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Exhibit 1
STRATEGIC BUSINESS COMBINATION AGREEMENT
BY AND BETWEEN
STEAG ELECTRONIC SYSTEMS AG
AND
XXXXXXX TECHNOLOGY, INC.
JUNE 27, 2000
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TABLE OF CONTENTS
PAGE
ARTICLE I. CAPITALIZATION OF NEWCO..........................................................2
1.1 Transfer of Foreign STEAG Subsidiary Shares to Newco..........................2
ARTICLE II. PURCHASE AND SALE OF STOCK......................................................2
2.1 Purchase and Sale of Stock....................................................2
2.2 Adjustment for Capital Changes................................................2
2.3 Assumed Obligations of STEAG..................................................3
2.4 Closing.......................................................................3
2.5 Certificate Legends...........................................................3
2.6 Allocation of Purchase Price..................................................3
2.7 Tax Election..................................................................4
2.8 Early Condition Satisfaction Date.............................................4
2.9 Post-Closing Adjustments......................................................5
ARTICLE III. REPRESENTATIONS AND WARRANTIES OF STEAG........................................6
3.1 Due Incorporation.............................................................7
3.2 Due Authorization.............................................................7
3.3 Non-Contravention/Consents and Approvals......................................8
3.4 Capital Structure.............................................................9
3.5 Financial Statements; Undisclosed Liabilities; Other Documents...............10
3.6 No Material Adverse Effects or Changes.......................................10
3.7 Properties...................................................................11
3.8 Intellectual Property........................................................12
3.9 Insurance....................................................................13
3.10 International Employee Plans.................................................13
3.11 United States Employee Matters and ERISA.....................................14
3.12 Labor Matters................................................................15
3.13 Tax Returns and Audits.......................................................16
3.14 Environmental Matters........................................................18
3.15 Litigation...................................................................20
3.16 Compliance with Applicable Laws..............................................20
3.17 Contracts; No Defaults.......................................................21
3.18 Change in Control and Severance Payments.....................................21
3.19 Year 2000....................................................................21
3.20 Broker's/Finder's Fees.......................................................22
3.21 Interim Operations of Newco..................................................22
3.22 Investment...................................................................22
ARTICLE IV. REPRESENTATIONS AND WARRANTIES OF XXXXXXX......................................22
4.1 Due Incorporation, Subsidiaries, and Due Authorization.......................23
4.2 Non-Contravention; Consents and Approvals....................................23
4.3 Capitalization...............................................................24
4.4 Financial Statements; Undisclosed Liabilities; Other Documents...............25
4.5 SEC Filings..................................................................26
4.6 No Material Adverse Effects or Changes.......................................26
4.7 Properties...................................................................26
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4.8 Intellectual Property........................................................27
4.9 Insurance....................................................................28
4.10 Employee Matters and ERISA...................................................28
4.11 Labor Matters................................................................30
4.12 Tax Returns and Audits.......................................................30
4.13 Environmental Matters........................................................32
4.14 Litigation...................................................................33
4.15 Compliance with Applicable Laws..............................................34
4.16 Contracts; No Defaults.......................................................34
4.17 Change in Control and Severance Payments.....................................34
4.18 Year 2000....................................................................35
4.19 Brokers and Finders..........................................................35
4.20 Opinion of Financial Advisor.................................................35
4.21 Vote Required................................................................35
4.22 Investment Company Act.......................................................35
4.23 CFM Agreement................................................................35
ARTICLE V. CONDUCT PRIOR TO THE CLOSING.....................................................36
5.1 Conduct of Business of STEAG Subsidiaries....................................36
5.2 Conduct of Business of Xxxxxxx...............................................38
5.3 Other Negotiations...........................................................40
5.4 German Counterpart Agreement.................................................41
ARTICLE VI. ADDITIONAL AGREEMENTS AND COVENANTS.............................................41
6.1 Covenant to Satisfy Conditions...............................................41
6.2 Proxy Materials and Stockholder Approval.....................................42
6.3 Integration Committee........................................................43
6.4 Employee Benefits............................................................43
6.5 Sale of Shares Pursuant to Regulation D......................................44
6.6 Access to Information........................................................44
6.7 Confidentiality..............................................................45
6.8 Public Disclosure............................................................45
6.9 Regulatory Approval; Further Assurances......................................45
6.10 Legal Requirements...........................................................46
