AMENDMENT AGREEMENT
(#1)
to the
SHARE PURCHASE AGREEMENT
between
CTT Cutting Tool Technology B.V.
("Seller")
and
Snap-on Incorporated
("Buyer")
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This Amendment Agreement (#1) (the "Amendment") between:
(1) CTT Cutting Tool Technology B.V., a company incorporated and existing under
the laws of the Netherlands, S Xxxxxxxxxxxxxx 000, 0000 XX Xxxxxxxx, Xxx
Xxxxxxxxxxx ("Seller"); and
and
(2) Snap-on Incorporated, a company incorporated and existing under the laws of
the State of Delaware, 00000 Xxxxxxxxx Xxxxx, Xxxxxxxx Xxxxxxx, XX 00000,
XXX ("Buyer"),
is entered into on this 30th day of September, 1999.
WHEREAS, Buyer and Seller have entered into a Share Purchase Agreement dated as
of April 16, 1999 (the "SPA") relating to the sale of business (the "Business");
WHEREAS, Buyer and Seller wish to make certain amendments and additions to the
SPA in accordance with the terms and provisions of this Amendment.
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NOW THEREFORE, the parties hereto agree as follows.
1. DEFINED TERMS
Unless otherwise set forth herein, words and expressions when used herein shall
have the same meaning as set forth in the SPA.
2. NEW PARENT COMPANY IN THE GROUP
2.1 Luxembourg corporation
SB Holding B.V. has incorporated a limited liability company in
Luxembourg with the corporate name SB Tools S.a.r.l.
2.2 New parent company
As a result of the contribution of all of the assets and liabilities
of Seller to SB Tools S.a.r.l. effected on 10th September 1999 and the
simultaneous repurchase by SB Tools S.a.r.l. of its own shares held by
SB Holding B.V., SB Tools S.a.r.l. is wholly owned by Seller and has,
as the final step in the Reorganization, become the ultimate parent
company of the Group. Consequently, the definition of "Holding" in
Section 1.1 of the SPA, shall be deleted and substituted by the
following:
"Holding" shall mean the Luxembourg company SB Tools S.a.r.l.;
In addition, the second preamble to the SPA shall be deleted and
substituted by the following:
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WHEREAS, Seller is the owner of the outstanding shares in SB Tools
S.a.r.l. ("Holding"), a Luxembourg limited liability company;
2.3 SB Holding B.V. becoming a Company
SB Holding B.V. has in the course of the Reorganization (as originally
planned) acquired from Sandvik Benelux B.V. certain real property,
machinery and equipment relating to the facilities in Helmond, the
Netherlands and will on the Closing Date be the owner of such
properties, in addition to certain minority shares in some of the
Companies. Consequently, SB Holding B.V. shall remain as a member of
the Group and shall be one of the Companies, as reflected in the
amended Schedule 1.1(C) (attached hereto).
2.4 Amendment of Schedules to the SPA
As a consequence of the arrangements reflected in this Section 2 and
due to additional information relating to the Business and the
Companies which has been made available to Seller subsequent to the
signing of the SPA, the Schedules to the SPA on the attached list have
been updated and shall therefore be substituted by the revised
Schedules attached hereto.
