Exhibit 10.32
[This is an English translation of the governing document.
The governing document is in German.]
Share Sale and Purchase and Option Agreement
between
Horst Michaels ,
Tulpenweg 13, 63755 Alzenau;
Anni Simoneit ,
represented by Gertrud Eckert
Markerstr. 31, 63755 Alzenau;
Arno Michaels ,
Prentelweg 2 a, 81243 Munich;
Bianca Michaels ,
Adolfsallee 7, 65185 Wiesbaden;
Ute Michaels,
Meistersingerstr. 13, 81927 Munich, and
(hereinafter together "Shareholders")
and
Applied Power Holding GmbH,
Mundelheimer Weg 51, 40472 Dusseldorf
(AG Dusseldorf, HRB 31197)
(hereinafter "Purchaser")
and
Actuant Corporation,
6100 North Baker Road, Milwaukee, Wisconsin 53209, USA
(hereinafter "Actuant")
Date: 22 July 2002
Table of Content:
List of Exhibits .............................................................. II
Preamble ...................................................................... 1
(S)1 Object of Sale ........................................................... 3
(S)2 Sale of Shares / Put Option .............................................. 4
(S)3 Purchase Price / Purchase Price Adjustment ............................... 5
(S)4 Effective Date/Closing ................................................... 8
(S)5 Guarantees ............................................................... 11
(S)6 Liability of the Shareholders for Taxes and other Public Dues ............ 31
(S)7 Indemnity for Neutron Claims and Risks in Relation to Properties Sold .... 32
(S)8 Indemnity for Environmental Liability .................................... 33
(S)9 Put Option ............................................................... 36
(S)9a Claim for Reimbursement of Corporation Tax .............................. 38
(S)10 Liability of the Shareholders ........................................... 39
(S)11 Non-Compete Covenant, Use of Name ....................................... 39
(S)12 Costs and Taxes ......................................................... 40
(S)13 Confidentiality ......................................................... 41
(S)14 Conditions Precedent, Right to Rescind .................................. 41
(S)15 Actuant's Guarantee, Discharge of the Supervisory Board/Management Board,
Actuant's Covenant ...................................................... 43
(S)16 Expert Arbitrator, Arbitration .......................................... 44
(S)17 Notices ................................................................. 45
(S)18 Transfer of all Rights and Obligations out of this Agreement ............ 46
(S)19 Miscellaneous ........................................................... 46
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List of Exhibits
Exhibit 1.3.1 List of Subsidiaries
Exhibit 1.3.2 List of Participations
Exhibit 3.4 Overview of the Development of the Working Capital
Exhibit 4.2.1 Draft of the Share Transfer Agreements
Exhibit 4.2.2 Draft of the Resignation Letters of the Supervisory Board
Members
Exhibit 4.2.3 Draft of the Termination Agreement between Heinrich Kopp AG
and Horst Michaels
Exhibit 4.2.4 Draft of the Resignation Declaration of Mr. Horst Michaels
Exhibit 4.2.5 Draft of the Shareholder's Waiver in respect of Claims out of
the Shareholders' Agreement
Exhibit 5.1.2 Copies of the Articles of Association of the Subsidiaries
Exhibit 5.1.3 List of Business Enterprise Agreements (Unternehmensvertrage)
Exhibit 5.2.4a List of all Pensions Obligations as per 31 December 2001
Exhibit 5.2.4b List of Persons who obtained Pension Obligations since
31 December 2001
Exhibit 5.2.7 List of Sureties (Burgschaften), Guarantees, Comfort Letters
etc.
Exhibit 5.3.1 List of Production Sites and Real Estate
Exhibit 5.3.2a List of Real Estate which is the Sole Property of the
Companies
Exhibit 5.3.2b List of Real Estate rented
Exhibit 5.3.4 Disclosure of Certain Cases in which Buildings or other
Structures have not been properly maintained
Exhibit 5.3.5 List of all Real Estate Subject to Third Party Rights
Exhibit 5.3.7 List of all Public Law Charges in respect of Properties
Exhibit 5.3.9 Lease, Rental or Similar Agreements with Third Parties in
respect of Properties owned by the Companies
Exhibit 5.4 Known Environmental Problems and Risks
Exhibit 5.5.1 List of Product Liability Claims within the last three years
Exhibit 5.5.3a List of the Top Ten Customers and Suppliers
Exhibit 5.5.3b Pricing Arrangements with Customers or Suppliers which are
outside the Ordinary Course of Business
Exhibit 5.5.4a List of Obligations to Purchase or Sell Minimum Quantities
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Exhibit 5.5.4b List of Agreements pursuant to which the Companies are bound
to Manufacture and/or Sell a Specific Product or Product Line
Exhibit 5.6.2 List of Third Party Rights on Other Assets of the Companies
Exhibit 5.6.3 List of all Equipment Leased
Exhibit 5.6.4 Valuation Principles for Current Assets
Exhibit 5.6.6a List of Bank Accounts with Balances as of 31 May 2002
Exhibit 5.6.6b List of Loan Agreements and Credit Lines with Balances as per
31 May 2002
Exhibit 5.7.1a List of Intellectual Property Rights
Exhibit 5.7.1b List of License Agreements in respect of intellectual
property rights
Exhibit 5.7.2a List of Third Party Rights in respect of intellectual
property rights
Exhibit 5.7.2b List of Obligations to pay Royalties for intellectual
property rights
Exhibit 5.9.1 List of Permits and Licenses
Exhibit 5.10.1a List of all Employees
Exhibit 5.10.1b List of Consultancy Agreements
Exhibit 5.10.2 List of Shop Agreements (Betriebsvereinbarungen)
Exhibit 5.10.4 List of Salary Increases
Exhibit 5.11.1 List of Litigation as per the Signing Date
Exhibit 5.11.2 List of Litigation of the last two years
Exhibit 5.12.1 List of Agreements within the Kopp Group
Exhibit 5.12.2 List of Agreements between the Companies and the Shareholders
Exhibit 5.13.1 List of Material Contracts
Exhibit 5.13.2a Disclosure in respect of Material Contracts
Exhibit 5.13.2b Disclosure of Change of Control Clauses in Material Contracts
Exhibit 5.13.3 List of Agency Agreements
Exhibit 5.13.4 List of Insurance Agreements
Exhibit 5.14.1a Disclosure: Disposal of Current Assets
Exhibit 5.14.1b Disclosure: Extension of Loan Agreements
Exhibit 5.14.2 Disclosure: Extension of Loan Agreements
Exhibit 8.1.2 Copies of Environmental Reports
Preamble
The Shareholders are the sole shareholders of Heinrich Kopp AG, with its seat in
Kahl am Main, registered with the Commercial Register of the Local Court of
Aschaffenburg under HRB 4758 (hereinafter also referred to as "Kopp" or the
"Company").
The Company develops, produces and sells electric and electronic devices,
especially switch programs, low-voltage distribution assemblies and other
electrical installation material. The Company operates production sites in
Germany in Kahl, Hildburghausen and Ingolstadt, and -through foreign
subsidiaries - in the Czech Republic and Tunisia. Distribution companies are
located in Germany, Austria, Hungary and Poland.
The Company holds, directly or indirectly, 100% of the shares in Brunnquell GmbH
Fabrik elektrotechnischer Apparate (Germany), Osterreichische Kopp Ges.m.b.H.
(Austria), Kopp Elektrotechnika, spol. s.r.o. (Czech Republic), Magyar KOPP Kft.
(Hungary), Kopp Elektrotechnika Sp. z o.o. (Poland), Profikontakt Elektrohandels
GmbH, Condor Installationstechnik GmbH (Germany) and HEKO Electrotechnique
S.A.R.L. (Tunisia). Finally, the Company holds a 10% interest in Indo Asian
Fusegear PVT. Ltd. (India), a 26% interest in Avanti Kopp Electricals PVT. Ltd.
(India) and a 0.9% interest in,,Eiba" Societe Cooperative (Belgium).
Furthermore, Osterreichische Kopp Ges.m.b.H. holds a 1.77% interest in TDZ
Technologie- und Dienstleistungszentrum Rohrbach GmbH (Austria).
The Shareholders, for the purposes of finding a successor, have decided to look
for a strategic partner to secure corporate success on a long-term basis and,
therefore, intend to sell the majority of the shares of the Company. The
Purchaser, a wholly-owned subsidiary of Actuant is interested in acquiring a
majority interest in the Company. In addition, the Purchaser intends to grant a
put option to certain of the Shareholders in respect of the sale of the
remaining minority stake in the Company pursuant to the terms of this Agreement.
NOW, THEREFORE, the parties agree as follows:
The following terms in this Agreement shall have the following meaning, unless
it is evident that something different is intended by the Parties:
"Actuant" has the meaning as set forth on the cover page;
"Administrative Charges" has the meaning as set forth in (S) 5 subpara. 3.6;
"Aggregate Limit of Liability" has the meaning as set forth in (S) 5 subpara. 16.8;
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"Assignee Entity" has the meaning as set forth in (S) 18 subpara 1;
"Closing" has the meaning as set forth in (S) 4 subpara. 2;
"Companies" has the meaning as set forth in (S) 1 subpara. 3;
"Companies' Financial Statements" has the meaning as set forth in (S) 5 subpara. 2.1;
"Company" has the meaning as set forth in the Preamble;
"Competing Products" has the meaning as set forth in (S) 11 subpara. 1;
"Effective Date" has the meaning as set forth in (S) 4 subpara. 1;
"Environmental Liability" has the meaning as set forth in (S) 8.1.1;
"Environmental Pollution" has the meaning as set forth in (S) 8.1.3;
"Environmental Provision" has the meaning as set forth in (S) 5 subpara. 4;
"Environmental Reports" has the meaning as set forth in (S) 8.1.2;
"Governmental Permission" has the meaning as set forth in (S) 5 subpara. 9.2;
"Intellectual Property Rights" has the meaning as set forth in (S) 5 subpara. 7.1;
"Kopp" has the meaning as set forth in the Preamble;
"Kopp Group" has the meaning as set forth in (S) 1 subpara. 3;
"Non-Compete Covenant" has the meaning as set forth in (S) 11 subpara. 1;
"Option Purchase Price" has the meaning as set forth in (S) 9 subpara. 5;
"Option Shares" has the meaning as set forth in (S) 9 subpara. 1;
"Option Sellers" has the meaning as set forth in (S) 9 subpara 1;
"Participations" has the meaning as set forth in (S) 1 subpara. 3;
"Purchaser" has the meaning as set forth on the cover page;
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"Purchase Price" has the meaning as set forth in (S) 3 subpara. 1;
"Put Option" has the meaning as set forth in (S) 9 subpara. 1;
"Reference Day" has the meaning as set forth in (S) 3 subpara. 5;
"Sellers" has the meaning as set forth in (S) 2 subpara 1;
"Shareholders" has the meaning as set forth on the cover page;
"Shareholders' Agreement" has the meaning as set forth in (S) 1 subpara. 2;
"Shares" has the meaning as set forth in (S) 1 subpara. 1;
"Signing Date" means the day of the conclusion of this Sale and
Purchase Agreement;
"Subsidiaries" has the meaning as set forth in (S) 1 subpara. 3;
"Territory" has the meaning as set forth in (S) 11 subpara. 1;
"Working Capital" has the meaning as set forth in (S) 3 subpara. 4.
(S) 1
Object of Sale
1.1 The stated capital of the Company of EUR 10,000,000.00 (in words: Euro ten
million) is divided into 130,500 registered ordinary shares without par
value (Stuckaktien) and 43,500 registered non-voting preference shares
without par value (Stuckaktien) held as follows:
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Shareholder Ordinary Preference Shares Total
Shares/share
registration
number
---------------------------------------------------------------------------
Horst Michaels 107,037 / (none) 107,037
A1
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Ute Michaels (none) 25,679 / B2 25,679
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Arno Michaels 2,649 / 5,883 / B3 8,532
A3
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Bianca Michaels 2,649 / 5,883 / B4 8,532
A4
---------------------------------------------------------------------------
Anni Simoneit 18,165 / 6,055 / B1 24,220
A2
---------------------------------------------------------------------------
Total 130,500 43,500 174,000
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The aforementioned shares are hereinafter collectively referred to as
"Shares".
The Shares are evidenced in collective share certificates (Sammelurkunden)
the registration numbers of which are as set out in the above table.
1.2 The stated share capital of the Company is fully paid in and has not been
repaid. The Shares are not subject to an obligation to make an additional
contribution. The Shares are the unrestricted property of the respective
Shareholders and are free from any third party rights. Except for the
shareholders' agreement entered into between the Shareholders dated July
13, 1992 (hereinafter "Shareholders' Agreement"), there are no contractual
commitments vis-a-vis third parties with respect to the Shares, especially
no rights of pre-emption, obligations to offer, voting commitments, trust,
or the like. The shareholders' rights and obligations are exclusively
governed by the Articles of Association, the Shareholders' Agreement and
statutory provisions.