6.11 Stock Option Grants..........................................................47
6.12 Conveyance Taxes.............................................................47
6.13 STEAG Intercompany Indebtedness; Transfer to Newco...........................47
6.14 Non-Solicitation of Employees................................................48
6.15 NASDAQ Listing...............................................................48
6.16 Directors; Nominating Committee; Officers....................................48
6.17 Name.........................................................................48
6.18 Access to Business Records...................................................48
ARTICLE VII. CONDITIONS TO THE STRATEGIC BUSINESS COMBINATION...............................49
7.1 Conditions to Each Party's Obligation to Consummate the Strategic Business
Combination..................................................................49
7.2 Conditions to Obligations of Xxxxxxx.........................................50
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7.3 Conditions to Obligations of STEAG...........................................51
ARTICLE VIII. TERMINATION, AMENDMENT AND WAIVER.............................................53
8.1 Optional Termination.........................................................53
8.2 Automatic Termination........................................................55
8.3 Effect of Termination........................................................55
8.4 Amendment....................................................................55
8.5 Extension; Waiver............................................................56
8.6 Notice of Termination........................................................56
ARTICLE IX. INDEMNIFICATION.................................................................56
9.1 Indemnification..............................................................56
9.2 Procedures for Indemnification...............................................57
9.3 Defense of Third Party Claims................................................57
9.4 Settlement of Third Party Claims.............................................58
ARTICLE X. GENERAL PROVISIONS...............................................................59
10.1 Notices......................................................................59
10.2 Definitions..................................................................60
10.3 Counterparts.................................................................60
10.4 Entire Agreement; Nonassignability...........................................61
10.5 Severability.................................................................61
10.6 Remedies Cumulative..........................................................61
10.7 No Survival of Warranties....................................................61
10.8 Expenses.....................................................................61
10.9 United States Dollars........................................................61
10.10 Governing Law................................................................61
10.11 Consent to Jurisdiction......................................................62
10.12 Rules of Construction........................................................62
10.13 Third Party Beneficiaries....................................................62
10.14 Certain Payments by Xxxxxxx..................................................62
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STRATEGIC BUSINESS COMBINATION AGREEMENT
THIS STRATEGIC BUSINESS COMBINATION AGREEMENT (this "Agreement"), dated
as of June 27, 2000, is entered into by and among STEAG Electronic Systems AG,
an Aktiengesellschaft organized and existing under the laws of the Federal
Republic of Germany ("STEAG"), and Xxxxxxx Technology, Inc., a Delaware
corporation ("Mattson").
RECITALS
A. STEAG and Mattson desire to enter into a transaction pursuant to
which Mattson will directly or indirectly acquire 100% of the issued and
outstanding capital stock, equity ownership or its equivalent (which, for
purposes of this Agreement, shall be referred to as "capital stock") (the "Stock
Acquisition") of the STEAG subsidiaries listed on Exhibit A to this Agreement
and STEAG Electronic Systems Semiconductor GmbH, a Gesellschaft mit
beschraenkter Haftung recently organized in connection with this Agreement and
existing under the laws of the Federal Republic of Germany ("Newco")
(collectively with the subsidiaries listed on Exhibit A, the "STEAG
Subsidiaries").
B. Prior to the Closing (as defined below), STEAG will contribute,
assign or otherwise transfer all of the capital stock it owns directly in of
each of those STEAG Subsidiaries incorporated or organized in jurisdictions
other than the U.S.A. and Germany to Newco, and at STEAG's option, STEAG may
also contribute, assign or otherwise transfer to Newco all of the capital stock
STEAG owns directly in of each of those STEAG Subsidiaries incorporated in the
U.S.A. (collectively, all such subsidiaries of STEAG that STEAG contributes or
transfers to Newco, the "Foreign STEAG Subsidiaries" and such capital stock, the
"Foreign Subsidiary Shares"), after which STEAG will own 100% of the capital
stock of Newco.
C. To effect the Stock Acquisition, at the Closing, STEAG will sell,
assign and transfer to Xxxxxxx 100% of the issued and outstanding capital stock
of Newco, each of the other STEAG Subsidiaries incorporated or organized in
Germany and each of the STEAG Subsidiaries incorporated in the U.S.A. that STEAG
owns directly and does not contribute or otherwise transfer to Newco (the
"Direct STEAG Subsidiaries", and such capital stock, the "Direct Subsidiary
Shares"), and in consideration thereof Xxxxxxx will issue and deliver to STEAG
shares of Xxxxxxx'x common stock, par value $0.001 per share (the "Xxxxxxx
Common Stock"), as provided in Article II below (the "Share Issuance"; together,
the Stock Acquisition and the Share Issuance are referred to herein as the
"Strategic Business Combination").
D. Concurrently herewith, Mattson, M2C Acquisition Corporation, a
Delaware corporation and a wholly-owned subsidiary of Mattson ("M2C"), and CFM
Technologies, Inc., a Pennsylvania corporation ("CFM"), are executing an
Agreement and Plan of Merger of even date herewith (the "CFM Agreement") which
provides (among other things) that, subject to the terms and conditions thereof,
M2C shall be merged with and into CFM (the "CFM Merger"), and it is the intent
and desire of STEAG, Xxxxxxx and CFM that the Strategic Business Combination and
the CFM Merger be mutually conditioned on the simultaneous consummation of both
such transactions for the long-term strategic benefit of their respective
stockholders.
