EXHIBIT 2.1
AMENDMENT TO STRATEGIC BUSINESS COMBINATION AGREEMENT
THIS AMENDMENT TO STRATEGIC BUSINESS COMBINATION AGREEMENT (this
"Amendment"), dated as of December 15, 2000, is entered into by and among STEAG
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Electronic Systems AG, an Aktiengesellschaft organized and existing under the
laws of the Federal Republic of Germany ("STEAG"), and ▇▇▇▇▇▇▇ Technology, Inc.,
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a Delaware corporation ("▇▇▇▇▇▇▇").
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RECITALS
▇. ▇▇▇▇▇▇▇ and STEAG have entered into that certain Strategic Business
Combination Agreement, dated as of June 27, 2000 (the "Agreement"), pursuant to
which ▇▇▇▇▇▇▇ will directly or indirectly acquire 100% of the issued and
outstanding capital stock, equity ownership or its equivalent of the STEAG
Subsidiaries (as defined in the Agreement).
B. STEAG and ▇▇▇▇▇▇▇ desire to amend the Agreement as set forth below in
order to effect certain changes in the structure and consideration of the
transactions contemplated thereby and to implement certain other modifications
and clarifications.
NOW, THEREFORE, in consideration of the covenants and representations set
forth herein, and for other good and valuable consideration, STEAG and ▇▇▇▇▇▇▇
agree as follows:
1. Defined terms. Capitalized terms used but not otherwise defined in
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this Amendment shall have the respective meanings ascribed to such terms in the
Agreement.
2. Recitals. Recitals A, B and C of the Agreement are hereby deleted and
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replaced in their entirety by the following:
"A. STEAG and ▇▇▇▇▇▇▇ desire to enter into a transaction pursuant to
which ▇▇▇▇▇▇▇ will directly or indirectly acquire 100% of the issued and
outstanding capital stock, equity ownership or its equivalent (which, for
purposes of this Agreement, shall be referred to as "capital stock") (the
"Stock Acquisition") of the STEAG subsidiaries listed on Exhibit A to this
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Agreement, STEAG Electronic Systems Semiconductor GmbH, a Gesellschaft mit
beschraenkter Haftung recently organized in connection with this Agreement
and existing under the laws of the Federal Republic of Germany ("Newco"),
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and STEAG Electronic Systems Semiconductor, Inc., a corporation to be
organized in connection with this Agreement under the laws of the State of
Delaware ("U.S. Newco") (collectively, the subsidiaries listed on Exhibit
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A, Newco and U.S. Newco, the "STEAG Subsidiaries").
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B. Prior to the Closing (as defined below), STEAG will contribute,
assign or otherwise transfer (i) all of the capital stock it owns directly
in of each of those STEAG Subsidiaries incorporated or organized in
jurisdictions other than
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the U.S.A. and Germany to Newco (collectively, all such subsidiaries of
STEAG that STEAG contributes or transfers to Newco, the "Foreign STEAG
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Subsidiaries," and such directly-owned capital stock, the "Foreign
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Subsidiary Shares"), after which STEAG will own 100% of the capital stock
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of Newco, and (ii) all of the capital stock it owns directly in each of
those STEAG Subsidiaries incorporated in the U.S.A. (the "U.S. STEAG
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Subsidiaries," and such capital stock, the "U.S. Subsidiary Shares") to
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U.S. Newco, after which STEAG will own 100% of the capital stock of U.S.
Newco.
C. To effect the Stock Acquisition, at the Closing, STEAG will sell,
assign and transfer to ▇▇▇▇▇▇▇ 100% of the issued and outstanding capital
stock of U.S. Newco, and will sell, assign and transfer to ▇▇▇▇▇▇▇ (or, at
▇▇▇▇▇▇▇'▇ election, to a wholly owned subsidiary of ▇▇▇▇▇▇▇) 100% of the
issued and outstanding capital stock of Newco and each of the other STEAG
Subsidiaries organized and existing under the laws of the Federal Republic
of Germany (the "Direct STEAG Subsidiaries," and such capital stock, the
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"Direct Subsidiary Shares"), and in consideration thereof ▇▇▇▇▇▇▇ will
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issue and deliver to STEAG shares of ▇▇▇▇▇▇▇'▇ common stock, par value
$0.001 per share (the "▇▇▇▇▇▇▇ Common Stock"), as provided in Article II
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below (the "Share Issuance"; together, the Stock Acquisition and the Share
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Issuance are referred to herein as the "Strategic Business Combination")."
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3. Capitalization of Newco and U.S. Newco. The caption to Article 1 of
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the Agreement is hereby amended by adding at the end thereof the words: "AND
U.S. NEWCO".
4. Transfer of Foreign Subsidiary Shares to Newco. Section 1.1 is hereby
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amended: (x) by adding at the end of the parenthetical in clause (b) thereof the
following: "and expenses incidental to its formation and the transfer to it of
the Foreign Subsidiary Shares"; and (y) by deleting from clause (c) thereof the
ending parenthetical and replacing it with the following: "(the "Newco
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Shares")".