1.3 Exhibit 1.3.1 contains a complete list of all legal entities in which the
Company holds more than 50% of the voting rights (hereinafter
"Subsidiaries"), stating the seat of the respective subsidiary and the
participation quota. Exhibit 1.3.2 contains a complete list of all other
interests of the Company in other legal entities, stating the seat of the
respective legal entity and the participation quota (hereinafter
"Participations"). The Company and the Subsidiaries are hereinafter also
referred to as "Kopp Group" or the "Companies".
(S) 2
Sale of Shares / Put Option
2.1 Horst Michaels, Arno Michaels, Bianca Michaels and Anni Simoneit
(hereinafter the "Sellers") hereby sell, and the Purchaser hereby
purchases, with economic effect as of the Effective Date ((S) 4 subpara. 1
of this Agreement), the following Shares, with all
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rights and obligations to be derived therefrom, including the right to draw
the profits pertaining to the fiscal year commencing January 1, 2002:
- Mr. Horst Michaels: all of his Shares,
- Mr. Arno Michaels: all of his Ordinary Shares,
- Ms. Bianca Michaels: all of her Ordinary Shares, and
- Ms. Anni Simoneit: all of her Shares.
2.2 With regard to all Shares held by Ute Michaels and all of the Preferred
Shares held by Arno Michaels and Bianca Michaels the Purchaser grants a put
option to Ute Michaels, Arno Michaels and Bianca Michaels in accordance
with the provisions set out in (S) 9 hereof.
(S) 3
Purchase Price / Purchase Price Adjustment
3.1 The purchase price for the Shares sold pursuant to(S)2 subpara. 1 shall
amount to
EUR 12,199,116.00
(in words: twelve million one hundred ninety-nine
thousand one hundred sixteen Euro)
(hereinafter referred to as "Purchase Price").
The Purchase Price will be allocated internally between the Sellers as
follows:
Mr. Horst Michaels EUR 9,728,861.00 79.74%;
Ms. Anni Simoneit EUR 2,017,599,00 16.54%;
Ms. Bianca Michaels EUR 226,328.00 1.86%;and
Mr. Arno Michaels EUR 226,328.00 1.86%.
3.2 The Purchase Price pursuant to(S)3.1 shall be due and payable as follows:
a) a partial amount of EUR 10,699,116.00 (in words: ten million six
hundred ninety-nine thousand one hundred sixteen Euro) shall be paid
immediately at Closing ((S) 4 subpara. 2 of this Agreement),
concurrently with (Zug um Zug) the transfer of the Shares sold pursuant
to (S) 2.1 to the Purchaser, at no cost or expense to the Sellers to
account no. 150737000, at Dresdner Bank Aschaffenburg, banking code
79580099.
b) a partial amount of EUR 1,500,000.00 (in words: one million five
hundred thousand Euro) shall be due one (1) year after Closing ((S)4
subpara. 2 of this
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Agreement) and shall be transferred to the account referred to in lit.
a) at no cost or expense to the Sellers, unless the Purchaser is
notified in writing of another account. The Purchaser hereby
irrevocably waives its right of set-off against this claim and its
right to invoke other objections or defenses, of whatever nature,
against this claim, provided that there is no breach of the guarantees
in (S) 5.1.1, first subparagraph, sentence 2 and second subparagraph,
sentence 1. In such cases any amounts set-off or otherwise withheld
shall be taken into account for the Aggregate Limit of Liability.
Otherwise the Purchaser shall have no right of set-off with potential
claims pursuant to (S)(S) 5, 6, 7 and/or 8 of this Agreement against
the claim for payment of this partial amount of the Purchase Price or
to invoke rights of retention (Zuruckbehaltungsrechte) on such basis.
As a security for the payment of this partial amount the Purchaser will
deliver a bank guarantee to the Sellers at Closing in accordance with
(S) 4.2 lit. b).
The Sellers will allocate and distribute these amounts among themselves.
3.3 The Purchase Price pursuant to para. 3.1 shall be subject to the adjustment
pursuant to (S)(S) 3.5 to 3.8 and shall be increased by such amounts which
will have been paid between the Signing Date of this Agreement and the
Closing (i) by the Company to IKB Bank as repayment of the IKB Bank loan
dated 2 September 1998 (as amended on 6 June 2000 and 26 October 2000)
(present value: EUR 4,985,096.00, next instalment of EUR 383,469.00 due and
payable on 30 September 2002) as well as (ii) by Kopp Elektrotechnika,
spol. s.r.o., Czech Republic, to Kopp Elektrotechnika, spol. s.r.o. (Czech
Republic) as repayment of the loan of HVB Czech Republic, Prague (present
value: EUR 550,000.00, next instalment of EUR 55,000.00 due and payable on
2 January 2003).
3.4 The Purchase Price pursuant to (S) 3 subpara. 1 is based on the assumption
that the added, non-consolidated Working Capital (as defined below) of the
Companies as per the Reference Day defined in (S) 3.5 will be between EUR
31.5 million and EUR 37.5 million. For each of the Companies the Working
Capital as per the Reference Day shall be calculated as follows:
- inventories (Sec. 266 para 2 B. I. German Commercial Code), booked and
accounted for in accordance with the principles pursuant to (S)5.6.4,
plus
- trade accounts receivable (Sec. 266 para 2 B. II. 1. German Commercial
Code), booked and accounted for in accordance with the principles
pursuant to (S) 5.6.5, first to third sentence, less
- trade accounts payable (Sec. 266 para 3 C. 4. German Commercial Code),
plus
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- cash etc. (Sec. 266 para 2 B. IV. German Commercial Code) and other
securities (Sec. 266 para 2 B. III. 3. German Commercial Code), less
- short-term liabilities in relation to credit institutions resulting out
of credit lines(included in Sec. 266 para 3 C. 2. German Commercial
Code).
Details of the calculation of the Working Capital are set out in Exhibit
3.4. Exhibit 3.4 further includes an overview of the development of the
Working Capital of the Companies within the first six months of the
business year 2002 and the planned development for the months of July and
August 2002. For the avoidance of doubt, it is hereby clarified that the
repayment of the loans pursuant to (S) 4.2 lit. f) shall be disregarded for
the calculation of the Working Capital if the Reference Day pursuant to (S)
3.5 occurs after the Closing.
The Sellers and the Purchaser shall jointly procure that the Working
Capital of the Companies as per the Reference Day shall be determined
without undue delay, in any case within 30 days following Closing. The
Working Capital shall be determined on the basis of non-consolidated,
non-audited management accounts of the Companies based on sum and balance
lists (Summen- und Saldenlisten) as per the Reference Day without physical
stock-take and by applying the same principles and methods which have been
applied for the calculation of the Working Capital for the first six months
of the business year 2002 (Exhibit 3.4). As of the Closing the Purchaser
shall grant and shall ensure, respectively, that the Sellers have full
access to the books, records and documents of the Companies, to the extent
necessary to calculate the Working Capital.
3.5 If the Closing occurs until the 15/th/ of a calendar month (including the
15/th/), the Working Capital shall be determined as per the end of the
previous calendar month; if the Closing occurs after the 15/th/ of a
calendar month, the Working Capital shall be determined after the Closing
as per the end of the then current calendar month (each referred to as
"Reference Day"). In case the Reference Day occurs after Closing, the
Purchaser shall be obliged to conduct the business of the Company from the
Closing on until the Reference Day within the ordinary course of business.
Any measures outside the ordinary course of business, such as the measures
listed in (S) 5.14.2 which are taken without the consent of the Sellers,
shall be disregarded for the purpose of the Working Capital calculation.
3.6 The Purchaser will procure that a draft of the Working Capital calculation
will be submitted to the Sellers at the latest within 30 days following the
Closing. The draft of the Working Capital calculation shall be deemed
binding between the parties and the Working Capital shall be deemed Working
Capital within the meaning of this Agreement if the Sellers do not object
in writing to the Purchaser within 30 days following receipt of the draft
Working Capital calculation and at the same time
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submitting a revised calculation of the Working Capital reflecting the
changes required from the point of view of the Sellers.
3.7 In case of disagreement on the draft Working Capital calculation or on any
item included therein, Sellers and Purchaser will first negotiate in good
faith to amicably settle the dispute between them. The Working Capital
calculation agreed between the parties within such negotiation shall be
deemed Working Capital within the meaning of this Agreement. In case the
Sellers and the Purchaser do not reach agreement within 14 days following
receipt of the objections by the Sellers, the dispute shall be referred to
the expert arbitrator pursuant to (S) 16.1 of this Agreement.
3.8 If and to the extent the Working Capital as per the Reference Day - as
finally determined pursuant to the terms and conditions of (S)(S) 3.4 to
3.7 and 16.1, respectively - falls short of an amount of EUR 31.5 million,
the Purchase Price shall be reduced by the amount by which the actual
Working Capital falls short of the amount of EUR 31.5 million. If and to
the extent the Working Capital as per the Closing exceeds an amount of EUR
37.5 million, the Purchase Price shall be increased by the amount by which
the actual Working Capital exceeds the amount of EUR 37.5 million.
Any amount due and payable pursuant to this (S) 3.8 by either party shall
be due and payable by the respective obliged party at no cost or expense
for the recipient within five (5) business days after which the calculation
of the Working Capital has become final and binding pursuant to the
aforementioned provisions. The Sellers will allocate and distribute this
amount among themselves. In the event that the balance is owed to the
Sellers, payment shall be made to the account referred to in (S) 3.2 lit.
a) and in the event that the balance is owed to the Purchaser to an account
notified in writing by the Purchaser.
(S) 4
Effective Date/Closing
4.1 The economic and fiscal effective date for the transfer of the Shares sold
by the Sellers pursuant to (S) 2.1 shall be the expiry of the day on which
all conditions precedent pursuant to (S) 14 para 1 of this Agreement have
been fulfilled ("Effective Date").
4.2 The completion of the sale of the Shares sold by the Sellers pursuant to
(S) 2.1 (hereinafter "Closing") shall take place at the latest five (5)
bank working days after all conditions precedents pursuant to (S) 14
subpara. 1 have been fulfilled in the offices of Freyberg Close Brothers,
Ulmenstra(beta)e 37, 60325 Frankfurt am Main, unless otherwise agreed
between the parties. At Closing, the Sellers and the Purchaser shall
confirm the
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satisfaction of the conditions precedents defined in (S) 14 subpara. 1 for
the completion of the sale of the Shares sold by the Sellers pursuant to
(S) 2.1 and shall take the following measures:
a) signing of the Share Transfer Agreements for transfer of the Shares
sold pursuant to (S) 2 subpara. 1 hereof, drafts thereof are
attached as Exhibit 4.2.1 hereto, and submission of share
certificates to Purchaser concurrently with (Zug um Zug) the actions
and measures to be taken by the Purchaser pursuant to this (S) 4.2;
b) payment of the partial amount of the Purchase Price pursuant to (S)
3 subpara. 2 lit. a) and delivery of a bank guarantee of a reputable
major bank to the Sellers in an amount of EUR 1,500,000.00 as
security for the partial amount of the Purchase Price pursuant to
(S) 3.2 lit. b) of this Agreement, due one year after Closing of
this Agreement, in which the bank undertakes to pay on first demand
of the Sellers. The bank guarantee shall at the minimum be valid
until a point in time which is one (1) year and ten (10) banking
days following the Closing;
c) delivery of a guarantee, payable on first demand, valid until 31
August 2004, by a major German bank to the Purchaser to secure
potential claims of Purchaser out of and in connection with this
Agreement and its consummation up to an amount of EUR 2,400,000.00
in which the bank waives its rights under (S)(S) 768, 770 et seq.
