EXHIBIT 2.1
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STOCK PURCHASE AGREEMENT
among
MEMRY HOLDINGS, S.A.,
and
THE SHAREHOLDERS OF
ADVANCED MATERIALS AND TECHNOLOGIES, N.V.
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October 30, 1998
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ARTICLE I
DEFINITIONS
ARTICLE II
SALE AND PURCHASE OF SHARES
Section 2.01. Sale and Purchase of Shares................................. - 6 -
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Section 2.02. Definition of Purchase Price and Payment for the Shares..... - 7 -
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Section 2.03. Net Worth Adjustment........................................ - 7 -
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Section 2.04 Closing Net Worth Statement................................. - 7 -
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Section 2.05. Buyer's Review.............................................. - 7 -
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Section 2.06. Sellers' Review............................................. - 7 -
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Section 2.07. Conference.................................................. - 8 -
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Section 2.08. Arbitrator.................................................. - 8 -
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Section 2.09. Scope of Arbitration........................................ - 8 -
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Section 2.10. Arbitrator's Decision....................................... - 8 -
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Section 2.11. Access...................................................... - 8 -
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Section 2.12. Closing Net Worth........................................... - 9 -
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Section 2.13. Support Payment............................................. - 9 -
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Section 2.14 Payments in Cash; Currency Translations; Payments to Sellers - 9 -
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Section 2.15 Representative Sellers...................................... - 9 -
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ARTICLE III
CLOSING
Section 3.01. Closing..................................................... - 10 -
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Section 3.02. Deliveries.................................................. - 10 -
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE SELLERS
Section 4.01 Title to Shares............................................. - 11 -
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Section 4.02 Authority Relative to this Agreement........................ - 11 -
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Section 4.03. Absence of Conflicts........................................ - 11 -
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Section 4.04. Organization and Qualification.............................. - 11 -
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Section 4.05. Subsidiaries; Other Affiliates; Investments................. - 12 -
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Section 4.06. Capitalization.............................................. - 12 -
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Section 4.07. Articles of Association; Minute Books....................... - 12 -
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Section 4.08. [intentionally omitted]..................................... - 12 -
Section 4.09. Governmental Approvals...................................... - 12 -
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Section 4.10. Financial Statements........................................ - 12 -
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Section 4.11. Absence of Certain Changes.................................. - 13 -
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Section 4.12. Tax Matters................................................. - 13 -
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Section 4.13. Compliance with Law......................................... - 14 -
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Section 4.14. Litigation.................................................. - 14 -
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Section 4.15. Agreements.................................................. - 15 -
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Section 4.16. Real Estate................................................. - 16 -
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Section 4.17. Accounts and Notes Receivable............................... - 16 -
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Section 4.18. [intentionally omitted]..................................... - 17 -
Section 4.19. Tangible Property........................................... - 17 -
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Section 4.20. Intellectual Property....................................... - 17 -
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Section 4.21. Liens....................................................... - 18 -
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Section 4.22. Liabilities................................................. - 18 -
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Section 4.23. Customers; Suppliers........................................ - 18 -
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Section 4.24. Labor Agreements............................................ - 19 -
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Section 4.25. Personnel Matters........................................... - 19 -
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Section 4.26. Environmental Protection.................................... - 19 -
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Section 4.27. Employee Benefits........................................... - 20 -
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Section 4.28. Computer Systems............................................ - 20 -
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Section 4.29. Employees; Compensation..................................... - 20 -
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Section 4.30. Insurance................................................... - 20 -
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Section 4.31. [intentionally omitted]..................................... - 20 -
Section 4.32. Operations of the Company................................... - 20 -
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Section 4.33. Potential Conflicts of Interest............................. - 22 -
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Section 4.34. Banks, Brokers and Proxies.................................. - 22 -
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Section 4.35. Full Disclosure............................................. - 22 -
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Section 4.36. No Broker................................................... - 23 -
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ARTICLE V
REPRESENTATIONS AND WARRANTIES OF THE BUYER
Section 5.01. Organization................................................ - 23 -
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Section 5.02. Authority Relative to this Agreement........................ - 23 -
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Section 5.03. Absence of Conflicts........................................ - 23 -
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Section 5.04. Parent Shares............................................... - 24 -
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Section 5.05. No Broker................................................... - 24 -
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ARTICLE VI
COVENANTS AND AGREEMENTS
Section 6.01. Payment of Debts............................................ - 24 -
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Section 6.02. Holding of Shares........................................... - 24 -
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Section 6.03. Confidentiality............................................. - 25 -
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Section 6.04. Covenant Not to Compete..................................... - 25 -
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ARTICLE VII
SURVIVAL OF REPRESENTATIONS AND WARRANTIES, INDEMNIFICATION
Section 7.01. Survival of Representations and Warranties; Interpretation.. - 26 -
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Section 7.02. Indemnification Provisions for Benefit of the Buyer......... - 27 -
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Section 7.03. Indemnification Provisions for Benefit of the Sellers....... - 28 -
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Section 7.04. Matters Involving Third Parties............................. - 28 -
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Section 7.05. Right of Set Off............................................ - 29 -
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ARTICLE VIII
MISCELLANEOUS
Section 8.01. Fees and Expenses........................................... - 30 -
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Section 8.02. Publicity................................................... - 30 -
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Section 8.03. Notices..................................................... - 30 -
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Section 8.04. Entire Agreement............................................ - 31 -
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Section 8.05. Waivers and Amendments...................................... - 31 -
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Section 8.06. Governing Law............................................... - 31 -
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Section 8.07. Jurisdiction................................................ - 31 -
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Section 8.08. Binding Effect; Benefit..................................... - 32 -
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Section 8.09. Variations in Pronouns...................................... - 32 -
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Section 8.10. Construction................................................ - 32 -
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Section 8.11. Counterparts................................................ - 32 -
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Section 8.12. Exhibits and Schedules...................................... - 32 -
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Section 8.13. Headings.................................................... - 32 -
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Section 8.14. Severability................................................ - 32 -
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EXHIBITS:
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Exhibit A - Escrow Agreement
Exhibit B - Opinion of Sellers' Counsel
Exhibit C - Form of Release
Exhibit D - Management Consulting Agreement of Advanced Business Consulting N.V.
Exhibit E - Standstill Agreement
Exhibit F-1 - Opinion of Buyer's Counsel
Exhibit F-2 - Opinion of Parent's Counsel
Exhibit G - Press Release
Exhibit H - Swiss Metals Agreement
SCHEDULES:
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Schedule A - Schedule of Sellers
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STOCK PURCHASE AGREEMENT
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STOCK PURCHASE AGREEMENT (this "Agreement"), dated as of October 30, 1998, by
and among MEMRY HOLDINGS, S.A. (the "Buyer"), a Belgian corporation and a
wholly-owned subsidiary of Memry Corporation, a Delaware corporation (the
"Parent"), and each of the shareholders of Advanced Materials and Technologies,
N.V., a Belgian corporation (the "Company"), set forth on Schedule A hereto
(each referred to individually as a "Seller" and collectively as the "Sellers").
W I T N E S S E T H:
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WHEREAS, the Sellers are the owners of all of the issued and outstanding
shares of capital stock of the Company (collectively, the "Shares"); and
WHEREAS, the Sellers wish to sell, transfer, assign, convey and deliver the
Shares to the Buyer, and the Buyer wishes to purchase, acquire and accept the
Shares from the Sellers, upon the terms and conditions set forth in this
Agreement; and
WHEREAS, without limiting the effect of the representations, warranties and
covenants of the Sellers herein, the Buyer has had the opportunity to carry out
legal, financial, business and environmental due diligence on the Company
pursuant to a letter of intent dated August 11, 1998.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
herein contained, the parties hereto, intending to be legally bound, agree as
follows:
ARTICLE I
DEFINITIONS
As used in this Agreement, the following terms have the following meanings.
Section 1.01. "Adjustment Payment" has the meaning given thereto in Section
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2.03.
Section 1.02. "Adverse Consequences" means the actual (as opposed to the
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unrealized potential) negative effect of all actions, suits, proceedings,
hearings, investigations, charges, complaints, claims, demands, injunctions,
judgments, orders, decrees, rulings, damages, dues, penalties, fines, costs,
amounts paid in settlement, Liabilities, obligations, taxes, Liens, losses, lost
value, expenses and fees, including court costs, but excluding attorneys fees
and expenses. In calculating Adverse Consequences, any amounts or consequences
that would not have occurred but for the failure of an Indemnified Party
(including, in the case of the Buyer, also the Company) to use reasonable good
faith efforts to mitigate the effects of the breach giving rise to the Adverse
Consequences shall not be included in the determination of Adverse Consequences.
Furthermore, (i) all calculations of Adverse Consequences shall be net of any
insurance proceeds, Tax benefits and/or recoveries from third parties actually
received by the Indemnified Party as a result of the breach, and (ii) in the
event (and to the extent) that a breach of a representation or warranty by
Sellers is remedied by the calculation of the Closing Net Worth and the
Adjustment Payment, the Parties agree that there will be no Adverse Consequences
of such breach. The Adverse Consequences
of a Specified Disclosure described in clause (i) of the definition thereof
shall be limited to the costs of any fines, penalties and/or similar charges
relating to the period through the Closing Date, and the Adverse Consequences of
a Specified Disclosure described in clause (iii) of the definition thereof shall
be limited to fines, penalties and similar costs (whether before or after the
Closing Date but not subsequent to any final adverse determination on such
matter). In no event shall the Adverse Consequences to the Buyer of a breach
relating directly to the Company (e.g., a breach by the Sellers of a
representation regarding the existence of the Company's Contracts and/or Other
Agreements) be greater than the Adverse Consequences to the Company of such
matter.
Section 1.03. "Affiliate" shall mean a person that, directly or indirectly,
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Controls or is Controlled by, or is under common Control with, the Buyer, the
Company, any Seller or any other relevant Person, as the case may be.
Section 1.04. "Agreement" means this Stock Purchase Agreement.
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Section 1.05. "Balance Sheet" has the meaning given thereto in Section
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4.10(a).
Section 1.06. "Balance Sheet Date" has the meaning given thereto in Section
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4.10(a).
Section 1.07. "Business" means the Company's business of the application,
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development, production and sale of products based on advanced shape memory
alloys and/or technologies and the provision of related services.
Section 1.08. "Business Day" means each Monday, Tuesday, Wednesday, Thursday
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and Friday which is not a day in which banking institutions in either New York,
New York, U.S.A., or Brussels, Belgium (or both), are authorized or obligated by
law or executive order to close.
Section 1.09. "Buyer" has the meaning given thereto in the premises.
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Section 1.10. "Buyer's Letter" has the meaning given thereto in Section 2.05.
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Section 1.11. "Buyer's Surviving Representations" has the meaning given
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thereto in Section 7.01(a).
Section 1.12. "Closing" has the meaning given thereto in Section 3.01 hereof.
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Section 1.13. "Closing Date" has the meaning given thereto in Section 3.01.
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Section 1.14. "Closing Net Worth" shall mean the Net Worth of the Company as
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of the close of business on the Closing Date, as determined pursuant to Sections
2.04 through 2.12.
Section 1.15 "Closing Payment" has the meaning given thereto in Section
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2.02(b).
Section 1.16. "Company" has the meaning given thereto in the premises.
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Section 1.17. "Computer Systems" has the meaning given thereto in Section
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4.28.
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Section 1.18. "Confidential Information" means any information concerning the
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Company and/or the Business that is not generally available to the public and
that is used, developed or obtained by the Company, or by its clients and/or
customers and disclosed to the Company in connection with the Business.
Section 1.19. "Contracts and/or Other Agreements" means and includes all
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contracts, agreements, instruments, indentures, notes, bonds, leases, mortgages,
deeds of trust, franchises, licenses (except for licenses constituting Permits
under Section 1.46 below), commitments or arrangements or understandings,
express or implied, written or oral.
Section 1.20. "Control" (including, with correlative meaning, the terms
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"controlled by" and "under common control with") as used with respect to any
person, means the possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of such person, whether
through ownership of voting securities or by contract or other agreement or
otherwise.
Section 1.21. "Currency Fluctuation Adjustment Amount" means U.S. $125,000,
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which amount is intended to approximate the decline of U.S. $1,250,000 in
Belgian Francs from August 11, 1998 to October 8, 1998.
Section 1.22. "Disclosure Letter" has the meaning given thereto in Article
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IV.
Section 1.23. "Documents and/or Other Papers" means and includes any
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document, contract or other agreement, certificate, notice, consent, affidavit,
letter, telegram, telex, telecopy, statement, schedule (including any Schedule
to this Agreement and the Disclosure Letter), exhibit (including any Exhibit to
this Agreement) or any other paper whatsoever.
Section 1.24. "Escrow Agent" means KBC, as escrow agent pursuant to the terms
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of the Escrow Agreement.
Section 1.25. "Escrow Agreement" means the escrow agreement between the
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Escrow Agent, Buyer and Sellers in the form of Exhibit A hereto.
Section 1.26. "Exchange Act" means the U.S. Securities Exchange Act of 1934,
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as amended.
Section 1.27. "Financials" has the meaning given thereto in Section 4.10(a).
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Section 1.28. "GAAP" shall mean Belgian accounting regulations and generally
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accepted accounting principles applied on a consistent basis.
Section 1.29. "Indemnified Party" shall have the meaning given thereto in
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Section 7.04.
Section 1.30. "Indemnifying Party" shall have the meaning given thereto in
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Section 7.04.
Section 1.31. "Intellectual Property" means all (i) patents, patent
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applications, inventions (whether patentable and whether reduced to practice),
invention disclosures, and improvements thereto, (ii)
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trademarks, service marks, trade dress, logos, trade names and corporate names
and registrations and applications for registration thereto, (iii) copyrights
and registrations and applications for registration thereof, (iv) mask works and
registrations and applications for registration thereof, (v) computer software,
data and documentation, (vi) trade secrets and confidential information and
(vii) copies and tangible embodiments thereof (in whatever form or medium).
Section 1.32. "Interim Balance Sheet" has the meaning set forth in Section
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4.10(b).
Section 1.33. "Interim Financials" has the meaning set forth in Section
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4.10(b).
Section 1.34. "Knowledge" means, with respect to the Buyer or the Company,
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the knowledge of any of its officers, directors or shareholders and, with
respect to the Sellers, the knowledge of any of the Sellers (provided, however,
that with respect to any references to Knowledge contained in Section 4.20,
Knowledge shall mean only the knowledge of each Seller singularly as a
consequence of which only the Seller or Sellers having such knowledge shall be
in breach of said Section 4.20 and not any Sellers not having such knowledge).
Where any representation or warranty contained in this Agreement is expressly
qualified by reference to the knowledge of the Sellers, the Sellers confirm that
they have made a reasonable due and diligent inquiry as to the matters that are
the subject of such representations and warranties and that each of the Sellers
has the right to access all material information relating to the business and
operations of the Company.
Section 1.35. "Liabilities" has the meaning given thereto in Section 4.22.
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Section 1.36. "Lien" means and includes any lien, security interest,
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mortgage, mandate to mortgage, pledge (including any "gage sur fonds xx
xxxxxxxx/pand op handelszaak"), charge, option, right of first refusal, claim,
lease, easement, restriction or any other encumbrance whatsoever.
Section 1.37. "Material Adverse Effect" means the causing, or a reasonable
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likelihood of causing, of at least U.S. $10,000 of Adverse Consequences on the
business, assets, properties, operations, results of operations, condition
(financial or otherwise) or prospects of the Company or the Business.
Section 1.38. "Net Worth of the Company" shall mean the amount by which the
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Company's Total Asset Value exceeds its Total Liability Value as of a given
date.
Section 1.39. "Noncompetition Period" means the period commencing on the
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Closing Date and terminating on the third anniversary thereof.
Section 1.40. "Parent" has the meaning given thereto in the premises.
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Section 1.41. "Parent Common Stock" has the meaning given thereto in Section
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2.02(b).
Section 1.42. "Parent Direct Shares" has the meaning given thereto in Section
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2.02(b).
Section 1.43. "Parent Escrowed Shares" has the meaning given thereto in
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Section 2.02(b).
Section 1.44. "Parent Shares" means the Parent Direct Shares and the Parent
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Escrowed
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Shares.
Section 1.45. "Parties" shall mean Buyer and Sellers, collectively.
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Section 1.46. "Permits" has the meaning given thereto in Section 4.09.
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Section 1.47. "Person" or "Persons" means any individual, corporation,
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general or limited partnership, limited liability company, firm, joint venture,
association, enterprise, joint stock company, trust, unincorporated organization
or other entity.
Section 1.48. "Preliminary Net Worth" means Bfr. 9,500,000, which is the
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estimated Net Worth of the Company as of October 30, 1998, as agreed upon by the
Parties based upon the principles set forth in Section 2.04 for the
determination of the Closing Net Worth.
Section 1.49. "Property" means real, personal or mixed property.
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Section 1.50. "Purchase Price" has the meaning given thereto in Section 2.02.
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Section 1.51. "SEC Reports" has the meaning given thereto in Section 5.04.
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Section 1.52. "Securities Act" means the U.S. Securities Act of 1933, as
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amended.
Section 1.53. "Seller" and "Sellers" has the meaning given thereto in the
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premises.
Section 1.54. "Sellers' Closing Net Worth Statement" has the meaning given
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thereto in Section 2.04.
Section 1.55. "Sellers' Letter" has the meaning given thereto in Section
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2.06.
Section 1.56. "Shares" has the meaning given thereto in the recitals.
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Section 1.57. "Specified Disclosure" means the facts and/or circumstances
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disclosed by Sellers to Buyer in (i) the first paragraph of Section 4.09 of the
Disclosure Letter, (ii) the first paragraph of Section 4.14 of the Disclosure
Letter, (iii) the first paragraph of Section 4.15 of the Disclosure Letter, (iv)
the first paragraph of Section 4.26 of the Disclosure Letter and (v) the first
paragraph of Section 4.01 of the Disclosure Letter.
Section 1.58. "Standstill Agreement" has the meaning given thereto in Section
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3.02.
Section 1.59. "Subsidiary" shall mean any person as to which the Buyer, any
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Seller or the Company as the case may be, directly or indirectly, owns or has
the power to vote, or to exercise a Controlling influence with respect to, fifty
percent (50%) or more of the securities of any class of such person, the holders
of which class are entitled to vote for the election of directors (or persons
performing similar functions) of such person.
Section 1.60. "Support Payment" has the meaning given thereto in Section
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2.13.
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Section 1.61. "Surviving Representations" has the meaning given thereto in
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Section 10.01.
Section 1.62. "Tangible Property" has the meaning given thereto in Section
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4.19.
Section 1.63. "Tax" or "Taxes" means all Belgian or foreign, national,
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federal, state, provincial, regional, county and local net income tax, gross
income tax, gross receipts tax, sales tax, use tax, ad valorem tax, employment
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tax, payroll tax, social security tax (including required contributions),
unemployment tax, disability tax, excise tax, severance tax, occupation tax,
premium tax, windfall profits tax, additional tax, add-on minimum tax, franchise
tax, license tax, profit tax, real and personal property tax, capital tax,
recording tax, transfer tax, customs or other taxes, fees, stamp taxes and
duties, assessments or charges of any kind whatsoever (whether payable directly
or by withholding), together with any interest and any penalties, fines,
additions to tax or additional amounts imposed with respect thereto.
Section 1.64. "Tax Liability" has the meaning given thereto in Section 4.22.
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Section 1.65. "Tax Return" means all income tax, excise tax, sales tax, value
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added tax, use tax, gross receipts tax, franchise tax, employment and payroll
related tax, property tax and all other tax returns, reports, declarations and
forms required to be filed or supplied to any Belgian or foreign tax authority
(federal, national, state, local, foreign, provincial, regional or otherwise) in
connection with or with respect to any Taxes.
Section 1.66. "Third Party Claim" has the meaning given thereto in Section
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7.04.
Section 1.67. "Total Asset Value" shall mean the aggregate value of the
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Company's assets as of a given date, determined in accordance with Section 2.04.
Section 1.68. "Total Liability Value" shall mean the aggregate value of the
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Company's liabilities as of a given date, determined in accordance with Section
2.04.
ARTICLE II
SALE AND PURCHASE OF SHARES
Section 2.01. Sale and Purchase of Shares. (a) At the Closing: (i) each
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Seller shall sell, transfer, assign and convey to the Buyer that number of
Shares as is equal to the number of Shares set forth opposite such Seller's name
on Schedule A hereto, free and clear of any Lien with respect thereto; and (ii)
the Buyer shall purchase, acquire and accept all of the Shares for the Purchase
Price. At the Closing, each of the Sellers (or their proxy holders) and the
Buyer shall record the transfer of the Shares in the Company's shareholders
register. The sale of the Shares according to the provisions of this Agreement
is indivisible, and may not be completed in part only. Each Seller agrees that,
by virtue of clause (i) above, it is also conveying to Buyer any rights that
such Seller has in, or has or may have to acquire any Shares (or any other
capital stock of the Company), whether by way of preemptive rights, warrants,
improperly cancelled shares or any other rights whatsoever.
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(b) As and from the Closing Date, the Buyer shall have full right of
ownership of the Shares, including all rights to vote and to receive
dividends, including the dividends pertaining to the 1998 business year.
Section 2.02. Definition of Purchase Price and Payment for the Shares.
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(a) The aggregate purchase price for the Shares (the "Purchase Price")
shall be equal to (i) U.S. $5,000,000, (ii) plus the Currency Fluctuation
Adjustment Amount, (iii) minus U.S. $335,000 (which the Parties agreed upon
as a net worth adjustment), (iv) plus any Adjustment Payment due Sellers
from Buyer, or minus any Adjustment Payment due Buyer from Sellers, as the
case may be, and (v) plus the amount of the Support Payment (if any).
(b) The Purchase Price shall be paid as follows: (i) at the Closing,
Buyer shall pay to the Sellers the sum of U.S. $1,250,000, in cash, plus
the Currency Fluctuation Adjustment Amount, minus U.S. 335,000 (which the
Parties agreed upon as a net worth adjustment); (ii) at the Closing, Buyer
shall deliver to the Sellers share certificates representing 506,250 shares
(the "Parent Direct Shares") of the Parent's common stock, par value $0.01
per share ("Parent Common Stock"); (iii) at the Closing, Buyer shall
deliver to the Escrow Agent, on behalf of the Sellers, share certificates
representing 168,750 shares of Parent Common Stock (the "Parent Escrowed
Shares"), pursuant to the terms of the Escrow Agreement (the payments in
clause (i), (ii), and (iii) above being collectively referred to as the
"Closing Payment"), (iv) Buyer or Sellers, as the case may be, shall make
the Adjustment Payment to the other in accordance with Section 2.03 below,
and (v) if applicable, Buyer shall make the Support Payment to Sellers in
accordance with Section 2.13 below.
Section 2.03. Net Worth Adjustment. Within five days following the date
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on which the Closing Net Worth is determined pursuant to Sections 2.04 through
2.12, Buyer shall pay to Sellers the amount by which the Closing Net Worth
exceeds Bfr. 10,500,000, or Sellers shall pay to Buyer the amount by which the
Preliminary Net Worth exceeds the Closing Net Worth, as the case may be, in
either case plus interest on such amount at the rate of 6% per annum calculated
on a per diem basis from the Closing Date to the payment date (the "Adjustment
Payment"). In the event that the Closing Net Worth is determined to be between
Bfr. 9,500,000 and 10,500,000 (inclusive), there shall be no Adjustment Payment.