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5. Transfer of U.S. Subsidiary Shares to U.S. Newco. A new Section 1.2
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is hereby added to the Agreement, the text of which shall be as follows:
"1.2 Transfer of U.S. Subsidiary Shares to U.S. Newco. Not later
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than five (5) days prior to the Closing, (a) STEAG will form U.S. Newco,
all of the shares of which shall be owned initially and until the Closing
by STEAG, and (b) STEAG will transfer and deliver to U.S. Newco, by means
of capital contribution, all of the issued and outstanding shares of
capital stock of (i) STEAG RTP Systems, Inc., (ii) STEAG Electronic
Systems, Inc., and (iii) STEAG Cutek, Inc. The transactions described in
this Section 1.2 will be effected in such manner that (a) U.S. Newco will
own all of the outstanding shares of capital stock of the U.S. STEAG
Subsidiaries, (b) U.S. Newco will have no other assets or liabilities
(other than its initial $100 cash capitalization and expenses incidental to
its formation and the transfer to it of the U.S. STEAG Subsidiaries),
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and (c) STEAG will own 100% of the issued and outstanding capital stock of
U.S. Newco (the "U.S. Newco Shares" and, together with the Newco Shares and
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the Direct Subsidiary Shares, the "STEAG Shares")."
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6. Purchase and Sale of Stock. Section 2.1 of the Agreement is hereby
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amended: (x) by adding immediately prior to the period in the first sentence
thereof the following clause "; provided, that at the election of ▇▇▇▇▇▇▇,
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▇▇▇▇▇▇▇ may designate an indirect, wholly owned subsidiary of ▇▇▇▇▇▇▇ organized
and existing under the laws of the Federal Republic of Germany ("▇▇▇▇▇▇▇
Germany"), by written notice to STEAG given at least 5 days prior to the Closing
(which notice shall state the name and registered seat of ▇▇▇▇▇▇▇ Germany and
such other information as shall be necessary to effect the transfers in
accordance with German law), to accept the delivery of the Newco Shares and the
Direct Subsidiary Shares from STEAG, and following such notice STEAG shall
transfer, and deliver the Newco Shares and the Direct Subsidiary Shares to
▇▇▇▇▇▇▇ Germany; provided, further, that such election shall not relieve ▇▇▇▇▇▇▇
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of its obligations under the next sentence of this Section 2.1 or under any
other provision of this Agreement"; and (y) by deleting part (iii) of clause (a)
thereof and replacing it in its entirety by the following clause: "(iii) the
▇▇▇▇▇▇▇ Secured Note referred to in Section 6.13(c) of this Agreement".
7. Assumed Obligations of STEAG. (a) Section 2.3 of the Agreement is
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hereby amended by inserting between the first and second sentence thereof the
following two new sentences:
"Without limiting the foregoing, the assumption by ▇▇▇▇▇▇▇ of STEAG's
guarantee obligations (a) under currency exchange rate forward contracts
(subject to Section 6.13(d) below), (b) under the (Yen) 500,000,000 credit
line described in Section 6.21 below, and (c) for deposits made under customer
contracts (totaling as of the date hereof, and not to exceed, DM 1,725,000
with respect to STEAG RTP Systems GmbH and DM 3,947,000 with respect to STEAG
MicroTech GmbH) will be secured, as of the Closing Date with respect to the
forward contracts and the credit line, and as of the date which is 6 months
after the Closing Date with respect to the customer contracts, by one or more
stand-by letters of credit or bank guarantees from a mutually acceptable bank
in form and substance reasonably satisfactory to STEAG, or such other form of
security as may be reasonably acceptable to STEAG; provided, that the
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obligation of ▇▇▇▇▇▇▇ to provide any such stand-by letter of credit or bank
guarantee shall terminate at such time as ▇▇▇▇▇▇▇ obtains from the applicable
third-party a full release of STEAG's obligations, in form and substance
reasonably satisfactory to STEAG. To the extent that STEAG has not been
released from any of the assumed obligations as a matter of law, whether due
to the absence of a third party consent or otherwise, ▇▇▇▇▇▇▇ will indemnify
STEAG in accordance with Section 9.1(c).".
(b) Schedule 2.3 is hereby deleted and replaced in its entirety by
Schedule 2.3A attached to this Amendment, and all references in the Agreement to
Schedule 2.3 shall be deemed to refer to such Schedule 2.3A.
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8. Closing. Section 2.4 of the Agreement is hereby amended by adding
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immediately prior to the period in the first sentence thereof the following
clause: "; provided, that the parties may elect to specify that the Closing will
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be deemed to take place at the time which is both 24:00 hours on December 31,
2000 and 0:00 on January 1, 2001".
9. Allocation of Purchase Price. Section 2.6 of the Agreement is hereby
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amended by deleting the first sentence thereof and replacing it with the
following sentence:
"STEAG and ▇▇▇▇▇▇▇ agree to allocate the value of (i) the Newco Shares
among the Foreign STEAG Subsidiaries, (ii) the U.S. Newco Shares among the
U.S. STEAG Subsidiaries and (iii) the ▇▇▇▇▇▇▇ Shares among the Direct STEAG
Subsidiaries, Newco and U.S. Newco for financial accounting and tax
purposes in accordance with the percentages set forth on the allocation
schedule attached as Schedule 2.6 attached hereto.",
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by deleting in the second sentence thereof the words "▇▇▇▇▇▇▇ Shares and Newco
Shares" and replacing them with the words "▇▇▇▇▇▇▇ Shares, Newco Shares and U.S.
Newco Shares", and by deleting the words "Direct Subsidiary Shares" in the last
sentence thereof and replacing them with the words "Foreign Subsidiary Shares".
10. Early Condition Satisfaction Date. Section 2.8 of the Agreement is
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hereby amended by deleting from clause (i) of the introductory paragraph thereof
the words: "prior to December 1, 2000," and by deleting from the end of the
second to last paragraph thereof the words "January 1, 2001" and replacing them
with the words "24:00/0:00 hours on December 31, 2000/January 1, 2001".