BGB (German Civil Code) and the possibility of deposit
(Hinterlegung);
d) execution of an agreement between the Company and Ms Anni Simoneit
pursuant to which the loan of 23 April 1992/6 October 1997 granted
by Ms. Simoneit to the Company (loan of DM 4,800,000.00) including
accrued interest until the Closing shall be repaid on Closing;
e) execution of an agreement between the Company and the
Theodor-Simoneit-Stiftung, Alzenau, pursuant to which the loan of 1
July 1992/27 November 1995 granted by the Theodor-Simoneit-Stiftung
to the Company (loan of DM 1,000,000.00) including accrued interest
until the Closing shall be repaid on Closing;
f) repayment of the loan granted by Ms Simoneit to the Company in the
amount of DM 4,800,000.00 and the loan granted by the
Theodor-Simoneit-Stiftung in the amount of DM 1,000,000.00, in both
cases plus interest accrued until the Closing;
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g) delivery of written declarations of the members of the supervisory
board from the shareholders' side, Gert Silber-Bonz, Dr. Bernd
Michaels, Dr. Reinhard Lohse and Dipl.-Ing. Horst Lettner, as
attached as draft version in Exhibit 4.2.2, according to which the
aforementioned persons irrevocably resign from their position as
members of the supervisory board of the Company as of the Closing;
h) signing of a termination agreement by the Company and Mr. Horst
Michaels as attached as draft in Exhibit 4.2.3, according to which
Mr. Horst Michaels irrevocably resigns from his position as director
and chairman of the board of directors of the Company as of the end
of the day on which the Closing occurs and confirms that all rights
and duties resulting from the service contract dated January 29,
1992 and the pension agreement dated January 29, 1992 are terminated
as of the end of the day on which the Closing occurs and Mr. Horst
Michaels irrevocably waives all of his pension claims resulting from
his service contract;
i) delivery of a written declaration of Mr. Horst Michaels addressed to
Osterreichische Kopp Ges.m.b.H. and HEKO Electrotechnique S.A.R.L.,
respectively, as attached in a draft version in Exhibit 4.2.4,
according to which Mr. Michaels irrevocably resigns from his
position as managing director of the afore-mentioned companies as of
the Closing, and confirms that all rights and duties resulting from
the service contract with HEKO Electrotechnique S.A.R.L. dated
January 2, 1991 are terminated as of the Closing;
j) delivery of an agreement between the Shareholders terminating the
Shareholders' Agreement at the latest with effect as of the Closing
and waiver by all Shareholders of any of their rights under the
Shareholders' Agreement in connection with the sale and transfer of
the Shares to the Purchaser or another subsidiary of Actuant. The
draft of the agreement is attached as Exhibit 4.2.5;
k) delivery to the Shareholders of a bank guarantee, payable on first
demand and valid until 31 August 2003, by a reputable major bank to
the Shareholders in the amount of EUR 1,395,600.00 to secure the
Shareholders' claims resulting from (S) 9a.2 hereof;
l) delivery of a bank guarantee, payable on first demand of the Option
Sellers and valid until 31 October 2003, by a reputable major bank
to the Option Sellers in the amount of EUR 2,879,337.00 to secure
claims of the Option Sellers resulting from (S) 9 hereof;
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m) delivery of a written statement by the Shareholders to the Purchaser
setting forth changes which affect the guarantees in (S) 5 hereof
since the Signing Date. For the avoidance of doubt, it is hereby
agreed that the statement is given for information purposes only. No
liability shall attach to the Shareholders solely based on the
statement but only if and to the extent set forth in (S) 5 of this
Agreement.
n) delivery of a notarised power of attorney pursuant to which Ute
Michaels, Arno Michaels and Bianca Michaels have appointed Horst
Michaels as their representative for all actions and measures as
shareholders of the Company and to receive notices (such as the
calling of a shareholders' meeting) on their behalf. This power of
attorney shall remain in place until 31 December 2003; until then it
shall be irrevocable.
(S) 5
Guarantees
The Shareholders hereby guarantee to the Purchaser with respect to the Company
and, unless explicitly provided otherwise in this (S) 5, also to the
Subsidiaries, within the scope defined in this Section by way of independent
guarantees (selbstandige Garantieversprechen) pursuant to Sec. 311 subpara. 1
BGB (German Civil Code) that the statements set forth in (S) 5 are true and
correct at the Signing Date, unless provisions explicitly refer to another time.
The guarantees, contained in (S) 5.1, are also given as of the time of the
Closing. Both parties confirm that they explicitly agree that the guarantees in
this (S) 5 shall not be qualified as quality warranty (Beschaffenheitsgarantie)
within the meaning of Sec. 276, 444 BGB (German Civil Code). With a view to
missing court precedents in respect of the new Sec. 444 BGB and based on the
assumption that the Shareholders would have not given any "quality guarantees"
within the meaning of Sec. 444 BGB if the statutory regime would apply, the
Purchaser hereby explicitly waives to invoke Sec. 444 BGB or any statutory
warranty claims the Purchaser would not have pursuant to the provisions of this
(S) 5.
5.1 Corporate Matters
5.1.1 The statements on the corporate and ownership structure contained in
(S) 1 hereof and the Exhibits pertaining to (S) 1 are correct. The
Shareholders are entitled to dispose of the Shares without any
limitation; this guarantee is not given by Ms Ute Michaels. The
Company is entitled to dispose of its shares in the Subsidiaries
without any limitation and is the unrestricted sole owner of such
shares. To the extent shares in Subsidiaries are held by other
Subsidiaries,
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the Subsidiaries holding the shares are entitled to dispose of these
shares in the Subsidiaries without any limitation and the
Subsidiaries are the unrestricted sole owners of such shares.
The Shares and all shares in the Subsidiaries (irrespective of which
Company of the Kopp Group holds such shares) are each free of other
encumbrances or other rights of other Shareholders or of third
parties including rights of preemption, option and purchase rights
regarding the shares in the Subsidiaries. Except for the
shareholders' agreement entered into between the Shareholders dated
July 13, 1992 there exist no agreements or rights to acquire or
subscribe for any of the shares or other securities of the
Companies. Unless otherwise disclosed in the Companies' Financial
Statements there are no other shares held by the Kopp Group in any
other companies or any obligations to acquire such shares. The
Shareholders do not directly or indirectly own any companies engaged
in the Kopp Group's scope of business anywhere in the world which
are not members of the Kopp Group and are not mentioned in (S) 1 of
this agreement with the exception of interests in listed companies
not exceeding an amount of 10%.
The share capital of each of the Companies is fully paid in. Cash
contributions have been made in full, and contributions in kind have
been made at most up to their market value. Contributions have not
been repaid. The parties agree that the sale of the property in
Miltenberg in December 2001 to a real estate company owned by the
Shareholders does not qualify for a repayment of contributions. The
Purchase Price due from the Shareholders for the sale of the
property in Miltenberg has been paid by netting the purchase price
with the distribution of the anticipated partial dividend resolved
and caused to be distributed on 28 June 2002 in the amount of EUR
2,001,000.00.
There are no rights of Shareholders or third parties to subscribe or
otherwise acquire new shares in the Companies, to convert any other
rights into shares or to require the issue of new shares. Except as
stated otherwise in this Agreement, no dividend distribution or any
other distributions of such kind were made with regard to periods
after the fiscal year ending December 31, 2001 by the Company. After
31 December 2001 no hidden distributions of profits have been made
in respect of any of the Companies.
5.1.2 Kopp is a corporation validly incorporated and existing under the
laws of the Federal Republic of Germany and the articles of
association dated July 5, 2001.No shareholders' resolutions amending
the articles of association exist that have not yet been registered
with the Commercial Register.
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The Subsidiaries are companies validly founded and existing under
the respective applicable law. Exhibit 5.1.2 contains the relevant
valid articles of association currently in force. There are no
shareholders' resolutions amending the articles of association and
subject to registration that have not yet been registered with the
Commercial Register, the company register or the competent register
under the respective applicable law.
Insolvency proceedings or comparable proceedings pursuant to foreign
law have not been applied for in relation to any of the companies of
the Kopp Group by the Companies. The Shareholders are not aware of
any pending applications filed by third parties for the commencement
of any such insolvency or comparable proceedings abroad. None of the
Companies of the Kopp Group is overindebted. The Purchaser is,
however, aware that Condor Installationstechnik GmbH was
overindebted and that the overindebtedness was eliminated as a
result of the declaration of subordination (Rangrucktritt) made by
the Company in March 2002.
5.1.3 Except as listed in Exhibit 5.1.3, the Companies are not party to
control agreements, profit and loss transfer agreements, or other
agreements between business enterprises within the meaning of (S)(S)
291 seq. AktG (German Stock Corporation Act) or any comparable
foreign law provisions.
5.2. Consolidated Financial Statements of the Companies, Distributions
5.2.1 The Consolidated Financial Statements of the Companies for the
fiscal years 2000 and 2001 (hereinafter referred to as "Companies'
Financial Statements"), with respect to the German Companies audited
and being provided with an unlimited audit certificate by
Rhein-Main-Treuhand GmbH
Wirtschafts-prufungsgesellschaft/Steuerberatungsgesellschaft, in
respect of the Austrian and Czech Companies audited and being
provided with an unlimited audit certificate by Leitner & Leitner
Wirtschaftsprufungsgesellschaft, in respect of the Hungarian Company
audited and being provided with an unlimited audit certificate by
PROXY Konyvvizsgalo es Tanacsado Kft. and in respect of the Tunesian
Company unaudited, have been prepared in accordance with the
respective applicable Generally Accepted Accounting Principles and
the principles of balance sheet and valuation continuity and
consistency. The Purchaser is, however, aware that as of 31 December
2001 the inventories of the Companies have no longer been valued
pursuant to the LIFO-principle in deviation from previous practice.
The Companies' Financial Statements give a
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true and fair view of the net worth, financial position and results
of each of the Companies for the respective periods.
5.2.2 Except for the distributions pursuant to (S) 9a.1 no dividends have
been paid after December 31, 2001.
5.2.3 The pension obligations of the Company vis-a-vis present or former
directors and employees or vis-a-vis any pensioners and other third
party were booked at their going concern value (Teilwert) by
applying a discount rate of 6 % and recognized actuarial principles,
and by applying the 1998 calculation guidelines of Dr. Klaus Heubeck
(Richttafeln 1998).
5.2.4 With the exception of any severance payments (Abfertigung) pursuant
to Austrian law Exhibit 5.2.4a contains a complete and correct list
of all pension obligations of the Companies as of 31 December 2001
including the names of the respective present and former directors
and employees or pensioners or any other third parties. In respect
of additional pension obligations coming into existence between 31
December 2001 and Closing the names of the persons entitled are
shown in Exhibit 5.2.4b. A valuation of these pension obligations
can only be made in a pension valuation as of 31 December 2002.
5.2.5 The closure of the occupational pension scheme
(Versorgungsverordnung) for new hires joining the Company after
December 31, 1997 is valid in accordance with the shop agreement
with the work's council of June 5, 1998. All liabilities resulting
from the shop agreement until December 31, 2001 and being not yet
fulfilled have been fully recorded in the Financial Statements of
the Company as of December 31, 2001.
5.2.6 Except for liabilities incurred after December 31, 2001 all
liabilities of the Companies (including contingent liabilities) are
reflected in the Companies' Financial Statements as of December 31,
2001. In particular all liabilities under the social compensation
plan (Sozialplan) resulting from the closure of the Miltenberg site
are fully and properly reflected in the Companies' Financial
Statements as of December 31, 2001. The expenses in connection with
the closure of the Miltenberg site which are not reflected in the
Companies' Financial Statements of December 31, 2001 (disregarding
rental payments pursuant to the rental agreement dated 28 December
2001) will not exceed EUR 10,000.00. As of the Closing the closure
of the Miltenberg site will have been completed, with the exception
of the termination of the rental agreement dated 28 December 2001
which will become effective only on 30 September 2002. After the
Closing the Company will incur no additional costs in
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connection with the closure of the Miltenberg site, except for costs
resulting from (i) accrued pension liabilities for employees who
worked in Miltenberg, (ii) rentals resulting out of the rental
agreement dated 28 December 2001 and (iii) the electricity supply
agreement terminated with effect as of 31 December 2002.
5.2.7 Except as listed in Exhibit 5.2.7 the Companies are not bound by any
sureties (Burgschaften), guarantees (apart from quality or similar
warranties), comfort letters or commitments of a similar nature in
favour of any third party.
5.3. Production Sites and Real Estate
5.3.1 Exhibit 5.3.1 contains a complete list of all production sites and
real estate of the Companies, including real estate not necessary
for the business.
5.3.2 The real estate listed in Exhibit 5.3.2.a is the sole property of
the respective company of the Kopp Group; the other places of
business are used by the Companies on the basis of the lease
agreements or other arrangements giving a right of use listed in
Exhibit 5.3.2.b.
The real estate listed in Exhibit 5.3.2a was acquired in accordance
with the statutory provisions applicable at the time of acquisition.
In particular, the acquisition of real estate by HEKO
Electrotechnique S.A.R.L. was approved in advance by the Governor
and the Central Bank of Tunisia.
5.3.3 The real property listed in Exhibits 5.3.2.a and 5.3.2.b
(hereinafter referred to as the "Properties") comprises all the real
properties used for the operation of the respective business by the
Companies presently or - except of the closed Miltenberg plant -
during the last twelve months prior to the Signing Date.
Due to law concerning neighbours and interests of adjoining owners
there are no obligations of the Companies to pay indemnification to
third parties for the use of real property owned by third parties
5.3.4 Except as listed in Exhibit 5.3.4, the buildings and other
structures of the Properties have been properly maintained until the
Signing Date; the buildings and other structures have no substantial
defects which would materially impair the normal continuation of the
operations of the business as practiced in the past.