Section 2.04 Closing Net Worth Statement. Sellers shall prepare and
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deliver to Buyer within 45 days following the Closing Date a statement (the
"Seller's Closing Net Worth Statement") reflecting the Sellers' determination of
the Closing Net Worth. In determining the Closing Net Worth, both the Company's
Total Asset Value and the Company's Total Liability Value shall be determined
(in each case as of the close of business on the Closing Date) in accordance
with the principles, practices and procedures which are consistent with those
which were applied in determining the Net Worth of the Company as shown on the
Balance Sheet.
Section 2.05. Buyer's Review. The Buyer will have 45 days following
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receipt of Sellers' Closing Net Worth Statement from the Sellers to review such
statement and to determine if, in Buyer's judgment, it has been prepared in
accordance with Section 2.04. If, in Buyer's judgment, adjustments are necessary
for the Sellers' Closing Net Worth Statement to be so prepared, Buyer, within
the 45-day period, shall notify Sellers in writing of its proposed adjustments,
including the amount, nature and basis for the adjustments ("Buyer's Letter").
If the Buyer does not deliver a Buyer's Letter to the Sellers within such 45-
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day period, the Sellers' Closing Net Worth Statement shall be determinative of
the Closing Net Worth.
Section 2.06. Sellers' Review. Sellers will then have 30 days following
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receipt of the Buyer's Letter, if so delivered pursuant to Section 2.05, to
review the Buyer's proposed adjustments set forth therein. Within this 30-day
period, Sellers shall notify Buyer in writing of Sellers' position with respect
to each of Buyer's proposed adjustments ("Sellers' Letter"). If the Sellers do
not deliver a Sellers' Letter to the Buyer within such 30-day period, the
Sellers' Closing Net Worth Statement, as adjusted by the Buyer's proposed
adjustments set forth in Buyer's Letter, shall be determinative of the Closing
Net Worth.
Section 2.07. Conference. As soon as practicable after Buyer's receipt
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of Sellers' Letter, if so delivered pursuant to Section 2.06, the Parties shall
confer and endeavor to resolve the adjustments, if any, which are in dispute.
Section 2.08. Arbitrator. If the Parties do not confer or are unable to
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resolve all of the proposed adjustments in Buyer's Letter to the mutual
satisfaction of the Parties, then, within the 20-day period following Buyer's
receipt of Sellers' Letter, or, if a conference pursuant to Section 2.07 occurs,
within the 20-day period following such conference, the Parties, at the request
of any Party, shall jointly engage the accounting firm of Deloitte & Touche LLP
to act as the arbitrator, subject to that firm confirming that it is independent
of all Parties. If such accounting firm is unable to confirm the foregoing, the
Parties shall jointly engage an alternate mutually acceptable accounting firm
that can confirm that it is independent of all Parties. If the Parties do not
agree on an alternate mutually acceptable accounting firm then, upon the request
of any Party, such alternate firm shall be selected by the President of the
Brussels Court of Commerce.
Section 2.09. Scope of Arbitration. If the provisions of Section 2.08
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become operative, then the arbitrator shall be furnished with a copy of this
Agreement, any amendments hereto, the Sellers' Closing Net Worth Statement,
Buyer's Letter and Sellers' Letter. The arbitrator shall have 30 days to review
this material, and additional material that any of the Parties voluntarily
chooses to submit and such other information as it deems appropriate. Within the
30-day period, the arbitrator will furnish the Parties with its written
determination regarding each unresolved adjustment of Buyer submitted for
arbitration.
Section 2.10. Arbitrator's Decision. The arbitrator shall confine itself
---------------------
only to adjustments proposed in Buyer's Letter and not resolved in Sellers'
Letter or in a subsequent writing signed by Buyer and Sellers. Each party shall
have the right to submit supporting or explanatory material to the arbitrator
and to the other parties. The arbitrator, in reaching a decision, shall provide
a written explanation of its conclusions to all parties, and its determination
shall be conclusive and binding upon the Parties. The submission of a dispute to
the arbitrator and the rendering of its decision shall be a condition precedent
to any Party's commencing legal action to pursue any claim arising under
Sections 2.03 through 2.10 hereof. The award or decision of the arbitrator shall
be deemed final and may be entered and enforced in any court of competent
jurisdiction. The Parties agree to submit to the jurisdiction of any such court
for the enforcement of such award or decision. The fee and expenses of the
arbitrator shall be borne by the parties in a proportion to be determined by the
arbitrator reflecting his decision on the merits. Section 11.03 ("Notices")
shall apply to all communications made under this Article II.
Section 2.11. Access. In preparing and reviewing the Sellers' Closing Net
------
Worth Statement and in conducting the reviews by any party and the arbitrator,
all Parties will grant the others and the arbitrator all reasonable access to
the records of the Company and auditor workpapers, prepared with
- 8 -
respect to the Sellers' Closing Net Worth Statement, Buyer's review thereof and
Sellers' review of the Buyer's Letter.
Section 2.12. Closing Net Worth. In the event that Sellers deliver a
-----------------
Sellers' Letter to Buyer pursuant to Section 2.06, the Sellers' Closing Net
Worth Statement prepared by Seller pursuant to Section 2.04 will be modified by
any adjustments set forth in Buyer's Letter and not objected to in Seller's
Letter, agreed to by the Parties pursuant to Section 2.07 or determined by the
Arbitrator pursuant to Section 2.10. The Sellers' Closing Net Worth Statement
after any and all such adjustments shall be determinative of the Closing Net
Worth.
Section 2.13. Support Payment. If, on the first anniversary of the Closing
---------------
Date, the price (determined as set forth below) of the Parent Shares is less
than $5.55 per share, then the Buyer shall pay to the Sellers, in the aggregate,
an amount equal to the product of (x) 675,000, multiplied by (y) the difference
between $5.55 and the greater of (x) $4.00 per share or (y) such price;
provided, however, if the Parent Shares are changed into or exchanged for a
different number or kind of securities of the Parent or of another entity by
reason of any reorganization, merger, consolidation, recapitalization,
reclassification, stock split-up, combination of shares or dividend payable in
capital stock, appropriate adjustment shall be made to the foregoing
calculation. For purposes of this (S)2.13, the price of the Parent Shares will
be determined by taking the average of the Daily Closing Price (as hereinafter
defined) for the twenty trading days immediately preceding the date of the first
anniversary of the Closing Date. As used in this (S)2.13, "Daily Closing Price"
means (i) if the Parent Shares are listed on a national securities exchange or
quoted through the NASDAQ National Market System, the reported Consolidated
Trading closing price; (ii) if the Parent Shares are quoted on the NASDAQ inter-
dealer quotation system, the reported closing price for such day on such system;
or (iii) if the Parent Shares are not listed on a national stock exchange or
quoted on NASDAQ, the closing price reported by the National Quotation Bureau,
Inc. for such day. If on the date that the price support payment referred to in
the first sentence of this Section 2.13 is due there exists an "Unresolved
Claim" under the Escrow Agreement, then the Buyer shall pay 25% of such price
support payment to the Escrow Agent to be held by the Escrow Agent as Escrowed
Property in accordance with the terms of the Escrow Agreement.
Section 2.14 Payments in Cash; Currency Translations; Payments to Sellers.
------------------------------------------------------------
All cash payments made pursuant to this Agreement shall be made in United States
dollars by certified or bank cashier's check or by wire transfer to such
accounts as the Buyer or the Sellers, as the case may be, shall designate in
writing. In the event that the amount of any payment hereunder is determined by
reference to Belgian Francs, such amount will be paid in United States dollars
based on the mean average of the currency exchange rate published in The Wall
--------
Street Journal on the four Business Days prior to the date on which payment is
--------------
due; provided, however, that for purposes of the payment made pursuant to
Sections 2.02(a)(iii) and 2.02(b)(i) above, the currency exchange rate shall be
Bfr. 33.57 to U.S. $1.00. Any cash payments by the Buyer to a Seller pursuant
to this ARTICLE II or pursuant to Section 10.03 hereof shall be in an amount
equal to such Seller's "Percentage of Interest", as set forth on Schedule A
hereto.
Section 2.15 Representative Sellers. Each of the Parties hereto agrees
----------------------
that any calculation, agreement or settlement of either the Adjustment Payment
or the Support Payment agreed to by both Xxxxxxxx Xxx Xxxxxxxxxx and G.I.M.V.
shall be binding upon each and every Seller as if such Seller had specifically
agreed thereto.
- 9 -
ARTICLE III
CLOSING
Section 3.01. Closing. The closing of the sale and purchase of the Shares
-------
(the "Closing") shall take place at the offices of Xxxxx & XxXxxxxx, Xxxxxx
Xxxxxx 000, 0000, Xxxxxxxx, Xxxxxxx at 9:00 a.m., prevailing local time,
simultaneously with the execution and delivery hereof. The date upon which the
Closing occurs is referred to as the "Closing Date".
Section 3.02. Deliveries. At the Closing, the following deliveries are
----------
being made:
(a) Buyer, Sellers and the Escrow Agent are executing the Escrow
Agreement;
(b) Buyer and Sellers are executing a standstill agreement in the form
of Exhibit E hereto (the "Standstill Agreement");
(c) The Buyer is receiving the favorable opinion of Xxxxx & XxXxxxxx,
counsel to the Sellers, dated the Closing Date, addressed to the Buyer, in the
form of Exhibit B hereto;
(d) The Buyer is receiving the resignation, dated the Closing Date, of
all members of the Board of Directors (excluding only Xxxxxxxx Xxx Xxxxxxxxxx),
as well as the resignation of the Company's statutory auditor;
(e) The Buyer is receiving releases, in the form of Exhibit C hereto,
from each Seller, each member of the Company's Board of Directors and each other
Affiliate of the Company;
(f) The Buyer is receiving (i) a letter from IWT consenting to the
change in Control of the Company, (ii) one or more letters from the EU
Commission with respect to the Brite-Euram contracts subsequent to the Closing,
and (iii) a letter from KBC consenting to the change in control of the Company;
(g) The Buyer is receiving satisfactory evidence of the termination of
(i) all outstanding shareholder and similar agreements relating to the Company
and (ii) the 390 warrants to purchase the Company's capital stock held by
Xxxxxxxx Xxx Xxxxxxxxxx;
(h) The Seller is receiving (i) the favorable opinion of Stibbe Simont
Xxxxxxx Duhot, counsel to the Buyer, dated the Closing Date, addressed to the
Sellers, in the form of Exhibit F-1 hereto and (ii) the favorable opinion of
Xxxx Xxxxx & Xxxxxxx LLP, counsel to the Parent, addressed to the Sellers, in
the form of Exhibit F-2 hereto;
(i) The Buyer and Advanced Business Consulting N.V. are entering into a
Management Consulting Agreement in the form of Exhibit D hereto; and
(j) The Buyer and Usines Metallurgique Suisse Holding S.A. are entering
into an Agreement in the form of Exhibit H hereto;
- 10 -
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE SELLERS
Each of the Sellers, severally, represents and warrants to the Buyer that the
statements contained in this Article IV are correct as of the date of this
Agreement, except as set forth in the "Disclosure Letter" delivered to Buyer
simultaneously with the execution hereof.
Section 4.01 Title to Shares. Each Seller is the owner of the Shares set
---------------
forth opposite such Seller's name on Schedule A hereto, free and clear of any
Lien, and has full power and authority to convey the Shares set forth opposite
such Seller's name on Exhibit A hereto to the Buyer, free and clear of any Lien,
and, upon payment for and recordation of transfer of such Shares, all as herein
provided, the Buyer will acquire good, marketable and valid title thereto, free
and clear of any Lien. No certificates have ever been issued in respect of the
Company's registered shares. Upon the Closing, no Person or Party other than
Buyer will have any valid rights with respect to the equity capital of the
Company.
Section 4.02 Authority Relative to this Agreement. Each Seller has the
------------------------------------
capacity and power to enter into and execute this Agreement and each other
agreement entered into by such Seller pursuant hereto and to perform fully such
Seller's obligations hereunder and thereunder. With respect to each Seller that
is a corporation, the execution of this Agreement and such other agreements and
the consummation by each Seller of the transactions contemplated hereby and
thereby have been approved and authorized by all necessary corporate action.
This Agreement has been duly executed by each Seller and constitutes, and each
other agreement to be entered into by each Seller pursuant hereto, upon
execution thereof by each Seller at the Closing, will be duly executed by each
Seller and constitute, the legal, valid and binding obligation of each Seller
enforceable against each Seller in accordance with its terms, subject to
applicable bankruptcy, liquidation and other concursus rules.
Section 4.03. Absence of Conflicts. The execution of this Agreement and
--------------------
each other agreement to be entered into by each Seller pursuant hereto, the
consummation of the transactions contemplated hereby and thereby and the
performance by each Seller of this Agreement and such other agreements in
accordance with their respective terms and conditions will not: (i) require any
Permit, or any notice to, filing or registration with, or permit, license,
variance, waiver, exemption, franchise, order, consent, authorization or
approval of, any other person; (ii) violate, conflict with or result in a breach
of any provision of or constitute a default (or an event which, with notice or
lapse of time or both, would constitute a default) under, or result in the
termination or modification of, or accelerate the performance required by, or
modify (or allow any other party thereto to modify), or result in the creation
of any Lien on the Shares held by such Seller or upon the assets, properties or
businesses of the Company under, any of the terms, conditions or provisions of
(x) if applicable, such Seller's articles of association or (y) any contract or
other agreement to which such Seller is a party or by or to which such Seller or
the Shares held by such Seller are bound or subject; or (iii) violate any
judgment, ruling, order, writ, injunction, award, decree, statute, law,
ordinance, code, rule or regulation of any court or foreign, federal, state,
provincial, regional, county or local government or any other governmental,
regulatory or administrative agency or authority which is applicable to such
Seller or to the Shares held by such Seller.
Section 4.04. Organization and Qualification. The Company is a corporation
------------------------------
duly organized, registered and existing under the laws of the Kingdom of
Belgium, and is registered with the
- 11 -
Register of Commerce of Hasselt under number 73.218. The registered office of
the Company is at 3540 Herk-de-Stad, Industrieterrein Daelemveld 1113. The
Company has the requisite corporate power and lawful authority to own, lease and
operate its assets, Property and business and to carry on its business as it is
now being conducted. The Company does not own or lease Property in any
jurisdiction other than its jurisdiction of incorporation and the jurisdictions
set forth in Section 4.04 of the Disclosure Letter.
Section 4.05. Subsidiaries; Other Affiliates; Investments. The Company has
-------------------------------------------
no direct or indirect Subsidiaries or Affiliates. The Company does not, directly
or indirectly, own or Control or have any capital or other equity interest or
participation in, or any interest convertible into or exchangeable or
exercisable for any capital or other equity interest or participation in, nor is
the Company, directly or indirectly, subject to any obligation or requirement to
provide funds to or invest in, any Person.
Section 4.06. Capitalization. The Shares are validly issued, fully paid-in
--------------
and non-assessable (i.e., the holders of the shares are not liable for more than
their previously-invested capital), and represent the entire issued share
capital of the Company. The Company has not issued any other shares, bonds,
convertible bonds, subscription rights or similar securities. There are no
agreements or arrangements in force which call for the issue of new shares in
the Company or the making of any loan by the Company. The transfer of the Shares
to the Purchaser does not and will not constitute an infringement of any
provision of the articles of association of the Company. There are no
outstanding obligations of the Company to repurchase, redeem or otherwise
acquire any capital stock of the Company. Neither the Company nor any of the
Sellers has outstanding any agreements or understandings affecting the issuance,
transfer or voting of the Company's outstanding or authorized but unissued
securities.
Section 4.07. Articles of Association; Minute Books. Copies of the Articles
-------------------------------------
of Association of the Company, and all amendments thereto, have been delivered
to the Buyer and such copies, as so amended, are true, complete and accurate.
Copies of the minute books of the Company, which have been delivered to the
Buyer, contain true, complete and accurate records of all meetings and consents
in lieu of meetings of its shareholders, its Board of Directors and any
committees thereof (or persons performing similar functions), since the time of
its incorporation. The copy of the Company's share register, which has been
delivered to the Buyer, is true, complete and accurate.
Section 4.08. [intentionally omitted].
Section 4.09. Governmental Approvals. The execution of this Agreement and
----------------------
each other agreement to be entered pursuant hereto, the consummation of the
transactions contemplated hereby and thereby and compliance with the provisions
hereof and thereof require no notice to, filing or registration with, or permit,
license, variance, waiver, exemption, franchise, order, consent, authorization
or approval of, any foreign, federal, state, provincial, regional, county or
local government or any other governmental, regulatory or administrative agency
or authority (individually, a "Permit" and collectively, "Permits"). The Sellers
are not aware of any matter which might prejudice the continuation (for a one
year period after the Closing) of any such Permits, approvals or consents in
accordance with their terms.
Section 4.10. Financial Statements.
--------------------
(a) The balance sheets of the Company as at December 31, 1995, December
31, 1996, and December 31, 1997, and the related statements of earnings,
stockholders' equity and cash flows for the periods ending thereon, including
the notes thereto, audited by the statutory auditor stated
- 12 -
therein, which have been previously delivered to the Buyer, fairly present the
financial position of the Company as at such dates and the results of operations
and the changes in stockholders' equity and cash flows of the Company for the
years then ended in accordance with GAAP. The foregoing financial statements as
at December 31, 1997, and for the year then ended are hereinafter referred to
collectively as the "Financials"; the balance sheet included in the Financials
is hereinafter referred to as the "Balance Sheet"; and December 31, 1997 is
hereinafter referred to as the "Balance Sheet Date".
(b) The unaudited balance sheet of the Company as at August 31, 1998,
and the related statements of earnings, stockholders' equity and cash flows for
the seven-month period then ended, including the notes thereto, by Boeye,
Cauwenbergh & Van Gulck, statutory auditor, which have been previously delivered
to the Buyer, fairly present (subject to normal recurring year-end audit
adjustments) the financial position of the Company as at such dates and the
results of operations and changes in stockholders' equity and cash flows of the
Company for the periods then ended in accordance with GAAP. The foregoing
financial statements as of August 31, 1998, and for the year then ended are
hereinafter referred to collectively as the "Interim Financials"; and the
balance sheet included in the Interim Financials is hereinafter referred to as
the "Interim Balance Sheet."
(c) For the avoidance of doubt, it is specified that the reserves
("provisions") in the Financials and the Interim Financials are made in
accordance with (i) applicable accounting regulations, (ii) the policies of the
Company applied on a consistent basis, and (iii) the principles of good faith
and caution, taking into account all information available at the time. All of
the Company's account books and other financial records for the past five years
have been properly kept, are located and available at the offices of the Company
and contain an accurate and complete record of the matters which should be dealt
with in them. The Financials and the Interim Financials have been annexed to
Section 4.10 of the Disclosure Letter.
Section 4.11. Absence of Certain Changes. Since the Balance Sheet Date,
--------------------------
the Company has conducted its business in the ordinary course consistent with
past practice and there has been no change, event, occurrence or development of
a state of circumstances or facts outside the ordinary course of business,
which, individually or in the aggregate, has had, or could reasonably be
expected to have, a Material Adverse Effect and none of the Sellers has any
Knowledge of any such change, event, occurrence or development of a state of
circumstances or facts which is threatened, nor has there been any damage,
destruction or other casualty loss (whether or not covered by insurance)
affecting the business or assets of the Company which, individually or in the
aggregate, has had or could reasonably be expected to have a Material Adverse
Effect.
Section 4.12. Tax Matters.
-----------
(a) The Company has duly and correctly, on a timely basis, in Belgium
(and any other relevant jurisdiction) filed all Tax Returns and other
declarations required to be filed by law or regulations prior to the date of
this Agreement, and such Tax Returns are true and accurate in all respects. The
Company has paid, prior to their due date, all amounts due and payable to the
tax authorities in Belgium (and any other relevant jurisdiction) and the Sellers
are not aware of any facts or claims which could give rise to any additional tax
liability relating to periods covered by the Financials and the Interim
Financials not reserved for in the Financials or the Interim Financials.
(b) The Company has not made or agreed to make any payments which are
- 13 -
not wholly allowable as a deduction in computing its profits for taxation
purposes, unless set forth in the Tax Returns as non-allowable or partially non-
allowable as a deduction.
(c) The Tax Liabilities of the Company have been examined by the taxing
authorities for all taxable years through and including the year ending December
31, 1995. There are no pending tax examinations or tax claims asserted on the
Company, nor to the Sellers' Knowledge is there any basis for any such
examination or claim. No relief (by way of deducting, reduction, set-off,
exemption or otherwise) from, against or in respect of any taxation or charge
that has been claimed by or given to the Company could be withdrawn, postponed,
restricted or otherwise lost as a result of any act, omission, event or
circumstance having arisen. There is no notification of intention of the tax
authorities, in Belgium or elsewhere, to contest or investigate the Tax Returns
and/or to levy additional Taxes.
(d) The Company's aggregate recoverable fiscal loss through September
30, 1998, was approximately Bfr 75,000,000 (it being understood that, anything
in this Agreement to the contrary notwithstanding, Sellers are not representing
and warranting as to the utilization of such loss after the Closing).
Section 4.13. Compliance with Law. To the Knowledge of the Sellers, the
-------------------
Company is in full compliance with, and has not violated, any judgment, ruling,
order, writ, injunction, award, decree, statute, law, ordinance, code, rule or
regulation, of any Belgian or foreign court or Belgian, foreign, national,
federal, state, provincial, regional, county or local government or any other
governmental, regulatory or administrative agency or authority applicable to it
or to its assets, properties, business or operations except for non-compliances
that would not have a Material Adverse Effect. To the Knowledge of the Sellers,
the conduct of the Company's business is in full compliance with, and has not
violated any Belgian or foreign, federal, state, county or local energy, public
utility, health, occupational safety or health requirement, environmental
requirement or any other Belgian or foreign, federal, state, provincial,
regional, county or local governmental, regulatory or administrative requirement
except where the failure to so comply would not have a Material Adverse Effect.
The Company has in effect all Permits necessary for the conduct of its
businesses as presently conducted by the Company, a complete list of which
Permits is set forth in Section 4.13 of the Disclosure Letter. All such Permits
are in full force and effect. To the Sellers' Knowledge, no violations exist in
respect of any Permit and no proceeding is pending, or to the Knowledge of the
Sellers threatened (i) to revoke, cancel suspend or otherwise limit any Permit
or (ii) alleging any failure to have all Permits required to operate the
business of the Company. None of the transactions contemplated by this Agreement
or the agreements contemplated hereby will terminate, violate or limit the
effectiveness of any Permit.
Section 4.14. Litigation. There are no currently effective judgments,
----------
rulings, orders, writs, injunctions, awards or decrees of any Belgian or foreign
court or any Belgian or foreign, federal, state, provincial, regional, county or
local government or any other governmental, regulatory or administrative agency
or authority or arbitral tribunal against or involving the Company. Except as
set forth in Section 4.14 of the Disclosure Letter, the Company is not a party
to, or to the Knowledge of the Sellers threatened with, any litigation or
judicial, governmental, regulatory, administrative or arbitration suit, action,
claim, proceeding or investigation which, if decided adversely to the Company,
could have an adverse effect upon the transactions contemplated hereby or a
Material Adverse Effect. The Sellers do not have Knowledge of any fact, event or
circumstance that a reasonably prudent person would believe may give rise to any
such suit, action, claim, proceeding or investigation. None of the Sellers has
Knowledge of any dispute with any person under any contract between the Company
and such persons which, individually or in the aggregate,
- 14 -
could have a Material Adverse Effect.