2.5 Ownership Interests in Uirlis Torc Teoranta Ltd and Taparia Tools Ltd
Sandvik holds 16,500 shares (out of 3,035,750 shares according to
annual report 97/98) in Taparia Tools Ltd, an Indian limited liability
company. This represents all the shares of Taparia Tools Ltd owned by
Sandvik. Consequently, the definition of "Ownership Interests" in
Section 1.1 of the SPA shall be deleted and substituted by the
following:
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"Ownership Interests" shall mean Sandvik's minority shareholding in
Deville S.A., Uirilis Torc Teoranta Ltd and Taparia Tools
Ltd respectively, as listed in Schedule 1.1 (D);
On the Closing Date, the minority shareholdings in Uirlis Torc
Teoranta Ltd will be held by Bahco Tools AB and not by SB Tools
S.a.r.l. and the shares in Taparia Tools Ltd have been assigned to
Bahco Tools AB. Consequently, the first sentence in the second
paragraph of Section 5.5 of the SPA shall be deleted and substituted
by the following:
"Holding or any of the Companies will on the Closing Date be the owner
of the Ownership Interests. The formal transfer of the shares in
Taparia Tools Ltd will be ended soonest after Closing;"
3. REIMBURSEMENT OF LUXEMBOURG COSTS
In addition to the Purchase Price, Buyer shall promptly reimburse
Seller or Sellers affiliates an amount equal to (a) any and all
capital tax payable in Luxembourg with respect to the transfer of
assets and liabilities by Seller to Holding as described in Section
2.2 hereof; minus (b) the amount of any capital tax that would have
been payable in the Netherlands had Sellers' assets and liabilities
been transferred to SB Holding B.V. as originally planned. The parties
confirm that, based upon approvals, received from the appropriate
authorities in Luxembourg, no such capital tax is expected to be
payable.
4. PURCHASE PRICE
Buyer and Seller agree that the Purchase Price as defined in Section
4.1 of the SPA, and the Preliminary Purchase Price as calculated in
Section 4.2 of the SPA shall be reduced by the amount of SEK Fifty
Million (50,000,000) with the result that the number in the second
line of Section 4.1 of the SPA shall be
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SEK Three Billion One Hundred Seventy-five Million (3,175,000,000) and
that the number in the second line of Section 4.2 of the SPA shall be
SEK Two Billion Six Hundred Fifteen Million Five Hundred Fifteen
Thousand (2,615,515,000).
5. WARRANTIES
With the exception of the representations and warranties by Seller
under Articles 5.17 and 5.18 and possible claims thereunder, it is
explicitly agreed that the representations and warranties of the
Seller set forth in the SPA, shall not apply to facts or circumstances
disclosed or otherwise known by Buyer prior to September 29, 1999, in
the Data Room materials or in the additional documentation requested
by and supplied to Buyer or of which the Buyer otherwise has actual
knowledge provided that the Buyer reasonably should have foreseen
without additional facts or information the consequences of such
disclosed facts or circumstances or other information. Nothing
disclosed in the Data Room or otherwise known to Buyer affects Buyer's
rights regarding review of and objection to the Closing Accounts
delivered by Seller as provided in Section 4.4 hereof and any
resulting purchase price adjustments under Section 4.1 (c) hereof.
6. FURTHER UNDERTAKINGS BY THE PARTIES
6.1 EBIT Adjustment
Buyer hereby waives any right it may have to issue a Notice of EBIT
Adjustment pursuant to Section 4.3 of the SPA.
6.2 Access to certain information
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In addition to the undertakings made by the parties pursuant to
section 16 of the SPA, each of Seller and Buyer shall provide, or
shall cause its respective affiliates (including Holding and the
Companies) to provide, the other party with corporate, financial and
other information pertaining to Holding or any of the Companies or to
the Ownership Interests which is reasonably requested for the purposes
of filing tax returns, applications, registrations and other
administration, court or similar filings.
Any request for information shall be given with five (5) Business
Day's notice, specifying the documents or other information requested.
The information shall be provided or otherwise made available to the
requesting party by the other party or its respective affiliates
during normal business hours of the entity where the information is
kept. If the recipient of such notice concludes that such information
is confidential or proprietary, the information may be withheld until
the recipient concludes that such information will not be disclosed to
the public without appropriate protection of confidentiality.
6.3 Pro Forma Net Assets
Subsequent to signing the SPA, the parties identified certain assets
of the Business owned by Sandvik or its Affiliates on December 31,
1998, the value of which was not included in the Pro Forma Net Assets.
The value of such assets on the Closing Accounts will be excluded for
purposes of determining Closing Adjusted Net Assets.