-16-
To the best knowledge of the Shareholders all planning, zoning and
other governmental regulations have been complied with in connection
with the construction and the present use of buildings on the
Properties. In particular (and without best knowledge qualifier),
(i) the construction permits for the buildings erected on the
Properties are valid and not subject to any pending or
threatened proceedings; legally valid licenses have been
granted for the use of all Properties situated in the Czech
Republic;
(ii) the Companies are not obligated to buy land adjacent to the
Properties which may not be used for an expansion of the
business;
(iii) the Properties situated in Germany are registered by the
authorities as an industrial or trading area pursuant to (S)
(S) 9 and 1 subpara. 2 no. 9 of the Ordinance of the Use of
Land of Construction Purposes (Baunutzungsverordnung) in the
respective zoning plan; the Properties situated in Austria
are registered as an industrial or trading area in the
regionalplanning schemes or in the zoning plan in accordance
with the Regional Planning Act of Upper Austria
(Oberosterreichisches Raumordnungsgesetz); the other
Properties situated abroad are admitted to be used for
industrial or trading purposes in accordance with the
relevant statutory rules (if any);
(iv) there is no right of any party to rescind the contract
pursuant to which the respective company of the Kopp Group
acquired title to the Properties;
(v) there are no pending disputes with any adjoining or
neighbouring owner, in particular with respect to boundary
walls and fences or with respect to any easement, right or
mean of access to the Properties.
5.3.5 The Properties owned by the Companies are free of any third party
rights or encumbrances (in particular pledges, easements, land
charges and building rights) except for those set forth in Exhibit
5.3.5. After the Signing Date no third party rights or encumbrances
will be registered on such Properties with respect to which
Purchaser has not given its explicit prior written consent.
5.3.6 Expect as reflected in the Companies Financial Statements as of
December 31, 2001 there are currently no taxes or other
administrative dues and fees, including development charges,
(hereinafter jointly referred to as
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"Administrative Charges") outstanding for payment and until the
Closing no Administrative Charges the payment of which has been
requested will be unpaid with respect to any of the Properties
situated in Germany and owned by the Companies.
5.3.7 Expect as listed in Exhibit 5.3.7 the Properties owned by the
Companies are not encumbered with construction charges (Baulasten)
or comparable public-law charges in other jurisdictions.
5.3.8 The principal means of access to the Properties is (directly or
indirectly over other Properties of the Companies) over public roads
which are maintained at public expenses. The Properties situated in
Germany enjoy the main service of water, drainage, electricity and
(for the sites in Hildburghausen and Kaplice only) gas.
5.3.9 Except as listed in Exhibit 5.3.9 and except as required by
encumbrances identified in Exhibit 5.3.5 there are no lease, rental
or similar agreements pursuant to which third parties are entitled
to the use or possession of Properties owned by the Companies or
parts thereof or are entitled to require from the respective company
of the Kopp Group the observance of restrictions in the use of such
Properties or parts thereof.
5.3.10 The lease agreements listed in Exhibit 5.3.2.b are valid and binding
and enforceable in accordance with their terms. The Companies have
not been in breach of any major provisions of any of these lease
agreements which would entitle the respective party to a termination
for an important reason (Kundigung aus wichtigem Grund) nor have
they received notice to this effect from the respective landlord.
None of the Companies is in default with rental payments. The lease
agreement dated 28 December 2001 between the Company and the
Miltenberg GbR in respect of the Miltenberg site has been terminated
by the Company with effect as of 30 September 2002. Until the
Closing all obligations out of the lease agreement have been
properly fulfilled by the parties thereto.
There are no disputes with any neighbours, in particular with
respect to boundary walls and fences or with respect to any
easement, right or means of access to the premises.
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5.4 Environmental
The conduct of the business of the Companies does not violate material
applicable environmental laws, regulations and permits (hereinafter
referred to as "Environmental Provisions") in a way that the respective
authorities would have the legal right to close down the business of the
Companies or otherwise substantially restrict the Companies' business. To
the best knowledge of the Shareholders all notices to the respective
authorities have been made which are necessary for the present business
operations of the Companies according to the Environmental Provisions being
in force at the Signing Date.
On the Signing Date the Shareholders are not aware of environmental
problems and risks in respect of the Properties, except for the ones listed
in the Environmental Reports and/or in Exhibit 5.4 or referenced therein.
5.5 Products and Product Liability
5.5.1 Within the last three (3) years prior to the Signing Date there have
been no lawsuits regarding product liabilities with a litigation
value (Streitwert) of more than EUR 10,000.00 against any of the
Companies. Exhibit 5.5.1 contains a complete list of all product
liability claims against any of the companies of the Kopp Group
within the last three (3) years prior to the Signing Date with a
value exceeding EUR 10,000.00 in the individual case. On the Signing
Date no product liability claims have been asserted which could
result in a loss of any of the Companies over and above EUR
25,000.00 in the current business year and/or the following two
business years.
5.5.2 To the Shareholders' best knowledge all products manufactured by the
Companies conform to applicable legal requirements and quality
standards which at the Signing Date are in force in Germany and have
to be observed pursuant to administrative regulations and applicable
laws and such legal requirement and quality standards in other
countries where the Companies are selling their products. The
Shareholders are not aware of any product recalls pending or
decisions by competent authorities in respect of such a recall.
5.5.3 Exhibit 5.5.3a contains a complete list of the top ten customers and
suppliers of the Companies based on turnover in the business year
2001.
With the exception of measures listed in Exhibit 5.5.3b and measures
which the Companies are contractually bound to take, none of the
Companies have, between 1 April 2002 and the Closing, granted any
price reductions, rebates or
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allowances, in particular advertising expense subsidies
(Werbekostenzuschusse), to a customer, who in the business year 2001
has purchased goods from the Kopp Group with a value of more than
two million Euro, or changed other major terms of the payment and
delivery terms agreed with such customer or a supplier, provided
always, that such measures have not been taken within the ordinary
course of business, in particular in accordance with past practise,
and will have a material negative effect for the business of the
Kopp Group.
5.5.4 Except as set forth in Exhibit 5.5.4a there are no obligations for
the Companies to purchase from their suppliers or sell to their
customers minimum quantities. Except under the agreements listed in
Exhibit 5.5.4b and except under agreements, in particular listing
agreements (Listungsvereinbarungen), with DIY stores (Baumarkten) or
similar retailers (including oral agreements), the Companies are not
bound by any agreements providing for a fixed term or subject to a
notice period for termination in excess of six (6) months under
which the Companies are required to manufacture and/or offer
specific products or product lines.
5.6. Other Assets
5.6.1 All other fixed and current assets reflected in the Companies'
Financial Statements for the fiscal year 2001 were, as of the 31
December 2001, the unrestricted property of the Companies and free
from any third party rights, except for retentions of title or
statutory liens in the ordinary course of business.
5.6.2 Except as listed in Exhibit 5.6.2 there are no liens, other security
rights or interests or encumbrances on any of the assets of the
Companies. Excepted are pledges and other encumbrances reflected in
the land register, retentions of title, statutory liens or other
security created in the ordinary course of business as security for
obligations of the Companies and any assets which are used by the
Companies based on valid rental or leasing agreements.
5.6.3 Exhibit 5.6.3 contains a list of all equipment (without car leasing
contracts) leased by any company of the Kopp Group with a monthly
rent exceeding EUR 5,000.00 in each case.
5.6.4 The current assets (Vorratsvermogen) - also during a business year -
are accounted for based on uniform principles at historical costs
(Anschaffungs-oder Herstellungskosten) without taking into account
administration and sales
-20-
overhead costs (Verwaltungs- und Vertriebsgemeinkosten) but taking
into account discounts as described in detail in Exhibit 5.6.4.
During a business year these discounts are accounted for in the same
amounts as they have been accounted for when establishing the
Financial Statements of the Companies as per 31 December 2001.
5.6.5 Trade accounts receivable (Forderungen aus Lieferungen und
Leistungen) are only booked, if the respective deliveries or
services have been made by the Companies. Specific cash discounts
(Skonto) and other cash discounts are taken into account by
continuing the value adjustments (Wertberichtigungsbetrage) made as
per 31 December 2001. Subsequent discounts such as boni or
advertising expense subsidies (Werbekostenzuschusse) are accounted
for by including the respective expenses in the profit and loss
statement as per the end of each month the percentage share of
turnover of which is equal to the respective percentage share before
deduction of such expenses as shown in the Financial Statements of
the Companies as per 31 December 2001. To the best knowledge of the
Shareholders there are no receivables with a nominal value of more
than EUR 50,000.00 the realization of which is in jeopardy and which
have not been written down (including by way of lump sum adjustment
(Pauschalwertberichtigung)).
5.6.6 Exhibit 5.6.6a includes a list of all bank accounts of the Companies
setting out the respective balances as of 31 May 2002. Exhibit
5.6.6b includes a list of all loan agreements and credit lines of
the Companies and, for each loan and credit line, the amount drawn
down by the respective Company as of 31 May 2002.
5.7 Intellectual Property
5.7.1 The Companies own the patents, trademarks, utility models, software
including source codes and other intellectual property rights
(hereinafter collectively referred to as "Intellectual Property
Rights") listed in Exhibit 5.7.1.a. The Companies have entered into
the license agreements with respect to patents, trademarks, utility
models or other intellectual property rights listed in Exhibit
5.7.1.b (license agreements for standard software like Microsoft
Office are not listed).
5.7.2 Except as listed in Exhibit 5.7.1.b and 5.7.2.a all Intellectual
Property Rights which are used or have been used in 2000 and 2002 in
the business are owned by one company of the Kopp Group without any
encumbrances or rights of third parties. With respect to any
Intellectual Property Right all due and payable fees have been paid
in full to the competent patent offices or other authorities.
-21-
To the best knowledge of the Shareholders
(i) there are no outstanding claims by third parties against any
company of the Kopp Group regarding infringements of
intellectual property rights;
(ii) except as listed in Exhibit 5.7.2.b there are no obligations
to pay a license fee to a third party for the use of
intellectual property rights;
(iii) none of the Intellectual Property Rights is the subject of
any pending proceedings for opposition, cancellation,
revocation or rectification;
(iv) none of the Intellectual Property Rights has been declared
invalid or has been limited in any significant respect by any
authority and no such proceedings are pending;
(v) the Companies do not violate any intellectual property rights
of third parties. Except as disclosed in Exhibit 5.7.2.a
third parties have not claimed violation vis-a-vis the
Companies;
(vi) no patent has lapsed which has generated sales in the
business year 2001 of more than EUR 100,000.00 in the
territory for which the respective patent was protected
(except for cases in which the patent has lapsed only as a
result of the maximum protection period having expired).
5.7.3 To the best knowledge of the Shareholders', except for the Companies
of the Kopp Group, no other parties have the right to use the
trademark "Kopp" for the sale of electrical products in the
countries in which the Companies sell the products manufactured by
them at the Signing Date. The Purchaser is however aware that Indo
Kopp Limited and Avanti Kopp Electricals PVT Ltd. have the right to
use the name "Kopp" as part of their company name and that these
companies are currently selling electrical products under their
respective company name in India.
5.8. Taxes and Social Security Contributions
The Companies have duly and timely filed complete and correct tax returns
and returns regarding social security contributions or will file such
returns until Closing. All taxes, social security contributions and other
public dues (including impositions pursuant to Austrian law
(Vorschreibungen), charges, interest, fines and other amounts associated
-22-
therewith) which are due or caused until December 31, 2001 have either
been paid or have been accrued for in the Companies' Financial Statements
as of December 31, 2001.
5.9 Public Permits and Licenses
5.9.1 Exhibit 5.9.1 contains a list of all trading permissions
(Gewerbeerlaubnis) and planning and building permissions
(Baugenehmigungen), as well as with regard to the Companies based
in the Czech Republic all licenses of use, of the last ten (10)
years for each company of the Kopp Group.
5.9.2 Each of the Companies has obtained all public permits and licenses
required for continuance of the business as currently conducted
(hereinafter referred to as "Governmental Permissions"). The
Companies presently operate their business in compliance with all
Governmental Permissions and underlying legal provisions in the
country the respective company is situated in with the exception of
such deviations, which have no substantial adverse effects on the
business operations of one of the Companies.
5.9.3 To the best knowledge of the Shareholders no company of the Kopp
Group has received written notice in which (i) the retraction, the
revocation or another termination of a Governmental Permission was
threatened or declared or (ii) a public authority alleges that one
of the Companies violates a provision essential for the business
operations or a condition contained in a Governmental Provision.