11. Post-Closing Adjustments. Section 2.9 of the Agreement is hereby
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deleted and replaced in its entirety by the following:
"2.9 Post-Closing Adjustments. The following adjustments will be made
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with regard to the profits and losses of the STEAG Subsidiaries following the
Closing:
(a) As promptly as practicable, but in no event more than 60 days
following the Closing Date, ▇▇▇▇▇▇▇ shall prepare and deliver to STEAG (i)
audited income statements of STEAG RTP Systems GmbH and STEAG MicroTech GmbH
for the 10 months ended October 31, 2000 (the "October Income Statements"),
and (ii) audited income statements of STEAG RTP Systems GmbH and STEAG
MicroTech GmbH for the year ended December 31, 2000 (the "Year 2000 Income
Statements" and, together with the October Income Statements, the "Closing
Financial Statements"). The Closing Financial Statements shall be prepared in
accordance with German GAAP (as defined in Section 3.5) applied on a basis
consistent with the accounting principles used in preparation of the income
statements for STEAG RTP Systems GmbH and STEAG MicroTech GmbH referred to in
Section 3.5(a), except, in the
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case of the October Income Statements, for such differences as are appropriate
for interim financial statements. The Closing Financial Statements shall be
audited by PricewaterhouseCoopers ("PWC"), using procedures and methods
consistent with past practice; provided that ▇▇▇▇▇▇▇'▇ auditors, ▇▇▇▇▇▇
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▇▇▇▇▇▇▇▇ ("AA"), shall be permitted to participate in such audits. STEAG will
make available such STEAG employees who are reasonably necessary for the
preparation of the Closing Financial Statements, using the books and records
of the STEAG Subsidiaries, to assist ▇▇▇▇▇▇▇ in preparing the Closing
Financial Statements.
(b) Unless within 10 business days after its receipt of the Closing
Financial Statements, STEAG delivers to ▇▇▇▇▇▇▇ a detailed written statement
describing its objections to the October Income Statements or the Year 2000
Income Statements, such Closing Financial Statements shall be final and
binding. If STEAG delivers such a written objection statement to ▇▇▇▇▇▇▇, the
parties and their respective auditors will use reasonable efforts to resolve
any disputes, but if a final resolution is not reached within 20 business days
after STEAG has submitted its objections, any remaining disputes will be
resolved by an internationally recognized firm of independent certified public
accountants (excluding PWC and AA) mutually selected by ▇▇▇▇▇▇▇ and STEAG or,
if they are unable to agree, by PWC and AA (the "Reviewing Accountants"). The
Reviewing Accountants shall be instructed to resolve any matters in dispute as
promptly as practicable and, in any event, within 30 days after the dispute is
submitted to them. The determination of the Reviewing Accountants will be
final and binding. ▇▇▇▇▇▇▇ and STEAG will each pay one-half of the fees and
expenses of the Reviewing Accountants. ▇▇▇▇▇▇▇ and STEAG shall cooperate with
each other and the Reviewing Accountants in connection with the matters
contemplated by this Section 2.9, including by furnishing such information and
access to such books, records (including accountants' work papers), personnel
and properties as may be reasonably requested.
(c) The parties agree that the estimated aggregate pre-tax profits for
STEAG RTP Systems GmbH and STEAG MicroTech GmbH for the year ending December
31, 2000 are DM 30.7 million (the "Year 2000 Profit Estimate"), based on the
assumptions that (i) the aggregate pre-tax profits for such companies for the
10 months ended October 31, 2000 were as set forth in Part A of Schedule 2.9,
and (ii) the reserve adjustment set forth in Part B of Schedule 2.9 will be
made in fiscal 2000 after October 31, 2000. If the actual aggregate pre-tax
profits for STEAG RTP Systems GmbH and STEAG MicroTech GmbH for the 10 months
ended October 31, 2000, as set forth in the October Income Statements, are
greater than or less than the amount set forth in Part A of Schedule 2.9, then
the Year 2000 Profit Estimate shall be adjusted up or down, as the case may
be, by the amount of the difference. Any dispute as to the need for such an
adjustment or the amount thereof shall be resolved in the manner provided in
Section 2.9(b).
(d) Within 5 business days after the Closing Financial Statements (and any
adjustment to the Year 2000 Profit Estimate) become final, in accordance with
the Profit Transfer Contracts (as defined in Section 3.5(c)), ▇▇▇▇▇▇▇ will
cause each of
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▇▇▇▇▇ ▇▇▇ Systems GmbH and STEAG MicroTech GmbH to transfer its profit for
fiscal year 2000 to STEAG. If the aggregate payments to STEAG pursuant to the
preceding sentence are less than the Year 2000 Profit Estimate (as adjusted,
if necessary), then, concurrently with the profit payments required by the
preceding sentence, ▇▇▇▇▇▇▇ will make a cash payment, by wire transfer to an
account designated in writing by STEAG, equal to the difference between such
aggregate profit payments and the Year 2000 Profit Estimate. If the aggregate
payments to STEAG pursuant to the first sentence of this paragraph are more
than the Year 2000 Profit Estimate (as adjusted, if necessary), then, within
10 business days after receipt of such payments, STEAG will make a cash
payment, by wire transfer to an account designated in writing by ▇▇▇▇▇▇▇,
equal to the difference between such aggregate profit payments and the Year
2000 Profit Estimate."
For the avoidance of doubt, neither party shall be required to make any
payment based on the aggregate cash balances of the combined STEAG Subsidiaries.