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E. STEAG and Xxxxxxx desire to make certain representations, warranties,
covenants, and agreements in connection with the transactions contemplated by
this Agreement.
F. The Supervisory Board (Aufsichtsrat) and the Management Board
(Vorstand) of STEAG and the Board of Directors of Xxxxxxx have approved the
transactions contemplated by this Agreement in accordance with the laws of their
respective jurisdictions of organization and have authorized the execution and
delivery of this Agreement.
G. In order to induce STEAG to enter into this Agreement, Xxxx Xxxxxxx
has entered into an agreement, dated the date hereof, between STEAG and Xxxx
Xxxxxxx (the "Voting Agreement"), pursuant to which Xxxx Xxxxxxx has agreed to
vote all of his shares of Mattson Common Stock in favor of the Mattson
Stockholder Proposal (as defined in Section 4.2(b)(iii) below).
NOW, THEREFORE, in consideration of the covenants and representations
set forth herein, and for other good and valuable consideration, STEAG and
Xxxxxxx agree as follows:
ARTICLE I.
CAPITALIZATION OF NEWCO
1.1 Transfer of Foreign STEAG Subsidiary Shares to Newco. Prior to the
Closing (as defined below in Section 2.4), STEAG shall transfer and deliver,
whether by capital contribution, sale or otherwise, the Foreign Subsidiary
Shares to Newco, notarized in accordance with applicable law as necessary to
effect their transfer. The transactions described in this Section 1.1 will be
effected in such manner that (a) Newco will own all of the Foreign Subsidiary
Shares, (b) Newco will have no other assets or liabilities (other than its
initial 25,000 Euro cash capitalization) and (c) STEAG will own 100% of the
issued and outstanding capital stock of Newco (the "Newco Shares" and, together
with the Direct Subsidiary Shares, the "STEAG Shares").
ARTICLE II.
PURCHASE AND SALE OF STOCK
2.1 Purchase and Sale of Stock. At the Closing, Xxxxxxx shall purchase
and accept delivery of the STEAG Shares from STEAG, and STEAG shall sell,
transfer, and deliver the STEAG Shares to Xxxxxxx. In consideration of such
sale, at the Closing, (a) Xxxxxxx shall issue and deliver to STEAG: (i)
11,850,000 shares of Xxxxxxx Common Stock, subject to adjustment pursuant to
Section 2.2 below (the "Xxxxxxx Shares"), (ii) US$100,000 payable in immediately
available funds to an account designated in a written notice delivered to
Xxxxxxx by STEAG at least three (3) business days prior to the Closing and (iii)
if applicable, the Xxxxxxx Note referred to in Section 8.1(j), and (b) Xxxxxxx
shall assume the obligations referred to in Section 2.3.
2.2 Adjustment for Capital Changes. If, between the date of this
Agreement and the Closing, the outstanding shares of Xxxxxxx Common Stock shall
have been changed into a different number of shares or a different class by
reason of any reclassification, recapitalization, stock split, reverse stock
split, combination, or exchange of shares, or a stock dividend or
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dividend payable in any other securities shall be declared with a record date
within such period, or any similar event affecting shares of Xxxxxxx Common
Stock shall have occurred (each a "Capital Change"), the number of Xxxxxxx
Shares and/or type of security issuable to STEAG pursuant to the Share Issuance
(the "Xxxxxxx Share Amount") shall be proportionately adjusted to reflect any
such Capital Change.
2.3 Assumed Obligations of STEAG. Effective upon the Closing, STEAG will
assign to Xxxxxxx, and Xxxxxxx will assume from STEAG, STEAG's rights and
obligations under the agreements, guarantees or other instruments listed on
Schedule 2.3 attached hereto. Except as provided in this Section 2.3 and
Schedule 2.3 or as expressly provided elsewhere in this Agreement, Xxxxxxx does
not assume any obligation or right of STEAG.
2.4 Closing. The closing of the transactions contemplated hereby (the
"Closing") shall take place as soon as practicable, but no later than three (3)
business days, after the later of (i) satisfaction or waiver of each of the
conditions set forth in Article VII hereof and (ii) January 1, 2001, or at such
other time as the parties hereto agree (the "Closing Date"). The Closing shall
take place at the offices of Xxxx Xxxx Xxxx & Freidenrich LLP, 000 Xxxxxxxx
Xxxxxx, Xxxx Xxxx, XX 00000-0000 or at such other location or locations as the
parties hereto agree.