5.10. Employees
5.10.1 Exhibit 5.10.1.a contains a complete and accurate list of all
employees employed by one of the Companies as of the Signing Date
including the following data: age of employee, date of commencement
of employment, special status (e.g. status of handicapped person if
disclosed by the employee, maternity protection, member of or
candidate for German works council), annual salary in 2001 (in case
of personnel recruited after 1 January 2002 the annual salary for
2002 calculated as of today).
Exhibit 5.10.1.b contains a complete list of all consultancy
agreements concluded by one of the Companies and third parties with
an annual salary exceeding EUR 50,000.00 or a period of
cancellation of at least six (6) months.
-23-
5.10.2 Exhibit 5.10.2 contains a complete list of all shop agreements with
the works council (Betriebsvereinbarungen) of the Companies being
in force at the Signing Date.
5.10.3 No service contract or employment agreement between any of the
Companies and any of its directors or employees provides for any
severance payment to be made by any of the Companies upon
termination with a value exceeding a severance payment payable by
operation of law or by stipulation in a social plan or in a shop
agreement with the works council (Betriebsvereinbarung).
5.10.4 Within a period of six month prior to the Signing Date the
Companies have not entered into legally binding obligations for any
increase in remuneration or benefits of their employees and they
will not enter into such obligations prior to the Closing Date.
Excepted are the increases and benefits disclosed in Exhibit 5.10.4
and such obligations, which result from ordinary business
operations and are made following the provisions of collective
bargaining agreements (Tarifabschlusse) (in particular for the
collective bargaining agreement of the Bayrische Metall- und
Elektroindustrie with IG Metall) up to the amounts agreed in the
respective collective bargaining agreement.
5.11 Litigation
5.11.1 Except as listed in Exhibit 5.11.1 no litigation involving the
Companies with an amount in dispute of more than EUR 10,000.00 in
the individual case is pending or, to the best knowledge of the
Shareholders has been threatened in writing.
5.11.2 Exhibit 5.11.2 contains a complete list of all disputes of the last
two years with a litigation value (Streitwert) of more than EUR
10,000.00 in the individual case, except for dunning procedures
(Mahnverfahren) and court actions for the recovery of payments
(Zahlungsklagen) of the Companies against third parties.
5.12. Legal Relationships within the Companies and with the Shareholders
5.12.1 Except as listed in Exhibit 5.12.1 there are no written agreements
between any of the Companies and affiliated companies. These
agreements and further oral agreements between the Companies, if
any, can be terminated at any time.
5.12.2 Except as listed in Exhibit 5.12.2, no legal relationships exist
between one of the Companies, on the one hand, and the Shareholders
or affiliated companies
-24-
of any of the Shareholders or persons related to the Shareholders,
on the other hand.
5.13 Material Contracts / Agency Contracts / Insurance Contracts
5.13.1 Exhibit 5.13.1 contains a complete list of all Material Contracts
binding the Companies as of the Signing Date. A Material Contract
under this Agreement is any contract either (i) with a duration of
more than twelve (12) months, or (ii) with which the Companies have
generated a turnover in the business year 2001 in excess of EUR
500,000.00 (in words: Euro five hundred thousand). All lease
agreements for real estates or offices, license agreements and
cooperation or joint venture agreements of any of the Companies are
considered to be Material Contracts notwithstanding their duration
or value.
5.13.2 Expect as disclosed in Exhibit 5.13.2a (i) no Material Contract has
been terminated by mutual agreement by any of the parties, (ii) no
essential provisions of the Material Contract have been breached by
any of the Companies and (iii) to the best knowledge of the
Shareholders no third party breaches essential provisions of a
Material Contract.
With the exception of contracts listed in Exhibit 5.13.2b no
Material Contract grants to any party a right of extraordinary
termination of the Material Contract in the case all shares of
the Company are sold.
5.13.3 Exhibit 5.13.3 contains a complete list of all agency agreements
existing as of the Signing Date binding any of the Companies.
None of the agency agreements provides for compensation claims in
case of termination of such agency agreements exceeding the amount
being owed by the Companies by operation of law.
5.13.4 Exhibit 5.13.4 contains a complete list of all insurance policies
taken out as of the Signing Date as well as all liability insurance
(except for vehicle liability insurance) which was in effect and
valid during the last ten (10) years by any company of the Kopp
Group (stating in each case the insurance company, risks covered and
the limits). The insurance contracts taken out as of the Signing
Date can not be terminated as a result of the consummation of this
Agreement.
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5.14. Conduct of the Business between 1 January 2002 and Closing of this
Agreement
5.14.1 In the period between 1 January 2002 and the Signing Date the
business activities of the Companies have been conducted within the
ordinary course of business. In particular,
(i) except as listed in Exhibit 5.14.1a the assets of the
Companies have not been disposed of (except current assets
being sold within the ordinary course of business),
(ii) no new share capital or other similar capital has been
created or issued,
(iii) except as listed in Exhibit 5.14.1b the Companies have not
extended existing loan arrangements or entered into new or
additional loan or financing arrangements,
(iv) the Companies have not incurred any pension obligations
and/or made any variation in existing pension obligations,
except to the extent required by law or contracts, and
(v) the Companies have not entered into, amended or terminated
agreements, the execution, amendment or termination of which
would not be within the ordinary course of business.
Excepted are in each case measures taken with the consent of the
Purchaser or disclosed in this Agreement or its Exhibits.
5.14.2 In the period between Signing and Closing of this Agreement the
Shareholders shall, to the extent legally permissible and possible,
procure that the business activities of the Companies will be
conducted within the ordinary course of business and in particular
that
(i) the assets of the Companies will not be disposed of, except
current assets being sold in the ordinary course of
business,
(ii) no new share capital or other similar capital will be
created or issued,
(iii) except as listed in Exhibit 5.14.2 the Companies will not
extend existing financing arrangements or enter into new or
additional financing arrangements,
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(iv) the Companies will not enter into, amend or terminate any
contracts if and to the extent the execution, amendment or
termination would not be within the ordinary course of
business,
(v) the Companies will not acquire or order current assets
except in the ordinary course of business,
(vi) the Companies will not place orders for fixed assets
exceeding EUR 100,000.00 (Euro one hundred thousand) in each
individual case and/or EUR 250,000.00 (Euro two hundred
fifty thousand) in the aggregate,
(vii) except to the extent required by law or contracts the
Companies will not incur any pension obligations, make any
variation in existing pension obligations, and
(viii) will not incur other obligations deviating from the ordinary
past practice.
Excepted are in each case measures which are taken with the
Purchaser's consent or disclosed in this Agreement or its Exhibits.
5.14.3 The orders for traded merchandise and for raw materials,
maintenance materials and supplies placed by the Companies after
the Signing Date but prior to the Closing upon which delivery is to
be made after the Closing are in compliance with ordinary
commercial practice as regards number, price, payment and other
terms.
5.14.4 Binding offers or tenders made by the Companies to customers after
the Signing Date but prior to the Closing as well as orders placed
by customers or suppliers of the Companies prior to Closing of this
Agreement which have been accepted by the Companies and all other
agreements in respect of finished goods which have not been
delivered on the Closing Date shall as regards volume, pricing
arrangements, payment terms, delivery dates and all other major
terms and conditions comply to the business practice of the
Companies until the Signing Date.
5.15 No Changes as a Result of the Consummation of this Agreement
5.15.1 Solely as a result of the change of control over the Companies by
the consummation of this Agreement no supplier of the Companies
will have the
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legal right of termination or to refuse fulfilment of his
contractual obligations for the supply of the Companies and no
license agreement, co-operation or joint venture agreement which
any of the Companies is a party to can be terminated by third
parties for this reason. The agreements disclosed in Exhibit
5.13.2b are excluded.
5.15.2 As a result of the consummation of this Agreement no investment
grants or subsidies have to be repaid by any of the Companies.
The terms and conditions of any grants or subsidies made available
to any of the Companies do not contain any provisions giving the
authorities the legal right to require repayment of any amount
granted to the Companies except in the event that the Companies do
not comply with the respective terms and conditions of the grant or
subsidy. To the Shareholders' best knowledge the Companies have not
breached any material terms and conditions of the respective grants
and subsidies in a way that would give the respective authority the
legal right to request repayment of the grants and/or subsidies.
5.16 Scope and other General Provisions regarding the Guarantees
5.16.1 To the extent independent guarantees included in this Agreement are
given to Shareholders' best knowledge, the knowledge of the current
members of the Company's management board (Vorstand) shall be
imputable to Shareholders. The requirement of "best knowledge"
shall be deemed fulfilled, if any of the Shareholders or any of the
aforementioned persons has knowledge that the relevant facts and
circumstances are not correct, would have had such knowledge after
having made due and proper inquiries with the respective managing
directors (Geschaftsfuhrer) of the Subsidiaries or did not have
such knowledge as a result of a grossly negligent (grobe
Fahrlassigkeit) violation of his/her duties as a diligent
businessman.
5.16.2 In the event that any of the independent guarantees included in
this (S) 5 should turn out not to be correct, the Purchaser shall
have the right to request that the Shareholders, within a
reasonable period and at the latest within 30 days from receipt of
Purchaser's request, put the Purchaser in the position it would
have been in if the relevant guarantee had been correct. In case
the Shareholders do not put the Purchaser in the position pursuant
to this Agreement or in case this is impossible, the Purchaser
shall have the right to request damages from the Shareholders.
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5.16.3 The Shareholders shall be liable for claims as a result of a breach
of any of the independent guarantees pursuant to this ss. 5 only if
each asserted claim exceeds Euro 100,000.00 and the aggregate
amount of such claims together with any claims under (S) 8 hereof
exceeds Euro 500,000.00. If the above-mentioned threshold is
exceeded, any amount, including the amount of Euro 500,000.00 can
be asserted.
5.16.4 The Shareholders shall not be liable for claims as a result of a
breach of any of the independent guarantees pursuant to this (S) 5
if and to the extent
(i) in the Companies Financial Statements as of December 31, 2001
the circumstances giving rise to the breach have been
accounted for, including, without limitation, accruals or
value adjustments (including by way of lump sum adjustments
(Pauschalwertberichtigung)) have been made for such
circumstances,
(ii) the circumstances are insured under any of the insurance
policies of the Companies, and in such event only for that
portion which the Companies receive under an insurance policy
within 120 days of submission to the insurance company. If
and to the extent the insurance does not make payment within
said period the Shareholders shall only be liable to the
Purchaser pursuant to this (S) 5 concurrently with (Zug um
Zug) an assignment of the claims against the insurance
company to the Shareholders, or
(iii) the circumstances have been disclosed in this Agreement or in
any of its Exhibits (circumstances shall be deemed disclosed
not only if disclosed in the respective Exhibit to a single
guarantee but also if disclosed in any other Exhibit).
Claims for breach of the guarantee pursuant to (S) 5.8 cannot be
asserted if and to the extent such additional taxes (steuerlicher
Mehraufwand) are equalised by future tax savings (zukunftige
Steuerersparnisse), e.g. because of allocation to different tax
periods, or would have been equalised in case of unchanged
continuance of the Companies and further not if and to the extent
the Purchaser seeks indemnification pursuant to (S) 6.
Claims for breach of the guarantee pursuant to (S) 5.4 cannot be
asserted if and to the extent indemnification for such breach of
guarantee can be sought according to (S) 8.2 or could, in
principle, be sought according to (S) 8.2, but such indemnification
is excluded pursuant to the other terms of (S) 8.
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5.16.5 If and to the extent third parties assert claims or threaten to
assert claims against any of the Companies which could result in a
breach by Shareholders of the independent guarantees pursuant to
this (S) 5, the Shareholders and, to the extent there is insurance
coverage for the respective claim, also the insurance of the
Companies shall be notified in writing without undue delay. The
Shareholders shall be given the opportunity, to the largest extent
possible, to defend such third party claims, including by way of
court action. Costs in connection therewith, if any, shall be
advanced by the Shareholders. The Purchaser shall grant and shall
ensure, respectively, that the Shareholders have full access to the
books, records and documents of the Purchaser and the Companies,
and assumes the obligation to use its best efforts to give the
Shareholders access to documents of third parties (especially court
files and administrative files) to the extent necessary or useful
to defend claims of third parties that may lead to claims of
Purchaser against Shareholders and/or claims of Purchaser. No
admission of liability, settlement or other measures shall be taken
by Purchaser and the Companies which could negatively impact the
chances to defend the claim without the prior consent of the
Shareholders. In case the Shareholders do not notify the Purchaser
within a reasonable period of time set by the Purchaser that they
want to defend the third party claim, the Purchaser or the
respective Company shall have the right to defend the third party
claim at its own cost. The fact that the Shareholders do not defend
a third party claim shall not be interpreted as admission that the
underlying circumstances qualify as a breach of the guarantees
pursuant to this (S) 5.