Section 4.15. Agreements. Section 4.15 of the Disclosure Letter sets forth
----------
all of the following Contracts and Other Agreements (whether written or oral) to
which the Company is a party or by or to which its assets, properties or
businesses are bound or subject:
(i) all Contracts and Other Agreements with any current or
former director, shareholder or Affiliate;
(ii) all Contracts and Other Agreements with any labor union
or association representing any employee;
(iii) all material Contracts and Other Agreements for the sale
or provision (or for the purchase or acquisition) of materials, supplies,
equipment, merchandise or services (material in this context shall mean the
contract or agreement contains obligations exceeding Bfr. 500,000 or which
cannot be terminated by the Company without penalty within six months of the
Closing Date);
(iv) all patent, trademark, service xxxx, trade name, and
copyright and franchise licenses, royalty agreements or similar Contracts and
Other Agreements relating to Intellectual Property;
(v) all distributorship, representative, broker, management,
marketing, sales agency, printing or advertising Contracts and/or Other
Agreements;
(vi) all Contracts and Other Agreements which give any person
any right to purchase any of the Company's assets, properties or businesses
(regardless of whether there are any conditions to the exercise of any such
right), other than contracts relating to the sale of inventory within the
ordinary course of business;
(vii) all joint venture, partnership, and other similar
Contracts and Other Agreements;
(viii) all Contracts and Other Agreements under which the
Company has guaranteed the obligations of any Person;
(ix) all Contracts or Other Agreements relating to any
borrowed money indebtedness or deferred purchase obligation (i.e., the Company
having been granted terms of more than 90 days to pay invoices) of the Company;
(x) all Contracts and Other Agreements under which the
Company agrees to share Tax Liability with any person;
(xi) all Contracts and Other Agreements (i) limiting the
freedom of the Company to engage in any line of business, compete with any
person or carry on its business in any geographic area and/or (ii) requiring the
Company to keep confidential and/or proprietary information of a third party,
and/or the existence of any relationship with such third party, confidential;
- 15 -
(xii) all Contracts and Other Agreements relating to the
acquisition by the Company of any operating business or the capital stock of any
person;
(xiii) all leases of real property or material leases of
personal property;
(xiv) all Contracts and Other Agreements with any current or
former employee, consultant or agent; and
(xv) any other Contract and/or Other Agreement not made in the
ordinary course of business, that produces, or may reasonably be expected to
produce, a Material Adverse Effect.
Each of the Contracts and Other Agreements set forth in Section 4.15 of the
Disclosure Letter are continuing in material accordance with their terms (except
for those which have expired in accordance with their terms without there being
clear evidence in the Disclosure Letter as to the renewal thereof). The Company
has not received notice that it has, and to the Sellers' Knowledge the Company
has not, violated or breached any of the terms or provisions of any such
contract and the Company has paid in full or internally accrued all amounts due
thereunder. To the Knowledge of Sellers, no party, other than the Company, is
in breach or default of any of the provisions of any such contract or agreement.
Correct and complete copies of all of the Contracts and/or Other Agreements
referred to in Section 4.15 of the Disclosure Letter (or, where such Contracts
and Other Agreements are oral, true and complete summaries thereof) are included
in the Disclosure Letter.
Section 4.16. Real Estate. The Company is the sole and full owner of the
-----------
real estate properties listed in Section 4.16 of the Disclosure Letter. Such
properties are free from any Liens and may be used for the purposes for which
they are presently used. The Company has no tenants thereon. The Company does
not lease any real property. No notice from any Belgian or foreign, federal,
state, provincial, regional, county or local government or any other
governmental, regulatory or administrative agency or authority has been served
upon any of the Sellers or the Company claiming any violation of any Belgian or
foreign, federal, state, provincial, regional, county or local statute, law,
code, rule, regulation, zoning or building ordinance or health or safety
ordinance, or requiring or calling attention to the need for any work, repairs,
construction, alterations or installations on or in connection with such real
estate which has not been complied with. The Company has the legal right to use
its properties for the operations currently conducted. The Company has complied
with the covenants, obligations and requirements relating to the real property
imposed by any law, decree or other regulation or court order or decision, the
terms of the deeds of ownership or any agreement to which the Company was or is
a party. There are no notices, decrees, complaints or requirements issued by any
competent authority in respect of the Company's property which would adversely
affect its value (such as, without prejudice to the generality of the foregoing,
expropriation measure, "measure de classement ou d'inscription sur la liste de
sauvegarde). The building permits delivered to the Company have been regularly
obtained and were valid in all respects when obtained and have been properly
complied with by the Company. There is no known dispute, administrative
investigation or litigation, pending, threatened or announced regarding the
Company's real property with any government, local or other public authority,
with any tenant or occupier of part of such real property, or with the owner or
occupier of any adjoining or neighboring property and the Sellers have no
Knowledge of facts likely to give rise to any such dispute.
Section 4.17. Accounts and Notes Receivable. All accounts and notes
-----------------------------
receivable reflected on the Interim Balance Sheet, and all accounts and notes
receivable arising subsequent to the date
- 16 -
thereof and on or prior to the Closing Date, have arisen or will arise in the
ordinary course of business, represent or will represent legal, valid, binding
and enforceable obligations to the Company and, except for Bfr. 639,000 of
overdue accounts existing as of September 1, 1998, to the Sellers' Knowledge
have been, or will be, collected or are, or will be, collectible in the
aggregate recorded amounts thereof in accordance with their terms within six
months after this due date and, to the Knowledge of the Sellers, are not subject
to any counterclaims or setoffs.
Section 4.18. [intentionally omitted]
Section 4.19. Tangible Property. The Company owns or has a valid leasehold
-----------------
interest in all equipment, furniture, leasehold improvements, fixtures,
vehicles, structures, any related capitalized items (collectively, "Tangible
Property") and other tangible assets or property which is currently used for the
conduct of the Company's business as presently conducted. A complete list of the
Company's Tangible Property (which may include a general list of miscellaneous
items which in the aggregate are not material) is set forth as Section 4.19 of
the Disclosure Letter. To the Sellers' Knowledge, all material Contracts and
Other Agreements pursuant to which the Company may hold or use any interest
owned or claimed by the Company (including, without limitation, options) in or
to the Tangible Property are in full force and effect and, with respect to the
performance of the Company, there is no default or event of default (or event
which, with notice or lapse of time or both, would constitute a default) which
default, individually or in the aggregate, would have a Material Adverse Effect.
The Tangible Property of the Company is in good operating condition and repair
for the purposes for which it is currently used.
Section 4.20. Intellectual Property.
---------------------
(a) The Company owns or has the right to use pursuant to license,
sublicense, agreement or permission all Intellectual Property currently used for
the conduct of the Company's businesses as presently conducted free and clear of
any Liens. Each item of Intellectual Property owned or used by the Company
immediately prior to the Closing will be owned or available for use by the
Company on identical terms and conditions immediately subsequent to the Closing.
The Intellectual Property has been registered, and/or covered by secrecy
agreements, in each case as set forth in (S)4.20 of the Disclosure Letter.
(b) To the Knowledge of the Sellers, the Company has not interfered
with, infringed upon, misappropriated, or otherwise come into conflict with any
Intellectual Property rights of third parties. None of the Sellers, the Company
or any of the Company's directors or officers (or employees with responsibility
for Intellectual Property matters) has ever received any charge, complaint,
claim or notice alleging any such interference, infringement, misappropriation
or violation. To the Knowledge of Sellers, no third party has materially
interfered with, infringed upon, misappropriated or otherwise come into conflict
with any Intellectual Property rights of the Company, nor is any charge,
complaint, action, suit, proceeding, hearing, investigation, claim or demand
pending with respect thereto.
(c) Section 4.20(A) of the Disclosure Letter identifies each patent
(including issuing country, number, current assignee of record, title and issue
date), each trademark and service xxxx registration (including issuing country,
number, description of xxxx, current owner of record and issue date), each
unregistered trademark and service xxxx for which no application for
registration is pending (including a description of the xxxx and the goods or
services with which it is used) currently in effect and owned by the Company;
and identifies each pending patent application (including country of filing,
serial
- 17 -
number, current owner of record, title and filing date), application for
registration of a trademark or service xxxx (including country of filing, serial
number, description of xxxx, current owner of record, and filing date). The
Sellers have delivered to the Buyer correct and complete copies of all such
written (or if oral, a written summary of such) licenses, agreements and
permissions (as amended to date). With respect to each item of Intellectual
Property that the Company owns:
(i) to the extent that the item constitutes a patent, or a
registered trademark or registered servicemark (or an application therefor), the
Company possesses all right, title and interest in and to the item;
(ii) the item is not subject to any outstanding judgment,
order, decree, stipulation, injunction or charge against the Company;
(iii) the Company is not under any contractual obligation to
indemnify any person or entity against any interference, infringement,
misappropriation or other conflict with respect to the item not otherwise
disclosed herein.
(d) Except for off-the-shelf computer software available in the open
market, the Company does not use any Intellectual Property of a Seller, an
Affiliate of a Seller or any third party.
Section 4.21. Liens. The Company owns outright and has good and marketable
-----
title to all of its assets, properties and businesses, including, without
limitation, all of the assets, properties and businesses reflected on the
Balance Sheet, free and clear of any Lien, except with respect to: (i)
immaterial assets, properties and businesses; (ii) assets, properties and
businesses disposed of, or subject to purchase or sales orders, in the ordinary
course of business since the Balance Sheet Date; (iii) Liens securing Taxes,
assessments, governmental, regulatory or administrative charges or levies, or
the claims of materialmen, carriers, landlords and like persons, which are not
yet due and payable; or (iv) Liens disclosed in (S)(S)4.16 and/or 4.19 of the
Disclosure Letter. The Company enjoys peaceful and undisturbed possession of all
assets, properties or businesses owned or leased by it and used in connection
with its business. The Company owns or otherwise has the right to use all of the
properties now used by it in the operation of its business. The representations
made in this Section 4.21 are not being made with respect to items of
Intellectual Property.
Section 4.22. Liabilities. As at the Balance Sheet Date, except for (i)
-----------
liabilities not, individually or in the aggregate, material, (ii) liabilities
under contracts and agreements disclosed with respect to Section 4.15 above, and
(iii) liabilities otherwise disclosed in Section 4.22 of the Disclosure Letter,
the Company did not have any direct or indirect indebtedness, liability, claim,
loss, damage, deficiency, obligation or responsibility, known or unknown, fixed
or unfixed, liquidated or unliquidated, secured or unsecured, subordinated or
unsubordinated, matured or unmatured, accrued, absolute, contingent or
otherwise, including, without limitation, liabilities on account of Taxes, other
governmental, regulatory or administrative charges or lawsuits brought, whether
or not of a kind required by GAAP to be set forth on a financial statement
(collectively, "Liabilities"), that were not fully and adequately reflected or
reserved against on the Balance Sheet; provided, however, that the
representations in this sentence as to Liabilities of a kind not required by
GAAP to be set forth on a balance sheet are being made to the Sellers'
Knowledge. The Company does not have any Liabilities not shown on the Balance
Sheet other than: (i) those incurred since the Balance Sheet Date in the
ordinary course of business; (ii) those not, individually or in the
- 18 -
aggregate, material; and/or (iii) Liabilities of the type described in clauses
(ii) and (iii) of the immediately preceding sentence; provided, however, that
the representations in this sentence as to Liabilities of a kind not required by
GAAP to be set forth on a balance sheet are being made to the Sellers'
Knowledge.
Section 4.23. Customers; Suppliers. Except as set forth in Section 4.23 of
--------------------
the Disclosure Letter, during each of the fiscal years of the Company ended
December 31, 1996 and December 31, 1997, not more than five percent (5%) of the
revenues of the Company during such period was attributable to any single
customer or to any group of affiliated customers and no one supplier or group of
affiliated suppliers (as defined under account n0 60 of the Belgian Standardized
Accounting System provided more than five percent (5%) of the requirements of
any kind of the Company taken as a whole during such period. Except as set forth
in the Financials, during the last 24 months, no customer or supplier of the
Company has cancelled or otherwise terminated, or threatened to cancel or
otherwise terminate, its relationship with the Company, and no customer of the
Company has decreased its usage of the goods or services of the Company by more
than 5%. Neither the Company nor any of the Sellers has any notice that any
customer intends to cancel its relationship with the Company or to decrease or
limit by more than 5% its usage of the goods or services of the Company, and
none of the Company's customers has indicated that a change in Control of the
Company (or the transactions contemplated hereby) would adversely affect its
relationship with the Company.
Section 4.24. Labor Agreements. No contract or other agreement exists
----------------
between the employees of the Company (or a union representing any of such
employees), collectively, and the Company and, to the best Knowledge of the
Sellers, no union has attempted to organize or represent the labor force of the
Company during the 24-month period immediately prior to the date hereof. During
such 24-month period there have been no lockouts, strikes, slowdowns, work
stoppages or threats thereof by or with respect to the Company's labor force.
Section 4.25. Personnel Matters. The standard terms and conditions of
-----------------
employment of the employees of the Company are included in Section 4.25 of the
Disclosure Letter, together with a list of all current employees of the Company
(position, age, years of seniority within the Company and salary). No increase
in the salaries or benefits of any employees of the Company or class of
employees has been agreed to, paid or made since the date of the Interim
Financials, nor has any negotiation for any such increase been entered into or
made, except in the ordinary course of business and in compliance with
applicable regulations. The Company has complied and continues to comply with
the Royal Decree of December 24, 1993 implementing the Law of January 6, 1989
safeguarding the competitiveness of the Kingdom of Belgium, as confirmed by the
Law of March 30, 1994 and with the Royal Decree of September 5, 1994, with the
Law of July 26, 1996 and with the implementing Royal Decrees of November 12 and
December 20, 1996, and all other laws and regulations related thereto. The
Company is in compliance with all legal and regulatory requirements related to
the organization of workers' councils, health and security councils, social
elections and all similar legislation. The Company has complied with all
individual labor agreements and all applicable collective bargaining agreements.
All remuneration and sums to be paid to the employees of the Company have been
calculated and paid in conformity with the applicable legal and tax rules. All
social security payments and withholding tax payments due and payable at or
prior to the date of this Agreement have been made in due time. The Company has
not, as of the date of this Agreement, any unsatisfied obligation, whether in
the form of a requirement to give notice or payment of an indemnity in lieu
thereof, towards any persons with regard to the termination of their employment
with the Company prior to the date of this Agreement.
- 19 -
Section 4.26. Environmental Protection. No notice, notification, demand,
------------------------
request for information, citation, summons or order has been issued, no
complaint has been filed, no penalty has been assessed and no investigation or
review is pending, or to Sellers' Knowledge, threatened by any governmental or
other entity (i) with respect to any alleged violation by the Company of any
environmental law, ordinance, rule, regulation or order of any government entity
in connection with the conduct of their businesses, and (ii) with respect to any
alleged failure by the Company to have any environmental permit, certificate,
license, approval registration, authorization or Permit required in connection
with the conduct of its business. There have been no environmental
investigations, studies, audits, tests, reviews or other analyses conducted by
or which are in the possession of the Company in relation to any property or
facility currently owned or leased by the Company which have not been set forth
in Section 4.26 of the Disclosure Letter and delivered to Buyer prior to the
date hereof.
Section 4.27. Employee Benefits. The Company has paid all amounts due to
-----------------
the social security authorities in Belgium and the Seller is not aware of any
facts or claims which could give rise to any additional social security
contributions or liability relating to periods covered by the Financials and the
Interim Financials not reserved for in the Financials or the Interim Financials.
There are no agreements or arrangements or schemes (excluding statutory
arrangements) for retirement benefits or pensions available to the employees of
the Company, nor have there ever been any such plan.
Section 4.28. Computer Systems. The Company's computer systems, including
----------------
all hardware and software (the "Computer Systems"), are presently serving the
Company's current uses reasonably adequately. There are no infringement suits,
actions or proceedings pending or, to the Knowledge of the Sellers, threatened
with respect to the Computer Systems.
Section 4.29. Employees; Compensation. Section 4.29 of the Disclosure
-----------------------
Letter sets forth all of the members of the management committee of the Company.
Except as set forth in Section 4.29 of the Disclosure Letter, none of such
members has, to the Knowledge of any of the Sellers, indicated to Xxxxxxxx Xxx
Xxxxxxxxxx within the last six months that he or she intends to resign or retire
as a result of the transactions contemplated hereby or otherwise within two
years after the Closing Date.
Section 4.30. Insurance. Section 4.30 of the Disclosure Letter sets forth
---------
all policies or binders of fire, liability, workmen's compensation, vehicular or
other insurance held by or on behalf of the Company (specifying the insurer, the
policy number or covering note number with respect to binders). To the Sellers'
Knowledge, such policies and binders are in full force and effect. To the
Sellers' Knowledge, the Company is not in default (or nonconforming) with
respect to any provision contained in any such policy or binder and has not
failed to give any notice or present any claim under any such policy or binder
in due and timely fashion. There are no outstanding unpaid claims under any such
policy or binder. Neither the Company nor any of the Sellers have received a
notice of cancellation or nonrenewal of any such policy or binder. None of the
Sellers have any Knowledge of any inaccuracy in any application for such
policies or binders, any failure to pay premiums when due or any similar state
of facts which might form the basis for termination of any such insurance.
Section 4.31. [intentionally omitted]
Section 4.32. Operations of the Company. Since the Balance Sheet Date, and
-------------------------
without limiting the representations and warranties contained in Section 4.11
above, the Company has not:
- 20 -
(i) amended its Articles of Association or merged with or
into or consolidated with any other person, subdivided or in any way
reclassified any shares of its capital stock or changed or agreed to change in
any manner the rights of its outstanding capital stock or the character of its
business;
(ii) issued, sold, purchased or redeemed, or entered into any
Contracts or Other Agreements to issue, sell, purchase or redeem, any shares of
its capital stock or any options, warrants, convertible or exchangeable
securities, subscriptions, rights (including preemptive rights), stock
appreciation rights, calls or commitments of any character whatsoever relating
to its capital stock;
(iii) entered into or amended any employment (other than in the
ordinary course of business) or consulting or other similar agreement; entered
into any contract or other agreement with any labor union or association
representing any employee; or adopted, entered into or amended any employee
benefit plan or made any change in the actuarial methods or assumptions used in
funding any defined benefit pension plan, or made any change in the assumptions
or factors used in determining benefit equivalencies thereunder;
(iv) declared, set aside or paid any dividends or declared,
set aside or made any distributions of any kind to its shareholders, or made any
direct or indirect redemption, retirement, purchase or other acquisition of any
shares of its capital stock;
(v) reduced its cash or short-term investments or their
equivalent, other than to meet cash needs arising in the ordinary course of
business;
(vi) adopted a plan of liquidation or resolutions providing
for the liquidation, dissolution, merger, consolidation or other reorganization
of the Company;
(vii) waived any right of value material to the Business (other
than in the ordinary course of business);
(viii) made any change in its accounting methods, principles or
practices or made any change in depreciation or amortization policies or rates
adopted by it;
(ix) written up the value of any portion of its assets,
properties or businesses;
(x) changed any of its business policies;
(xi) made any wage or salary increase or bonus, or increase in
any other direct or indirect compensation, for or to any of its directors,
employees, consultants or agents or any accrual for or contract or other
agreement to make or pay the same other than in the ordinary course of business
and in amounts consistent with past practice;
(xii) made any loan or advance to any of its officers,
directors, employees, consultants, agents or other representatives (other than
travel advances made in the ordinary course of business in a manner consistent
with past practice) or made any other loan or advance;
- 21 -
(xiii) made any payment or commitment to pay severance or
termination pay to any of its directors, employees, consultants, agents or other
representatives;
(xiv) except in the ordinary course of business: entered into
any lease (as lessor or lessee); sold, abandoned or made any other disposition
of any of its assets, properties or businesses; granted or suffered any Lien on
any of its assets, properties or businesses; entered into or amended any
contract or other agreement of the type required to be disclosed pursuant to
Section 4.15 hereof to which it is a party or by or to which it or its assets,
properties or businesses are bound or subject or pursuant to which it agrees to
indemnify any person or to refrain from competing with any person;
(xv) made any capital expenditures in excess of U.S. $10,000
in any one case or U.S. $25,000 in the aggregate;
(xvi) incurred or assumed any debt, obligation or Liability, or
issued any debt securities or assumed, guaranteed, endorsed or otherwise as an
accommodation became responsible for, Liabilities of any other person or made
any loans or advances, individually or in the aggregate, material outside the
ordinary course of business;
(xvii) made any acquisition of all or any part of the assets,
properties, capital stock or business of any other person, except for purchases
of inventory or Tangible Property in the ordinary course of business;
(xviii) terminated, entered into, or amended in any material
respect, any material contract or other agreement or terminated or entered into
any other material transaction (for purposes of this clause (xviii) a contract
or transaction will be material if it would be material pursuant to (S)4.15(iii)
above); or
(xix) agreed to do any of the foregoing.
Section 4.33. Potential Conflicts of Interest. To the Sellers' Knowledge,
-------------------------------
none of the Sellers, nor any director of the Company, or any entity Controlled
by any of the foregoing, owns, directly or indirectly, any interest in
(excepting not more than five percent (5%) stock holdings held solely for
investment purposes in securities of any person which are listed on any national
securities exchange or regularly traded in the over-the-counter market) or is a
director, officer, employee, consultant or agent of any person which is a
competitor or customer of the Company, owns, directly or indirectly, in whole or
in part, any Tangible Property, patent, trademark, service xxxx, trade name,
copyright, franchise, invention, permit, license or Confidential Information
which the Company is using for the business of the Company.
Section 4.34. Banks, Brokers and Proxies. Section 4.34 of the Disclosure
--------------------------
Letter sets forth: (i) the name of each bank, trust company and securities or
other broker with which the Company maintains relations; (ii) the name of each
person authorized by the Company to effect transactions therewith or to have
access to any safe deposit box or vault; and (iii) all proxies, powers of
attorney or other like instruments to act on behalf of the Company in matters
concerning its business or affairs. On the date hereof the Company has not less
than Bfr. 1,000,000 in Cash.
Section 4.35. Full Disclosure. All Documents and Other Papers delivered by
---------------
or on behalf of the Sellers or the Company in connection with this Agreement and
the transactions contemplated
- 22 -
hereby are true, complete, accurate and authentic as of the date hereof, with
respect to documents included in the Disclosure Letter, and when given, with
respect to other Documents and Other Papers. (With respect to the immediately
preceding sentence, the Parties agree and acknowledge that (i) the word
"complete" refers to the completeness of the physical document itself, rather
than the subjects covered therein, and (ii) that such representation is not
breached by the existence and delivery of Documents and Other Papers which have
been superseded, in whole or in part, by manifestly clear provisions of other
Documents and Other Papers included in the Disclosure Letter.) The information
furnished by or on behalf of the Sellers to the Buyer in connection with this
Agreement and the other agreements to be entered into pursuant hereto and the
transactions contemplated hereby and thereby does not contain any untrue
statement of a material fact and does not omit to state a material fact (i)
required to be stated therein by the terms hereof, or (ii) necessary to make the
statements made, in the context in which made, when read together in the context
of the subject matter, not false or misleading. To the Sellers' Knowledge, there
is no fact arising outside the ordinary course of business which the Sellers
have not disclosed to the Buyer which has a Material Adverse Effect, or so far
as any of the Sellers can now reasonably foresee will have a Material Adverse
Effect or affect the ability of the Sellers to perform this Agreement (it being
agreed and understood that this representation does not include facts relating
to general business, financial and industry facts).