6.4 Reimbursement of certain costs
Buyer undertakes to reimburse Seller and Seller's Affiliates for any
and all documented out-of-pocket costs up to a maximum of SEK
1,500,000 incurred by Seller, Seller's Affiliates or any of the
Companies relating to the ordering of new stationery (including, but
not limited to, letterheads, business cards,
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invoice and order forms) and new signs and any other similar items,
which costs have been incurred following the changes of names of the
Companies and which costs have been incurred by Seller and/or any of
its affiliates as a result of the postponement of Closing from 30 June
1999 until 30 September 1999. Notwithstanding the foregoing, Seller
shall not be reimbursed for any such costs to the extent the value of
such stationery, signs, etc. is reflected as an asset on the Closing
Accounts. Reasonable, documented out-of-pocket travel expenses up to a
maximum of SEK 1,000,000 generated within the Group solely in
connection with work performed within the project established for the
investigation of strategical and synergy questions in relation to the
Buyer's acquisition of the Business and which bear upon the time after
June 1, 1999 and which have been separately accounted for shall be
reimbursed for by Buyer to Seller.
6.5 Bisov
Sandvik and Buyer agree to negotiate, execute and deliver definitive
agreements mutually acceptable to both parties pursuant to which Buyer
will buy and Sandvik will sell all of its interests in the equity of
Bisov but in no event less than 98% of the issued and outstanding
equity of Bisov. Such definitive agreements shall contain terms,
conditions, covenants, representation and warranties customary to such
agreements and including the following:
(i) The Purchase Price shall be SEK Twelve Million One Hundred
Twenty Six Thousand (12,126,000);
(ii) Sandvik will convert all amounts due from Bisov to Sandvik
or its Affiliates except for trade payables arising in the
ordinary course of business to a term loan (the "Note") in
the principal amount of not more than the amount outstanding
on the books of Bisov on September 30, 1999. Such Note shall
be interest free for one year and
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bear interest thereafter at a fixed rate per annum equal to
12-month Libor plus 0.3% on the date hereof. The principal
amount of the Note shall be payable in monthly installments
over three (3) years beginning at the end of the first full
fiscal year in which Bisov earns after tax net income for
the fiscal year. The parties agree to discuss the Note and
its terms prior to the end of the first year following
Buyer's purchase. If, at the end of such three year period
Bisov has not earned after tax net income in any of those
three full fiscal years, Sandvik will forgive the loan and
cancel the Note.
(iii) Bisov shall be added as a Licensee to the License Agreement.
(iv) Prior to execution of the Note, the parties will discuss the
appropriate currency for payment.
From the date hereof Sandvik shall continue to operate Bisov in
accordance with past practice and shall not remove any assets from or
receive any payments from Bisov except for payments for goods and
services in the ordinary course of business.
6.6 Assignment Agreement
The covenants of Seller according to Article 7.5 and the covenants of
Buyer according to Article 8.5 concerning certain indebtedness will on
the date hereof be partly settled through two separate assignment
agreements whereof one between Sandvik Finance B.V. and Sansafe S.A.
on the one side and Snap-on International Finance Company on the other
side and the second agreement between Sandvik Inc. and Sansafe S.A. on
the one side and the Buyer on the other side.
6.7 Third Party Representatives and Distributors
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Buyer and the Group Companies shall be solely responsible for
communicating with third party sales representatives and distributors
identified on Schedule 5.13(a) of the SPA (the "Distributors") in
order to effect the transition of such Distributors to new contracts
with the Group Companies governing the sale of the products within the
Business. In the event Buyers' offering of a new non-exclusive
contract shall cause a Distributor to claim termination penalties or
other indemnities under its contract with Sandvik or its affiliates,
Buyer shall reimburse Sandvik or its affiliates for any indemnities
paid to such Distributor after consultation with Buyer to the extent
such indemnity relates to the Distributors distribution or
representation of saws and tools products. With respect to the five
(5) Distributors identified with an asterisk (*) on Schedule 5.13(a)
of the SPA Sandvik shall reimburse Buyer to the extent any indemnity
to a Distributor paid by a Group Company after consultation with
Sandvik relates to such distributors' distribution or representation
of other products of Sandvik than such within the Business.