In case it turns out that that the circumstances underlying the
asserted third party claim qualify as a breach of any of the
independent guarantees pursuant to this ss. 5, the costs of
defending the third party claim shall be borne by the Shareholders;
otherwise the costs shall be borne by the Purchaser.
5.16.6 Claims of the Purchaser pursuant to the above provisions shall
become statute-barred two (2) years from Closing. Claims of the
Purchaser for any breach of the independent guarantee pursuant to
(S) 5 subpara. 4 shall become statute-barred five (5) years from
Closing. The aforementioned statutes of limitations shall not apply
to claims of Purchaser with respect to additional taxes,
liabilities regarding social security contributions and other
public dues. Such claims shall become statute-barred after
expiration of six months following the date upon which an
additional assessment or amended assessment by the competent
authorities becomes final and binding.
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The running of the limitation period shall be stopped (gehemmt)
pursuant to Sec. 209 German Civil Code (BGB) by the Purchaser giving
timely notice in writing of a claim to the Shareholders with
particulars of the claim, provided always that the Purchaser
initiates arbitration proceedings within a period of three (3)
months after the respective written notice of claim. The provision
of Sec. 203 German Civil Code (BGB) shall not apply, unless the
parties agree in writing on a case by case basis that pending
negotiations shall interrupt the limitation period.
5.16.7 The Shareholders are themselves or through third parties which are
bound by secrecy obligations as professionals entitled (at their own
expense) to participate in the handling of tax field audits and
audits with respect to social security contributions and other
public dues covering the periods until the Closing. The Purchaser
shall provide to Shareholders in writing with full information
concerning any pending or current audit without undue delay, if
possible within 14 days, and shall without undue delay notify
Shareholders in writing of any attempt by the relevant authorities
to make any charge (of whatever nature) or to disallow any relief or
allowance (of any nature). The Purchaser shall procure that the
Shareholders, to the extent necessary for them, have unrestricted
access to the financial documents, records and other documents of
the Companies for the period up to the Closing, and that all
documents relating to taxes, social security contributions or other
public dues, as well as all documents that need to be preserved
pursuant to commercial provisions, are kept during the statutory
preservation period.
5.16.8 Any liability of the Shareholders pursuant to (S) 5, (S) 6, (S) 7
and (S) 8 of this Agreement shall be limited to EUR 7,000,000.00
(Euro seven million) ("Aggregate Limit of Liability"). On 31 July
2003, the Aggregate Limit of Liability shall be reduced to EUR
6,000,000.00 (Euro six million) and on 31 July 2004 to EUR
5,000,000.00 (Euro five million). For any and all claims asserted by
the Purchaser towards the Shareholders in writing until 31 July 2003
or 31 July 2004 in accordance with the provisions of (S) 5.16.6,
second paragraph (the relevant date shall be the date of receipt by
the Shareholders), the respective higher Aggregate Limit of
Liability valid until 31 July shall be applicable.
5.16.9 Any claims or remedies of the Purchaser against the Shareholders,
irrespective of their nature and legal grounds, except for claims
and remedies explicitly granted by this (S) 5, shall, to the extent
legally permissible, be deemed excluded and are hereby waived, in
particular all claims resulting from breach of obligations (Sec. 280
German Civil Code - in particular for culpa in
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contrahendo, Sec. 311 para 2 German Civil Code), frustration of
contract (Storung der Geschaftsgrundlage, Sec. 313 German Civil
Code) and/or claims for reduction of the Purchase Price (Minderung).
The right to rescind (Wandlung) and/or to withdraw from (Rucktritt)
this Agreement is hereby specifically excluded, unless otherwise
explicitly agreed herein or granted by a mandatory statutory law.
(S) 6
Liability of the Shareholders for Taxes and other Public Dues
6.1 The Shareholders shall indemnify the Purchaser and the Companies from all
taxes and other public dues in respect of one of the Companies, which
relate to periods until 31 December 2001. This indemnity shall apply
irrespective of whether the taxes or public dues were known to the
Shareholders or not. The indemnity shall not apply to the extent that the
facts or events triggering the tax or public dues have resulted, will
result or would have resulted in case of unchanged continuation of the
Companies in an effective reduction of the tax or public due burden before
or after 31 December 2001 (shift of taxes from one period into the other).
6.2 The tax returns of the Companies, to the extent referring to periods until
31 December 2001, are to be made in coordination with the Shareholders and
their advisors. The Purchaser hereby undertakes to notify the Shareholders
without undue delay, if possible within 14 days, of claims for payment of
additional taxes or public dues and of all other actions and measures of
the tax authorities or social security authorities
(Sozialversicherungstrager) which could affect potential rights/obligations
of the Shareholders pursuant to this (S) 6. A breach by Purchaser of the
undertaking to notify the Shareholders shall not affect justified claims of
the Purchaser pursuant to this (S) 6, if as a result of the breach
objections or defenses of the Shareholders vis-a-vis tax and social
security authorities are not limited. In particular, the Purchaser shall
ensure that the Shareholders are notified in writing within 14 days of the
announcement or beginning of tax field audits (steuerliche
Au(beta)enprufungen) and field audits of social security authorities and
shall give the Shareholders and/or Shareholders' advisors the opportunity
to participate in all such audits relating to periods until the 31 December
2001.
Any actions, whether court actions or not, and any declarations to the tax
authorities and/or social security authorities by the Purchaser also in
respect of periods until 31 December 2001 shall only be filed/made with the
prior consent of the Shareholders, to the extent potential rights and/or
obligations of Shareholders pursuant to this (S) 6 may be affected. Any
such consent shall not be unreasonably withheld. If as a result of
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a field audit or otherwise there are payment claims for periods until 31
December 2001, including without limitation for wage tax and social
security contributions, the Purchaser shall be entitled to agree on a lump
sum payment of such taxes or contributions only with the consent of the
Shareholders. The consent to such lump sum payments shall be given by the
Shareholders if a due and diligent business man would agree to such lump
sum payments. If the Shareholders agree to such lump sum payments, the
obligation of the Shareholders to indemnify and hold the Purchaser or the
respective Companies harmless includes the aggregate amount payable based
on such lump sum calculations.
6.3 The provisions of (S)(S) 5.16.4, 5.16.5, 5.16.6, 5.16.7 and 5.16.8 shall
apply mutatis mutandis, but not (S) 5.16.3 and (S) 5.16.6 first sentence.
All claims pursuant to this (S) 6 shall, together with all claims pursuant
to (S) 5, (S) 7 and (S) 8, in the aggregate, be limited to the Aggregate
Limit of Liability pursuant to (S) 5.16.8.
(S) 7
Indemnity for Neutron Claims and Risks in Relation to Properties Sold
7.1 The Shareholders shall indemnify and hold the Purchaser and the Companies
harmless from all claims of Neutron Mikroelektronik GmbH, Maybachstrasse
17, 63456 Hanau resulting out of and in connection with the development and
manufacturing agreement (Entwicklungs- und Fertigungsvertrag) between
Neutron Mikroelektronik GmbH and the Company dated 11 November 1997 and all
other claims of Neutron Mikroelektronik GmbH in relation to the development
of new circuits, including court costs and attorney's fees up to the
statutory amounts in Germany. There shall only be an obligation to
indemnify and hold harmless to the extent a claim made by Neutron
Mikroelektronik GmbH exceeds the amount accrued by the Company at the
Signing Date in relation to the claims of Neutron Mikroelektronik GmbH (EUR
30,677.51).
7.2 The Shareholders shall indemnify and hold the Purchaser and the Companies
harmless for a period of ten (10) years as of Closing from all claims,
obligations and liabilities in relation to properties the use of which was
abandoned by the Companies prior to Closing. In particular, this shall
apply to the former operating site in Miltenberg.
The Purchaser shall procure that the Companies assign and transfer to the
Shareholders any claims against insurance companies, if any, in connection
with circumstances that result in an obligation of the Shareholders to
indemnify pursuant to this (S) 7.2 (including without limitation for
pollution of soil and groundwater) and further that the Companies, at the
costs of the Shareholders, will use their best efforts to assist the
Shareholders in pursuing such insurance claims.
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7.3 The provisions of (S)(S) 5.16.4 (i), 5.16.5 and 5.16.8 shall apply mutatis
mutandis. Any claims pursuant to this (S) 7 shall become time barred three
months after the claims of Neutron Mikroelektronik GmbH or other third
parties have become time barred and shall together with all claims pursuant
to (S) 5, (S) 6 and (S) 8, in the aggregate, be limited to the Aggregate
Limit of Liability pursuant to (S) 5.16.8.
(S) 8
Indemnity for Environmental Liability
8.1 For the purposes of this (S) 8 the term "Environmental Liability",
"Environmental Reports" and "Environmental Pollution" shall have the
following meaning:
8.1.1 "Environmental Liability" means all costs and expenses - which are
not only internal costs and expenses - incurred by the entities
indemnified pursuant to this (S) 8 which are necessary to comply
with final and binding orders of authorities or courts (including
those based upon third party claims under private law) to clean up
an Environmental Pollution or all costs and expenses - which are not
only internal costs and expenses - which are required to remedy or
prevent an immediate danger to the well-being or health of human
beings caused by Environmental Pollution. Environmental Liability
does not include lost profits or other consequential loss, in
particular as a result of interruptions of business.
8.1.2 "Environmental Reports" means the environmental risk assessments of
buildings, sealing of surface, soil and ground water prepared by
Institut fur Angewandte Geologie und Umweltanalytik Brehm regarding
the Kopp sites in Kahl, Hildburghausen, Kaplice and Aigen, all dated
May 14, 2002 as well as the 2nd Report on Soil Contamination
regarding the Brunnquell site in Ingolstadt, prepared by Harress
Pickel Consult and dated February 25, 2002. Copies of the
Environmental Reports are attached as Exhibit 8.1.2.
8.1.3 "Environmental Pollution" means all contamination of soil, soil-air,
ground water or buildings which was caused prior to the Closing and
could cause hazards or material disadvantages or material annoyance
for the individual or the general public, in particular
a) dangerous alterations to the soil within the meaning of
Section 2 para. 3 of the Federal Soil Protection Act
(Bundes-Bodenschutzgesetz), and thus all impairments to the
functions of the soil which could cause
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hazards or material disadvantages or material annoyances for
the individual or the general public;
b) residual contamination within the meaning of Section 2 para.
5 of the Federal Soil Protection Act and thus both closed
waste removal facilities and other real estate upon which
waste has been treated, stored or deposited (former storage),
and real estate of closed facilities and other real estate
upon which environmentally hazardous materials were handled,
with the exception of facilities, the shutting down of which
requires approval pursuant to the Nuclear Energy Act (former
plants), through which hazardous alterations to the soil or
other dangers for the individual or the general public are
caused.
8.2 The Shareholders shall indemnify the Purchaser and the Companies for a
period of five (5) years from the Closing within the framework of the other
provisions of this (S) 8 against all Environmental Liability.
8.3 There shall be no obligation to indemnify and hold harmless, if and to the
extent
8.3.1 the Environmental Liability relates to Environmental Pollution which
was caused after the Closing or Environmental Pollution which was
caused prior to the Closing but aggravated by the Purchaser and/or
the Companies after Closing by negligence on the part of the
Companies. The determination whether or not Environmental Pollution
was caused prior to or after the Closing or aggravated after the
Closing shall be made - to the extent possible -on the basis of the
Environmental Reports. The burden of proof for the fact that any
Environmental Pollution was caused prior to the Closing shall be
borne by the Purchaser. The burden of proof for the fact that any
Environmental Pollution caused prior to the Closing was increased
after the Closing by negligence on the part of the Purchaser and/or
the Companies shall be borne by the Shareholders. To avoid any cases
of doubt, it is hereby clarified that the Shareholders shall also be
responsible pursuant to the terms and conditions of this (S) 8 (in
particular (S) 8 subpara. 3) to indemnify the Purchaser and the
Companies for any such Environmental Liability based upon
Environmental Pollution already mentioned in the Environmental
Reports as potential risks ("A","B" and "C" risks);
8.3.2 the respective Environmental Liability results from inspections or
preparation and exploration measures conducted after the Closing
outside the ordinary course of business of the relevant Company. The
Environmental Liability
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resulting from inspections or measures conducted within the ordinary
course of business of the relevant Company shall not be excluded;
8.3.3 the respective Environmental Liability is the result of a change of
existing or the adoption of new laws after the Closing;
8.3.4 the respective Environmental Liability is the result of a material
change in the use of the Properties of the Companies with the effect
that the Property concerned is no longer used for industrial or
trading purposes;
8.3.5 only third parties (except for insurance companies in which case (S)
8.3.6 shall apply) are liable for the Environmental Liability by
virtue of a non-appealable official order, final and binding court
judgment or any other enforceable title (settlement, etc.) without
such third parties having any right of recourse against the
Purchaser and/or the Companies after the assertion of claims. In
case third parties are liable in addition to the Companies, the
Purchaser may assert its claims against the Shareholders pursuant to
(S) 8.2 only concurrently with (Zug um Zug) the assignment of
potential recourse claims against such third parties;
8.3.6 the respective Environmental Liability is covered by an insurance
policy and the insurance company effects payment within 120 days
from notification of the damage. If the insurance company has not
effected payment upon expiration of the aforementioned period, the
Purchaser may assert its claims against the Shareholders under (S) 8
subpara. 2 only concurrently with (Zug um Zug) the assignment of the
respective claims against the insurance company to the Shareholders;
or
8.3.7 the Companies stop conducting business or Properties or buildings on
such Properties are abandoned by the Companies. This limitation
shall not apply to the sites in Hildburghausen and Ingolstadt.