12. Transfer of U.S. STEAG Subsidiaries to U.S. Newco. Section 2.10 of
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the Agreement is hereby deleted in its entirety.
13. Due Incorporation. Section 3.1(b) of the Agreement is hereby amended
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by deleting the last sentence thereof and replacing it with the following
sentence:
"At the Closing, (i) ▇▇▇▇▇▇▇ will receive good and valid title to shares or
other units of capital stock representing one hundred percent (100%) of the
equity ownership interest of U.S. Newco, Newco, and each Direct STEAG
Subsidiary; (ii) U.S. Newco will hold good and valid title to each U.S. STEAG
Subsidiary; and (iii) Newco will hold good and valid title to each Foreign
STEAG Subsidiary, free and clear of any Encumbrances."
14. Non-Contravention/Consents and Approvals. Subsection (iii) of Section
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3.3(b) of the Agreement is hereby amended by deleting the words "Direct
Subsidiary Shares" and replacing them with the words "Foreign Subsidiary
Shares".
15. Conduct of Business of STEAG Subsidiaries following the STEAG Early
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Condition Satisfaction Date. A new Section 5.5 is hereby added to the
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Agreement, the text of which shall be as follows:
"5.5 Conduct of Business of STEAG Subsidiaries following the STEAG Early
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Condition Satisfaction Date. During the period between the STEAG Early
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Condition Satisfaction Date and the Closing, STEAG shall use its reasonable
efforts to cause the STEAG Subsidiaries to comply with policies, procedures
and directives of the proposed management team designated by the Integration
Committee (as defined in Section 6.3 of this Agreement). Notwithstanding the
foregoing, neither STEAG, any STEAG Subsidiary nor any officer, director or
employee of any STEAG Subsidiary shall be required to take any action pursuant
to the preceding sentence if: (a) such action would breach, violate or
conflict with any of STEAG's representations,
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warranties, covenants or obligations under any other provision of this
Agreement or the transactions contemplated hereby; (b) such action would cause
STEAG, any STEAG Subsidiary or any of their respective officers, directors or
employees to violate any law, applicable regulation or binding agreement; (c)
such action would require the consent of ▇▇▇▇▇▇▇ under Section 5.1 of this
Agreement, unless such action has received the prior written consent of STEAG
as well as ▇▇▇▇▇▇▇ (for the avoidance of doubt, but without limiting the
foregoing, any action to close down any facility or business unit shall
require such consent); or (d) such action would reasonably be expected to
result in expense, loss or damage to STEAG or would otherwise adversely affect
STEAG or any of its officers or directors (other than by reducing the profits
or net assets of any of the STEAG Subsidiaries). Notwithstanding the previous
sentence, the parties agree that, following the STEAG Early Condition
Satisfaction Date, the proposed management team designated by the Integration
Committee shall be permitted, without any further consent, to cause the STEAG
Subsidiaries to (x) increase reserve amounts, (y) take asset write-offs and
(z) make inventory valuation changes. Nothing contained in this Section 5.5
shall restrict or limit STEAG's right to receive such reports and information
from the STEAG Subsidiaries as are customary or as otherwise requested by
STEAG."
16. Stock Option Grants. Section 6.11 of the Agreement is hereby amended
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by adding after the last sentence thereof the following sentence:
"Nowithstanding the foregoing, ▇▇▇▇▇▇▇ shall not be required to grant options
to employees of STEAG Subsidiaries in Japan, Korea or the United Kingdom to the
extent such grants would violate applicable laws in such countries; provided,
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that ▇▇▇▇▇▇▇ shall use its reasonable efforts to grant such options in
compliance with applicable local law as soon as practicable following the
closing; and provided,further, that upon such grants being made the respective
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vesting period for such grantee shall begin as of the Closing Date,
notwithstanding the date of option grant."
17. STEAG Intercompany Indebtedness; Forward Contracts. STEAG hereby
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represents and warrants that: (x) in accordance with Section 6.13(b) of the
Agreement, as of June 30, 2000, STEAG caused all indebtedness of any of the
STEAG Subsidiaries to STEAG or any of its affiliates (other than indebtedness of
one STEAG Subsidiary to another, and other than Excluded Indebtedness), in
aggregate principal amount of approximately $100,974,000, to be cancelled and
converted to equity without any payment on the part of such STEAG Subsidiaries;
(y) subsequent to such cancellation of indebtedness STEAG extended additional
loans to the STEAG Subsidiaries, the aggregate principal amount of which was
approximately $21,726,906 as of November 30, 2000; and (z) as of November 30,
2000, the STEAG Subsidiaries had aggregate cash in an amount not less than $20
million. New subsections (c) and (d) are hereby added to Section 6.13 of the
Agreement, the text of which shall be as follows:
"(c) Notwithstanding anything to the contrary in subsection (b) of this
Section 6.13, in Section 5.1((h), or in any other provision of this Agreement,
(i) from and after December 15, 2000, STEAG shall not be required to cancel
any indebtedness of any STEAG Subsidiary to STEAG; (ii) STEAG will not loan
any
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additional amounts to any STEAG Subsidiary following the date which is 10 days
prior to the expected Closing Date without the prior written consent of
▇▇▇▇▇▇▇; provided, that if the expected Closing Date is postponed, STEAG shall
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be entitled to loan additional amounts until the date which is 10 days prior
to such later expected Closing Date; (iii) from and after December 15, 2000,
STEAG will not cause or permit any STEAG Subsidiary to make any cash payments
to STEAG (other than in respect of Excluded Indebtedness described in clauses
(i), (iii) or (v) of the second sentence of Section 6.13(b)); and (iv) at the
Closing, STEAG will accept as payment for all remaining indebtedness of the
STEAG Subsidiaries to STEAG (other than Excluded Indebtedness) a secured
promissory note from ▇▇▇▇▇▇▇, or, at the request of ▇▇▇▇▇▇▇, will assign all
remaining indebtedness of the STEAG Subsidiaries to STEAG (other than Excluded
Indebtedness) to a wholly owned subsidiary of ▇▇▇▇▇▇▇ (to be designated in a
written notice from ▇▇▇▇▇▇▇ to STEAG at least 2 days prior to the Closing),
and such assignment by STEAG will be made in exchange for a secured promissory
note from ▇▇▇▇▇▇▇. The secured promissory note referred to in the immediately
preceding sentence will be equal in principal amount to the aggregate amount
of intercompany indebtedness cancelled or assigned by STEAG (to be set forth
in a notice from STEAG to ▇▇▇▇▇▇▇ at least 2 days prior to the Closing), and
will be in the form of Exhibit F and secured by a stand-by letter of credit or
bank guarantee from a mutually acceptable bank in form and substance
reasonably satisfactory to STEAG (the "▇▇▇▇▇▇▇ Secured Note").
