Clause 5.4 states that "subject to the declarations recognized in this section above, the Purchaser declares that it is aware that the Company's shares are being sold as they are (AS IS). The parties mutually undertake to amend the documents of Guy Development and/or [the French company] and/or the property companies, if and to the extent necessary in order to adapt these documents to the provisions of this agreement."
- Whereas Mr. Knepfler stated that "the purchaser declares that it has the financial strength required to fulfill its obligations under this memorandum of conditions" (clause 5.5).
It should be noted that the forecast document, which I discussed above, was not part of the representations anchored in the agreement, at least not explicitly.
- Regarding the possibility of cancellation, clause 7.3 stipulates that "each party shall be entitled to cancel this Agreement due to its fundamental breach by the breaching party, provided that it has given written notice of 14 days' advance notice of its intention to do so, and during this period of time the breaching party has not amended the one that needs to be amended."
Differences between Mr. Knepler and Mr. Nehemiah and ADN
- There is no dispute that immediately after the signing of the agreement, Mr. Knepfler learned of ADN's debt to Ravad. Against this background, an addendum to the agreement was signed on May 31, 2016 (Appendix 7 to the counter-statement of defense), according to which if Ravad makes the company's debt immediately repayable, Mr. Knepfler will waive the right of veto and some of the protections in the agreement, in exchange for compensation.
- However, the agreements between the parties did not lead them to the deceased and to the estate, and as we shall immediately see, the parties raise different versions regarding the conduct of the matter that led to the filing of the claim and the counterclaim.
According to Mr. Kneffler, it quickly became clear to him that he had been presented with false representations in relation to the transaction in which he had entered into. Thus, in a meeting held in mid-June 2016 with Mr. Nehemiah, the latter informed him that Lille properties would not meet their rental targets. It also turned out that there was a debt to the property management company there. This debt amounted to €700,000, according to the reports to which Mr. Knepfler was disclosed only after the signing. He further claimed that Mr. Nehemia and the other directors were aware that the performance of the properties in France was significantly lower than those in the company's reports, and that there was no congruence between the basic data in the forecast document and reality. Hence, they misled him with false representations in order to attract him to invest in the deal.