Section 4.36. No Broker. No broker, finder, agent or similar intermediary
---------
has acted for or on behalf of the Company or any of the Sellers in connection
with this Agreement or the transactions contemplated hereby, and no broker,
finder, agent or similar intermediary is entitled to any broker's, finder's or
similar fee or other commission in connection herewith based on any contract or
other agreement with the Company or any of the Sellers or any action taken by
the Company or any of the Sellers.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF THE BUYER
The Buyer represents and warrants to the Sellers as follows:
Section 5.01. Organization. The Buyer is a corporation duly organized,
------------
registered and existing under the laws of the Kingdom of Belgium, and is
registered with the Register of Commerce of Brussels under number 628809. The
registered office of the Company is at 0000 Xxxxxxxx, Xxxx. Xxxxx Xxxxxxx 119.
The Parent is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware.
Section 5.02. Authority Relative to this Agreement. The Buyer has the
------------------------------------
capacity and power to enter into and execute this Agreement and each other
agreement to be entered into by Buyer pursuant hereto and to perform fully its
obligations hereunder and thereunder. The Parent has the capacity and power and
authority to enter into and execute this Agreement and to guaranty the
performance by Buyer hereunder as set forth herein, to execute the Standstill
Agreement and to perform fully its obligations under this Agreement and the
Standstill Agreement. The execution of this Agreement and such other agreements
and the consummation by the Buyer of the transactions contemplated hereby and
thereby, and the execution of this Agreement and the Standstill Agreement by
Parent, and the performance by Parent of its obligations hereunder and
thereunder (including, without limitation, the authorization of the issuance of
the Parent Shares), have been approved and authorized by all necessary corporate
action of the Buyer and the Parent, respectively. This Agreement has been duly
executed by the Buyer and constitutes, and each
- 23 -
other Agreement to be entered into by the Buyer pursuant hereto, upon execution
thereof by the Buyer at the Closing, will be duly executed by the Buyer and
constitute, the valid and binding obligation of the Buyer enforceable against
the Buyer in accordance with its terms. This Agreement and the Standstill
Agreement have been duly executed by Parent and constitute the valid and binding
obligation of the Parent, enforceable against the Parent in accordance with
their respective terms.
Section 5.03. Absence of Conflicts. The execution of this Agreement and
--------------------
each other agreement to be entered into by Buyer and Parent pursuant hereto, the
consummation of the transactions contemplated hereby and thereby and compliance
with the provisions hereof and thereof will not: (i) violate, conflict with or
result in a breach of any provision of or constitute a default (or an event
which, with notice or lapse of time or both, would constitute a default) under,
or result in the termination of, or accelerate the performance required by, or
result in a creation of any Lien upon any of the assets, properties or
businesses of the Buyer or the Parent under, any of the terms, conditions or
provisions of (x) the Buyer's Articles of Association or the Parent's
Certificate of Incorporation and by-laws, each as amended, or (y) any contract
or other agreement to which the Buyer or the Parent or any of their respective
assets, properties or businesses is subject; or (ii) violate any judgment,
ruling, order, writ, injunction, award, decree, statute, law, ordinance, code,
rule or regulation of any Belgian, U.S. or other court, or Belgian, U.S. or
foreign or other federal, state, provincial, regional, county or local
government or any other governmental, regulatory or administrative agency or
authority which is applicable to the Buyer or the Parent or any of their
respective assets, properties or businesses; or (iii) require any Permit, or any
notice to, filing or registration with, or permit, license, variance, waiver,
exemption, franchise, order, consent, authorization or approval of, any other
person that has not been obtained.
Section 5.04. Parent Shares. Upon their delivery at the Closing in
-------------
accordance with Article II above, the Parent Shares shall be duly and validly
issued, fully-paid and non-assessable. The Parent has filed all reports,
registration statements, definitive proxy statements and other documents and all
amendments thereto and supplements thereof required to be filed by it with the
U.S. Securities and Exchange Commission since October 31, 1996 (the "SEC
Reports"), all of which have complied in all material respects with all
applicable requirements of the Securities Act, the Exchange Act and the rules
and regulations promulgated thereunder. As of the respective dates of filing in
final or definitive form (or, if amended or superseded by a subsequent filing,
then on the date of such subsequent filing), none of the Parent's SEC Reports
contained any untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances in which they were made, not misleading.
The Parent has only one class of common stock, which is not divided into series,
and no classes of preferred stock, outstanding. Upon delivery of the Parent
Shares pursuant to this Agreement, the Sellers will acquire valid title thereto,
free and clear of any Lien (except for Liens arising under this Agreement and
the agreements contemplated hereby, Liens existing with respect to the Sellers
or created by the Sellers and restrictions imposed upon the transfer of
securities by applicable securities laws).
Section 5.05. No Broker. No broker, finder, agent or similar intermediary
---------
has acted for or on behalf of the Buyer or the Parent in connection with this
Agreement or the transactions contemplated hereby, and no broker, finder, agent
or similar intermediary is entitled to any broker's, finder's, or similar fee or
other commission in connection therewith based on any contract or other
agreement with the Buyer or the Parent or any action taken by the Buyer or the
Parent.
- 24 -
ARTICLE VI
COVENANTS AND AGREEMENTS
Section 6.01. Payment of Debts. At the Closing, (i) each Seller shall pay
----------------
to the Company any amounts owed to the Company by such party, and (ii) each
Seller shall use its best efforts to cause the Company to pay any amounts that
the Company owes to such party (except only for (i) accrued regular fees due to
Advanced Business Consulting N.V. not yet payable and (ii) borrowed money
indebtedness of the Company to Usines Metallurgique Suisse Holding S.A.).
Section 6.02. Holding of Shares. The Buyer shall not (and shall ensure
-----------------
that any transferee of the Shares shall not) sell, transfer or otherwise convey
any of the Shares to an "entity," as defined in Article 227(20) and Article
227(30) of the Belgian Income Tax Code, or merge with another person, within
eighteen months of the Closing Date; provided, however, that this Section 6.02
shall not prevent Buyer from conveying up to 1% of the Shares to an "entity" so
long as the Shares being so transferred were Shares numbered no. 1500 to no.
1550, inclusive.
Section 6.03. Confidentiality. The Sellers will treat and hold as such
---------------
all of the Confidential Information and refrain from using any of the
Confidential Information except in accordance with this Agreement; provided,
however, that (i) in the case of Usines Metallurgique Suisse Holding S.A., the
foregoing prohibition will only prohibit the disclosure and use of Confidential
Information relating to the development, manufacture and processing of shape
memory alloys for five years from the Closing Date, (ii) in the case of Xxx
Xxxxxx, the foregoing prohibition will not prevent the use and disclosure of
Confidential Information except to directly compete with the Company's
activities on the date hereof or in the twelve months prior hereto during the
Noncompetition Period, and (iii) in the case of G.I.M.V., information relating
to general business practices shall be excluded from the restrictions of this
(S)6.03. In the event that any Seller is requested or required (by oral question
or request for information or documents in any legal proceeding, interrogatory,
subpoena, civil investigative demand, or similar process) to disclose any such
Confidential Information, such Party will notify the Buyer promptly of the
request or requirement so that the Buyer may seek an appropriate protective
order to waive compliance with the provisions of this (S)6.03. If, in the
absence of a protective order or the receipt of a waiver hereunder, such Party
is, on the written advice of counsel, compelled to disclose any such
Confidential Information to any tribunal or else stand liable for contempt, such
Party may disclose such Confidential Information to the tribunal; provided,
--------
however, that the Party shall use its best efforts to obtain, at the request
-------
of the Buyer, an order or other assurance that confidential treatment will be
accorded to such portion of the Confidential Information required to be
disclosed as the Buyer shall designate.
Section 6.04. Covenant Not to Compete. Except as expressly set forth
-----------------------
elsewhere herein, during the Noncompetition Period the Sellers shall not engage
directly or indirectly in any business which is competitive with the Business
(or any portion thereof) in all or any portion of the European Union; provided,
--------
however, that (i) the ownership by any Seller separately (except that Sellers
-------
Xxxxxxxx Xxx Xxxxxxxxxx, Advanced Business Consulting N.V. and Xxxxxx Xxxxxxx
shall be considered as one Seller for purposes of this (S)6.04) of less than 5%
of the outstanding stock of any publicly traded corporation shall not be deemed
solely by reason thereof to cause the Sellers to be engaged in any of such
corporation's businesses; (ii) with respect to G.I.M.V., (a) only (x) businesses
directly competing with the Company in the development, manufacturing and
processing of
- 25 -
shape memory alloys as their core business, or (y) businesses directly competing
with the Company in the development, manufacturing and processing of shape
memory alloys not as their core business but where G.I.M.V. has entrusted and/or
allowed Mr. Alex Brabers to assist such competitor in entering into or
conducting such business, shall be deemed competitive with the Company, (b) so
long as G.I.M.V. has not allowed Mr. Alex Brabers to play any part in the
decision to invest or the management, supervision and/or monitoring of the
investment, the geographical scope of the covenant not to compete shall be
limited to the Kingdom of Belgium, (c) so long as G.I.M.V. has not allowed Mr.
Alex Brabers to play any part in the decision to invest or the management,
supervision and/or monitoring of the investment, the Noncompetition Period for
G.I.M.V. shall only be eighteen months; and (d) G.I.M.V. will not have violated
this Section 6.04 when a non-Affiliated venture capital (or similar) fund in
which G.I.M.V. has invested invests in a company described in part (x) of clause
(a); and (iii) the provisions of this sentence shall not apply to Xxx Xxxxxx.
During the Noncompetition Period, the Sellers shall not hire, or assist any
other Person in hiring, any of the Company's employees as of the Closing Date or
within the last six months prior thereto. None of the Sellers shall take any
action that is designed or intended to have the effect of discouraging any
lessor, licensor, customer, supplier or other business associate of the Company
from maintaining the same business relationships with the Company after the
Closing as it maintained with the Company prior to the Closing. If the final
judgment of a court of competent jurisdiction, or an arbitrator pursuant to
(S)8.07 below, declares that any term or provision of this (S)6.04 is invalid or
unenforceable, the Parties agree that the court or arbitrator making the
determination of invalidity or unenforceability shall have the power to reduce
the scope, direction, or area of the term or provision, to delete specific words
or phrases, or to replace any invalid or unenforceable term or provision with a
term or provision that is valid and enforceable and that comes closest to
expressing the intention of the invalid or unenforceable term or provision, and
this Agreement shall be enforceable as so modified. Each of the Sellers
acknowledges and agrees that the Buyer would be damaged irreparably in the event
any of the provisions of this (S)6.04 is not performed in accordance with its
specific terms or otherwise is breached. Accordingly, each of the Sellers agrees
that the Buyer shall be entitled to an injunction or injunctions to prevent
breaches of the provisions of this (S)6.04 and to enforce specifically this
(S)6.04 and the terms and provisions hereof in any action instituted in any
court having jurisdiction over the Parties and the matter, in addition to any
other remedy to which it may be entitled.
Section 6.05. Release from AMT. At the first annual shareholders meeting of
----------------
the Company subsequent to the Closing, the Buyer shall see to it
(sterkmaken/porte fort) that the Company's shareholders shall release the
Company's pre-Closing directors and statutory auditor from liability to the
Company; provided, however, that such release shall not include any matter not
disclosed in this Agreement (including all exhibits and schedules hereto and the
Disclosure Letter). This Section 6.05 is without prejudice to any claims Buyer
may have against Sellers for indemnification hereunder.
ARTICLE VII
SURVIVAL OF REPRESENTATIONS AND WARRANTIES, INDEMNIFICATION
Section 7.01. Survival of Representations and Warranties; Interpretation.
----------------------------------------------------------
(a) All representations and warranties contained herein (including the
Schedules and Exhibits hereto but excluding the representations and warranties
specifically enumerated in the immediately following sentence) shall survive the
execution hereof and the Closing hereunder and shall continue in full force and
effect thereafter, but will expire on December 31, 1999. All representations and
warranties of the Sellers' contained in Sections 4.01, 4.06, 4.12, 4.15(i),
4.24, 4.27 and 4.33 (the "Surviving Representations"), all representations and
warranties of the Buyer contained in Section 5.04 of this
- 26 -
Agreement, other than those set forth in the second and third sentences thereof
(excluding such two sentences, the "Buyer's Surviving Representations"), and all
covenants and agreements of the Parties contained in this Agreement, shall
survive the Closing and shall continue in full force and effect thereafter until
six months subsequent to the expiration of the applicable statute of limitations
(other than those which by their terms sooner terminate).
(b) Subject to the remainder of this Section 7.01(b), each Party shall
have the right to rely fully upon the representations, warranties, covenants and
agreements of the other Parties contained in this Agreement (including the
Schedules and Exhibits hereto and the Disclosure Letter). Notwithstanding the
foregoing, with respect to representations and warranties that do not relate to
the mere existence of a document, the Sellers shall have used their reasonable
efforts to arrange disclosures made in the Disclosure Letter relating thereto in
paragraphs and corresponding to the sections and subsections contained in
Article IV, and such representations and warranties shall (except as provided
below) only be qualified by the information referred to in the relevant section
of the Disclosure Schedule; provided, however, (a) that if (i) the documents
annexed to the Disclosure Letter describe a state of facts giving rise to an
exception to a representation, and (ii) such exception is clear from the text of
such document such that, notwithstanding the fact that the exception is not
included in the appropriate section of the Disclosure Letter, a reasonably
prudent buyer acting in good faith should, by virtue of its normal review of
such document as part of its normal pre-acquisition due diligence process,
understand the exception to the appropriate representation and warranty, then
such representation and/or warranty shall be deemed modified by such exception
notwithstanding the fact that such exception is not disclosed in the
corresponding section of the Disclosure Letter, and (b) that notwithstanding the
fact that clause (a) above is a proviso to the first portion of this section,
and not the reverse, the exception created by such proviso shall not be
interpreted more narrowly because it is a proviso than if it stated the general
rule of the sentence and what is the general rule was the proviso. Furthermore,
notwithstanding the foregoing, with respect to representations and warranties
regarding the existence (or non-existence) of certain documents, the existence
of any document disclosed with respect to one section or subsection of the
Disclosure Letter shall qualify all other sections and/or subsections of the
Disclosure Letter; provided, however, that each of Schedules 4.04, 4.15(i),
4.16, 4.20, 4.26, 4.29, 4.30 and 4.34 of the Disclosure Letter will have to be
complete on their own, and will not be qualified by information contained in a
non-corresponding section of the Disclosure Letter.
(c) For purposes of determining the amount of Tax Liabilities of the
Company existing as of the Closing Date for periods which began before the
Closing Date and end after the Closing Date, the portion of such Tax which
relates to the portion of such taxable period ending on the Closing Date shall
(x) in the case of any Taxes other than Taxes based upon or related to income or
receipts, be deemed to be the amount of such Tax for the entire taxable period
multiplied by a fraction, the numerator of which is the number of days in the
taxable period ending on the Closing Date and the denominator of which is the
number of days in the entire taxable period, and (y) in the case of any Tax
based upon or related to income or receipts be deemed equal to the amount which
would be payable if the relevant taxable period ended on the Closing Date. Any
credits relating to a taxable period that begins before and ends after the
Closing Date shall be taken into account as though the relevant taxable period
ended on the Closing Date.
Section 7.02. Indemnification Provisions for Benefit of the Buyer. In the
---------------------------------------------------
event the Sellers breach (or a breach would exist or have occurred but for a
Specified Disclosure) any of their representations, warranties, and covenants
contained herein, and, if there is an applicable survival period pursuant to
(S)7.01 above, provided that the Buyer makes a written claim for indemnification
within two months of becoming aware of such claim (containing, to the extent
reasonably practicable at the time of notification, a detailed description of
the facts on the basis of which the claim is based and a good faith
- 27 -
estimate of the claim (provided, however, that no delay in providing such
information shall relieve the Sellers from any obligation hereunder unless (and
then solely to the extent) the Sellers thereby are prejudiced)) against the
Sellers at an address determined pursuant to (S)8.03 below within such survival
period, then (x) in the case of representations and warranties relating (in
whole or in part) to the Company, the Sellers shall, severally, in proportion to
their respective percentage of interest set forth on Schedule A, and (y) in the
case of representations relating solely to Sellers (and not to Company), or a
covenant of a Seller, then the breaching Seller (and only the breaching Seller),
indemnify the Buyer from and against the entirety of any Adverse Consequences
the Buyer may suffer through and after the date of the claim for indemnification
(including any Adverse Consequences the Buyer may suffer after the end of any
applicable survival period) resulting from, arising out of, relating to, in the
nature of, or caused by the breach; provided, however, (i) Buyer's right to
-------- -------
indemnification with respect to breaches of the Sellers' representations and
warranties, other than the Surviving Representations (but excluding those in
Section 4.12), shall be limited to the amount of U.S. $2,500,000 in the
aggregate, (ii) the Sellers shall not have any obligation to indemnify the Buyer
from and against any Adverse Consequences resulting from, arising out of,
relating to, in the nature of, or caused by the breach of any representation or
warranty of the Sellers (other than the Surviving Representations (but excluding
those in Section 4.12)) until the Buyer has suffered Adverse Consequences (in
the aggregate) by reason of all such breaches in excess of a U.S. $150,000
aggregate threshold (at which point the Sellers will be obligated to indemnify
the Buyer from and against all such excess Adverse Consequences), and (iii) the
Sellers shall not be obligated to indemnify the Buyer against the breach of any
particular representation or warranty unless the Adverse Consequences of such
breach (when aggregated with the Adverse Consequences of all related breaches)
exceeds U.S. $10,000 (it being agreed that Sellers will then be obligated to
indemnify against all Adverse Consequences, not just the excess over U.S.
$10,000 and, solely for purposes of determining the amount of Adverse
Consequences (and not for purposes of determining whether a breach occurred)
without giving effect to the inclusion in any such representation or warranty of
a materiality qualification). Under no circumstances can the Sellers reject or
restrict or claim under this section on the ground that a loss, damage or
expense was (or will be) suffered by the Company, rather than by the Buyer. The
Parties agree and understand that this Agreement does not provide Buyer with the
right to indemnification for breaches of representations, warranties and
covenants not contained herein. Without limiting the preceding sentence, the
Parties agree that the Sellers are not indemnifying the Buyer against (i)
changes to any applicable laws, rules or regulations, or (ii) damages done to
the Company and/or the Business by the Buyer, the Parent and/or the Company
subsequent to the Closing.
Section 7.03. Indemnification Provisions for Benefit of the Sellers. In the
-----------------------------------------------------
event the Buyer breaches any of its representations, warranties, and covenants
contained herein, and, if there is an applicable survival period pursuant to
(S)7.01 above, provided that the Sellers make a written claim for
indemnification within two months of becoming aware of such claim (containing,
to the extent reasonably practicable at the time of notification, a detailed
description of the facts on the basis of which the claim is based and a good
faith estimate of the claim (provided, however, that no delay in providing such
information shall relieve the Buyer from any obligation hereunder unless (and
then solely to the extent) the Buyer thereby is prejudiced)) against the Buyer
pursuant to (S)8.03 below within such survival period, then the Buyer shall
indemnify the Sellers from and against the entirety of any Adverse Consequences
the Sellers may suffer through and after the date of the claim for
indemnification (including any Adverse Consequences the Sellers may suffer after
the end of any applicable survival period) resulting from, arising out of,
relating to, in the nature of, or caused by the breach; provided, however, that
-------- -------
(i) the Sellers' aggregate right to indemnification with respect to breaches of
any representations of Buyer, other than the Buyer's Surviving Representations,
shall be limited to the amount of U.S. $2,500,000 in the aggregate, (ii) the
Buyer shall not have any obligation to indemnify the Sellers from and against
any Adverse Consequences resulting
- 28 -
from, arising out of, relating to, in the nature of, or caused by the breach of
any representation or warranty (other than Buyer's Surviving Representations) of
the Buyer until the Sellers have suffered Adverse Consequences (in the
aggregate) by reason of all such breaches (or alleged breaches) in excess of a
U.S. $150,000 aggregate threshold (at which point the Buyer will be obligated to
indemnify the Sellers from and against all such excess Adverse Consequences),
and (iii) the Sellers shall not be obligated to indemnify the Buyer or the
Company against the breach of any particular representation or warranty unless
the Adverse Consequences of such breach (when aggregated with the Adverse
Consequences of all related breaches) exceeds U.S. $10,000 (it being agreed that
Buyer will then be obligated to indemnify against all Adverse Consequences, not
just the excess over U.S. $10,000 and, solely for purposes of determining the
amount of Adverse Consequences (and not for purposes of determining whether such
a breach occurred) without giving effect to the inclusion in any such
representation or warranty of a materiality qualification).
Section 7.04. Matters Involving Third Parties.
-------------------------------
(a) If any third party shall notify any Party (the "Indemnified Party")
with respect to any matter (a "Third Party Claim") which may give rise to a
claim for indemnification against any other Party (the "Indemnifying Party")
under this Article VII, then the Indemnified Party shall promptly (but in any
event within two months) notify each Indemnifying Party thereof in writing;
provided, however, that no delay on the part of the Indemnified Party in
-----------------
notifying any Indemnifying Party shall relieve the Indemnifying Party from any
obligation hereunder unless (and then solely to the extent) the Indemnifying
Party thereby is prejudiced.
(b) Any Indemnifying Party will have the right to defend the Indemnified
Party (or, if appropriate, the Company) against the Third Party Claim with
counsel of its choice reasonably satisfactory to the Indemnified Party so long
as (A) the Indemnifying Party notifies the Indemnified Party in writing within
20 days after the Indemnified Party has given notice of the Third Party Claim
that the Indemnifying Party will indemnify the Indemnified Party from and
against the entirety of any Adverse Consequences the Indemnified Party may
suffer resulting from, arising out of, relating to, in the nature of, or caused
by the Third Party Claim, (B) the Indemnifying Party provides the Indemnified
Party with evidence reasonably acceptable to the Indemnified Party that the
Indemnifying Party will have the financial resources to defend against the Third
Party Claim and fulfill its indemnification obligations hereunder, (C) the Third
Party Claim involves only money damages and does not seek an injunction or other
specific performance order (or similar equitable relief), (D) settlement of, or
an adverse judgment with respect to, the Third Party Claim is not, in the good
faith judgment of the Indemnified Party, likely to establish a precedential
custom or practice adverse to the continuing business interests of the
Indemnified Party, and (E) the Indemnifying Party conducts the defense of the
Third Party Claim actively and diligently and at its sole cost.
(c) So long as the Indemnifying Party is conducting the defense of the
Third Party Claim in accordance with (S)7.04(b) above, (A) the Indemnified Party
may retain separate co-counsel at its sole cost and expense and participate in
the defense of the Third Party Claim, (B) the Indemnified Party will not consent
to the entry of any judgment or enter into any settlement with respect to the
Third Party Claim without the prior written consent of the Indemnifying Party
(not to be withheld unreasonably), and (C) the Indemnifying Party will not
consent to the entry of any judgment or enter into any settlement with respect
to the Third Party Claim without the prior written consent of the Indemnified
Party (not to be withheld unreasonably).