(d) Between December 15, 2000 and the Closing, STEAG will cancel all
currency exchange rate forward contracts listed on Schedule 2.3, the
cancellation of which, in the aggregate, would not result in a loss, as of the
time of cancellation, to STEAG or any STEAG Subsidiary. For the avoidance of
doubt, in determining which forward contracts to cancel pursuant to the
preceding sentence, STEAG shall not be required to take into account any
potential exchange rate gain or loss on the underlying accounts receivable. In
accordance with Section 2.3 of this Agreement, ▇▇▇▇▇▇▇ will assume and become
solely responsible for the guarantee obligations of STEAG under any forward
contracts listed on Schedule 2.3 which are not so cancelled as of the
Closing."
18. Actions of Directors of STEAG Subsidiaries. A new Section 6.19 is
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hereby added to the Agreement, the text of which shall be as follows:
"6.19 Actions of Directors of STEAG Subsidiaries. Upon the availability
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of audited financial statements as of December 31, 2000, for the STEAG
Subsidiaries other than Newco and U.S. Newco, ▇▇▇▇▇▇▇ will promptly review
such financial statements. As soon as practicable after the review of such
audited financial statements in the case of the STEAG Subsidiaries other than
Newco and U.S. Newco, and not later than 30 days after the Closing in the case
of Newco and U.S. Newco, except with respect to fraud or intentional
violations of law, ▇▇▇▇▇▇▇ will approve, or cause the applicable holding
company to approve, to the fullest extent permitted under applicable law, the
prior actions of the officers and directors of the STEAG Subsidiaries in its
capacity as sole shareholder of such subsidiaries. Except with the
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prior written consent of STEAG, ▇▇▇▇▇▇▇ further agrees not to, and to cause
its applicable direct and indirect subsidiaries not to, commence or institute
any claim, action or proceeding against any such officers and directors with
respect to actions taken prior to the Closing by such persons in their
capacity as officers or directors of any of the STEAG Subsidiaries (other than
for fraud or intentional violations of law)."
19. Cooperation on Tax Matters. A new Section 6.20 is hereby added to the
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Agreement, the text of which shall be as follows:
"6.20 Cooperation on Tax Matters. Following the Closing, ▇▇▇▇▇▇▇ and STEAG
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shall each promptly notify the other in writing upon receipt by STEAG,
▇▇▇▇▇▇▇, any of their Affiliates or any of the STEAG Subsidiaries of written
notice of any pending or threatened federal, state, local or foreign tax
audits, claims for taxes or assessments that may affect the tax liabilities of
any of the STEAG Subsidiaries with respect to any tax period ending on or
before the Closing Date. ▇▇▇▇▇▇▇ will (a) provide STEAG with copies of all
correspondence received from any tax authority with respect to such tax
periods and (b) will consult with STEAG with respect to, and allow STEAG a
reasonable opportunity to comment on, any response by ▇▇▇▇▇▇▇ or any STEAG
Subsidiary. STEAG will assist ▇▇▇▇▇▇▇ and any STEAG Subsidiary with respect to
any such matter and will cooperate with any request for information. Nothing
contained in this Section 6.20 shall be deemed to create an obligation by
STEAG to pay any Taxes on behalf of any STEAG Subsidiary. For a period of six
years following the Closing Date, ▇▇▇▇▇▇▇ and STEAG will each provide to the
other, upon request, access during normal business hours to all Tax records
relating to the STEAG Subsidiaries."
20. Japanese Loan Guaranty. A new Section 6.21 is hereby added to the
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Agreement, the text of which shall be as follows:
"6.21 Japanese Loan Guaranty. Each of ▇▇▇▇▇▇▇ and STEAG will use their
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reasonable efforts to have STEAG released from its guarantee obligations under
the (Yen)500,000,000 credit line from Westdeutsche Landesbank Girozentrale
Tokyo Branch, Japan to STEAG Electronic Systems Japan Co., Ltd. (which
obligations ▇▇▇▇▇▇▇ will assume pursuant to Section 2.3 of this Agreement). In
the event that STEAG is not so released within 18 months after the Closing,
▇▇▇▇▇▇▇ will cause such credit line to be repaid or refinanced without any
continuing obligation on the part of STEAG."
