EXECUTION VERSION
CONTRIBUTION IN KIND AGREEMENT
among
AXALTO HOLDING N.V.
and
XXX. XXXXXXX XXXXXX
XX. XXXXXX XXXXXX
ACTON 1 BETEILIGUNGS GMBH
ACTON 2 BETEILIGUNGS GMBH
ACTON 3 BETEILIGUNGS GMBH
DECEMBER 6, 2005
CONTRIBUTION IN KIND AGREEMENT
This agreement (the "AGREEMENT") is made and entered into as of December 6,
2005, among:
1. XXX. XXXXXXX XXXXXX, XX. XXXXXX XXXXXX, ACTON 1 BETEILIGUNGS GMBH, ACTON 2
BETEILIGUNGS GMBH and ACTON 3 BETEILIGUNGS GMBH, jointly and severally
among them (the "XXXXXX ENTITIES");
AND
2. AXALTO HOLDING N.V. ("AXALTO").
RECITALS
A. Axalto, whose shares are listed on the French Eurolist of Euronext Paris
S.A., operates directly and through its subsidiaries in the business of
microprocessor cards products and applications.
B. Gemplus International S.A., a corporation organized under the laws of the
Grand Duchy of Luxembourg, whose registered office is located 00X, Xxxxxx
X.X. Xxxxxxx X-0000, Xxxxxxxxxx, Grand Duchy of Luxembourg ("GEMPLUS") and
whose shares are listed on the French Eurolist of Euronext Paris S.A. and
the NASDAQ National Market system through an American depositary shares
Facility, also operates directly and through its subsidiaries in the
business of microprocessor cards products and applications.
C. The Xxxxxx Entities own a total of 115,508,200 shares of Gemplus, held as
follows: 100 by Xxx. Xxxxxxx Xxxxxx, 100 by Xx. Xxxxxx Xxxxxx, 33,236,428
by Acton 1 Beteiligungs Gmbh, 35,700,770 by Acton 2 Beteiligungs Gmbh and
46,570,802 by Acton 3 Beteiligungs Gmbh (the "XXXXXX ENTITIES SHARES")
representing at the date of execution of this Agreement 18.4% of the share
capital and voting rights of Gemplus.
D. The Boards of Directors of each of Axalto and Gemplus have determined that
it is in the best corporate interests of Axalto and Gemplus to effect the
combination of their respective businesses as set forth under the terms of
a Combination Agreement entered into between Axalto, Gemplus, the Xxxxxx
Entities, TPG Giant, LLC, TPG Partners III, L.P. and T3 Partners, L.P., on
or around the date of this agreement (the "COMBINATION AGREEMENT") in a
"merger of equals".
E. Pursuant to and in accordance with the terms and conditions of the
Combination Agreement, the Xxxxxx Entities have agreed to contribute the
Xxxxxx Entities Shares to Axalto and Axalto has agreed to allot and issue
to the Xxxxxx Entities 9,240,656 newly issued shares of Axalto Common Stock
(the "XXXXXX ENTITIES CONTRIBUTION IN KIND").
IN CONSIDERATION OF THE FOREGOING, IT IS AGREED AS FOLLOWS
ARTICLE I
DEFINITIONS; INTERPRETATION
1.1 Unless otherwise defined herein, words and expressions defined in the
Combination Agreement shall bear the same meaning when used in this Agreement.
ARTICLE II
XXXXXX ENTITIES CONTRIBUTION IN KIND
2.1 Upon and subject to the terms and conditions of this Agreement and the
Combination Agreement, the Xxxxxx Entities hereby agree, in consideration of the
allotment and issue by Axalto to the Xxxxxx Entities of 9,240,656 newly issued
shares of Axalto Common Stock ranking pari passu with all other shares of Axalto
Common Stock to contribute on the date of Closing of the Contribution in Kind
(as defined in Section 2.5 of the Combination Agreement) the Xxxxxx Entities
Shares to Axalto free and clear of all Encumbrances together with all rights and
advantages (other than any rights, title, interest or advantages in, to or in
respect of the Gemplus Distribution) which are at the date of this Agreement
attached to the Xxxxxx Entities Shares.
2.2 The Xxxxxx Entities Contribution in Kind described in Section 2.1 above
shall be implemented pursuant to and in accordance with the terms and subject to
the conditions of the Combination Agreement.
2.3 The Xxxxxx Entities agree that they shall not sell, transfer, pledge, lease,
dispose of or encumber the Xxxxxx Entities Shares in any manner, or agree or
otherwise commit to do any of the foregoing, other than pursuant to the Xxxxxx
Entities Contribution in Kind and the Combination Agreement.
2.4 Completion of the transactions described in this Agreement shall take place
in accordance with Section 2.5 of the Combination Agreement.
2.5 For the avoidance of doubt, it is hereby specified that the Xxxxxx Entities
Shares contributed to Axalto in the Xxxxxx Entities Contribution in Kind will be
transferred with any and all rights and benefits attached thereto, including all
shares issued or property distributed and/or that may be so issued or
distributed by Gemplus following the date of the Transfer Instruction and to
which the Xxxxxx Entities Shares give right, without any effect on the
consideration set forth in Section 2.1 above; provided, however, that Axalto
shall not be entitled to any portion of the amount of the Gemplus Distribution
to be made by Gemplus to the holders of Gemplus Shares pursuant to the terms of
the Combination Agreement paid with respect to the Xxxxxx Entities Shares.