(d) In the event any of the conditions in (S)7.04(b) above is or becomes
- 29 -
unsatisfied, however, (A) the Indemnified Party shall, actively and diligently,
defend against the Third Party Claim in a prudent manner, and (B) assuming that
the Indemnified Party has complied with clause (A) above, the Indemnifying
Parties will remain responsible for any Adverse Consequences the Indemnified
Party may suffer resulting from, arising out of, relating to, in the nature of,
or caused by the Third Party Claim to the fullest extent provided in this
Article 7. In addition, the Indemnifying Party may retain separate co-counsel
(at its sole cost and expense) and participate in the defense of the Third Party
Claim. Furthermore, in the event the Indemnifying Party was offered the defense
of the Third Party Claim but failed to satisfy the conditions of clauses (A),
(B), and/or (E) of Section 7.04(b) above (other than as described in the
immediately following sentence), the Indemnified Party shall have the right to
consent to the entry of any reasonable judgment or enter into any reasonable
settlement with respect to such Third Party Claim without needing to obtain any
consent from any Indemnifying Party in connection therewith (although the
Indemnified Party shall be required to consult with the Indemnifying Party with
respect to such Third Party Claim). However, in the event that the Indemnified
Party took over the defense of the Third Party Claim notwithstanding the
satisfaction of the conditions set forth in clauses (A), (B) and (E) of Section
7.04(b) above because of the failure of the Indemnifying Party to satisfy the
conditions of clauses (C) and/or (D) of said Section 7.04, or because the
Indemnifying Party disputes its liability for this matter in good faith, then
the Indemnified Party shall not consent to the entry of any judgment or enter
into any settlement without the consent of the Indemnifying Party (which consent
shall not be unreasonably withheld).
Section 7.05. Right of Set Off. The Buyer shall have the option (but not
----------------
the obligation) to set off and apply against any amounts due and payable to any
of the Sellers pursuant to this Agreement or the Escrow Agreement an amount
equal to the amount for which the Sellers are obligated to indemnify the Buyer
pursuant to (S)7.02 hereof. Set-offs made under the Escrow Agreement shall be
made in accordance with the terms of the Escrow Agreement. Set-offs made under
this Agreement may be made only with the consent of the Sellers or the
resolution of the dispute pursuant to (S)8.07 below; provided, however, that in
the event that at the time such a payment is otherwise due from Buyer such a
matter is being contested in good faith, Buyer may withhold any such amount
until the resolution of such dispute.
ARTICLE VIII
MISCELLANEOUS
Section 8.01. Fees and Expenses. Whether or not the transactions
-----------------
contemplated hereby are consummated, each of the parties hereto shall pay its
own fees and expenses incident to the negotiation, preparation and execution of
this Agreement and the consummation of the transactions contemplated hereby,
including attorneys', accountants' and other advisors' fees and the fees and
expenses of any broker, finder or agent retained by such party in connection
with the transactions contemplated hereby, except as otherwise expressly
provided in this Agreement or any agreement entered into pursuant hereto.
Section 8.02. Publicity. Immediately upon the Closing, the Parties shall
---------
jointly issue and disseminate the press release annexed hereto as Exhibit G.
Thereafter, except as required under applicable law (and only to the extent so
required), no Party shall make any publicity release or announcement concerning
this Agreement or the transactions contemplated hereby without advance written
approval of the form and substance thereof by the other Parties and their
respective counsel, which approval shall not be unreasonably withheld.
- 30 -
Section 8.03. Notices. Any notice or other communication required or which
-------
may be given hereunder shall be in writing and shall be delivered personally,
telecopied, telegraphed or telexed, or sent by certified, registered, or express
mail, postage and/or charges prepaid, to the parties at the following addresses
or at such other addresses as shall be specified by the parties by like notice,
and shall be deemed given when so delivered personally, telecopied, telegraphed
or telexed, or if mailed, two days after the date of mailing, as follows:
(i) if to the Buyer, to it:
AMT Holdings, N.V.
c/o Memry Corporation
00 Xxxxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxxxxxx 00000
Telecopier: (000) 000-0000
Attention: Xx. Xxxxx X. Xxxxx
with a copy (which shall not constitute notice) to:
Xxxx Xxxxx & Xxxxxxx LLP
Xxx Xxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Telecopier: (000) 000-0000
Attention: Xxxxx X. Xxxxx, Esq.
(ii) if to the Sellers, to each of them at the addresses
listed on Exhibit A, with, in any case, a copy (which shall not constitute
notice) to:
Xxxxx & XxXxxxxx
Xxxxxx Xxxxxx 000
0000 Xxxxxxxx, Xxxxxxx
Telecopier: 011-32-2-639-3699
Attention: Koen Xxxxxxxxxxx, Esq.
Section 8.04. Entire Agreement. This Agreement (including the
----------------
Exhibits and Schedules hereto and the Disclosure Letter) contains the entire
agreement among the parties with respect to the purchase of the Shares and
related transactions and supersede all prior Contracts and Other Agreements,
written or oral, with respect thereto.
Section 8.05. Waivers and Amendments. This Agreement may be amended,
----------------------
modified, superseded, cancelled, renewed or extended, and the terms and
conditions hereof may be waived, only by a written instrument signed by the
parties hereto or, in the case of a waiver, by the party waiving compliance. No
delay on the part of any party in exercising any right, power or privilege
hereunder shall operate as a waiver thereof, nor shall any waiver on the part of
any party of any right, power or privilege hereunder, nor any single or partial
exercise of any right, power or privilege hereunder, preclude any other or
further
- 31 -
exercise thereof or the exercise of any other right, power or privilege
hereunder. The rights and remedies herein provided are, absent fraud, exclusive
of any rights or remedies which any party may otherwise have at law or in
equity. The rights and remedies of any party arising out of or otherwise in
respect of any inaccuracy in or breach of any representation or warranty, or any
failure to perform or comply with any covenant or agreement, contained in this
Agreement shall in no way be limited by the fact that the act, omission,
occurrence or other state of facts upon which any claim of any such inaccuracy,
breach or failure is based may also be the subject matter of any other
representation, warranty, covenant or agreement contained in this Agreement (or
in any other agreement between the parties) as to which there is no inaccuracy,
breach or failure (it being agreed and understood that in no event shall a Party
be entitled to recover more than its Adverse Consequences suffered).
Section 8.06. Governing Law. This Agreement shall be governed by,
-------------
and construed and enforced in accordance with and subject to, the laws of the
Kingdom of Belgium.
Section 8.07. Jurisdiction. (a) Any dispute arising from this
------------
Agreement (other than a dispute over the determination of the Closing Net Worth,
which shall be resolved in accordance with Article II) shall be settled by
arbitration in accordance with the rules of CEPANI ("Centre belge pour l'etude
et la pratique de l'arbitrage national et international/Belgisch centrum voor
studie en praktijk van nationale en internationale arbitrage") by three (3)
arbitrators appointed in accordance with such rules. The proceedings shall take
place in Brussels, Belgium and shall be conducted in English.
(b) Nothing in (S)8.07(a) above shall prevent a Party from seeking
injunctive relief pending a decision of an arbitrator pursuant to (S)8.07(a)
above or to enforce such a decision in any court having jurisdiction over the
Party against whom injunctive relief or enforcement is sought.
Section 8.08. Binding Effect; Benefit. This Agreement shall inure
-----------------------
to the benefit of and be binding upon the parties hereto and their respective
successors and assigns. Except as set forth in Section 7.06, nothing in this
Agreement, expressed or implied, is intended to confer on any Person other than
the parties hereto or their respective successors and assigns, any rights,
remedies, obligations or liabilities under or by reason of this Agreement.
Section 8.09. Variations in Pronouns. All pronouns and any
----------------------
variations thereof refer to the masculine, feminine or neuter, singular or
plural, as the identity of the Person or Persons may require.
Section 8.10. Construction. While this Agreement has been drafted
------------
by Buyer's counsel, the parties have participated jointly in the negotiation of
this Agreement. Without prejudice to Articles 1156 through 1164 of the Belgian
Civil Code, in the event an ambiguity or question of intent arises, this
Agreement shall be construed as if drafted jointly by the parties and no
presumption or burden of proof shall arise favoring or disfavoring any party by
virtue of the authorship of any of the provisions of this Agreement. The word
"including" shall mean including without limitation. A matter, item and or/fact
will be deemed to be "material" for purposes of this Agreement if it has a cost
or effect, or is likely to have a cost or effect, when aggregated with all
similar matters, items and facts, of at least U.S.$10,000.
Section 8.11. Counterparts. This Agreement may be executed in
------------
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
Section 8.12. Exhibits and Schedules. The Exhibits and Schedules
----------------------
to this Agreement are a part of this Agreement as if set forth in full herein.
- 32 -
Section 8.13. Headings. The headings in this Agreement are for
--------
reference purposes only and shall not in any way affect the meaning or
interpretation of this Agreement.
Section 8.14. Severability. If any term, provision, covenant or
------------
restriction of this Agreement, or any part thereof, is held by a court of
competent jurisdiction or any foreign, federal, state, county or local
government or any other governmental, regulatory or administrative agency or
authority to be invalid, void, unenforceable or against public policy for any
reason, the remainder of the terms, provisions, covenants and restrictions of
this Agreement shall remain in full force and effect and shall in no way be
affected, impaired or invalidated.
- 33 -
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
Buyer: MEMRY HOLDINGS, S.A.
By: /s/ Xxxxx X. Xxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxx
Title: President
By: /s/ Xxxxxx X. Xxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxx
Title: V.P. CFO
Sellers: /s/ Xxxxxxxx Xxx Xxxxxxxxxx
--------------------------------------------
Xxxxxxxx Xxx Xxxxxxxxxx
/s/ Xxxxxx Xxxxxxx
--------------------------------------------
Xxxxxx Xxxxxxx
/s/ Xxx Xxxxxx
--------------------------------------------
Xxx Xxxxxx
Usines Metallurgique Suisse Holding S.A.
By: /s/ Xxxxx Shneuwly
-----------------------------------------
Name: Xxxxx Shneuwly
Title: CEO
G.I.M.V.
By: /s/ A. Brabers
-----------------------------------------
Name: A. Brabers
Title:
By: /s/ S. Braeckmans
-----------------------------------------
Name: S. Braeckmans
Title:
ADVANCED BUSINESS CONSULTING N.V.
By: /s/ Xxxxxxxx Xxx Xxxxxxxxxx
-----------------------------------------
Name: Xxxxxxxx Xxx Xxxxxxxxxx
Title: President, CEO
- 34 -
========================================================
The undersigned, the "Parent" in the above Agreement,
hereby (i) makes the representations and warranties
set forth in Article V above on its own behalf,
jointly and severally with Buyer, and (ii) guarantees,
jointly and severally with the Buyer, with waiver of
the parties' benefice de discussion/voorrecht van
uitwinning and its benefice de division/recht van
schuldsplitsing, that the Buyer shall comply with all
of its obligations under the above Agreement,
including the Buyer's obligations to indemnify the
Sellers as stated therein.
========================================================
MEMRY CORPORATION
By: /s/ Xxxxxx X. Xxxxx
-------------------------------------
Name: Xxxxxx X. Xxxxx
Title: V.P., CFO
- 35 -
EXHIBIT A
1
ESCROW AGREEMENT
----------------
ESCROW AGREEMENT (this "Agreement"), dated as of the 30th day of October,
1998, by and among (i) Memry Holdings, S.A., a Belgian corporation (the
"Buyer"), (ii) the shareholders (each individually a "Seller" and collectively
the "Sellers") of Advanced Materials and Technologies, N.V., a Belgian
corporation (the "Company"), and (iii) KBC Bank N.V., a Belgian corporation, as
escrow agent hereunder (the "Escrow Agent").
W I T N E S S E T H
- - - - - - - - - -
WHEREAS, the Sellers and the Buyer are parties to a Stock Purchase Agreement,
dated as of the date hereof (the "Purchase Agreement"), pursuant to which the
Sellers are selling to the Buyer, and the Buyer is purchasing from the Sellers,
the shares (as defined in the Purchase Agreement); and
WHEREAS, the "Closing" of the transactions contemplated by the Purchase
Agreement is occurring simultaneously with the execution and delivery hereof;
and
WHEREAS, the parties hereto wish to enter into this Agreement on the terms and
conditions set forth herein in connection with such Closing, and the Parties are
consummating the transactions contemplated by the Purchase Agreement in
connection with the simultaneous entering into of this Agreement (and would not
consummate such transactions but for this Agreement);
NOW THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt and adequacy of which is acknowledged by
each of the parties hereto, the parties hereto hereby agree as follows:
1. Definitions. Each capitalized term used herein and not specifically
-----------
defined herein shall have the meaning given to such term in the Purchase
Agreement.
2. Escrow Agent's Appointment and Duties. The Buyer and the Sellers hereby
-------------------------------------
appoint the Escrow Agent as escrow agent hereunder, and the Escrow Agent hereby
accepts such appointment. The Escrow Agent's duties hereunder are limited
solely to the holding of the Escrowed Property (as hereinafter defined) and the
payment and delivery of the same as provided herein, the giving of notices to
the Buyer and the Sellers as provided herein and such other duties as are
specifically set forth herein. No duties or obligations not expressly set forth
herein shall be implied to the Escrow Agent.
3. Escrowed Property.
-----------------
(a) Simultaneously with the execution and delivery hereof, the Buyer has
deposited in escrow with the Escrow Agent, share certificates, in the names of
each of the Sellers representing 168,750 shares, in the aggregate, of Parent
Common Stock (the "Escrowed Shares"). The 168,750 shares have been divided
among the Sellers in accordance with each Seller's "Percentage of Interest" as
set forth on Schedule A to the Purchase Agreement. The Escrow Agent hereby
acknowledges receipt of the Escrowed Shares.
(b) The Escrow Agent shall maintain custody of the Escrowed Shares, as well
as the Stock Powers (as defined below) and any other securities of any kind paid
as a dividend or distribution (whether
regular, special or liquidating) upon the Escrowed Shares or any such other
securities (collectively the "Subsequently Escrowed Securities"), in a manner
consistent with the manner in which a reasonably prudent institution would
maintain custody of securities owned by it. The Escrow Agent shall maintain
custody of any cash paid upon the Escrowed Shares or any Subsequently Escrowed
Securities, whether as a dividend or distribution (regular, special, or
liquidating), and any interest earned thereon (collectively "Escrowed Funds") in
an interest-bearing money market account.
(c) Simultaneously with the execution and delivery hereof, each Seller has
deposited with the Escrow Agent a stock power, duly executed in blank, covering
the Escrowed Shares in the name of such Seller (collectively the "Stock
Powers"). The Escrow Agent hereby acknowledges receipt of the Stock Powers.
(d) For purposes of this Agreement, the term "Escrowed Property" shall
refer to the Escrowed Shares, any Subsequently Escrowed Securities, any Escrowed
Funds and the Stock Powers.
4. Settlement of Escrowed Property.
-------------------------------
a. Settlements by Escrow Agent. The Escrow Agent shall retain possession
---------------------------
of the Escrowed Property except as follows: (i) upon the appointment of a
successor escrow agent pursuant to Section 6.b. below, the Escrow Agent shall
promptly disburse all remaining Escrowed Property to such successor escrow
agent; (ii) upon its receipt at any time of a Certificate (as defined in Section
4.b. below) executed by the Buyer and the Sellers instructing it as to how to
disburse all or any portion of the Escrowed Property then remaining, the Escrow
Agent shall promptly disburse the specified Escrowed Property in accordance with
said Certificate; (iii) upon receipt of a Certificate signed solely by the Buyer
instructing the Escrow Agent to disburse all or any portion of the Escrowed
Property to the Sellers, or a Certificate signed solely by the Sellers
instructing the Escrow Agent to disburse all or any portion of the Escrowed
Property to the Buyer, the Escrow Agent shall promptly so disburse the specified
Escrowed Property in accordance with said Certificate; (iv) if, by 5:00 p.m.
local time in Brussels, Belgium, on the first Business Day following the first
anniversary of the date hereof, the Escrow Agent has not at any time during the
term hereof received a Notice from any party hereto, the Escrow Agent shall
promptly disburse all of the Escrowed Property to the Sellers; and (v) upon
receipt of a final order of an arbitrator pursuant to Section 7 below,
instructing it to disburse all or any portion of the Escrowed Property, the
Escrow Agent shall promptly so disburse the specified property in accordance
with said order. In determining whether to disburse the Escrowed Property from
time to time in accordance with the above-stated provisions of clauses (ii),
(iii) or (iv) of this Section 4.a, the Escrow Agent shall rely exclusively upon
the written notice received by it hereunder (i.e., a Certificate) or the fact
that a certain written notice has not been received by it, as the case may be,
notwithstanding either (i) any notice to the contrary which may be received by
the Escrow Agent from any other person or entity or (ii) any knowledge which the
Escrow Agent may have or may be deemed to have as to the correctness of the
content of any notice given to it hereunder (including the authenticity of any
signatures).
b. Procedures for Payments of Escrowed Property. Any notice (a "Notice")
--------------------------------------------
of the Buyer's or the Sellers' desire for all or any portion of the Escrowed
Property to be disbursed pursuant to this Section 4 shall be in writing. Each
such Notice shall be sent by the Sellers or the Buyer, as the case may be, to
the other, accompanied by a written certificate (a "Certificate") signed by the
party sending such Notice, and providing a space for the signature of the other
party, instructing the Escrow Agent to disburse all or a designated portion of
the Escrowed Property in the manner specified therein (which manner of
disbursement shall also be specified in the Notice). (Reference is made to
Section 6.a. below for provisions regarding the Escrow Agent's responsibility to
disburse Escrowed Property.) Copies of any such Notice, along with the attached
Certificate, shall simultaneously be sent to the Escrow Agent. A party
receiving a
Certificate shall respond to it within fifteen (15) business days of its receipt
thereof. Such response shall consist of either (i) signing the Certificate in
the space provided for such purpose and sending the Certificate to the Escrow
Agent, with a copy to the other party hereto, or (ii) returning the Certificate
to the party sending the Notice, unsigned, with an explanation of why such party
believes it is not required to sign such Certificate in accordance with the
remaining provisions of this Section 4. The Buyer or the Sellers, as the case
may be, shall sign or not sign a Certificate in accordance with the provisions
of subsections c., d., and e. of this Section 4. Notwithstanding the foregoing,
a Certificate made pursuant to Section 4.a.(iii) shall not provide a space for
the signature of the other party or require any response from the other party.
c. Adjustment Payment. If, upon the final determination of the
------------------
Adjustment Payment pursuant to Article II of the Purchase Agreement, the Sellers
are to make the Adjustment Payment to the Buyer and the Sellers do not make such
Adjustment Payment in full within fifteen days following the date of such
determination, then the Buyer may give the Sellers a Notice of its desire for an
amount of the Escrowed Property (determined pursuant to Section 4.f. below)
equal to the amount of the Adjustment Payment to be paid to the Buyer.
d. Payment to the Buyers Upon the Sellers' Breaches. If, at any time
------------------------------------------------
after the date hereof until 5:00 p.m. in New York, New York U.S.A. on the first
anniversary of the date hereof, (w) the Buyer asserts any claims against the
Sellers pursuant to any one or more provisions of the Purchase Agreement or in
connection with the consummation of the transactions contemplated thereby
("Claims"), (x) such Claims are thereafter resolved by agreement of the Buyer
and the Sellers or by the order of an arbitrator in accordance with the
provisions of Section 7 below (a Claim that has not been resolved as aforesaid
is hereinafter referred to as "Unresolved"), (y) such resolution requires the
payment of money by the Sellers to the Buyer, and (z) any Seller does not
immediately pay its proportion of the amount then due to the Buyer in accordance
with the Purchase Agreement, then the Buyer may, at its sole option, give each
such Seller a Notice of its desire for some specified portion or all of such
amount to be paid from the remaining Escrowed Property held on behalf of such
Seller to the Buyer. The parties hereto agree and acknowledge that the ability
of the Buyer to recover any damages for Claims from the Escrowed Property is in
addition to, and not in lieu of, the Buyer's remedies under the Purchase
Agreement, and that the Buyer, at its option, may refuse to send a Notice out
pursuant to this Section 4.d. and instead enforce its other rights, including a
right to bring a collection action against the appropriate Sellers.
e. Payments of Claims. If, as of the fifth Business Day immediately
------------------
after the first anniversary of the date hereof (i) there are no Claims which
have been asserted by the Buyer, have been resolved pursuant to Section 4.d.
hereof and which remain unpaid, (ii) there are no Unresolved Claims, and (iii)
the Escrowed Property has not been previously delivered to Sellers pursuant to
clause (iv) of Section 4.a. above, then the Sellers shall give Buyer a Notice of
their desire that to the remaining Escrowed Property be paid to the Sellers.
f. Valuation of Escrowed Property. In the event that the Escrow Agent at
------------------------------
any time or from time to time delivers any Escrowed Property to the Buyer, the
following rules of valuation and priority shall apply: (i) the Escrow Agent
shall first deliver to the Buyer any Escrowed Funds then held by the Escrow
Agent on behalf of the appropriate Seller; (ii) all payments of Escrowed Funds
shall be made in U.S. Dollars; (iii) if the Escrowed Funds paid over do not
satisfy the amount to be paid to Buyer pursuant to the Certificate or order of
the arbitrators, or if there are no Escrowed Funds within the Escrowed Property,
the Escrow Agent will deliver to Buyer first Escrowed Shares and only thereafter
any Subsequently Escrowed Property; (iv) Escrowed Shares delivered to Buyer
shall be valued at the average of the Daily Closing Price (as defined below),
for the twenty trading days immediately preceding the date of delivery; and (v)
Subsequently Escrowed Property shall be valued in good faith by the Escrow
Agent, if a public market therefor exists, and, if not, by agreement of Buyer
and Sellers (or if they are unable to agree, pursuant to
Section 7 below). As used in this (S)4.f. "Daily Closing Price" means (i) if the
Parent Shares are listed on a national securities exchange or quoted through the
NASDAQ National Market System, the reported Consolidated Trading closing price;
(ii) if the Parent Shares are quoted on the NASDAQ inter-dealer quotation
system, the reported closing price for such day on such system; or (iii) if the
Parent Shares are not listed on a national stock exchange or quoted on NASDAQ,
the closing price reported by the National Quotation Bureau, Inc. for such day.
5. Provisions Regarding Dividend and Voting Rights of Escrowed Shares.
------------------------------------------------------------------
a. Voting Rights. Any Escrowed Shares and/or Subsequently Escrowed
-------------
Securities with voting rights held by the Escrow Agent from time to time shall
be voted from time to time by the Seller in whose name such securities are
issued; provided, however, that nothing in this (S)5.a. shall in any way limit
or restrict the voting obligations of the Sellers as set forth in the Standstill
Agreement.
b. Dividend and Distribution Rights. Any and all dividends or
--------------------------------
distributions made on the Escrowed Shares and/or Subsequently Escrowed
Securities from time to time, whether regular, special or liquidating, shall be
paid and/or made in the name of the appropriate Seller in care of the Escrow
Agent, and shall be retained by the Escrow Agent as Escrowed Property pursuant
to the terms hereof.
6. Other Provisions Regarding the Escrow Agent.
-------------------------------------------
a. Indemnification of Escrow Agent. The Buyer and the Sellers
-------------------------------
acknowledge that the Escrow Agent is acting solely as an escrow agent at their
request and for their convenience and that the Escrow Agent shall not be liable
to any such party for any act or omission on its part unless taken or suffered
in willful disregard of this Agreement or involving gross negligence on the part
of the Escrow Agent. The Buyer and the Sellers jointly and severally agree to
defend, indemnify and hold the Escrow Agent harmless from and against all costs,
claims and expenses (including reasonable attorneys' fees) incurred in
connection with the performance of the Escrow Agent's duties hereunder, except
with respect to actions or omissions taken or suffered by the Escrow Agent in
disregard of this Agreement or gross negligence on the part of the Escrow Agent.