6.8 Industrial Property Rights
In connection with the Reorganization certain affiliates of Sandvik
entered into Asset Transfer or Share Purchase or similar agreements
(collectively "Reorganization Agreements") with Companies in the
Group. To the extent any such Reorganization Agreement reserved to
Sandvik AB or any other Sandvik affiliate any intellectual or other
industrial property rights of any type used within the marketing,
sales and distribution of products within the Business ("Industrial
Property Rights"), Sandvik hereby confirms, warrants and represents
that all such Industrial Property Rights have been transferred to and
registered in the name ("Transferred") of Kapman AB or other Group
Company prior to the date hereof. To the extent any such Industrial
Property Rights have not been Transferred to Kapman AB or other Group
Company prior to the date hereof, Sandvik undertakes to cause the
Transfer of any such
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rights to Kapman AB or other Group Company within a reasonable period
after the date hereof. To the extent that there are any Industrial
Property Rights that are not owned by a Group Company and are owned by
another Affiliate of Sandvik, Sandvik hereby similarly undertakes to
cause any such Industrial Property Rights to be Transferred to Kapman
AB or such other entity as previously approved by Buyer within a
reasonable period after Closing.
6.9 Lease of Executives' Residence
Sandvik has provided personal residences to Xx. Xxxxx Xxxxxxxx and Xx.
Xxxxxx Agren in Sandviken, Sweden. Sandvik shall lease such personal
residence to Bahco Group AB for sub-lease to Xx. Xxxxxxxx through
December 31, 2000, and for one additional year thereafter shall lease
to Bahco Group AB for sub-lease to the same residence or an
appropriate substitute residence in Sandviken. Such term shall be
extended beyond December 31, 2001. Sandvik shall lease to Bahco Group
AB for sub-lease to Xx. Xxxxx his personal residence in Sandviken
through December 31, 2001, which term shall be extended. Sandvik will
invoice Bahco Group AB quarterly in arrears for the direct costs to
Sandvik attributable to the provision of such residences to Xx.
Xxxxxxxx and Xx. Xxxxx. On the request of Bahco Group AB, Sandvik will
in a positive atmosphere consider a possible prolongation of any of
the above lease terms.
6.10 Certain Benefit Matters
Certain Group Companies or some or all employees thereof participate
in, are covered by, or obtain benefits under certain pension, health,
disability, welfare or other benefit plans sponsored by Sandvik or its
Affiliates. The parties shall cooperate to separate the coverage and
benefits in accordance with principles to be finalised by the parties
promptly following closing. Further, the parties agree that the
Closing Accounts shall include as a liability or reserve an amount
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equal to the sum of (a) a ratable portion of any amount payable or to
be payable to any employee of the Group Companies under any annual
bonus or incentive or similar deferred compensation plan covering such
employee prior to the Closing Date plus (b) the value of any unused
vacation days for employees of Group Companies accrued through the
Closing Date.
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7. INTEGRAL PART OF THE SPA
This Amendment shall be deemed to be incorporated into and constitute
an integral part of the SPA.
--------------
IN WITNESS WHEREOF, the parties have duly executed this Amendment as
of the date first written above.
CTT CUTTING TOOL
TECHNOLOGY B.V.
/s/ Xxxxxxx Falkland /s/ Xxxxxx X. Xxxxx
-------------------------- --------------------------
By: Xxxxxxx Falkland By: Xxxxxx X. Xxxxx
Title: Director Title: Director
/s/ Xxxxxx X. Xxxxxx
-------------------------
By: Xxxxxx X. Xxxxxx
Title: Chairman, President and
Chief Executive Officer
