated period; (b) have been prepared in accordance with the applicable legislation and with  US GAAPs (“GAAP”); and (c) duly reflect all activities and operations engaged in, as well any provisions that must be recorded in accordance with GAAP.

	
(iv)  

	
Bluesence has filed timely, fully and accurately all formal and substantive Taxes’ obligations pertaining to the Business and which the latter has had to levy accordingly.

	
6.8  

	
Data protection and IT systems

	
(i)  

	
The Company fulfils and has fulfilled timely, fully and exactly, in relation to data processing by them, as data controller and/or data processor, all formal and substantive obligations under data protection legislation.

	
(ii)  

	
The Company holds title to the necessary exploitation rights in the systems, software and IT developments used by them in the pursuit of the Business (the “IT Systems”) and may exploit them in the most appropriate manner for such purpose.

	
(iii)  

	
The Company is the owner or lessee of the hardware they use in the operation of the Business.

	
6.9  

	
Intellectual Property Rights

	
(i)  

	
All trade names, trademarks, domain names, industrial designs, patents, utility models, copyright, inventions, know-how, commercial rights, confidential information and any other industrial and intellectual property rights (the “Intellectual Property Rights”) used by the Company, belong to the Company and are duly registered in its name or are held in accordance with a valid instrument, and their use has not been licensed or assigned permanently or temporarily to any third party, nor the Company is aware of any unauthorized use or utilization of the Intellectual Property Rights by any third party, and they have not tolerated the unauthorized use or exploitation of the Intellectual Property Rights by third parties, and none of the Intellectual Property Rights are due to expire within three (3) months following the Agreement Date.

	
(ii)  

	
Attached as Annex 6.9(ii) there is a true, exact and complete list of the main characteristics of the Intellectual Property Rights registered and/or applied for and of the license agreements entered into by the Company for the Intellectual Property Rights (the “License Agreements”).

	
(iii)  

	
The Intellectual Property Rights described in Clauses 6.9(i) and 6.9(ii) above and in the License Agreements are all those required for the operation of the Business of the Company as pursued up to the Agreement Date.

	
(iv)  

	
The Intellectual Property Rights are duly registered with the relevant authorities and in full force and effect and may be enforced against third parties.

	
(v)  

	
The Company is the full owner of, and hold lawful title to, the Intellectual Property Rights, which are free, clear and exempt from any kind of Encumbrances and they are not subject to any challenge, opposition, declaration of suspension or nullity, claim or litigation. The Company has fulfilled all of the obligations imposed by the laws of the applicable jurisdiction in order to maintain the validity of their title to the Intellectual Property Rights and is fully authorized to use and utilize the Intellectual Property Rights and the trademarks and other third-party rights falling outside the subject matter of the License Agreements.

	
(vi)  

	
The Company does not infringe, directly or indirectly, any registration or modes of intellectual property rights, copyright, including software, data bases and/or domain names held by third parties.

	
6.10  

	
Legal compliance

The Company pursues and has pursued all of its activities, businesses and transactions of all kinds in timely, full and exact compliance with all formal and substantive obligations under the legislation applicable in Spain and in any other territory or country in which it pursues and has pursued its business.

	
6.11  

	
Information

All of the information provided, contained or referred to in the Agreement, as well as the information contained in the documents included in the appendixes thereto, is true, exact and complete in all respects, and no fact, item, information or data that could adversely affect the current situation of the Company has been omitted, and the Seller is not aware of any event or fact of particular relevance that may affect the truthfulness, exactness or completeness of such information.

 

	
7.  

	
Indemnification

 

	
7.1  

	
The Seller, acknowledging that the data, information, Representations and Warranties, covenants and agreements offered to the Purchaser and set forth in this Agreement and its annexes and appendices represent the basis on which the Purchaser has decided to enter into this Agreement and to carry out the Sale and Purchase described herein, covenants and agrees to indemnify, defend, protect and hold harmless the Purchaser from, against and in respect of all Adverse Consequences suffered, sustained, incurred or paid by the Purchaser in connection with, resulting from or arising out of, directly or indirectly:

	
(a)  

	
any breach or inaccuracy of any Representation or Warranty of the Seller set forth in this Agreement; and

	
(b)  

	
any non-fulfilment of any covenant or agreement set forth in the Agreement.

	
  

	
The Purchaser shall be the beneficiary of any payment to be made by the Seller pursuant to this Clause 7, unless otherwise unilaterally decided by the Purchaser.

	
7.2  

	
The rights laid down in the Purchaser’s favour in this Clause 7 will not be affected by the narrow perusal, if any, that the Purchaser and its advisors have carried out or by the knowledge they may have had, before or after the Agreement Date or by the decision of the Purchaser to undertake the Sale and Purchase.

	
7.3  

	
The obligations of indemnity shall be in force for a period of two (2) years following the Agreement Date unless before the expiry of this period the Purchaser has filed a claim against the Seller in accordance with this Agreement or has notified the Seller of the existence of a claim, in which case this term shall be extended until such claim has been resolved.

 

	
8.  

	
Assignment of rights

 

The Purchaser may assign all or part of the rights and/or obligations assumed by it under this Agreement to any third party, merely by serving notice of the assignment to the other Parties of the Agreement. Under the assignment, any reference to the Purchaser contained herein shall be understood as a reference to the assignee or assignees.