21. Insurance. A new Section 6.22 is hereby added to the Agreement, the
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text of which shall be as follows:
"6.22 Insurance. Regardless whether the Closing or the STEAG Early
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Condition Satisfaction Date has occurred, as from January 1, 2001, ▇▇▇▇▇▇▇
shall provide or cause to be provided, at its own expense, insurance under
▇▇▇▇▇▇▇'▇ insurance policies listed on Schedule 6.22 hereto with respect to
the STEAG Subsidiaries (other than the STEAG Subsidiaries located in Asia);
provided, that
--------
9
▇▇▇▇▇▇▇ will not be providing the following types of insurance: (a)
environmental liability insurance; (b) legal expense insurance; (c) personal
accident insurance; (d) travel insurance abroad; (e) automobile insurance; (f)
luggage insurance; and (g) director and officer insurance. Until the Closing
Date, such insurance policies shall name STEAG as an additional insured party.
In the event this Agreement is thereafter terminated, ▇▇▇▇▇▇▇ shall continue
such insurance coverage until the earlier of (a) the date STEAG obtains
replacement insurance coverage or (b) 60 days following the date of
termination, following which STEAG shall reimburse ▇▇▇▇▇▇▇ for its allocated
share of ▇▇▇▇▇▇▇'▇ insurance costs with respect to the STEAG Subsidiaries."
22. Transition Services Agreements. A new Section 6.23 is hereby added
------------------------------
to the Agreement, the text of which shall be as follows:
"6.23. Transition Services Agreement. The parties agree that the
-----------------------------
Transition Services Agreements to be executed and delivered at the Closing,
including the supply agreement between STEAG MicroTech GmbH and STEAG
Electronic Systems spol. s r.o. shall be true and correct German language
translations of substantially the English language forms initialed and dated
by STEAG and ▇▇▇▇▇▇▇ on December 15, 2000."
23. Conditions to Each Party's Obligations. Section 7.1(f) of the
--------------------------------------
Agreement is hereby amended by deleting all of the language following the comma
and replacing it with the following: "of the outstanding Foreign Subsidiary
Shares".
24. Conditions to Obligations of STEAG. A new subsection (l) is hereby
----------------------------------
added to Section 7.3 of the Agreement, the text of which shall be as follows:
"(1) ▇▇▇▇▇▇▇ Secured Note; Security for Assumed Guarantee. STEAG shall
----------------------------------------------------
receive at the Closing (i) the ▇▇▇▇▇▇▇ Secured Note referred to in Section
6.13(c), (ii) the stand-by letter of credit or bank guarantee securing the
▇▇▇▇▇▇▇ Secured Note, and (iii) the stand-by letter(s) of credit or bank
guarantee(s) securing ▇▇▇▇▇▇▇'▇ obligations with respect to forward contracts
and the (Yen) 500,000,000 credit line pursuant to Section 2.3."
25. Termination. Section 8.1(j) of the Agreement is hereby deleted in
-----------
its entirety.
26. Indemnification. A new subsection (c) is hereby added to Section 9.1
---------------
of the Agreement, the text of which shall be as follows:
"(c) ▇▇▇▇▇▇▇ shall indemnify and hold harmless the STEAG Indemnified
Persons from and against all Damages arising out of (i) the failure of STEAG
RTP Systems GmbH and STEAG MicroTech GmbH to discharge after the Closing their
obligations to third parties to the extent of any obligation of STEAG under
(S)303 AktG (German Stock Corporation Act), as a result of the termination of
the Profit Transfer Contracts, to guarantee such obligations up until the date
of publication or deemed publication
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of the registration of the termination of the Profit Transfer Contracts with
the German Commercial Register, and (ii) the obligations assumed by ▇▇▇▇▇▇▇
pursuant to Section 2.3 of this Agreement."
27. Notices. The address for copies of notices to STEAG under Section
-------
10.1(b) of the Agreement is hereby deleted and replaced by the following:
"Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇"
28. Expenses. Section 10.8 of the Agreement is hereby amended by adding
--------
after the second sentence thereof the following:
"In order to implement the preceding sentence, within 60 days following the
Closing, STEAG will deliver to ▇▇▇▇▇▇▇ an accounting of all costs and expenses
incurred by STEAG in connection with this Agreement and the transactions
contemplated hereby, including legal, accounting and investment banking fees,
together with true and complete copies of all invoices relating to such costs
and expenses. None of such costs or expenses have been paid by or allocated to
the STEAG Subsidiaries prior to the Closing. ▇▇▇▇▇▇▇ will, or will cause one
or more of the STEAG Subsidiaries to, reimburse STEAG for 50% of the aggregate
costs and expenses shown on such accounting within 10 days of ▇▇▇▇▇▇▇'▇
receipt of such accounting."
29. German Counterpart Amendment. As soon as practicable after the date of
----------------------------
this Amendment, and in any event prior to the Closing, ▇▇▇▇▇▇▇ and STEAG shall
execute and deliver an amendment to the German law-governed version of the
Agreement, in such form as may be necessary or appropriate to effectuate the
purposes of this Amendment and is otherwise mutually acceptable to ▇▇▇▇▇▇▇ and
STEAG, which document shall be notarized in accordance with German law or as
otherwise agreed among the parties.
30. General Provisions. (a) Except as expressly amended or modified by
------------------
this Amendment, the Agreement remains in full force and effect.