Moreover, (S) 5.16.4 (i) and (ii) shall apply mutatis mutandis. The general
duty to mitigate shall remain unaffected.
8.4 As soon as any of the entities indemnified becomes aware of any
circumstances which could give rise to an obligation of the Shareholders to
indemnify pursuant to this (S)8, the Purchaser shall be obliged to inform
the Shareholders of all circumstances and to coordinate all measures with
the Shareholders; this includes the right of access to the respective
Properties and to review all records, to the extent necessary for a
reasonable review by the Shareholders.
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In the event the Purchaser and the Shareholders can not agree on the
measures to be taken within 14 days following receipt of the notice by the
Shareholders, the Shareholders shall have the right to defend orders of
authorities or third party claims at its own expense, including by way of
court action. The provisions of (S)5.16.5 shall apply mutatis mutandis.
8.5 Claims for indemnification pursuant to this (S)8 can only be asserted if
the respective Environmental Liability exceeds an amount of EUR 100,000.00
and the aggregate amount of all existing Environmental Liabilities together
with any claims arising under (S) 5 exceeds an amount of EUR 500,000.00. If
the threshold of EUR 500,000.00 is exceeded, any amount, including the
amount of EUR 500,000.00 can be asserted. Any claims pursuant to this (S) 8
shall together with all claims pursuant to (S)5, (S)6 and (S)7, in the
aggregate, be limited to the Aggregate Limit of Liability pursuant to
(S)5.16.8.
(S)9
Put Option
9.1 Subject to the condition precedent that the Closing of the Share Sale and
Purchase Agreement pursuant to(S)4.2 occurs the Purchaser, by way of an
otherwise unconditional and irrevocable offer, hereby grants the option to
Ms. Ute Michaels, Ms. Bianca Michaels and Mr. Arno Michaels (hereinafter
referred to as "Option Sellers") to sell the preferred Shares referred to
in (S)2.2. (the "Option Shares") to the Purchaser in accordance with the
further provisions of this (S)9 (the "Put Option").
9.2 The Put Option can be exercised at the earliest on 1 October 2003 and at
the latest on 31 December 2004 by written declaration of the Option Sellers
to the Purchaser. The Put Option can only be exercised jointly and in the
same way by the Option Sellers.
9.3 The Put Option shall be deemed to have been effectively exercised upon
receipt by the Purchaser. The Purchaser shall send the Option Sellers a
written acknowledgement of receipt of the exercise of the Put Option. The
transfer of the Option Shares will be effected concurrently with (Zug um
Zug) the payment of the Option Purchase Price on the basis of a share
transfer agreement in accordance with the draft attached hereto as Exhibit
4.2.1.
9.4 The purchase price for the Option Shares shall amount to EUR 2,879,337.00
(in words: two million eight hundred seventy-nine thousand three hundred
thirty-seven Euro) (the "Option Purchase Price") and shall be due and
payable within five (5) banking days from receipt of the exercise of the
Put Option concurrently with (Zug um Zug) the transfer of the Option
Shares; payment shall be made at no cost or expense to
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the Option Sellers to the account no. 150737000 at Dresdner Bank
Aschaffenburg, banking code 79580099.
The Option Purchase Price will be allocated internally between the Option
Sellers as follows:
Ms. Ute Michaels EUR 1,974,589.00 68.58%;
Mr. Arno Michaels EUR 452,374,00 15.71%; and
Ms. Bianca Michaels EUR 452,374.00 15.71%.
The Option Sellers will allocate and distribute the Option Purchase Price
among themselves. The Option Purchase Price shall be fixed and
non-adjustable.
The Purchaser hereby irrevocably waives its right of set-off (Aufrechung)
against this claim and its right to invoke other objections (Einwendungen)
or defenses (Einreden), of whatever nature, against the claim for payment
of the Option Purchase Price provided that there is no breach of the
guarantees in (S) 9.7. In such cases any amounts set-off or otherwise
withheld shall be taken into account for the Aggregate Limit of Liability.
The Purchaser shall, in particular, have no right of set-off with potential
claims pursuant to (S)(S)5, 6, 7 and/or 8 of this Agreement against the
claim for payment of the Option Purchase Price or to invoke rights of
retention (Zuruckbehaltungsrechte) against such claim.
9.5 As a security for the payment of the Option Purchase Price the Purchaser
shall, at the Closing ((S)4 subpara. 2 lit. l) hereof), deliver a bank
guarantee, payable on first written demand of the Option Sellers and valid
until 31 October 2003, of a reputable major bank in the amount of EUR
2,879,337.00. The Option Sellers shall reimburse the Purchaser for the
costs of the bank guarantee up to a maximum amount of EUR 57,586.00 (equal
to 2% of the amount of the bank guarantee). Payment shall be made
concurrently with the payment of the Option Purchase Price and against
delivery of written evidence of the costs of the bank guarantee.
9.6 The sale of the Option Shares shall also comprise the right to draw all
profits which have not been distributed until the exercise of the Put
Option.
9.7 The Option Sellers hereby guarantee by way of an independent guarantee
(selbstandiges Garantieversprechen) pursuant to Sec. 311 para. 1 BGB
(German Civil Code) with effect as of the day of the transfer in rem of the
Option Shares to the Purchaser that they are the sole owners of the Option
Shares and that the Option Shares are free of any third party rights.
Further warranties and/or guarantees, as per the date of transfer of the
Option Shares, are not assumed, irrespective of the legal
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basis, nature and substance thereof. The provisions set out in (S)5
sentences 3 and 4 and (S)5.16.9 shall apply mutatis mutandis also to the
sale of the Option Shares.
As a consideration for the granting of the Put Option the Option Sellers
have, however, already hereby given the guarantees pursuant to (S)5 and
have agreed to the obligations to indemnify the Purchase pursuant to
(S)(S)6, 7, and 8.
9.8 The Option Sellers hereby declare their agreement to change Sec. 5 para 3
sentence 2 of the articles of association of the Company to the effect that
also the pledging of or granting of other encumbrances over shares of the
Company shall require the approval of the Company.
(S)9a
Claim for Reimbursement of Corporation Tax
9a.1 In the Shareholders' Meeting of the Company of 28 June 2002 the
Shareholders have resolved on the distribution of an anticipated partial
dividend (Abschlagsdividende) in the amount of EUR 2,001,000.00 out of the
profits for the business year 2001. This amount has already been dividended
out. Prior to the Closing the Shareholders will pass a further resolution
on the distribution of a further (partial) dividend in the amount EUR
6,168,300.00 and cause the Company to distribute this amount to the
Shareholders. Therefore, until the Closing an aggregate amount of EUR
8,169,300.00 will have been distributed to the Shareholders as dividend out
of the profits for the business year 2001.
9a.2 In addition to the Purchase Price pursuant to (S)3 (as adjusted pursuant to
(S)3.4 - 3.5) and in addition to the Option Purchase Price payable in case
of the exercise of the Put Option, if any, the Purchaser shall pay to the
Shareholders as a compensation for the Company's claim for reimbursement of
corporation tax (Korperschaftssteuerer-stattungsanspruch) resulting from
the distributions pursuant to (S)9a.1 above an amount as is equal to the
Company's claim for reimbursement of corporation tax. This amount shall
bear interest as of 1 March 2003 at a rate of 6% p.a. and shall be due and
payable on 31 July 2003 including accrued interest. The parties expect that
as a result of the distributions pursuant to (S)9a.1 the Companies will
have a claim for reimbursement of corporation tax in an amount of EUR
1,361,550.00.
The Shareholders hereby instruct the Purchaser to transfer the amount
payable pursuant to this (S) 9a.2 to the account referred to in (S)3.2
unless the Shareholders notify the Purchaser of any other account in
writing five (5) banking days prior to the due date. The Shareholders will
allocate and distribute this amount among themselves. As
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a security for payment of this amount, the Purchaser will provide a bank
guarantee of a reputable major bank to the Shareholders at Closing in
accordance with the provisions set out in (S)4 subpara. 2 lit. k).
The Purchaser hereby undertakes, as of the Closing until the date of
payment of the amount pursuant to this (S)9a.2, not to take any measures
which could jeopardize the claim for reimbursement of corporation tax, in
particular not to waive such claim.
9a.3 The Purchaser hereby irrevocably waives its right of set-off (Aufrechung)
against the claim pursuant to (S)9a.2, if and to the extent such claim has
come into existence pursuant to (S)9a.1, and its right to invoke other
objections (Einwendungen) or defenses (Einreden), of whatever nature,
against this claim. The Purchaser shall, in particular, have no right of
set-off with potential claims pursuant to (S)(S)5, 6, 7 and/or 8 of this
Agreement against a claim that has come into existence pursuant to (S)9a.2
or to invoke rights of retention (Zuruckbehaltungsrechte) against such
claim.
(S)10
Liability of the Shareholders
With respect to all liabilities resulting from this Agreement, the Shareholders
shall be jointly and severally (gesamtschuldnerisch) liable.
(S)11
Non-Compete Covenant, Use of Name
11.1 For a period of 3 (three) years following the Closing, the Shareholders
hereby covenant not to, whether directly or indirectly, manufacture or
distribute products or otherwise assist in the manufacturing or
distribution of products (e.g. by transfer of know-how or rendering
consultancy services) within Europe, USA and Tunesia (hereinafter the
"Territory") which directly or indirectly compete with the products
manufactured and/or distributed by the Companies on the Closing and during
the 12 months prior to the Closing (such products are hereinafter referred
to as the "Competing Products" and this covenant by the Shareholders is
hereinafter referred to as "Non-Compete Covenant"). During the term of the
Non-Compete Covenant Shareholders shall also refrain from, whether directly
or indirectly,
(i) acquiring or owning a direct or indirect ownership interest in
enterprises which manufacture or distribute, or otherwise support
the manufacturing or distribution of the Competing Products within
the Territory;
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(ii) taking other actions which would interfere with any contractual or
customer relationship of the Companies in the Territory or otherwise
intentionally interfere with the business of the Companies in the
Territory.
11.2 In each case of a violation of the Non-Compete Covenant by Shareholders,
the respective Shareholder violating the Non-Compete Covenant shall be
obligated to pay to the Purchaser a contractual penalty (Vertragsstrafe) in
the amount of Euro 250,000.00 (Euro two hundred fifty thousand). Should the
Shareholders violating the Non-Compete Covenant despite a written warning
of the Purchaser continue the violation, the Shareholders in violation
shall pay for each month during part of which the violation is continuing a
further contractual penalty in the amount of Euro 100,000.00 (Euro one
hundred thousand). Sec. 343 BGB (German Civil Code) shall remain
unaffected.
In addition to the contractual penalty Purchaser has the right to seek
injunctive relief in the event of a violation of the Non-Compete Covenant
and to assert claims for damages against the violating Shareholders in
excess of the amount of the contractual penalty.
11.3 The Non-Compete Covenant pursuant to this (S) 11 shall, however, not
restrict Shareholders from owning or acquiring an interest in publicly
traded entities not exceeding 10%.
11.4 The Shareholders hereby agree that the Kopp Group may continue to use the
name "Kopp". After the Closing Shareholders shall refrain from using,
directly or indirectly, any trade name or component thereof presently being
used by the Kopp Group, including but not limited to, "Kopp", "Brunnquell",
"Profikontakt", "Condor" and "HEKO".
(S)12
Costs and Taxes
12.1 Each party shall bear its own costs and expenses that have been or will be
incurred by it in connection with the preparation and conclusion of this
Agreement, including the costs of its respective advisors.
12.2 The costs of this Agreement and its completion, especially any registration
costs, as well as costs in connection with required antitrust approvals,
shall be borne by Purchaser.
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12.3 Any taxes, especially any taxes on capital gains, shall be borne by such
party realising such capital gain.
12.4 Real estate transfer tax triggered as a result of the consummation of this
Agreement, if any, shall be borne by the Purchaser.