The Escrow Agent may act or refrain from acting in respect of any matter
referred to herein in full reliance upon and with the advice of counsel which
may be selected by it and shall be fully protected in so acting or refraining
from acting upon the advice of such counsel. Further, if a Certificate
delivered to the Escrow Agent is not clear as to the Escrowed Property covered
therein, the Escrow Agent shall be entitled (but under no obligation) to seek
clarification of the same before being required to distribute Escrowed Property
pursuant to paragraph 4 above. The provisions of this Section 6.a. shall
survive the termination of this Agreement. The Sellers and Buyer accept the
application of the General Regulations Governing Banking Operations applied by
the Escrow Agent. The Escrow Agent will perform its obligations insofar as
there are no legal provisions or judgments which prevent it from doing so. The
Escrow Agent will pay interest on Escrowed Funds after deduction of the Belgian
withholding tax and other bank charges.
b. Replacement of Escrow Agent.
---------------------------
(i) Resignation of Escrow Agent. The Escrow Agent may resign, at any
---------------------------
time, and be discharged of the obligations created by this Agreement by
executing and delivering to the Buyer and the Sellers, notice of its resignation
as Escrow Agent hereunder and specifying the date on which such resignation is
intended to take effect (which date must be at least one month subsequent to the
date on which such notice is given). Upon receiving such notice of resignation,
the Buyer and the Sellers shall endeavor to agree upon a successor Escrow Agent
to be appointed by written instrument, in triplicate, executed by the Buyer and
the Sellers, one copy of which instrument shall be delivered to the successor
Escrow Agent (with the additional copies being retained by the Buyer and the
Sellers, respectively). If no agreement has been reached as aforesaid and no
successor Escrow Agent shall have been so appointed and have accepted such
appointment within twenty (20) days after such notice of resignation, the Buyer
shall appoint a successor Escrow Agent prior to the date on which the
resignation of the prior Escrow Agent is to take effect. The resignation of the
Escrow Agent shall become effective only upon the acceptance of appointment by
the successor Escrow Agent.
(ii) Discharge of Escrow Agent. At any time, the Buyer and the
-------------------------
Sellers may discharge the Escrow Agent by jointly executing and delivering to
the Escrow Agent notice of its discharge as escrow agent hereunder and
specifying (i) the date when such discharge shall take effect and (ii) who the
successor Escrow Agent is, in which event, the Escrow Agent will be discharged
of its duties as of such date.
(iii) Successor Escrow Agent. If the Escrow Agent shall be
----------------------
dissolved, or if its property or affairs shall be taken under the control of any
court or administrative body or agency because of insolvency or bankruptcy or
for any other reason, a vacancy shall forthwith exist in the office of Escrow
Agent, and within a period of thirty (30) days thereafter, a successor shall be
appointed by the mutual agreement of the Buyer and the Sellers. If no agreement
has been reached as aforesaid and no successor Escrow Agent shall have been so
appointed and have accepted such appointment within such thirty (30) day period,
the Buyer shall appoint a successor Escrow Agent.
(iv) Instruments in Writing. Appointments made by the Buyer and/or
----------------------
the Sellers under this Section 6.b. shall be made by an instrument or
instruments in writing. Copies of each instrument shall be delivered by the
Buyer and the Sellers to the predecessor Escrow Agent and to the successor
Escrow Agent so appointed.
(v) Successor Escrow Agents. Any successor Escrow Agent appointed
-----------------------
hereunder shall execute, acknowledge and deliver to the Buyer and the Sellers an
instrument accepting such appointment hereunder, and thereupon such successor
Escrow Agent, without any further act, deed or conveyance, shall become duly
vested with all of the property, rights, powers, trusts, duties and obligations
of its predecessor hereunder, with the same effect as if originally named Escrow
Agent. Notwithstanding any other provision of this Agreement, upon request of
such successor Escrow Agent, the Escrow Agent ceasing to act, the Buyer and the
Sellers shall execute and deliver an instrument transferring to such successor
Escrow Agent all the property, rights, powers and trusts created hereby of the
Escrow Agent so ceasing to act hereunder, and the Escrow Agent so ceasing to act
shall immediately transfer to the successor Escrow Agent all of the Escrowed
Property then held by it hereunder.
(vi) Escrow Agent's Fees. Buyer, on the one hand, and Sellers, on the
-------------------
other, shall each be responsible for one half of the Escrow Agent's fees
hereunder (which fees shall be BEF 50,000 per annum (or portion thereof).
7. Governing law; Jurisdiction; Modification or Waiver. This Agreement shall
---------------------------------------------------
be governed and
construed in accordance with the laws of the Kingdom of Belgium. All disputes
arising under this Agreement shall be resolved by arbitration in accordance with
the terms and provisions set forth in (S)11.07 of the Purchase Agreement, which
terms are incorporated herein by this reference. Except as set forth in the next
sentence, the terms and provisions of this Agreement may only be modified or
waived by a writing executed and delivered by all parties hereto.
Notwithstanding anything to the contrary contained herein, each of the Sellers
agrees that any decision to send a Notice, to sign or not sign a Certificate,
and/or to take or refrain from taking any other action with respect to this
Agreement and/or the Escrowed Property may be made on behalf of all of the
Sellers by all of Xxxxxxxx Xxx Xxxxxxxxxx, Swiss Metalworks Holding (UMSH) and
G.I.M.V., acting unanimously, and each other Seller agrees to act and/or refrain
from acting, and to execute and deliver any necessary documents, if directed to
do so in writing by each of such three named Sellers.
8. Notices. All notices, demands, approvals, consents, elections or other
-------
communications permitted or required to be given hereunder (the "Notices") shall
be in writing and shall be deemed given (i) 7 days after being posted certified
mail, return receipt requested, postage prepaid in the proper amount, or (ii)
when delivered, if sent by hand delivery or by overnight courier service.
Notices shall be addressed as follows:
(i) if to the Buyer, to:
AMT Holdings, N.V.
c/o Memry Corporation
00 Xxxxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxxxxxx 00000
Telecopier: (000) 000-0000
Attention: Xx. Xxxxx X. Xxxxx
with a copy (which shall not constitute notice) to:
Xxxx Xxxxx & Xxxxxxx LLP
Xxx Xxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Telecopier: (000) 000-0000
Attention: Xxxxx X. Xxxxx, Esq.
(ii) if to the Sellers, to each of them at the addresses listed
on Exhibit A, with, in any case, a copy (which shall not constitute notice) to:
Xxxxx & XxXxxxxx
Xxxxxx Xxxxxx 000
0000 Xxxxxxxx, Xxxxxxx
Telecopier: 011-32-2-639-3699
Attention: Koen Xxxxxxxxxxx, Esq.
(iii) if to the Escrow Agent, to:
KBC Bank X.X.
Xxxxxxxxx 0
0000 Xxxxxxxx, Xxxxxxx
with a copy (which shall not constitute notice) to:
KBC Bank X.X.
Xxxxxxx Xxxxx
0000 - Xxxxxxxxx 0
0000 Xxxxxxx, Xxxxxxx
Attention: Xxxxxx-Xxx Van Os
Xxxxxx Cromphout
Xx Xxxxx
or to such address as any party may from time to time specify in writing to the
others. If any such Notice is given by hand delivery, the person to whom such
Notice is given shall, if requested, acknowledge receipt of such Notice and the
date of such receipt on a copy of such notice.
9. Binding Effect. Subject to Section 6, this Agreement shall be binding
--------------
upon and shall inure to the benefit of the parties hereto and their respective
heirs executors, administrators, legal representatives, successors and assigns.
10. Counterparts. This Agreement may be executed in one or more
------------
counterparts, each of which shall be considered an original but all of which
together shall be deemed to constitute one and the same document.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
Buyer: MEMRY HOLDINGS, S.A.
By:
-----------------------------------------
Name:
Title:
Sellers: --------------------------------------------
Xxxxxxxx Xxx Xxxxxxxxxx
--------------------------------------------
Xxxxxx Xxxxxxx
--------------------------------------------
Xxx Xxxxxx
USINES METALLURGIQUE SUISSE HOLDING S.A.
By:
-----------------------------------------
Name:
Title:
G.I.M.V.
By:
-----------------------------------------
Name:
Title:
A.B.C. N.V.
By:
-----------------------------------------
Name:
Title:
ESCROW AGENT: KBC Bank N.V., as Escrow Agent
By:
------------------------------------------
Name: Jan Seurs
Title: Kantoor Direteur, KBC Schulen
and
By:
------------------------------------------
Name: Xx Xxxxx
Title: Kantoor Directeur, KBC Herk-de-Stad11
EXHIBIT B
October 30, 1998
Dear Sirs,
RE: XX. XXX XXXXXXXXXX, XXX. XXXXXXX, ADVANCED BUSINESS CONSULTING N.V., MR.
--
XXX XXXXXX, USINES METALLURGIQUES SUISSES HOLDING S.A. AND GIMV N.V.
1. Framework of the opinion
------------------------
We have been asked to give an opinion, as counsel to Xx. Xxx Xxxxxxxxxx,
Xxx. Xxxxxxx, Advanced Business Consulting N.V., Xx. Xxx Xxxxxx, Usines
Metallurgiques Suisses Holding S.A. and GIMV N.V., the sellers (the
"Sellers") of shares in Advanced Materials and Technologies N.V. (the
"Company"), in connection with the sale and transfer of Shares of the
Company to Memry Holdings S.A., pursuant to a stock purchase agreement
dated October 30, 1998 (the "Agreement"), it being understood that we have
not represented the Sellers with respect to the Company, nor the Company at
any other occasion prior to this transaction.
Capitalized terms used herein and not defined herein shall have the meaning
ascribed to them in the Agreement.
This opinion is being given to you pursuant to Section 3.02 (c) of the
Agreement.
2. Documents
---------
For the purposes of giving this opinion, we have examined the following
documents:
2.1 a copy of the constitutional documents of the Company comprising its
coordinated by-laws as of December 28, 1995 (the "By-laws");
2.2 copies of those minutes of the shareholders' meetings (and of the
meetings of the board of directors, if any) deciding upon
modifications of the capital of the Company, the issuance of
convertible bonds and warrants, of which excerpts have been published
in the Official Gazette;
2.3 a copy of the share register book of the Company;
2.4 a copy of the co-ordinated by-laws of GIMV N.V., a copy of the
delegation of powers dated July 18, 1995 and published in the Belgian
Official Gazette on August 23, 1995 and a copy of the delegation of
powers dated October 20, 1998, not yet published;
2.5 a copy of the company file with the Commercial Registry of Hasselt,
Belgium.
2.6 an uncertified copy of the final draft of the Agreement;
2.7 an agreement by and between the Sellers, dated October 30, 1998,
signed by the Sellers, containing
Xx. Xxxxxxxx Xxx Xxxxxxxxxx'x agreement to the waiver of the warrants
issued to him by the Company on December 28, 1995, and containing the
Sellers' agreement to waive their preemptive rights pursuant to the
transfer of Shares to the Buyer;
2.8 a copy of a draft notarial deed, drafted by notary public, Xx. Xxxx-
Xxxxxxxx Xxxxx, and recording the minutes of the extra-ordinary
meeting of shareholders of the Company to be held at Closing, with
regard to the confirmation by Xx. Xxx Xxxxxxxxxx of the waiver and
cancellation of warrants issued by the Company ("Notarial Deed").
2.9 an oral confirmation by Mr. Braeckmans, Legal Counsel at GIMV, that
the management committee of GIMV has approved the transaction in
principle, but that no minutes of this decision have been made so far.
Except as stated above and as we have deemed necessary in connection with this
legal opinion, we have not examined any contracts, instruments or other
documents entered into by or affecting the Company, or any of its corporate
records and have not made any further inquiry concerning the Company.
3. Assumptions
-----------
For the purpose of this opinion letter, we have assumed (without making any
investigation thereof):
3.1 the genuineness of all signatures on the documents and instruments
examined by us;
3.2 the completeness and conformity to originals of all documents
purporting to be copies of originals and the authenticity of all
documents submitted to us as originals (more in particular, we have
assumed that no pages in the shareholders register, copies of which
have been handed over to us, have been filled out other than the pages
of which we have received copies and that all shares issued by the
Company concerned have been registered in its share register);
3.3 that there have been no amendments to the By-laws of the Company in
the form examined by us;
3.4 that the resolutions of the shareholders' meeting and the board of
directors of the Company as examined by us were duly passed at a
properly convened and quorate meeting of genuine shareholders,
respectively duly appointed directors of the Company and have not been
amended or rescinded and are in full force and effect and that no
director of the Company might have a personal interest in the
transactions to which the decisions rendered relate other than as
stated therein, if any;
3.5 that there are no provisions of the laws of any jurisdiction outside
Belgium which would have any implication on the opinions hereinafter
expressed;
3.6 that we are authorized to assume that the Company has not passed a
voluntary dissolution resolution, that no petition has been presented
or order made by a court for the bankruptcy, winding-up, dissolution,
"concordatjudiciaire" or "sursis de paiement" of the Company and that
no trustee, liquidator or similar officer has been appointed in
relation to the Company or any of the respective assets or revenues;
3.7 that with respect to title to registered shares, we are authorized to
rely on copies of the appropriate recording in the shareholders'
register of the Company concerned and to assume (i) that there are no
agreements or arrangements and that there have not been any actions or
other matters which may cancel, amend, replace, supersede or otherwise
affect the information contained in such
shareholders' register, and (ii) that the persons signing on behalf of
the shareholders were duly authorized to sign on behalf of such
shareholders;
3.8 that there are no agreements or arrangements and that there have not
been any actions or other matters which cancel, amend, replace,
supersede or otherwise affect the information contained in the
documents reviewed by us;
3.9 that none of the parties to the documents that we have reviewed, have
been seeking to achieve any purpose not apparent from the documents
reviewed by us which might render these documents illegal or void, and
that there is no provision in any other document which will affect any
statement made therein;
3.10 that the Agreement submitted in final draft form to us, was executed
in the form submitted to us and that there have been no amendments or
changes to the Agreement;
3.11 the legal capacity of the individuals signing such documents; and
3.12 the genuineness of the statement referred to under 2.9.
We have made such examination of the laws of Belgium as currently applied by
Belgian courts as in our judgment is necessary for the purpose of this opinion.
We do not, however, purport to be qualified to pass upon and express no opinion
herein as to the laws of any jurisdiction other than those of Belgium.
There is no intention on our part to amend or update this opinion in the event
of any changes after the date thereof in any Belgian laws or regulations or case
law relevant to this opinion.
This opinion is governed by and shall be construed in accordance with Belgian
law as in effect on the date at which it is given, and any matter relating to it
shall be subject to the exclusive jurisdiction of the Belgian courts.
4. Opinions
--------
Based upon and subject to the assumptions and qualifications in this opinion and
having regard to such legal considerations as we have deemed relevant, we are of
the opinion that, as per October 30, 1998, the date on which we completed our
investigation:
4.1 the Company is a corporation duly incorporated under the laws of the
Kingdom of Belgium;
4.2 as of the date hereof, the capital stock of the Company amounts to BF
82,400,000, represented by 3,752 shares, under registered form, without par
value, of which 910 shares "A", 1,634 shares "B" and 1,208 shares "C";
4.3 all of the Shares are validly issued and fully paid-up and represent
the entire issued share capital of the Company. Subject to the valid
passing of the Notarial Deed, the Company currently does not have, to our
knowledge, any other shares, convertible bonds, subscription rights (except
these provided by law) or similar securities. The transfer of the Shares to
the Buyer does not and will not constitute an infringement of any provision
of the By-laws of
the Company, except for the preemptive right set forth in article 13 of the
Bylaws, which the Sellers have declared to waive in the agreement amongst
the Sellers, referred to in 2.7.
4.4 pursuant to the copy of the shareholders' register of the Company,
each Seller is the owner of the Shares set forth opposite such Seller's
name on Schedule A to the Agreement and the shareholders' register does not
mention any Lien.
4.5 the execution of the Agreement, and the performance by the GIMV N.V.
of its obligations thereunder and the transactions contemplated thereby,
are within the corporate power and authority of GIMV N.V. and have been
authorized by all legally required corporate action or proceedings on
behalf of GIMV, assuming that the decision referred to under 2.9 will be
duly recorded in the minutes.
5. Qualifications
--------------
The opinions expressed herein are subject to the following qualifications :
5.1 on the basis of the shareholders' register and the documents examined
by us, it is not unambiguously certain whether with regard to the
respective transfers of Shares of the Company prior to the date of this
opinion, the preemptive rights of the shareholders have at all time been
complied with or have at all time been duly waived by the shareholders
concerned;
5.2 on December 11, 1992, the extra-ordinary meeting of shareholders held
before notary public, Xx. Xxxxxxxx Cols, unanimously decided to annul 390
Shares held by Xx. Xxx Xxxxxxxxxx as settlement for the alleged non-
compliance with the preemptive rights of the other shareholders at the
occasion of the acquisition by Xx. Xxx Xxxxxxxxxx from Xx. Xx Xxxxxxxx of
195 Shares and from Xx. Xxxx Xxxxxxxx of 195 Shares. While it cannot be
excluded that a cancellation of shares as settlement for a failure to
comply with preemptive rights and/or resulting from or in a capital
decrease, of which Xx. Xxx Xxxxxxxxxx as the only shareholder suffers the
consequences, may be voidable, it is our opinion that the risks resulting
therefrom for the Buyer are extremely remote, because of inter alia the
following reasons:
(i) all of the then shareholders of the Company are party to the
Agreement which contains representations in this respect;
(ii) under the Agreement, Xx. Xxx Xxxxxxxxxx is also transferring any of
his rights which may not have been validly cancelled;
(iii) any actions in order to nullify the decision of the shareholders'
meeting held on December 11, 1992, are barred pursuant to article
194bis of the Belgian Company Law Act.
5.3 a Belgian Court may not award by way of costs all of the expenditure
incurred by a successful litigant in proceedings brought before the Court;
5.4 the granting of certain remedies, such as in unction orders or specific
performance may be at the discretion of the Belgian courts, and such
remedies are not necessarily granted;
5.5 any enforcement may be limited and affected by (i) Belgian bankruptcy,
insolvency, reorganization, liquidation, moratorium or other similar laws
affecting creditors' rights generally, and (ii) the application of general
principles of abuse of rights and good faith as applicable under the laws
of the Kingdom of Belgium.
5.6 a judgment rendered or enforced by a Belgian court is subject to a
registration tax of 3 % (on any sum of money exceeding BEF 500.000). Both
the debtor(s) and the creditor(s) are responsible for the payment of such
registration duty, it being understood that the maximum liability of any
creditor is limited to 50 % of the sums received by such creditor under
such judgment. The Belgian tax administration has a priority right on any
amounts payable pursuant to the judgment as security for the effective
payment of the registration duty.
Introduction of legal proceedings in Belgium and enforcement of a
judgment would also give rise to certain nominal filing charges and
notification fees. Pursuant to Article 851 of the Belgian Code of Judicial
Procedure a foreign plaintiff can be required, at the request of a Belgian
defendant, to post a bond ( "caution judicaturn solvi") to secure payment
of any expenses or damages for which the foreign plaintiff might be liable,
unless waived in an applicable treaty.
5.7 whenever our opinion with respect to the existence or absence of facts
is indicated to be based on our knowledge or awareness, we are referring
solely to the actual knowledge of the particular Xxxxx & XxXxxxxx
(Brussels) attorneys who have represented the Sellers in connection with
certain matters relating to the Agreement. We have not undertaken any
independent investigation to determine the existence or absence of such
facts and no inference as to our knowledge concerning any facts should be
drawn from the fact that such representation has been undertaken by us.
This opinion is given for the sole benefit of Memry Holdings S.A. and Memry
Corporation in connection with the transactions contemplated by the Agreement.
This opinion is not to be disclosed to any other person (other than your legal
advisors, which are bound by confidentiality) nor is it to be relied upon by any
other person or for any other purpose or quoted or referred to in any public
document without our prior written consent.
Yours faithfully,
Xxxxx Xxxx Koen Xxxxxxxxxxx
EXHIBIT C
RELEASE
This Release is being executed and delivered simultaneously with, and as part
of the transactions contemplated by, the Stock Purchase Agreement dated October
30, 1998 (the "Agreement"), among Memry Holdings, S.A., a Belgian corporation
("Buyer"), and the shareholders of Advanced Materials and Technologies, N.V.
(each individually a "Seller").
The undersigned acknowledges that Buyer is expressly relying on this Release
in consummating its purchase of the Shares pursuant to the Agreement, and would
not purchase the Shares but for this Release.
The undersigned [Seller], for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged and intending to be legally bound,
in order to induce Buyer to purchase the Shares pursuant to the terms of the
Agreement, hereby agrees as follows:
The undersigned [Seller], on behalf of himself and each of his Affiliates (if
any), hereby releases and forever discharges Advanced Materials and
Technologies, N.V., a Belgian corporation (referred to herein as the "Company"
or the "Releasee") from any and all claims, demands, judgments, proceedings,
causes of action, orders, obligations, contracts, agreements, liens, accounts,
costs and expenses (including attorney's fees), debts and liabilities
whatsoever, whether known or unknown, suspected or unsuspected, matured or
unmatured, both at law and in equity, which the undersigned [Seller] or any of
its Affiliates now has, have ever had or may hereafter have against the Company
arising contemporaneously with or prior to the Closing Date or on account of or
arising out of any matter, cause, event or omission occurring contemporaneously
with or prior to the Closing Date, including, but not limited to, any rights to
indemnification or reimbursement from the Company, whether pursuant to its
articles of association, resolution, contract or otherwise and whether or not
relating to claims pending on, or asserted after, the Closing Date; provided,
however, that nothing contained herein shall operate to release (i) any
obligations of Buyer or the Company arising under the Agreement (or any other
agreement entered into at the Closing thereunder), or (ii) any Liability of the
Company set forth on Annex I hereto.
The undersigned [Seller] hereby irrevocably covenants to refrain from,
directly or indirectly, asserting any claim or demand, or commencing,
instituting or causing to be commenced, any proceeding of any kind against
Releasee, based upon any matter purported to be released hereby.
Without in any way limiting any of the rights and remedies otherwise available
to any Releasee, the undersigned [Seller] shall indemnify and hold harmless
Releasee from and against all actions, suits, proceedings, hearings,
investigations, charges, complaints, claims, demands, injunctions, judgments,
orders, decrees, rulings, damages, dues, penalties, fines, costs, amounts paid
in settlement, Liabilities, obligations, taxes, Liens, losses, lost value,
expenses and fees arising directly or indirectly from or in connection with (i)
the assertion by or on behalf of the undersigned [Seller] or any of its
Affiliates of any claim or other matter purported to be released pursuant to
this Release and (ii) the assertion by any third party of any claim or demand
against any Releasee which claim or demand arises directly or indirectly from,
or in connection with, any assertion by or on behalf of the undersigned [Seller]
or any of its Affiliates against any third party of any claims or other matters
purported to be released pursuant to this Release.
If any provision of this Release is held invalid or unenforceable by any court
of competent jurisdiction, the other provisions of this Release will remain in
full force and effect. Any provision of this Release held invalid or
unenforceable only in part or degree will remain in full force and effect to the
extent not held invalid or unenforceable.