(b) This Amendment may be executed in one or more counterparts, all of
which shall be considered one and the same instrument and shall become effective
when one or more counterparts have been signed by each of the parties and
delivered to the other parties, it being understood that all parties need not
sign the same counterpart.
(c) In the event that any provision of this Amendment, or the application
thereof becomes or is declared by a court of competent jurisdiction to be
illegal, void, or unenforceable, the remainder of this Amendment will continue
in full force and effect nd
11
the application of such provision to other persons or circumstances will be
interpreted so as reasonably to effect the intent of the parties hereto. The
parties further agree to replace such void or unenforceable provision of this
Amendment with a valid and enforceable provision that will achieve, to the
extent possible, the economic, business, and other purposes of such void or
unenforceable provision.
(This page intentionally left blank.)
12
IN WITNESS WHEREOF, STEAG and ▇▇▇▇▇▇▇ have caused this Amendment to be
executed and delivered by each of them or their respective officers
thereunto duly authorized, all as of the date first written above.
STEAG ELECTRONIC SYSTEMS AG
By: /S/ ppa Lockowandt
-------------------------
▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
General Counsel
By: /S/ ▇. ▇▇▇▇▇▇
-------------------------
▇▇. ▇▇▇▇ ▇▇▇▇▇▇
Chief Financial Officer
▇▇▇▇▇▇▇ TECHNOLOGY, INC.
By: /S/ ▇▇▇▇ ▇▇▇▇▇▇▇
-------------------------
▇▇▇▇ ▇▇▇▇▇▇▇, Chairman
and Chief Executive Officer
13
[Exhibit F]
SECURED PROMISSORY NOTE
U.S. $__________________ Place of Issuance: Fremont, California
Date of Issuance: January __, 2001
FOR VALUE RECEIVED, ▇▇▇▇▇▇▇ Technology, Inc., a Delaware corporation (the
"Company"), hereby promises and covenants to pay to the order of STEAG
Electronic Systems AG, an Aktiengesellschaft organized and existing under the
laws of the Federal Republic of Germany (the "Holder") the principal sum of
______________________________________________ Dollars
($_______________________) (the "Principal Amount") in lawful money of the
United States, together with accrued and unpaid interest from the date of
issuance hereof on the unpaid Principal Amount of this Note from time to time
outstanding at the "Interest Rate" (as hereinafter defined), which the Company
also promises and covenants to pay the Holder, as follows:
1. Time and Place of Payment. The unpaid Principal Amount, together with all
-------------------------
accrued and unpaid interest, shall be due and payable on July _____, 2001 (the
"Maturity Date"). All payments due hereunder shall be made by wire transfer of
immediately available funds to the following account, or to such other account
or in such other manner as the Holder may designate in writing:
TO: [ ]
ROUTING & TRANSIT #: [ ]
FOR CREDIT OF: STEAG Electronics Systems AG
CREDIT ACCOUNT #: [ ]
BY ORDER OF: [NAME OF SENDER]
2. Application of Payments. Payments received on this Note shall be applied
-----------------------
to payment of, in the following order: (i) costs and expenses of enforcing this
Note following an Event of Default, (ii) accrued and unpaid interest and (iii)
the remaining Principal Amount.
3. Prepayments. The Company may prepay all or any portion of the accrued and
-----------
unpaid interest, the outstanding Principal Amount and any other amounts due
under this Note, prior to the Maturity Date, at any time and from time to time,
without penalty and without prior notice to the Holder. Any prepayments shall be
applied as set forth in Section 2.
4. Interest Rate. The unpaid Principal Amount from time to time shall bear
-------------
interest at the rate of six percent (6%) per annum (the "Interest Rate"), and
shall be computed on the basis of a 360-day year. Interest shall accrue
beginning on the date of issuance hereof.
1
5. Letter of Credit. This Note and the obligations of the Company hereunder
----------------
are secured by an irrevocable letter of credit or bank guarantee issued by
[Silicon Valley Bank] (the "Letter of Credit") dated ________________, a copy of
which is attached hereto as Exhibit A.
---------
6. Transfer. This Note shall be negotiable and may be transferred by the
--------
Holder in whole or in part, at any time and from time to time, subject to the
terms and conditions of the Letter of Credit and upon the concurrent transfer of
Letter of Credit to secure the obligations of the transferee. Upon any such
transfer, a new Note or Notes will be issued to the transferee in exchange
therefor.
7. Events of Default. The following shall constitute "Events of Default"
-----------------
hereunder:
(a) the Company shall have failed to pay the Principal Amount of, or any
interest on, this Note when due; or
(b) the Company shall file a voluntary petition for relief under the
United States Bankruptcy Code, as amended from time to time, or any bankruptcy,
reorganization, arrangement, insolvency, readjustment of debt, receivership,
dissolution, or liquidation law or statute of any jurisdiction, whether now or
hereafter in effect; or the Company shall be adjudicated insolvent or bankrupt
by a decree of a court of competent jurisdiction; or the Company shall petition
or apply for or acquiesce in, or consent to the appointment of, any receiver or
trustee of the Company or for all or any part of the property of the Company; or
the Company shall make an assignment for the benefit of creditors; or the
Company shall admit in writing its inability to pay its debts as they mature; or
(c) there shall be filed against the Company any involuntary petition for
relief under the United States Bankruptcy Code, as amended from time to time, or
there shall be commenced against the Company any proceeding relating to the
Company under any bankruptcy, reorganization, arrangement, insolvency,
readjustment of debt, receivership, dissolution, or liquidation law or statute
of any jurisdiction, whether now or hereafter in effect, and such petition or
any such proceeding shall remain undismissed for a period of 60 days or the
Company by any act indicates its consent to, approval of, or acquiescence in,
such petition or any such proceeding; or a receiver or trustee shall be
appointed for the Company or for all or a substantial part of the property of
the Company and any such receivership or trusteeship shall remain undischarged
for a period of 60 days; or a warrant of attachment, execution, or similar
process shall be issued against any substantial part of the property of the
Company and the same shall not be dismissed or bonded within 60 days after levy;
or
2
(d) the Letter of Credit shall, in whole or in part, terminate, be
modified, cease to be effective or cease to be a legally valid, binding and
enforceable obligation of the issuing bank.
