EXHIBIT 2.1
OPTION AGREEMENT
This Option Agreement is entered into this 3rd day of the month of October 2002,
in Milan, by and between:
(1) IMPCO Technologies Inc., a company incorporated and existing under the
laws of State of Delaware U.S.A. with registered offices at 00000,
Xxxxxxx Xxxxx, Xxxxxxxx, Xx., X.X.X., represented by its director and
attorney-in-fact, Xx. Xxxxxxx X. Xxxxx (hereinafter referred to as
"Impco"); and
(2) Xx. Xxxxxxx Xxxxxxxxxx, born in Narzole, on 15 March 1951, and domiciled
at Xxxxxxxx, Xxx Xx Xxxxx, 0, married, in a separation of assets regime;
(3) Mr. Pier Xxxxxxx Xxxxxxxxxx, born in Narzole, on 22 July 1952, and
domiciled at Xxxxxxxx, Xxx Xx Xxxxx, 0, married, in a separation of
assets regime;
(4) Xxx. Xxxxx Xxxxxxxx, born in Cherasco, on 4 November 1956, domiciled at
Cherasco, Xxx Xx Xxxxx, 0, married, in a separation of assets regime;
(5) Xxx. Xxxxx Xxxxxxxx, born in La Xxxxx, on 16 March 1957, domiciled at
Cherasco, Xxx Xx Xxxxx, 0, married in a separation of assets regime
(Messrs. Xxxxxxx and Pier Xxxxxxx Xxxxxxxxxx, Xxxxx Xxxxxxxx and Xxxxx
Xxxxxxxx are hereinafter jointly referred to as the "Sellers").
(Impco and Xxxxxxxxxx hereinafter individually referred to as one "Party",
collectively referred to as the "Parties").
WHEREAS:
The Sellers are the controlling shareholders of B.R.C. Societa a
Responsabilita Limitata, with registered offices at Cherasco, via La
Xxxxx 1, registered with the Court of Alba under the no. 02811070040
(hereinafter referred to as the "Parent").
(B) The Parent, in turn, in addition to certain assets and liabilities
belonging to the Sellers' family, holds a quota representing 100% of the
issued and outstanding corporate capital of M.T.M. S.r.l., a limited
liability company with registered offices at Cherasco, via La Xxxxx 1,
registered with the Court of Alba under the no. 00525960043 (hereinafter
referred to as the "Company").
(C) Impco and the Sellers have entered into negotiations aimed at considering
the possible acquisition by Impco of the Company and/or the integration
of the Company's operations with the operations of Impco's international
group of companies.
Following several meetings and discussions, on 17 April 2002 Impco and
the Company entered into a Confidentiality Agreement which included as an
attachment a Term Sheet (all such documents are hereinafter referred to
as the "Letter of Intent"), setting out reciprocal confidentiality
undertakings of the Parties and the basic arrangements reached by the
parties in relation to the envisaged transaction.
(E) In accordance with the terms of the Letter of Intent, from 22 April 2002
to 7 May 2002 Impco carried out a due diligence on the Parent's and the
Company's legal and
accounting situation (the "Due Diligence"); from 13 May 2002 to 14 May
2002 the Sellers carried out a due diligence on Impco's legal and
accounting situation.
(F) On the basis of the Due Diligence findings Impco and the Sellers have
agreed certain amendments to their basic arrangements which were
reflected in an Amendment to the Letter of Intent signed on 21 June 2002
(the "Amendment" and, together with the Letter of Intent, the "Amended
Letter of Intent").
(G) The Sellers have agreed to grant to Impco, which agreed to acquire, an
option to enter into certain agreements providing for the purchase by
Impco of a participation equal to 50% of the Parent, the granting of
certain options between the Parties concerning the sale and purchase of
the remaining 50% of the Parent's legal capital, and certain shareholders
agreement in relation to the governance of the Parent and the Company, at
terms agreed between the Parties.
NOW, THEREFORE, the Parties hereto have agreed as follows:
1. DEFINITIONS
Terms defined in the Contracts (as defined below) shall have the same
meaning when used herein; in addition, the following terms, when used
herein with capital letters, shall have the meanings respectively
ascribed thereto in this Clause 1.
1.1 "Contracts" means the Sale and Purchase Agreement, the Shareholders
Agreement, the Pledge Agreement and the Option Deed.
1.2 "Fiduciary Terms" means the general terms and conditions of the fiduciary
mandate granted by the Sellers and Impco to the Fiduciary Company.
1.3 "Irrevocable Instructions" means the joint irrevocable instructions
granted by the Sellers and Impco to the Fiduciary Company in the form
attached hereto as Annex 1.3 to supplement the Fiduciary Terms.
1.4 "Lock-Up Agreement" means the agreement attached hereto as Annex 1.4
pursuant to which the Sellers have agreed to restrict their ability to
dispose of the Lock-Up Impco Shares.
1.5 "Lock-Up Impco Shares" means 1,662,818 ordinary shares of Impco, being
72% of the Impco Shares.