This Release may not be changed except in a writing signed by the person(s)
against whose interest such change shall operate. This Release shall be
governed by and construed under the laws of the Kingdom of Belgium.
All words used in this Release will be construed to be of such gender or
number as the circumstances require. Capitalized terms used herein but not
defined herein shall have the meaning attributed thereto in the Agreement.
IN WITNESS WHEREOF, the undersigned has executed and delivered this Release as
of this 30th day of October, 1998.
--------------------------------------
[Name]
Annex I
-------
None
EXHIBIT D
MANAGEMENT CONSULTING AGREEMENT
1. MEMRY EUROPE N.V., a limited liability company with registered office at
3540 Xxxx-xx-Xxxx, Xxxxxxxxxx 0000, and registered with the Trade
Registry of Hasselt under number 73.218;
here represented by Messrs. Xxxxx Xxxxx and Xxxxxx Xxxxx, directors of
the company;
hereinafter referred to as the "Company";
2. ADVANCED BUSINESS CONSULTING N.V., a limited liability company with
registered office at 3210 Lubbeek, Xxxxxxxxxxx 0, and registered with the
Trade Registry of Leuven under number 099031;
here represented by Xx. Xxxxxxxx Xxx Xxxxxxxxxx and Xxx. Xxxxxx Xxxxxxx,
directors of the company;
hereinafter referred to as "ABC" or the "Consultant";
WITNESSETH:
1. The Company has as its corporate purpose (i) the application and
development of products, based on advanced shape memory materials and/or
technologies, including the design, the procurement of services and goods
and (ii) the trade, as well as the export and/or production of such
materials, applications and know-how, both in Belgium and abroad.
2. The Consultant is specialized in advising enterprises active in the
business of advanced materials and technologies, in particular shape
memory alloys, and the management of such enterprises in general.
NOW, THEREFORE, THE PARTIES HERETO AGREE AS FOLLOWS:
Article 1 - Services
--------------------
1.1. ABC shall assist the management committee, director general and daily
manager of the Company, as the need may be, in the daily management of
the Company and shall advise on technical matters related to the
development, production and sale of shape memory alloys, which form part
of the specific know-how of the Company (the "Services").
1.2. ABC shall put all its experience in this area at the disposal of the
Company to carry out the Services under this Agreement to the best of its
ability, i.e., in accordance with the state of the art and within
reasonable terms. The provision of Services can take an oral, as well as
a written, form and can take place at the locations designated from time
to time by the board of directors of the Company.
1.3. ABC is not an agent or employee of the Company. ABC shall perform the
Services under the Agreement as an independent contractor. ABC shall
comply with all applicable laws, including the laws, rules and
regulations related to the payment of all taxes and social security
contributions.
1.4. ABC shall appoint a competent and sufficiently qualified person in
accordance with the standards set forth in Annex 1 to the Agreement (the
"Qualified Person") for the performance of the Services.
Article 2 - Term
----------------
2.1. The Agreement is entered into for a definite term of 2 years starting on
November 1, 1998 and expiring on October 31, 2000.
2.2. Absent a written termination notice given by registered mail by one of
the parties not less than 6 months prior to the expiration of the initial
term of the Agreement, the Agreement shall be automatically renewed for
successive periods of 1 year.
2.3. If the Qualified Person initially appointed by ABC to perform the
Services under the Agreement is unable or incapacitated for whatsoever
reason to perform the Services as set forth in this Agreement for an
uninterrupted period of at least 2 months, the Company would, unless ABC
is able to substitute a satisfactory, competent and sufficiently
Qualified Person, be entitled to terminate this Agreement with immediate
effect without formal notice, by simple notification given by registered
mail.
Article 3 - Confidentiality
---------------------------
3.1. ABC shall treat and shall cause its affiliates, shareholders, directors,
employees and agents to treat at all times as strictly confidential, any
and all information, plans, patents, designs, processes, manufacturing
methods, ideas and the like, which it receives or which may be told,
shown or may be acquired from the Company or any affiliate of the Company
in any way in connection with or as a result of the execution or
implementation of the Agreement, to the extent that it is confidential
information and is not information already in the public domain.
3.2. In case of violation by ABC or any of its affiliates, shareholders,
directors, employees or agents, of the confidentiality obligation set
forth in Section 3.1 of the Agreement, the Company shall be entitled to
an indemnity of BEF 690,000 per violation not preventing the Company to
recover a higher damage if it can prove it.
3.3. In the event of repetitive breaches of the confidentiality obligation set
forth in Section 3.1 of the Agreement, the Company can terminate, at any
time, without notice nor indemnity the Agreement.
Article 4 - Management Consulting Fee
-------------------------------------
4.1. The Company shall pay ABC a fixed management consulting fee of BEF
4,784,000 per year
or BEF 398,666.66 per month, excluding VAT, for the Services rendered
under the Agreement.
4.2. The management consulting fee shall be due each quarter and in advance
and shall be paid by the Company in equal installments upon submission of
an invoice of ABC.
4.3. The management consulting fee shall be paid to ABC either by wire
transfer into the bank account number 000-0000000-00 or by bank check.
4.4. The management consulting fee may be annually reviewed and increased (but
not decreased), in function of the improvement of the results and the
expansion of the Company.
Article 5 - Intellectual Property
---------------------------------
5.1. ABC shall disclose and shall cause its affiliates, shareholders,
directors, employees and agents to disclose promptly to the Company all
ideas, inventions, discoveries, processes, designs, methods, substances,
articles, computer programs, and improvements, whether or not patentable
or copyrightable (all of the foregoing being hereinafter collectively
called "Intellectual Property"), which they conceive, invent, discover,
create or develop, alone or with others, during or at the occasion of the
performance of the present Agreement or during a period of 6 months
thereafter that in any way relate to the business conducted by the
Company on the date hereof or, otherwise, relate to the corporate purpose
of the Company as described in the recitals to this Agreement.
5.2. ABC shall assign and shall cause its affiliates, shareholders, directors,
employees and agents to assign for free to the Company all of their
rights, titles, and interests in and to all Intellectual Property or any
improvements thereto which they conceive, invent, discover, create or
develop, alone or with others, during or at the occasion of the
performance of the present Agreement or during a period of 6 months
thereafter, to the extent that any such Intellectual Property or
improvements in any way relate to the business conducted by the Company
on the date hereof or, otherwise, relate to the corporate purpose of the
Company as described in the recitals to this Agreement.
Article 6 - Miscellaneous
-------------------------
6.1. In the event that any provision of this Agreement or any part thereof
should be null and void, it shall not affect the validity of the other
provisions.
6.2. This Agreement constitutes the entire agreement and understanding between
parties hereto and it supersedes all prior agreements and understandings
among the parties hereto with respect to the subject matter hereof.
6.3. The failure of a party on one or more occasions to exercise or enforce
any right under this agreement shall not be deemed to be a waiver thereof
in the past or at any time thereafter.
6.4. Notwithstanding anything to the contrary set forth herein or in that
certain Stock Purchase Agreement, dated as of October 30, 1998, between
the Company, the stockholders of the
Company and Memry Holdings S.A., ABC and the Qualified Person acting on
behalf of ABC shall be permitted to advise Memory Metals Holland B.V.
with respect to its development and commercialization of its proprietary
medical stent system, provided, however, that ABC shall be prohibited
from transferring or disclosing any of the Company's Intellectual
Property to Memory Metals Holland B.V.
Article 7 - Applicable Law and Jurisdiction
-------------------------------------------
7.1. This Agreement is governed by Belgian law.
7.2. Any dispute arising in connection with the interpretation or the
performance of the Agreement shall be exclusively subject to CEPINA
arbitration.
Done in Brussels, on October 30, 1998, in 2 originals, each party acknowledging
having received one original.
For the COMPANY:
------------------------------- ---------------------------------
Xxxxx Xxxxx Xxxxxx Xxxxx
("read and approved") ("read and approved")
For ABC:
------------------------------- ---------------------------------
Xxxxxxxx Xxx Xxxxxxxxxx Xxxxxx Xxxxxxx
("read and approved") ("read and approved")
ANNEX 1
"QUALIFIED PERSON" REQUIREMENTS
I.Background Capabilities
(a) The individual(s) must possess a thorough understanding of the
engineering properties of shape memory alloys, as evidenced by at least
three (3) years experience in technical and/or management activities
concerning successful commercial use of these alloys.
(b) The individual(s) must possess managerial experience in the successful
conduct of the functions critical to a commercial enterprise,
specifically sales and marketing, manufacturing, financial planning and
control, and quality management systems.
(c) The individual(s) must have demonstrated leadership abilities, as
evidenced by either (i) successive growth in managerial scope through
internal promotion, or (ii) growth via entrepreneurship of a successful
commercial enterprise.
(d) The individual(s) must possess knowledge of Belgian industrial
practices, regulations, codes, labor standards, taxation regimes and
environmental laws and regulations.
(e) The individual(s) must be fluent in English, French and Flemish
languages in order to effectively fulfill the duties expected hereof.
II. General Requirements
(a) The individual(s) will be expected to represent the broad interests of
Memry Corporation throughout the European Community, inclusive of
representing its business strategy, as well as commercial and
shareholder interests.
EXHIBIT E
STANDSTILL AGREEMENT
--------------------
STANDSTILL AGREEMENT (this "Agreement"), dated as of October 30, 1998, by and
among MEMRY HOLDINGS, S.A. (the "Buyer"), a Belgian corporation and a wholly-
owned subsidiary of Memry Corporation, a Delaware corporation (the "Parent"),
the Parent and each of the shareholders of Advanced Materials and Technologies,
N.V., a Belgian corporation (the "Company"), as set forth under the heading
"Sellers" on the signature pages hereto (each referred to individually as a
"Seller" and collectively as the "Sellers").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Sellers are the owners of all of the issued and outstanding
shares of capital stock of the Company (collectively, the "Shares");
WHEREAS, pursuant to that certain Stock Purchase Agreement, dated as of
October 30, 1998 (the "Purchase Agreement"), the Sellers shall sell, transfer,
assign, convey and deliver the Shares to the Buyer, and the Buyer shall
purchase, acquire and accept the Shares from the Sellers;
WHEREAS, pursuant to the Purchase Agreement the Buyer is to pay a portion of
the Purchase Price by the delivery of the Parent Shares; and
WHEREAS, the Buyer is consummating the transactions contemplated by the
Purchase Agreement, including delivering the Parent Shares to the Sellers, in
express reliance upon the execution and delivery of this Agreement by the
Sellers, and the Sellers are consummating the transactions contemplated by the
Purchase Agreement in express reliance upon the execution and delivery of this
Agreement by the Buyer and the Parent;
NOW, THEREFORE, in consideration of the premises and the mutual covenants
herein contained, the parties hereto, intending to be legally bound, agree as
follows:
I. Definitions. Capitalized terms used, but not otherwise defined, herein
-----------
have the meanings ascribed to such terms in the Purchase Agreement.
2. Investment Representations and Warranties. In connection with the
-----------------------------------------
issuance of the Parent Shares to the Sellers pursuant to the Purchase Agreement,
the Sellers hereby represent, warrant and acknowledge to the Buyer and the
Parent as follows:
2.1 The Parent Shares are being acquired by the Sellers for their own
account, for investment purposes and not with a view to the sale or distribution
of all or any part of the Parent Shares, nor with any present intention to sell
or in any way distribute the same, as those terms are used in the Securities Act
of 1933, as amended (the "Act"), and the rules and regulations promulgated
thereunder.
2.2 The Sellers have sufficient knowledge and experience in financial
matters so as to be capable of evaluating the merits and risks of acquiring the
Parent Shares.
2.3 The Sellers have reviewed copies of such documents and other
information as the Sellers have deemed necessary in order to make an informed
investment decision with respect to the Sellers acquisition of the Parent
Shares.
2.4 The Sellers understand that the Parent Shares may not be sold,
transferred or otherwise disposed of without registration under the Act or the
availability of an exemption therefrom, and that in the absence of an effective
registration statement covering the Parent Shares or an available exemption from
registration under the Act, the Parent Shares must be held indefinitely.
Further, the Sellers understand and have the financial capability of assuming
the economic risk of an investment in the Parent Shares for an indefinite period
of time.
2.5 The Sellers have been advised that the Sellers will not be able to
dispose of the Parent Shares, or any interest therein, without first complying
with the relevant provisions of the Act, any applicable state securities laws
and the other restrictions set forth or referred to herein.
2.6 The Sellers acknowledge that the Parent is under no obligation to
register the Parent Shares or to furnish any information or take any other
action to assist the undersigned in complying with the terms and conditions of
any exemption which might be available under the Act or any state securities
laws with respect to sales of the Parent Shares in the future.
2.7 Each certificate representing Parent Shares or any other securities
issued or issuable, directly or indirectly, in respect of the Parent Shares upon
any stock split, stock dividend, recapitalization, merger, consolidation, share
exchange or similar event, shall be endorsed, stamped or otherwise imprinted
with a legend in substantially the following form:
THE SALE AND ISSUANCE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"ACT"), OR UNDER THE SECURITIES LAW OF ANY STATE OR OTHER JURISDICTION.
THESE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO,
OR IN CONNECTION WITH, THE DISTRIBUTION THEREOF. THESE SECURITIES MAY NOT
BE OFFERED, SOLD, PLEDGED, OR TRANSFERRED UNLESS (I) A REGISTRATION
STATEMENT UNDER THE ACT IS IN EFFECT AS TO THESE SECURITIES AND SUCH OFFER,
SALE, PLEDGE, OR TRANSFER IS IN COMPLIANCE WITH APPLICABLE SECURITIES LAW
OF ANY STATE OR OTHER JURISDICTION OR (II) THERE IS AN OPINION OF COUNSEL
OR OTHER EVIDENCE, IN EITHER CASE, SATISFACTORY TO THE ISSUER OF THIS
CERTIFICATE, THAT AN EXEMPTION THEREFROM IS AVAILABLE AND THAT SUCH OFFER,
SALE, PLEDGE, OR TRANSFER IS IN COMPLIANCE WITH APPLICABLE SECURITIES LAW
OF ANY STATE OR OTHER JURISDICTION.
FURTHERMORE, THE SALE, PLEDGE, HYPOTHECATION, TRANSFER OR OTHER DISPOSITION
AND THE VOTING OF THE SECURITIES REPRESENTED
BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS AND CONDITIONS OF A CERTAIN
STANDSTILL AGREEMENT BY AND AMONG THE INITIAL HOLDER OF THIS CERTIFICATE,
MEMRY HOLDINGS, N.V., AN AFFILIATE OF THE ISSUER OF THIS CERTIFICATE, AND
CERTAIN OTHER HOLDERS OF STOCK AND OTHER SECURITIES OF THE ISSUER OF THIS
CERTIFICATE. COPIES OF SUCH AGREEMENT MAY BE OBTAINED UPON WRITTEN REQUEST
TO THE SECRETARY OF THE ISSUER OF THIS CERTIFICATE.
Each of the parties hereto agrees that the Parent may make a notation to
this effect on its records and instruct any transfer agent of the Parent Shares
to impose transfer restrictions on the shares represented by certificates
bearing the legend referred to in this section to enforce the provisions of this
Agreement.
3. Disposition of Parent Shares.
----------------------------
3.1 Each Seller hereby agrees that such Seller shall make no disposition
of the Parent Shares unless and until:
3.1.1 Such Seller shall have notified the Parent of the proposed
disposition and provided a written summary of the terms and conditions of the
proposed disposition;
3.1.2 Such Seller shall have complied with all requirements of this
Agreement applicable to the disposition of the Parent Shares, including, the
provisions of (S)4 hereof; and
3.1.3 Such Seller shall have provided the Parent with an opinion of
counsel (which counsel shall be Xxxxx & XxXxxxxx or other counsel that is
reasonably acceptable to the Parent), in form and substance satisfactory to the
Parent, that (i) the proposed disposition does not require registration of the
Parent Shares under the Act or (ii) all appropriate action necessary for
compliance with the registration requirements of the Act or of any exemption
from registration available under the Act (including Rule 144 promulgated
thereunder) has been taken.
3.2 The Parent shall not be required (i) to
transfer on its books any Parent Shares that have been sold or transferred in
violation of the provisions of this (S)3 or (ii) to treat as the owner of the
Parent Shares, or otherwise to accord voting or dividend rights to, any
transferee to whom the Parent Shares have been transferred in contravention of
this Agreement.
4. Standstill Provision. For the period commencing on the Closing Date and
--------------------
ending on the first anniversary of the Closing Date, no Seller shall offer for
sale, sell, distribute pledge, hypothecate, transfer or otherwise encumber or
dispose of any of the Parent Shares.
5. Voting Agreement. For the period (the "Voting Period") commencing on the
----------------
Closing Date and ending on the earlier of (i) the third anniversary of the
Closing Date or (ii) (A) the date on which all of the Parent Shares (including
the Parent Escrowed Shares) are sold or (B) the date on which a portion of the
Parent Shares (including the Parent Escrowed Shares) are sold with respect to
the portion sold (provided, however, that this voting agreement shall remain in
effect with respect to the portion of Parent Shares that is not sold until
otherwise terminated hereunder) the Sellers shall consent to, vote for, or
otherwise approve of each and every management proposal included in any
stockholders' action to be taken with respect to a management proposal,
including any action to be taken by written consent and any action to be taken
in connection with the solicitation of proxies by management for an annual or
special meeting of stockholders.
6. Representations and Covenants of Parent.
---------------------------------------
6.1 Representations. The Parent hereby represents and warrants to the
---------------
Sellers that, but for the failure of the bid price of the Company's common stock
to meet the requirements of the National Association of Securities Dealers, Inc.
("NASD") for listing on The Nasdaq Small Cap Market, the Company currently meets
all stated requirements for its common stock to be so listed.
6.2 Covenants. The Parent agrees (i) to reapply to the NASD for
---------
listing of its common stock on The Nasdaq Small Cap Market promptly upon the
closing bid price of such common stock being at or above $4.00 per share for
twenty consecutive trading days, and (ii) upon the filing of such application,
to use its reasonable efforts
to effect such a listing. For purposes of providing the benefits of Rule 144
promulgated under the U.S. Securities Act of 1933, as amended (the "Securities
Act"), to the Sellers, the Parent agrees to file with the U.S. Securities and
Exchange Commission, in a timely manner, all reports and other documents
required of the Parent under the Securities Act and the U.S. Securities Exchange
Act of 1934, as amended.
7. Miscellaneous.
-------------
7.1 Entire Agreement. This Agreement contains the entire agreement
----------------
among the parties with respect to the subject matter hereof and supersedes all
prior contracts and other agreements, written or oral, with respect hereto.
7.2 Waivers and Amendments. This Agreement may be amended, modified,
----------------------
superseded, cancelled, renewed or extended, and the terms and conditions hereof
may be waived, only by a written instrument signed by the parties hereto or, in
the case of a waiver, by the party waiving compliance. No delay on the part of
any party in exercising any right, power or privilege hereunder shall operate as
a waiver thereof, nor shall any waiver on the part of any party of any right,
power or privilege hereunder, nor any single or partial exercise of any right,
power or privilege hereunder, preclude any other or further exercise thereof or
the exercise of any other right, power or privilege hereunder.
7.3 Governing Law. This Agreement shall be governed by, and construed
-------------
and enforced in accordance with, and subject to, the laws of the State of New
York, U.S.A.
7.4 Jurisdiction. Any dispute arising from this Agreement shall be
------------
settled by arbitration in accordance with the Commercial Arbitration Rules (the
"Rules") and the Guidelines for Expediting Larger, Complex Commercial
Arbitrations of the American Arbitration Association (the "AAA"), and judgment
upon the award rendered in such arbitration may be entered in any court having
jurisdiction over it. The arbitration shall be conducted in New York, New York.
There shall be one arbitrator (referred to as the "Arbitrator"). The parties
shall endeavor to agree on the selection of an Arbitrator, but if no agreement
has been reached within 40 days of
claimant's demand that an arbitrator be selected the Arbitrator shall be
selected by the AAA upon the request of any party. The Arbitrator shall conduct
himself as neutral, and be subject to disqualification pursuant to Section 19 of
the Rules. The Arbitrator shall be compensated at his normal hourly or per diem
rates for all time spent in connection with the arbitration proceeding, and
pending final award, appropriate compensation and expenses shall be advanced
equally by the parties. Within 15 days after the Arbitrator has been appointed,
a preliminary hearing among the Arbitrator and counsel for the parties shall be
held for the purpose of evolving a written plan for the management of the
arbitration that shall promote the efficient, expeditious and cost-effective
conduct of the proceeding. Nothing in this (S)7.4 shall prevent a Party from
seeking injunctive relief pending a decision of an arbitrator pursuant to this
(S)7.4 or to enforce such a decision in any court having jurisdiction over the
Party against whom injunctive relief or enforcement is sought.
7.5 Binding Effect; Benefit. This Agreement shall inure to the benefit
-----------------------
of and be binding upon the parties hereto and their respective successors and
assigns. The Parent is a direct, contemplated third party beneficiary of this
Agreement and may bring action (in accordance with (S)7.4) to enforce the terms
hereof.
7.6 Variations in Pronouns. All pronouns and any variations thereof
----------------------
refer to the masculine, feminine or neuter, singular or plural, as the identity
of the person or persons may require.
7.7 Construction. While the Parent's counsel prepared this Agreement,
------------
the parties have participated jointly in the negotiation of this Agreement. In
the event an ambiguity or question of intent arises, this Agreement shall be
construed as if drafted jointly by the parties and no presumption or burden of
proof shall arise favoring or disfavoring any party by virtue of the authorship
of any of the provisions of this Agreement. The word "including" shall mean
including without limitation.
7.8 Counterparts. This Agreement may be executed in counterparts,
------------
each of which shall be deemed an original but all of which together shall
constitute one and the same instrument.
7.9 Headings. The headings in this Agreement
--------
are for reference purposes only and shall not in any way affect the meaning or
interpretation of this Agreement.
7.10 Severability. If any term, provision, covenant or restriction of
------------
this Agreement, or any part thereof, is held by a court of competent
jurisdiction or any foreign, federal, state, county or local government or any
other governmental, regulatory or administrative agency or authority to be
invalid, void, unenforceable or against public policy for any reason, the
remainder of the terms, provisions, covenants and restrictions of this Agreement
shall remain in full force and effect and shall in no way be affected, impaired
or invalidated.
* * *
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
Buyer: MEMRY HOLDINGS, S.A.
By:
------------------------------
Name:
Title:
Parent: MEMRY CORPORATION
By:
------------------------------
Name:
Title:
Sellers:
---------------------------------
Xxxxxxxx Xxx Xxxxxxxxxx
---------------------------------
Xxxxxx Xxxxxxx
---------------------------------
Xxx Xxxxxx
USINE METALLURGIQUE SUISSE
HOLDING S.A.
By:
------------------------------
Name:
Title:
G.I.M.V.
By:
------------------------------
Name:
Title:
ADVANCED BUSINESS
CONSULTING N.V.
By:
------------------------------
Name:
Title:
EXHIBIT F-1
Xx. Xxxxxxxx Xxx Xxxxxxxxxx
Xxx. Xxxxxx Xxxxxxx
Xx. Xxx Xxxxxx
Swiss Metalworks Holding (UMSH)
G.I.M.V.
Advanced Business Consulting N.V.