2.6 The Xxxxxx Entities and Axalto undertake to notify to Gemplus or cause to be
notified to Gemplus pursuant to the Combination Agreement the transfer of the
Xxxxxx Entities Shares to Axalto by way of the Xxxxxx Entities Contribution in
Kind under this Agreement for the purpose
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of article 40 of the Luxembourg law on commercial companies of August 10, 1915,
as amended, and article 1690 of the Luxembourg Civil Code. In addition, the
Xxxxxx Entities and Axalto undertake, for the purpose of the Luxembourg Law of
December 4, 1992 on major holdings (the "LUXEMBOURG LAW ON MAJOR HOLDINGS"), to
notify at the same time Gemplus and the Luxembourg Commission de Surveillance du
Secteur Financier within seven calendar days following the Closing of the
Contribution in Kind, of the transfer of the Xxxxxx Entities Shares to Axalto by
way of the Xxxxxx Entities Contribution in Kind (the "MAJOR HOLDING TRANSFER
NOTIFICATION"), and for such a purpose the Xxxxxx Entities and Axalto hereby
jointly instruct and authorize any lawyer of Loyens Xxxxxxx to proceed on their
behalf with such a notification.
The Xxxxxx Entities and Axalto acknowledge that Gemplus must take any action as
may be necessary to have the transfer of the Xxxxxx Entities Shares to Axalto by
way of the Xxxxxx Entities Contribution in Kind made of public knowledge in
France in accordance with the relevant provisions of French law, as soon as
possible following receipt by Gemplus of the Major Holding Notification and in
any event no later than nine working days after such receipt.
2.7 This Agreement and its terms are intended by the parties hereto to be in
addition to, and so shall not limit or otherwise affect the validity of, the
provisions of the Combination Agreement, and, for the avoidance of doubt, all
applicable provisions of the Combination Agreement shall apply to the Xxxxxx
Entities Contribution in Kind as though stated herein. In the event of any
conflict between the terms of the this Agreement and the Combination Agreement,
the terms of the Combination Agreement shall prevail.
ARTICLE III
TERMINATION
In the event that:
(a) the Combination Agreement is terminated and becomes null and void in
accordance with its terms; or
(b) the conditions set forth in the Combination Agreement to the Completion
of the Xxxxxx Entities Contribution in Kind are not satisfied by the time
specified therein,
this Agreement shall automatically terminate and become wholly null and void and
have no effect, with no liability on the part of any Party, but without
prejudice to any rights or liabilities any Party may have against any other
Party for breach of the Combination Agreement.
ARTICLE IV
MISCELLANEOUS
4.1 Representations of the Xxxxxx Entities
The Xxxxxx Entities represent to Axalto that:
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They are acquiring the shares of Axalto Common Stock ("AXALTO SHARES") pursuant
to the Xxxxxx Entities Contribution in Kind for their own account for investment
and not with a view towards the resale, transfer or distribution thereof, nor
with any present intention of distributing the Axalto Shares.
Neither the Xxxxxx Entities nor any of their affiliates, as such term is defined
in Rule 501(b) under the United States Securities Act of 1933, as amended (the
"SECURITIES ACT"), nor any person acting on its or their behalf (i) has offered,
or will offer, to sell the Xxxxxx Entities Shares in the United States by means
of any form of general solicitation or general advertising within the meaning of
Rule 502(c) under the Securities Act or (ii) has engaged, and no such person
will engage, in any directed selling efforts within the meaning of Rule 902(b)
of Regulation under the Securities Act. They agree that they will not offer to
sell Axalto Shares other than in accordance with the foregoing and no such
transfer shall be made that could be integrated with the Offer for purposes of
the Securities Act.
4.2 Axalto Representation
Axalto represents to the Xxxxxx Entities that:
Neither Axalto nor any of its affiliates, as such term is defined in Rule 501(b)
under the Securities Act nor any person acting on its or their behalf (i) has
offered to sell the Axalto Shares in the United States by means of any form of
general solicitation or general advertising within the meaning of Rule 502(c)
under the Securities Act or (ii) has engaged, and no such person will engage, in
any directed selling efforts within the meaning of Rule 902(b) of Regulation
under the Securities Act.
4.3 Governing Law
This Agreement is governed by and shall be construed in accordance with the laws
of The Netherlands.
4.4 Jurisdiction
Any and all disputes arising out of or in connection with this Agreement shall
be finally settled under the then-prevailing Rules of Arbitration of the
International Chamber of Commerce by three arbitrators appointed in accordance
with the Rules. The venue of the arbitration shall be Geneva (Switzerland) and
the language shall be English. The arbitrators shall not act in amiable
composition.
4.5 Further Actions
Each party to this Agreement shall from time to time do and perform such other
and further acts and execute and deliver any and all such further instruments,
as may be necessary, proper or required by law to consummate and make effective
the transactions contemplated by this Agreement.
IN WITNESS WHEREOF, this Agreement has been signed in Amsterdam, The
Netherlands, by or on behalf of each of the parties as of the day first above
written in six (6) original copies.
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XXXXX 1 BETEILIGUNGS GMBH
ACTON 3 BETEILIGUNGS GMBH
XXX. XXXXXXX XXXXXX
XX. XXXXXX XXXXXX
By: /s/ Xx. Xxxxxxxx Xxxxx
------------------------------------
Name: Xx. Xxxxxxxx Xxxxx
Title: Attorney-in-fact
ACTON 2 BETEILIGUNGS GMBH
By: /s/ Xx. Xxxxxxxx Xxxxx
------------------------------------
Name: Xx. Xxxxxxxx Xxxxx
Title: Managing Director
AXALTO HOLDING N.V.
By: /s/ Olivier Piou
------------------------------------
Name: Olivier Piou
Title: Chief Executive Officer
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