1.6 "Option Period" means the 15-day period commencing on 1 January 2003 and
ending on 15 January 2003.
1.7 "Option Price" has the meaning attributed thereto in Section 3.1.
1.8 "Pledge Agreement" means the Italian pledge agreement in the form
attached hereto as Annex 1.8 pursuant to which on the Execution Date the
Quota shall be pledged in favor of the Sellers to secure payment by Impco
of the Deferred Portion of the Purchase Price.
1.9 "Sale and Purchase Agreement" means the sale and purchase agreement
attached hereto as Annex 1.9.
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1.10 "Shareholders Agreement" means the shareholders agreement attached hereto
as Annex 1.10.
1.11 "Fiduciary Company" means Cititrust S.p.A., a fiduciary company
incorporated pursuant to Italian law, with registered offices at Foro
Buonaparte 16, Milan.
2. GRANTING OF OPTION
2.1 The Sellers hereby irrevocably grant to Impco, which hereby accepts, the
right to enter into the Contracts, within the terms and pursuant to the
conditions set out herein.
2.2 By way of implementation of the granting of the Option, simultaneously
with the signing of this Option Agreement and with payment by Impco of
the first tranche of the Option Price pursuant to Section 3.1.1 below,
the Parties have executed or caused to be executed the following actions:
2.2.1 The Sellers have registered the Quota in the name of the
Fiduciary Company, pursuant to the Fiduciary Terms and the
Irrevocable Instructions.
The Sellers, Impco and the Fiduciary Company have signed and
exchanged the Fiduciary Terms and the Irrevocable Instructions.
The Sellers have signed the Contracts and have delivered them to
the Fiduciary Company to be kept and disposed of in accordance
with the Irrevocable Instructions.
2.2.4 The Sellers have signed the Lock-Up Agreement and have delivered
it to the Fiduciary Company.
3. OPTION PRICE
3.1 In consideration for the granting of the option pursuant to Section 2.1
above, Impco hereby agrees to pay to the Sellers the amount of USD
11,500,000 (U.S. Dollars eleven million five hundred thousand) (the
"Option Price") as follows:
As to USD 1,500,000 (U.S. Dollars one million five hundred
thousand) in cash by wire transfer to the Sellers' account no.
36840 with Monte dei Paschi di Siena, branch no. 100 at Xxx
Xxxxxxx 00, Xxxxx, on the date of signing of this Option
Agreement and simultaneously with implementation of the actions
set out in Section 2.2 above (Step One) followed by:
3.1.2 as to the balance of USD 10,000,000 (U.S. Dollars ten million) by
delivering to the Fiduciary Company, for the account of the
Sellers, the Impco Shares duly recorded in the name of the
Sellers, on or before, and in any case no later than, 28 November
2002 (Step Two).
3.2 Pursuant to the Lock-Up Agreement the Sellers have agreed to abide by
certain restrictions to their ability to dispose of the Lock-Up Impco
Shares. The Parties hereby agree and acknowledge that the Sellers may
freely dispose of the portion of the Impco Shares in excess of the
Lock-Up Impco Shares.
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3.3 This Option Agreement shall automatically terminate in case Impco fails
to effect payment of the second tranche of the Option Price as provided
in Section 3.1.2. In such case:
3.3.1 the Sellers shall have the right to retain the first tranche of
the Option Price referred to in Section 3.1.1;
3.3.2 Impco shall pay to the Sellers the amount of USD 2,800,000 (US
Dollars two million eight hundred thousand) as finally liquidated
damages;
3.3.3 neither Party shall have any further claim hereunder towards the
other.
3.4 For the sake of clarity in case this Option Agreement is terminated in
accordance with Section 3.3 above, Impco shall not be under any further
obligation to effect payment of the second tranche of the Option Price,
nor shall the Sellers have any claim in relation to such second tranche
or for damages or for any other reason whatsoever other than as provided
for in Section 3.3.2 above.
3.5 In the event that this option granted hereunder is exercised by Impco
pursuant to Section 4 below, the Option Price shall be deemed to
constitute payment on account of the Purchase Price and shall be deducted
from the amount payable by Impco to the Sellers on the Execution Date
pursuant to the Sale and Purchase Agreement.
3.6 The Parties hereby acknowledge that the number of Impco Shares to be part
of the Option Price pursuant to Section 3.1.2 above has been mutually
agreed and determined, such determination being final and conclusive in
any respect.
3.7 The Impco Shares to be part of the Option Price shall be delivered to the
Fiduciary Company, in accordance with Section 3.1.2 above, fully paid in,
free from any Encumbrance and fully entitled to all rights pertaining to
Impco's ordinary shares pursuant to the applicable law and Impco's
articles of association, including, without limitation, the voting
rights, the right to collect dividends and the preemption rights on any
issue of new capital by Impco.
4. EXERCISE OF THE OPTION
4.1 The option granted by the Sellers hereunder may have exercised by Impco
by delivering to the Sellers and the Fiduciary Company, a notice of
exercise at any time during the Option Period.