Upon the occurrence of an Event of Default, the Holder shall have the right
to declare the entire unpaid Principal Amount of this Note, together with
accrued but unpaid interest and the costs and expenses of enforcing this Note,
due and payable and such Principal Amount, interest, costs and expenses may be
collected forthwith, regardless of the stipulated date of maturity, and the
Holder may exercise any and all other rights and remedies available to it under
applicable law.
The Company shall give prompt written notice of the occurrence of an Event
of Default to the Holder at the address set forth in Section 10.1 of the SBCA or
such other address as the Holder may, from time to time, notify the Company in
writing.
8. No Right of Set-Off. The obligation of the Company to pay the Holder the
-------------------
Principal Amount, all the interest that accrues thereon and all other amounts
due under this Note shall be absolute and unconditional and the rights of the
Holder shall not be subject to any defense, set-off, counterclaim or recoupment,
including, without limitation, by reason of any obligation, indebtedness or
liability at any time owing by Holder to Company.
9. Combination Agreement. This Note is given pursuant to Section 6.13 (c) of
---------------------
the Strategic Business Combination Agreement, dated as of June 27, 2000, between
the Holder and the Company, as amended by the Amendment to Strategic Business
Combination Agreement, dated as of December 15, 2000 (the "SBCA"). In the event
of any conflict between the SBCA and the terms of this Note, the terms of the
SBCA shall be controlling.
10. General.
-------
(a) Headings. The headings used in this Note are for reference purposes
--------
only and shall not constitute a part hereof or affect the meaning or
interpretation of this Note.
(b) Time is of the Essence. Time is of the essence of this Note. In the
----------------------
event this Note, or any part thereof, is not paid when due, the Company agrees
to pay all costs of collection including, but not limited to, attorneys' fees
and expenses.
(c) Presentment; Failure to Accelerate. Presentment for payment, demand,
----------------------------------
protest and notice of demand, protest and non-payment, and all other notices are
hereby waived by the Company. No failure to accelerate the debt evidenced hereby
by reason of default hereunder or indulgences granted from time to time shall be
construed (i) as a novation of this Note or as a
3
reinstatement of the indebtedness evidenced hereby or as a waiver of such right
of acceleration or of the right of the Holder thereafter to insist upon strict
compliance with the terms of this Note or (ii) to prevent the exercise of such
right of acceleration or any other right or remedy granted hereunder or by
applicable laws; and the Company hereby expressly waives the benefit of any
statute or rule of law or equity now provided, or which may hereafter be
provided, which would produce a result contrary to or in conflict with the
foregoing.
(d) Extension of Time. No extension of the time for the payment of this
-----------------
Note made by agreement with any person now or hereafter liable for the payment
of this Note shall operate to release, discharge, modify, change, or affect the
original liability of the Company under this Note, either in whole or in part
unless the Holder agrees otherwise in writing.
(e) Amendments to be Written. This Note may not be changed orally, but
------------------------
only by an agreement in writing signed by the party against whom enforcement of
any waiver, change, modification, or discharge is sought.
(f) No Benefit of Statute of Limitations, Moratorium. To the extent
------------------------------------------------
permitted by law, the Company hereby waives and renounces for itself, its
successors, and assigns, all rights to the benefits of any statute of
limitations and any moratorium, reinstatement, marshalling, forbearance,
valuation, stay, extension, redemption, appraisement exemption, and homestead
now provided, or which may hereafter be provided by the Constitution and laws of
the United States of America and of any state thereof, both as to itself and in
and to all of its property, real and personal, against the enforcement and
collection of the obligations evidenced by this Note.
(g) Governing Law. This Note, upon acceptance by the Holder, shall
-------------
constitute a contract under and shall be construed and enforceable in all
respects in accordance with the laws of the [State of Delaware], without regard
to principles of conflicts or choice of law thereof or of any other
jurisdiction.
(h) Notice. All notices and other communications required hereunder
------
shall be delivered to the Holder and the Company in accordance with Section 10.1
of the Agreement.
(i) Invalid Provisions. If any term or provision of this Note shall be
------------------
held invalid, illegal or unenforceable, the validity of all other terms and
provisions hereof shall in no way be affected thereby.
(j) "Company"; "Holder". As used herein, the terms "Company" and "Holder"
-------------------
shall be deemed to include their respective successors, legal
4
representatives and assigns whether by voluntary action of the parties or by
operation of law.
5
IN WITNESS WHEREOF, the Company has caused this Note to be signed by its
duly authorized officer as of the day and year first above written.
▇▇▇▇▇▇▇ TECHNOLOGY, INC.
By: ____________________________________
Name: __________________________________
Title: _________________________________
6