The Seller agrees that there is no need to formalise the assignment by the Purchaser in a separate agreement and that, to be operative, such assignment shall require neither further action nor any further document or authorisation of any kind.

The Seller may not assign the rights and obligations he assumes under this Agreement without prior written authorisation from the Purchaser.

 

	
9.  

	
Confidentiality

 

The Parties undertake to hold in confidence and not to disclose to third parties (except to their professional advisors or it required by law or by a Judicial and/or Governmental Authority) without the prior written consent of the other the terms and conditions of this Agreement and of any other ancillary documents; as well as the negotiations relating to them.

The press release to be published, as the case may be, by or on behalf of the Parties relating to this Agreement shall be in terms approved by the Purchaser; and any written communication of the Seller to any third party (including to current and/or former employees, suppliers and/or clients of the Company) in connection to this Agreement shall be previously approved by the Purchaser.

 

	
10.  

	
Expenses and Taxes

 

Each Party shall bear its respective expenses and legal costs, including advisors’ fees, and all other costs and expenses incurred by the Parties in relation to this Agreement. The Parties shall bear as provided for under applicable law the Notary’s fees for the notarization of the Agreement and the transfer of the Shares. Any tax arising from this Agreement and from the Sale and Purchase of the Shares of the Company regulated hereunder shall be borne by the Parties pursuant to the applicable Law.

 

	
11.  

	
Notices

 

	
11.1  

	
All notices, notifications or other communications pertaining to the Agreement shall be deemed to have been duly given and made if in writing, by certified mail (correo certificado) or burofax, in the English language and served by any duly authenticated means providing proof of the contents and delivery of the communication.

	
11.2  

	
The Parties agree that all notices, notifications and/or other communications resulting from the performance of the Agreement and pertaining to the Parties and the Company shall be served to the following:

Seller

To the attention of Mr. Sergi Vargas Vila

Address: c/ Sardenya, 68-72, Barcelona

Telephone: 639 491 990

Email: svargas@bluesence.es

Purchaser

ZD Ventures Corp.

To the attention of Mr. Kam Shah

Address: 47 Avenue RD, Suite 200, Toronto A6 M5R 2G3, 416-929-1806

Email: ks@zdventures.com

With copy:

To the attention of Mr. Pablo Vinageras Cobielles

Address: Av. Diagonal 654, Building D, 1st floor, 08034 Barcelona

Email: pablo.vinageras.cobielles@garrigues.com

	
11.3  

	
Any change of address must be communicated significantly in advance to the other Party by any duly authenticated means providing proof of the contents and delivery of the communication.

 

	
12.  

	
Disputes resolution

 

	
14.1

	
The Parties shall attempt in good faith to resolve any dispute arising out of or relating to this Agreement promptly by negotiation between the Parties or their appointed representatives. Any Party may give the other Parties written notice of any dispute not resolved in the normal course of business to initiate the relevant disputes resolution procedures.

	
  

	
If the matter has not been resolved by the Parties within one (1) month as from the relevant disputing Party’s notice, or if the parties fail to meet within one (1) month, either Party may initiate court proceedings as provided hereinafter.

	
12.2  

	
In the event the Parties are not able to resolve the dispute according to the provisions set forth in Clause 12.1, any controversy, claim or dispute arising among the Parties as the result of this Agreement shall be resolved by the Courts as set forth in Clause 13 herein below.

 

	
13.  

	
Applicable Law and Jurisdiction

 

This Agreement shall be governed and construed in accordance with substantive Spanish Law. The Parties, waiving the right to their own jurisdiction, if any, expressly submit themselves to the competence and jurisdiction of the Courts of Barcelona (Spain).

 

	
14.  

	
Severability

 

	
  

	
If any clause of this Agreement was declared totally or partially null or void, such nullity or voidness would only affect that provision or part thereof which is null or void and the Agreement shall remain in force in all other respects, the provision or part thereof that is affected being deemed non-existent.

	
  

	
Accordingly, only the null or void provision of the Agreement shall cease to be valid, and no other part or provision of this Agreement shall be annulled, invalidated or adversely or otherwise affected by such nullity or voidness, unless, due to being essential to the Sale and Purchase, it unavoidably affects the Agreement as a whole.

 

	
15.  

	
Miscellaneous

 

	
15.1

	
This Agreement and its annexes and appendices, which form an integral part hereof to all effects and purposes, represent the only valid agreement between the Parties in relation to the subject-matter hereof, and render null and void any other oral or written contracts or agreements previously reached between the Parties.

	
15.2

	
No amendment or variation in the terms of this Agreement shall be effective if it has not been established in writing and signed by the Parties, which are to be bound thereby.

	
15.3

	
This Agreement is executed in English.

IN WITNESS WHEREOF, the Parties have executed this Agreement in one (1) counterpart in the place and on the date first above written.

[signature page follow]

  

  

  

By the Seller

__SD: Sergi Vargas Vila_______________________

Sergi Vargas Vila

By the Purchaser

SD: Terence Robinson

Terence Robinson,

in the name and on behalf of

ZD Ventures Corp.

( enclosures are excluded)

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