4.2 Upon receipt of the notice of exercise Impco and the Sellers shall agree
on the Execution Date, which, save as otherwise agreed between the
Parties, will not be a date later than 31 January 2003, and Impco shall
communicate in writing to the Fiduciary Company the date so agreed upon.
4.3 On the Execution Date the Parties shall perform the activities set out in
Section 5.2 of the Sale and Purchase Agreement and upon completion
thereof the Fiduciary Company shall record as beneficiary holder of the
Quota Impco in place of the Sellers.
4.4 In the event that the Sellers refuse to cooperate in the performance of
the actions set out in Section 5.2 of the Sale and Purchase Agreement,
the Fiduciary Company shall, in
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accordance with the Irrevocable Instructions, deliver to Impco the
Contracts signed by the Sellers and shall record Impco as beneficiary
holder of the Quota upon receipt of: (i) a copy of each of the Contracts
duly signed by Impco; and (ii) the balance of the portion of the Purchase
Price to be paid by Impco on the Execution Date.
5. FIDUCIARY COMPANY
5.1 Any liability of the Parties towards the Fiduciary Company, including,
without limitation, fees and expenses due to the Fiduciary Company for
its services under the Fiduciary Terms and the Irrevocable Instructions
as well as any indemnification due to the Fiduciary Company thereunder or
by operation of law, shall be sustained by the Sellers and Impco in equal
shares, except in the event that the any such liability is the
consequence of a breach by any of the Parties of its obligations
hereunder or under the Fiduciary Terms and the Irrevocable Instructions
or under any of the Contracts, in which case the Party in breach shall be
solely liable for the payment of such liability.
6. APPOINTMENTS
6.1 As soon as reasonably practicable after the date of execution of this
Option Agreement, Impco shall cause that appropriate corporate action
is taken in accordance with California laws and Impco's articles of
association to ensure that: (i) Xx. Xxxxxxx Xxxxxxxxxx is appointed as
member of Impco's board of directors; and (ii) Xx. Xxxxxx Xxxxxxx and Mr.
Marco Selmandi are appointed as members of Impco's executive committee.
Impco shall use its best efforts to cause that Xx. Xxxxxxx Xxxxxxxxxx is
appointed as Chairman of the nomination committee of Impco's board of
directors.
7. INTERIM MANAGEMENT
7.1 During the period between 3rd October 2002 and the Execution Date, the
Sellers shall conduct the businesses of the Parent, the Company and the
Subsidiaries within the ordinary course of business only and in
accordance with past practices, save as otherwise agreed in writing by
Impco in advance.
8. NOTICES
8.1 Any communication or notice in relation to this Agreement shall be
effected in writing and in English language and delivered by registered
letter with receipt by return mail and, if necessary, sent by telegram or
fax in advance, and shall take effect from the date in which the
registered letter is sent.
8.2 The aforesaid communications or notices shall have to be sent to the
following addresses:
If to Impco:
IMPCO Technologies Inc., 00000, Xxxxxxx Xxxxx, Xxxxxxxx, Xx.,
X.X.X., Fax no. [*], attn. [*], with copy to Studio Xxxxxxxx e
Associati, xxx xxx Xxxxx 0 00000 Xxxxxx, Xxxxx, attn. Xxxxxxx
Xxxxxxxx, fax no. x000000000000;
If to the Sellers collectively:
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Xxxxxxx Xxxxxxxxxx, c/o Studio Tibaldi Girando, via S. Margherita
8 Alba (CN) (Italy), fax no. x000000000000, with copy to Xxx.
Xxxxx Xx Xxxx, X.xx Xxxxx Xxxxx 00 00000 Xxxxxx (Xxxxx), fax no.
x00000000000.
It is understood that any communication sent to the above addresses shall
be considered as received when effectively delivered to the relevant
Party. Any change of address shall only be valid if communicated in
writing to the other Party.
9. GOVERNING LAW AND JURISDICTION
9.1 This Option Agreement and all ancillary agreements shall be governed by
and interpreted in accordance with the laws of the Republic of Italy.
9.2 Any dispute in relation to the validity, interpretation, execution or
performance of this Option Agreement or any ancillary agreement shall be
submitted to arbitration under the rules of the Amsterdam Chamber of
Commerce by three arbitrators, fluent in Italian and in English, one of
whom will be appointed by Impco, one by the Sellers and the third, who
will act as Chairman, by the first two arbitrators or, in the event of
their failure to reach an agreement within thirty days of their
appointment, in accordance with the arbitration rules of the Amsterdam
Chamber of Commerce. The seat of arbitration shall be Amsterdam.
IN WITNESS WHEREOF, the Parties have executed this Option Agreement in the place
and as of the date first above written.
Impco Technologies Inc. Xxxxxxx Xxxxxxxxxx
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Pier Xxxxxxx Xxxxxxxxxx
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Xxxxx Xxxxxxxx
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Xxxxx Xxxxxxxx
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