(S)13
Confidentiality
13.1 All parties mutually undertake to keep the content of this Agreement, in
particular the Purchase Price, secret and confidential vis-a-vis third
parties. This shall not apply to the extent a party is forced to disclose
the same by statutory provisions, administrative decree or stock exchange
rules. Even in such cases, the parties shall, however, inform each other
prior to such disclosure and shall limit the same to the minimum required.
13.2 The Shareholders shall not disclose confidential information relating to
the business of the Companies, unless such information is or becomes
publicly known, is disclosed to the Shareholders from third parties
(provided that such a third party is not a person who has worked for any of
the companies in which Kopp held a majority interest during the last five
years prior to the Closing) or is required to be disclosed by the
Shareholders to a court or governmental authority.
13.3 Press releases shall be mutually agreed between the parties in advance. The
same applies with respect to announcements and declarations of the
Purchaser vis-a-vis employees, customers, suppliers or other business
partners of the Kopp Group prior to Closing. After the signing of this
Agreement and the publication of the press release both parties shall
however have the right to make declarations to the press or other third
parties without the consent of the respective other party, provided that
the content of this Agreement is not disclosed. (S) 13.1 shall in any case
remain unaffected.
(S)14
Conditions Precedent, Right to Rescind
14.1 The Closing of this Agreement pursuant to (S)4 shall be subject to the
following conditions precedent:
14.1.1 the Company having approved the transfer of all shares in the
Company to the Purchaser or any other subsidiary of Actuant pursuant
to (S)5 subpara. 3 of the Articles of Association of the Company;
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14.1.2 the competent court having approved the sale of the shares in the
Company by Anni Simoneit; and
14.1.3 (i) the Federal Cartel Office having cleared the transaction or the
time limits to prohibit the transaction having expired without
prohibition and (ii) the Austrian Cartel Court having cleared the
transaction, the time limits to prohibit the transaction having
expired without prohibition or the Cartel Court having notified that
the review procedure has been aborted (eingestellt) or that no
review will be conducted;
The parties shall confirm in writing on the Closing Date that the above
conditions have been fulfilled and/or waived (to the extent legally
permissible).
14.2 The Purchaser and the Shareholders (the latter ones only jointly) shall be
entitled to rescind this Agreement in writing if any of the conditions
precedent set forth above in (S)14.1 have not been met by 31 October 2002
or such other date the parties may mutually agree to in writing.
14.3 If any circumstances arise between the Signing Date and the Closing of this
Agreement which would have constituted a breach of the independent
guarantees under (S)5 hereof if the guarantees had been provided as of the
Closing resulting in a Material Adverse Impact on the Companies' Business
Operations and such circumstances and the Adverse Impact continue to exist
at the Closing, the Purchaser shall be entitled to rescind this Agreement
until the Closing by written notice to the Shareholders. The right of
rescission shall expire upon the Closing of this Agreement.
A "Material Adverse Impact on the Companies' Business Operations" within
the meaning of this (S)14 subpara. 3 shall mean any impairment which has
(not: might have) substantial adverse effects for the business operations
of the Kopp Group as a whole so that the Purchaser cannot be reasonably
expected to be bound to this Agreement. A Material Adverse Impact on the
Companies' Business Operations shall, however, in any event, be found to
exist only if the impairment - on balance - results in any loss, expenses
or other liabilities of (i) the relevant Company concerned in an amount in
excess of EUR 1,000,000.00 and (ii) the Kopp Group in an aggregate amount
in excess of EUR 2,500,000.00.
If the parties fail to come to an agreement on the Closing Date with regard
to the question of whether or not any impairment of the Companies' business
is to be considered a Material Adverse Impact within the meaning of this
(S)14 subpara. 3 and/or whether such impairment continues to exist at the
Closing, the expert arbitrator
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shall make a decision in accordance with (S) 16 subpara. 1 hereof. The
expert arbitrator shall make a decision as soon as possible, but in any
case within ten working days. The decision shall be binding upon the
parties. In addition, (S)16 subpara. 1 shall apply mutatis mutandis.
14.4 In the event of a rescission pursuant to (S)14 subparas. 2 or 3 above the
provisions of this Agreement shall become null and void, with the exception
however of the provisions as to costs and taxes ((S)12) and
confidentiality ((S) 13) which shall continue to apply. In case of
rescission, neither the Shareholders nor Purchaser shall have any claims of
whatever nature against each other as a result of the recession, in
particular no claims resulting from breach of obligations (Sec. 280 German
Civil Code, in particular not in the cases of Sec. 311 para 2 German Civil
Code - culpa in contrahendo) or frustration of contract (Storung der
Geschaftsgrundlage, Sec. 313 German Civil Code).
(S)15
Actuant's Guarantee, Discharge of the Supervisory Board/Management Board,
Actuant's Covenant
15.1 Actuant hereby guarantees to all or any of the Sellers the payment of the
Purchase Price pursuant to (S)(S) 3.1, 3.2 and 3.3, the payment of any
adjusted Purchase Price pursuant to (S) 3.8 by the Purchaser and the
fulfilment of all other payment obligations of the Company on the Closing
resulting out of the agreements to be executed on the Closing pursuant to
(S)4 subpara. 2. This guarantee shall expire upon the complete payment of
the guaranteed amounts by the Purchaser or the Company.
15.2 The Purchaser shall procure that the members of the supervisory board from
the shareholders' side who have resigned from their office with effect as
of the Closing and Mr. Michaels as member of the management board of the
Company shall be discharged (entlasten) within the next ordinary
shareholders' meeting of the Company. The discharge (Entlastung) for the
activities from 1 January 2002 until the Closing shall be resolved at the
latest as part of the ordinary shareholders' meeting for the year 2003. The
same shall apply mutatis mutandis for discharging (entlasten) Mr. Michaels
as managing director/member of a management board of other Companies of the
Kopp Group. Actuant hereby covenants that the Purchaser duly and properly
fulfils all obligations pursuant to this Agreement which are not primarily
payment obligations.
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(S)16
Expert Arbitrator, Arbitration
16.1 If the parties fail to reach an agreement within the period set out in (S)3
subpara. 7 with respect to the draft Working Capital calculation, upon
notice by either party, a public accountant nominated by the Chamber of
Chartered Accountants (Wirtschafts-pruferkammer), Dusseldorf, shall be
appointed as expert, whose determination of the disputed matter shall be
binding and final among the parties. The parties shall be given an
opportunity to present their views and opinions to the expert in writing or
orally and to respond to the opinions of the respective other party in
writing. The expert shall comment on any submissions made by the parties.
The expert shall be given any information requested orally and in writing
and shall be granted access to any books, documents and papers of the
Companies if and to the extent considered by him to be required to
determine the Working Capital. Any consultants and representatives of the
Companies bound by professional secrecy shall be released from such secrecy
obligation if and to the extent considered by the expert to be required and
shall further provide oral as well as written information.
The expert shall be bound by the arrangements set out herein and the
Exhibits hereto. The expert shall be instructed to, authorised to and
shall, if necessary, adjust the draft Working Capital calculation so as to
comply with his decision. The draft Working Capital calculation as
determined by the expert, whether as initially drafted or amended, shall
constitute the final Working Capital calculation for the purposes of this
Agreement.
Costs and expenses of the expert shall be advanced by the parties upon
first demand in equal instalments and shall be borne by them upon
conclusion of the procedure, in accordance with their success therein. On
the basis of these principles, the expert shall ultimately decide on the
allocation of his costs at his reasonable discretion. This shall not
address the own costs of the parties and the costs of their advisors, which
the parties shall bear themselves in any event.
16.2 All disputes arising out of and in connection with this Agreement, unless
subject to the expert arbitrator's decision pursuant to (S) 16 subpara. 1
above, or its validity shall be finally settled by an arbitration panel
pursuant to the rules and provisions of an arbitration agreement to be
entered into between the parties separately and simultaneously herewith.
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(s)17
Notices
Notices in connection with this Agreement shall be addressed and sent to the
parties in writing and deemed to be served if delivered as follows:
a. if to one or more of the Shareholders, Sellers and/or Option Sellers solely
to:
Mr. Horst Michaels:
Tulpenweg 13
63755 Alzenau
with a copy to:
Freshfields Bruckhaus Deringer
Dr. Axel Epe
Freiligrathstr. 1
40479 Dusseldorf
b. if to the Purchaser to:
Andrew G. Lampereur
Chief Financial Officer
Actuant Corporation
6100 North Baker Road
Milwaukee, WI 53209
U.S.A.
with a copy to:
Anthony W. Asmuth III, Esq.
Quarles & Brady LLP
411 East Wisconsin Avenue Suite 2040
Milwaukee, Wisconsin 53202-4497
U.S.A.
and:
Bernd Thalmann, LL.M.
Mayer, Brown, Rowe & Maw Gaedertz
Bockenheimer Landstrasse 98-100
60323 Frankfurt am Main
or to such addresses any of the above addressees shall designate by written
notice to the other addressees. The parties agree that Mr. Michaels shall act as
representative (Handlungs- und
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Zustellungsbevollmachtigter also in arbitration proceedings) for the
Shareholders, Sellers and/or Option Sellers and that Mr. Michaels can appoint an
authorized representative with address in Germany at any time he sees fit for
all Shareholders, Sellers and/or Option Sellers.
(s)18
Transfer of all Rights and Obligations out of this Agreement
18.1 The Purchaser shall be entitled to transfer all rights and obligations
resulting out of this Agreement and all agreements executed in
consummation of this Agreement by way of transfer of contract
(Vertragsubernahme) in its entirety to a, whether directly or indirectly,
wholly owned subsidiary of Actuant (the "Assignee Entity"), subject to the
condition that the Assignee Entity declares to the Shareholders in writing
to assume all rights and obligations of the Purchaser out of this
Agreement and the arbitration agreement of even date by way of transfer of
contract (Vertragsubernahme). The Purchaser shall have this right prior
and after Closing, in the latter case, however, only if at the same time
all of the shares in the Company acquired in consummation of this
Agreement are also transferred to the Assignee Entity. The Shareholders
already hereby consent to the transfer of contract provided for in this
(s)18.1.
18.2 Any obligations of Actuant out of this Agreement, including without
limitation pursuant to (s)15, shall remain unaffected by a transfer of
contract (Vertragsubernahme) pursuant to (s)18.1. Any guarantees,
covenants etc. which Actuant has given in this Agreement in relation to
obligations of the Purchaser, shall after a transfer of contract refer to
the obligations assigned by the Assignee Entity pursuant to (s)18.1
without any further declarations required.
(s)19
Miscellaneous
19.1 This Agreement is subject to, and shall be governed by, the laws of
Germany, excluding, however, the provisions of German international
private law.
19.2 Amendments and alterations to this Agreement have to be in writing, unless
notarisation is required. This shall also apply to a waiver of the written
form.
19.3 If any provisions of this Agreement should be or become invalid, or if
this Agreement does not address any specific situation, all other
provisions of this Agreement shall not be affected thereby. Instead of
such invalid provision, or in order to provide a provision to fill the
gap, such provision shall be deemed to have been agreed upon that,
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as close as legally possible, complies with the purpose and intent of the
parties with the invalid provision, especially with respect to any measure
of performance, time or period provided therein, or which reflects what
the parties would have agreed upon if they had considered such situation.
19.4. The Exhibits to this Agreement, as well as all amendments and alterations
to this Agreement, constitute an integral part of this Agreement. Any
reference to this Agreement includes all Exhibits, alterations and
amendments thereto.
19.5 This Agreement has been executed in a German and an English version. In
case of discrepancies between the German and the English version, the
German version shall prevail. Where in the English version a German term
has been inserted in brackets it alone shall be authoritative for the
purpose of the interpretation of the relevant English term in this
Agreement.
19.6 Mr. Horst Michaels and Ms. Ute Michaels hereby consent to each other to
the entering into this Agreement pursuant to Sec. 1365 German Civil Code
(BGB).
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[Signature page of the Share Sale and Purchase and Option Agreement dated 22
July 2002]
Frankfurt, this 22 day of July 2002
/s/ Horst Michaels
- -----------------------------
(Horst Michaels)
/s/ Anni Simoneit
- -----------------------------
(Anni Simoneit)
by Dr. Frank Heerstraben based on power of attorney dated 12 July 2002
/s/ Arno Michaels
- -----------------------------
(Arno Michaels)
Based on Power of Attorney dated 20-6-2002
/s/ Bianca Michaels
- -----------------------------
(Bianca Michaels)
/s/ Ute Michaels
- -----------------------------
(Ute Michaels)
Based on Power of Attorney dated 17-7-2002
Applied Power Holding GmbH
by:
/s/ B. Thalmann
- -----------------------------
(B. Thalmann)
Based on Power of Attorney dated July 17, 2002
Actuant Corporation
by:
/s/ G.H.P. Boel
- -----------------------------
Based on Power of Attorney dated 17-7-2002