X/X XXXXX & XXXXXXXX
Xxxxxxxxxx 000
0000 XXXXXXXX
October 30, 1998
Dear Madam:
Dear Sirs:
RE: MEMRY HOLDINGS S.A. / LEGAL OPINION
O. ref.:JPF/KVO/98.2683/L01
---------------------------
1. We have acted as Belgian counsel to Memry Holdings S.A. (the
"Company") in connection with the acquisition of all the shares of
Advanced Materials and Technologies N.V. ("AMT"), pursuant to a stock
purchase agreement dated October 30, 1998 (the "Agreement").
We are giving this opinion pursuant to Section 3.02.(h) of the
Agreement.
Unless expressly provided otherwise, terms and expressions, defined in
the Agreement, shall have the same meaning herein.
2. For the purposes of the present opinion, we have examined the
following documents:
a) an uncertified copy of the final draft of the Agreement;
b) a certified copy of the deed of incorporation of the Company
dated October 22, 1998;
c) a copy of the resolution of the board of directors dated October
23, 1998, approving the Agreement; and
d) a certified copy of the Company file with the Trade Registry of
Brussels dated October 27, 1998.
Except as stated above and as we have deemed necessary in connection
with this legal opinion, we have not examined any contracts,
instruments or other documents entered into by or affecting the
Company, or any of its corporate records and have not made any further
inquiry concerning the Company.
3. With respect to the documents which we have examined and reviewed, we
have assumed:
- the genuineness of all signatures;
- the conformity to original documents and the completeness of
all documents submitted to us as certified or uncertified copies
and the authenticity of the originals thereof;
- that no changes or amendments occurred after the date of their
issuance or photocopying;
- that the Agreement submitted in final draft form to us was
executed in the form submitted to us and that there have been no
amendments or changes to the Agreement; and
- the legal capacity of individuals signing such documents.
The present opinion is confined to and given on the basis of the laws
of Belgium, as they exist at the date hereof and as applied by Belgian
courts. We express no opinion as to the laws of any jurisdiction other
than the laws of Belgium.
There is no intention on our part to amend or update this opinion in
the event of any changes after the date hereof in any Belgian law or
regulations or case law relevant to this opinion.
4. Based upon and subject to the foregoing, the qualifications set out
below and any matters not disclosed to us, we are of the opinion that:
a) the Company is a corporation duly incorporated and organized
under the laws of Belgium;
b) the Company has the corporate power and capacity to enter into
and perform its obligations under the Agreement;
c) the entering into and the performance of the terms and conditions
of the Agreement by the Company have been duly authorized by all
necessary corporate action; and
d) the execution by the Company of the Agreement and the fulfillment
of or compliance with the terms thereof do not violate or
conflict with, or result in a breach of the articles of
association of the Company.
5. The opinions expressed above are subject to the following
qualifications:
a) any enforcement against the Company may be limited and affected
by (i) Belgian bankruptcy, insolvency, reorganization,
liquidation, moratorium or other similar laws affecting
creditors' rights generally, and (ii) the application of general
principles of abuse of rights and good faith as applicable under
the laws of Belgium;
b) Belgian courts may give effect to the mandatory rules of the
law of another country with which the subject matter of the
proceedings has a close connection if, and insofar as, under the
laws of the latter country, those rules must be applied whatever
the law applicable to the Agreement; and
c) should a suit be filed before a Belgian court, a certified sworn
translation may be required in French, Dutch or German (according
to the seat of the court) of all documents not written in the
official language of the seat of the court.
6. This opinion shall, therefore, be governed by and construed in
accordance with the laws of Belgium as in effect on the date at which
it is given and any matters relating to it shall be of the exclusive
jurisdiction of the Belgian courts.
This opinion is addressed to and is solely for the benefit of the
shareholders of AMT. Accordingly, it may not be relied upon by any
other person (other than their legal advisors) or for any other
purpose than in connection with the Agreement and it is not to be
circulated, quoted or otherwise referred to for any other purpose.
You are requested not to give copies of this opinion to others without
our permission.
Yours sincerely,
Xxxxxxxx XXXXXX Xxxx-Xxxxxx XXXXXXX
EXHIBIT F-2
October 30, 1998
Xx. Xxxxxxxx Xxx Xxxxxxxxxx
Xx. Xxxxxx Xxxxxxx
Xx. Xxx Xxxxxx
Usines Metallurgique Suisse Holding S.A.
G.I.M.V.
Advanced Business Consulting N.V.
x/x Xxxxx & XxXxxxxx
Xxxxxx Xxxxxx 000
0000 Xxxxxxxx, Xxxxxxx
Ladies and Gentlemen:
This opinion is furnished to you pursuant to Section 3.02(h)(ii) of the Stock
Purchase Agreement, dated as of October 30, 1998 (the "Purchase Agreement"), by
and between each of you (each singularly a "Seller" and collectively the
"Sellers") and Memry Holdings, S.A., a Belgian corporation (the "Buyer"). We
have acted as counsel to Memry Corporation, a Delaware corporation and the
Buyer's parent corporation (the "Parent"), in connection with the preparation,
execution and delivery of (i) the Purchase Agreement (which the Parent is
executing for the purposes set forth therein), (ii) the Standstill Agreement,
and (iii) the consummation of the transactions contemplated thereby. The items
described in clauses (i) and (ii) above shall be hereinafter referred to
collectively as the "Agreements." Capitalized terms used herein and not
otherwise defined herein shall have the respective meanings attributed thereto
in the Purchase Agreement.
In rendering the opinions set forth herein, we have examined copies,
telecopies or photocopies of: (i) the executed Agreements; (ii) the Certificate
of Incorporation and By-laws of the Parent; and (iii) such other records,
documents, certificates and other instruments as in our judgment are necessary
or appropriate as a basis for the opinions expressed below. In our examination
of such documents we have
assumed the genuineness of all signatures, the legal capacity of natural
persons, the authenticity of all documents submitted to us as originals, the
conformity to original documents of all documents submitted to us as copies, and
the authenticity of the originals of such copies. As to any facts material to
this opinion which we did not independently establish or verify (which
independent establishment or verification is limited to review of the items set
forth in clauses (i) through (iii) of the first sentence of this paragraph), we
have relied (i) upon statements, certifications and representations of the
officers and other representatives of the Parent, including, as to matters of
fact (as opposed to legal conclusions), the representations regarding the Parent
set forth in the Purchase Agreement; and (ii) upon certificates of public
officials of the State of Delaware. With respect to our opinion in paragraph 5
below, we have also assumed that the Shares have been validly and properly
conveyed to Buyer by Sellers in accordance with Belgian law and the terms of the
Purchase Agreement. In rendering this opinion, other than as described above, we
have made no independent investigation concerning the facts represented to us by
the Parent.
Based upon the foregoing, and in reliance thereon, and subject to the
qualifications, assumptions and exceptions heretofore and hereinafter set forth,
we are of the opinion that:
1. The Parent is a corporation legally existing and in good standing under
the laws of the State of Delaware and has all requisite corporate power and
authority to own, lease and operate its assets and properties.
2. The Parent has all requisite corporate power and authority to execute,
deliver and perform its obligations under the Agreements. The execution,
delivery and performance of the Agreements by the Parent and the consummation of
the transactions contemplated thereby by the Parent have been duly authorized by
all necessary corporate action of the Parent. The Agreements have been duly
executed by the Parent.
3. The execution of the Agreements and the consummation of the transactions
contemplated thereby by the Parent (a) will not
conflict with or violate any provision of the Certificate of Incorporation or
By-Laws of the Parent, and (b) to our knowledge, will not violate any
constitution, statute, regulation or rule of the United States or the State of
Connecticut (or any provision of the Delaware General Corporation Law).
4. Based solely upon information provided to us by American Stock Transfer &
Trust Co., the Parent's transfer agent, as of October 16, 1998, there were
19,954,140 shares of the Parent's common stock, par value $0.01 per share
("Parent Common Stock"), issued and outstanding. The Parent Common Stock is not
divided into classes and/or series. To our knowledge, the Parent has no shares
of preferred stock issued and outstanding.
5. The issuance of the Parent Shares to the Sellers on behalf of the Buyer
pursuant to the Purchase Agreement has been duly authorized by the Parent. The
Parent Shares have been validly issued, are fully paid and non-assessable, and
are being transferred to Sellers free and clear of any Liens (other than Liens
created by or with respect to the Sellers). Subject to (i) applicable laws,
(ii) the restrictions set forth in the Purchase Agreement and the documents
contemplated thereby, and (iii) restrictions created by or with respect to the
Sellers, there are no legal prohibitions on the transfer by the Sellers of the
Purchased Shares.
As used in this opinion letter, the phrase "to our knowledge" shall mean our
actual knowledge based solely upon our inquiries to the Parent without further
investigation. We do not express, or purport to express, any opinion with
respect to the laws of any jurisdiction other than the laws of the State of
Connecticut, the General Corporation Law of the State of Delaware and the
Federal laws of the United States of America (but, as to such Federal laws,
including only those laws which, in our experience, are normally applicable to
transactions of the type provided for in the Agreements). The opinions given
herein are provided pursuant to Section 3.02(h)(ii) of the Purchase Agreement
and in connection with the transactions contemplated thereby, and this letter
and the opinions given herein may not, unless otherwise specifically agreed to
in writing by a member of this firm, be circulated or used, quoted or relied
upon for any other purpose or by any person
or entity other than the Sellers. This opinion is given as of the date hereof
and we assume no obligation to update or supplement this opinion to reflect any
facts or circumstances which may hereafter occur or come to our attention or any
changes in law which may hereafter occur.
Very truly yours,
EXHIBIT G
MEMRY CORPORATION ANNOUNCES EUROPEAN ACQUISITION
BROOKFIELD, CT - OCTOBER 30, 1998 - Memry Corporation (MRMY on the OTC Bulletin
BoardTM) announced that it had completed the acquisition of Advanced Materials
and Technologies, n.v. (AMT), of Herk-de-Stad, Belgium. The terms of the
transaction included a cash payment of $1.04 million and 675,000 shares of Memry
Corporation common stock. In addition, Memry may be obligated to pay up to an
additional $1.05 million in cash if, twelve months from the closing date, the
value of the Memry shares is below $5.55 per share.
Formerly owned primarily by Usines Metalurgiques Suisse Holdings, S.A., known as
Swiss Metals, GIMV n.v., Investment Company for Flanders, of Antwerp, Belgium
and AMT's founder, Xx. Xxxxxxxx Xxx Xxxxxxxxxx, AMT is one of Europe's leading
providers of shape memory alloys serving customers in Europe, Asia and the U.S.
Located just one hour from Brussels, AMT owns and occupies a new 15,000 square
foot manufacturing facility in close proximity to all major European locations.
According to Memry's Chairman and CEO, Xx. Xxxxx Xxxxx, "This acquisition offers
Memry the opportunity to significantly increase its European market presence at
a time when the majority of its medical customer base is establishing
manufacturing operations within the European Community to better serve their own
markets. In addition, AMT's significant technical strengths in shape memory
alloys and their application in industrial, commercial and medical applications
complement those of Memry's existing operations in Xxxxx Xxxx, XX xxx
Xxxxxxxxxx, XX. It is anticipated that AMT, to become known as Memry Europe,
N.V., will also benefit from the strong European presence of Memry's private
label/supply/ distribution relationship with Raychem Corporation and is expected
to result in rapid growth. We are delighted to welcome X. Xxx Xxxxxxxxxx and
his team to the Memry organization."
For further information, contact Memry Corporation's Investor Relations
Department at 000-000-0000.
Memry Corporation, with locations in Brookfield, Connecticut and Menlo Park,
California, is engaged in the design, development and manufacture of various
medical and industrial materials and components utilizing shape memory alloys.
Through the production of nickel titanium strip, wire and tubing and technical
expertise in the forming and assembly of these materials, Memry produces such
products as laparoscopic surgical assemblies, medical stent materials and
components, cellular telephone antennae components and various high performance
valves.
EXHIBIT H
AGREEMENT
AGREEMENT, dated as of October 30, 1998 (this "Agreement"), between USINES
METALLURGIQUE SUISSE HOLDING S.A., a Swiss corporation ("Swissmetal"), and
ADVANCED MATERIALS AND TECHNOLOGIES, N.V., a Belgian corporation ("AMT").
WHEREAS, Swissmetal is the holder of 1634 shares of the capital stock of AMT,
which shares are being sold (along with all of the other outstanding shares of
the capital stock of AMT) to Memry Holdings, S.A., a Belgian corporation (the
"Buyer"), pursuant to that certain Stock Purchase Agreement, dated as of the
date hereof (the "Stock Purchase Agreement"), among the Buyer, Memry
Corporation, a Delaware corporation (the "Parent"), and the stockholders of AMT;
WHEREAS, Swissmetal is the owner of certain movable tangible personal property
located at AMT (the "Business Assets") that are used by AMT in the Business (as
defined in the Stock Purchase Agreement) and Swissmetal desires to sell to AMT
and AMT desires to buy from Swissmetal the Business Assets;
WHEREAS, Swissmetal and AMT are parties to that certain exclusive supply
agreement, dated as of August 17, 1992, as the same may have been amended from
time to time (as so amended, the "Supply Agreement"), pursuant to which AMT
purchases on an exclusive basis certain products used for the manufacturing of
shape memory alloy products from Swissmetal, and Swissmetal and AMT desire to
terminate such Supply Agreement and release each other from liability
thereunder;
WHEREAS, on January 19, 1998, Swissmetal loaned AMT BEF 5,000,000, with such
amount accruing interest at a rate of 5% per annum payable upon demand (the
"Loan") and Swissmetal and AMT desire to modify the Loan so that interest will
be payable thereon monthly in arrears and the principal amount plus accrued
interest will
become due and payable on November 30, 1999, instead of upon demand; and
WHEREAS, Swissmetal has, directly or indirectly through an affiliate, been
providing AMT with certain insurance coverage under Master Agreement Policy No.
49/61675/01 (the "Insurance Coverage"), and Swissmetal and AMT desire to
terminate such coverage while still providing AMT with the benefit of any
Insurance Coverage for periods prior to such termination.
NOW, THEREFORE, the parties hereto hereby agree as follows:
Section 1. Purchase and Sale of Business Asset.
--------- -----------------------------------
Section 1.1 Purchase and Sale; Purchase Price. On and subject to the
----------- ---------------------------------
terms and conditions of this Agreement, AMT shall purchase the Business Assets
from Swissmetal for an aggregate consideration equal to BEF 350,000, plus VAT
(the "Purchase Price"), and Swissmetal shall, upon receipt of the cash portion
of the Purchase Price, sell, transfer, convey and deliver to AMT the Business
Asset. AMT shall deliver the cash portion of the Purchase Price on November 2,
1998 to Swissmetal by sending Swissmetal a bank or certified check for such
amount on such date.
Section 1.2 Representations and Warranties of Swissmetal Regarding
----------- ------------------------------------------------------
the Business Asset. Swissmetal hereby represents and warrants to AMT that
------------------
Swissmetal has good and marketable title to the Business Assets, free and
clear of all Liens (as defined in the Stock Purchase Agreement).
Section 1.3 Further Assurances. In case at any time after the date
----------- ------------------
hereof any further action is necessary or desirable to carry out the purposes
of Section 1 of this Agreement, Swissmetal shall take such further action
(including, without limitation, the execution and delivery of such further
instruments and documents, including bills of sale or similar documents) as
AMT may reasonably request.
Section 2. Termination of Supply Agreement; Mutual Release.
--------- -----------------------------------------------
Section 2.1 Termination of Supply Agreement. Swissmetal and AMT hereby
----------- -------------------------------
mutually agree to terminate, effective immediately, the Supply Agreement and,
except as set forth in Section 2.3, all obligations of either Swissmetal or
AMT existing thereunder.
Section 2.2 Mutual Release. Each of Swissmetal and AMT and their
----------- --------------
respective representatives, successors, assigns and agents, hereby fully,
finally and forever remise, release and discharge, except as set forth in
Section 2.3, each other from all and any manner of claims, suits, obligations,
liabilities, damages, costs, and demands whatsoever, whether known or unknown,
matured or unmatured, foreseen or unforeseen, arising under the Supply
Agreement.
Section 2.3 Exceptions to Termination and Release. The termination
----------- -------------------------------------
and release set forth in Section 2.1 and 2.2 above shall not, however,
terminate the following obligations, or release a party from the following
liabilities: (i) any obligations or liabilities of Swissmetal relating to
sales made under the Supply Agreement prior to the date hereof; and (ii) any
obligations or liabilities of AMT to pay Swissmetal for purchases under the
Supply Agreement prior to the date hereof in amounts included as liabilities
in the determination of AMT's Closing Net Worth (as defined in the Stock
Purchase Agreement).
Section 3. Agreement to Modify the Loan. The Loan is hereby modified and
--------- ----------------------------
amended, as of the date hereof, as follows:
Section 3.1 Principal Amount. The principal amount of the Loan is BEF
----------- ----------------
5,000,000. The principal amount of the Loan shall become due and payable by
AMT on November 30, 1999.
Section 3.2 Interest. Interest on the unpaid principal amount of
----------- --------
the Loan shall be payable by AMT to Swissmetal at a
rate of 5% per annum, payable monthly, in arrears on the last day of each
month commencing on November 30, 1998 and on any other date that principal is
paid on the Loan.
Section 3.3 Prepayment. The Loan may be prepaid, without premium or
----------- ----------
penalty, by AMT at any time.
Section 3.4 Assignment. The Loan may not be assigned, pledged,
----------- ----------
hypothecated or otherwise encumbered, transferred or disposed of by Swissmetal
without the prior written consent of AMT.
Section 4. Insurance.
--------- ---------
Section 4.1 Termination of Insurance Coverage. Swissmetal shall
----------- ---------------------------------
cause the Insurance Coverage to be terminated on a prospective basis as soon
as practicable.
Section 4.2 Arrangement Regarding Benefit of Insurance Coverage.
----------- ---------------------------------------------------
Swissmetal shall provide AMT with the benefit of the Insurance Coverage
heretofore in effect by (i) upon AMT's request from time to time, submitting
to the providers of the Insurance Coverage claims for which AMT may benefit
from the Insurance Coverage, (ii) taking all action as may be requested by AMT
to prosecute such claims and obtain payment from the providers of the
Insurance Coverage, and (iii) paying to AMT any amounts received by Swissmetal
from providers of the Insurance Coverage. Without imposing obligations not
previously in existence, the parties agree and understand that such agreement
shall be effective whether any such Insurance Coverage is on a "claims made"
basis (i.e., for claims made prior to the date of the termination of the
Insurance Coverage that have been made) or on an "occurrence" basis (i.e.,
Insurance Coverage available for occurrences prior to the date of the
termination of such Insurance Coverage whether or not any claim has been
heretofore made). Swissmetal also agrees to fully cooperate with AMT in
determining the amount and scope of the Insurance Coverage.
Section 5. Miscellaneous.
--------- -------------
Section 5.1 Entire Agreement. This Agreement contains the entire
----------- ----------------
agreement among the parties with respect to the matters set forth herein and
supersedes all prior contracts and other agreements, written or oral, with
respect thereto.
Section 5.2 Waivers and Amendments. This Agreement may be amended,
----------- ----------------------
modified, superseded, cancelled, renewed or extended, and the terms and
conditions hereof may be waived, only by a written instrument signed by the
parties hereto or, in the case of a waiver, by the party waiving compliance.
No delay on the part of any party in exercising any right, power or privilege
hereunder shall operate as a waiver thereof, nor shall any waiver on the part
of any party of any right, power or privilege hereunder, nor any single or
partial exercise of any right, power or privilege hereunder, preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege hereunder.
Section 5.3 Governing Law. This Agreement shall be governed by, and
----------- -------------
construed and enforced in accordance with and subject to, the laws of the
Kingdom of Belgium.
Section 5.4 Jurisdiction. (a) Any dispute arising from this
----------- ------------
Agreement shall be settled by arbitration in accordance with the rules of
CEPANI ("Centre belge pour l'etude et la pratique de l'arbitrage national et
international/Belgisch centrum voor studie en praktijk van nationale en
internationale arbitrage") by three (3) arbitrators appointed in accordance
with such rules. The proceedings shall take place in Brussels, Belgium and
shall be conducted in English. (b) Nothing in this Section 5.4 shall prevent a
party from seeking injunctive relief pending a decision of an arbitrator
pursuant to 5.4(a) above or to enforce such a decision in any court having
jurisdiction over the party against whom injunctive relief or enforcement is
sought.
Section 5.5 Binding Effect; Benefit. This Agreement shall inure to
----------- -----------------------
the benefit of and be binding upon the parties
hereto and their respective successors and assigns. Nothing in this Agreement,
expressed or implied, is intended to confer on any person other than the
parties hereto or their respective successors and assigns, any rights,
remedies, obligations or liabilities under or by reason of this Agreement.
Section 5.6 Construction. While AMT's counsel prepared this
----------- ------------
Agreement, the parties have participated jointly in the negotiation of this
Agreement. Without prejudice to Articles 1156 through 1164 of the Belgian
Civil Code, in the event an ambiguity or question of intent arises, this
Agreement shall be construed as if drafted jointly by the parties and no
presumption or burden of proof shall arise favoring or disfavoring any party
by virtue of the authorship of any of the provisions of this Agreement. The
word "including" shall mean including without limitation.
Section 5.7 Headings. The headings in this Agreement are for
----------- --------
reference purposes only and shall not in any way affect the meaning or
interpretation of this Agreement.
Section 5.8 Severability. If any term, provision, covenant or
----------- ------------
restriction of this Agreement, or any part thereof, is held by a court of
competent jurisdiction or any foreign, federal, state, county or local
government or any other governmental, regulatory or administrative agency or
authority to be invalid, void, unenforceable or against public policy for any
reason, the remainder of the terms, provisions, covenants and restrictions of
this Agreement shall remain in full force and effect and shall in no way be
affected, impaired or invalidated.
* * *
IN WITNESS WHEREOF, the parties have executed this Agreement in Brussels,
Belgium, as of the date first above written in 2 original copies, with each
party receiving one original copy.
USINES METALLURGIQUE SUISSE
HOLDING S.A.
By:
--------------------------------
Name:
Title:
and
By:
--------------------------------
Name:
Title:
ADVANCED MATERIALS AND
TECHNOLOGIES, N.V.
By:
--------------------------------
Name: Xxxxx X. Xxxxx
Title: Director
By:
--------------------------------
Name: Xxxxxx X. Xxxxx
Title: Director
Schedule A
List of Sellers, Shares Held,
and Percentage of Interest
----------------------------
Name and Address Percentage
of Seller No. of Shares of Interest
---------------- ------------- -----------
Xxxxxxxx Xxx Xxxxxxxxxx 340 9.062
Xxxxxxxxxxx 0
X-0000 Xxxxxxx
Xxxxxxx
Xxxxxx Xxxxxxx 65 1.732
Xxxxxxxxxxx 0
X-0000 Xxxxxxx
Xxxxxxx
Xxx Xxxxxx 14 0.374
Xxxxxxxxxx 00
X-0000 Xxxxxx
Xxxxxxx
Xxxxx Metalworks Holding (UMSH) 1,634 43.550
Xxxxxxxxxxxxx 00
XX-0000 Xxxxxxx 1
SWITZERLAND
G.I.M.V. 1,194 31.823
Xxxxx Xxxxxxxxxx 00
X-0000 Xxxxxxxxx
Xxxxxxx
Advanced Business Consulting, N.V. 505 13.459
Xxxxxxxxxxx 0
X-0000 Xxxxxxx
Xxxxxxx
_______ ________
Totals 3,752 100.0%
===== ========