2.5 Certificate Legends. The Xxxxxxx Shares to be issued pursuant to
this Article II shall not have been registered and shall be characterized as
"restricted securities" under the United States federal securities laws, and
under such laws such shares may be resold without registration under the
Securities Act of 1933, as amended (the "Securities Act"), only in certain
limited circumstances. Each certificate evidencing the Xxxxxxx Shares to be
issued pursuant to this Article II shall bear the following legend:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933. SUCH SHARES MAY NOT BE SOLD OR OTHERWISE TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION UNDER THE SECURITIES ACT,
SUCH EXEMPTION TO BE EVIDENCED BY AN OPINION OF LEGAL COUNSEL OR OTHER
DOCUMENTATION REASONABLY ACCEPTABLE TO THE COMPANY."
and such other legends as required pursuant to the Stockholder Agreement (as
defined in Section 7.2(f)).
2.6 Allocation of Purchase Price. STEAG and Xxxxxxx agree to allocate
the value of (i) the Newco Shares among the Foreign STEAG Subsidiaries and (ii)
the Xxxxxxx Shares among the Direct STEAG Subsidiaries and Newco for financial
accounting and tax purposes in accordance with the percentages set forth on the
allocation schedule attached as Schedule 2.6 attached hereto. Neither STEAG nor
Xxxxxxx shall voluntarily take any position for purposes of any federal, state,
provincial, or local income tax with respect to the allocation of the Xxxxxxx
Shares and Newco Shares which is inconsistent with such allocation. Nothing
herein will limit STEAG's right to determine the stated values of the Direct
Subsidiary Shares contributed to
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Newco or the number of Newco Shares issued as long as the percentages provided
on Schedule 2.6 are unaffected.
2.7 Tax Election. After consummation of the Strategic Business
Combination, Xxxxxxx may, in its sole discretion, make an election, and may
cause some or all of the STEAG Subsidiaries, to make an election, under Section
338(g) of the United States Internal Revenue Code of 1986, as amended (the
"Code") (and any corresponding elections under state, local, or foreign law)
with regard to the transactions contemplated by this Agreement. Xxxxxxx
acknowledges and agrees that STEAG makes no representations or warranties that
any such election is available and that STEAG shall have no liability to Xxxxxxx
or any other person for the consequences of any such election.
2.8 Early Condition Satisfaction Date. If (i) prior to December 1, 2000,
all of the conditions set forth in Section 7.1 have been satisfied, Xxxx Xxxxxxx
shall have executed and delivered counterparts of the Stockholder Agreement, and
all of the conditions set forth in Sections 7.2 and 7.3 (other than conditions
which, by their nature, can only be satisfied by delivery of securities,
documents or other instruments on the Closing Date) would have been either
satisfied or waived by the relevant party were the Closing to occur at such time
and (ii) simultaneously with the actions contemplated by this Section 2.8, the
actions contemplated by Section 1.10 of the CFM Agreement (the "CFM Early
Satisfaction Date Actions") also occur and STEAG is provided reasonably
satisfactory evidence of the simultaneous occurrence thereof, then, no later
than three (3) business days thereafter (the "STEAG Early Condition Satisfaction
Date") at a place and time (simultaneous with the CFM Early Satisfaction Date
Actions), to be mutually agreed upon by the parties and CFM, the parties shall
take the following actions:
(a) Xxxxxxx and STEAG will each deliver or cause to be delivered to
the other the closing certificates and legal opinions that would
have been required at the Closing pursuant to Sections 7.2 (c)
and (g) and Sections 7.3 (c) and (i); provided, that such
certificates and opinions shall be dated as of the STEAG Early
Condition Satisfaction Date and shall address representations,
warranties and covenants, in the case of certificates, and
opinions, in the case of legal opinions, as of such date;
(b) Xxxxxxx and STEAG shall each execute and deliver the Stockholder
Agreement; and Xxxxxxx and STEAG shall execute and deliver the
Transition Services Agreement and such other agreements as would
have been required at the Closing pursuant to Sections 7.2 and
7.3; provided, that such agreements shall be dated as of the
STEAG Early Condition Satisfaction Date and shall become
effective upon, but not before, the Closing Date; and
(c) Xxxxxxx shall execute and deliver to STEAG an irrevocable
acknowledgement and waiver, in form and substance reasonably
satisfactory to STEAG and CFM, of the satisfaction or waiver of
the closing conditions set forth in Sections 7.2 and the waiver
of Xxxxxxx'x termination rights set forth in Sections 8.1; and
STEAG shall execute and deliver to Xxxxxxx an irrevocable
acknowledgement and waiver, in form and substance reasonably
satisfactory to Xxxxxxx and CFM, of the
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satisfaction or waiver of the closing conditions set forth in
Sections 7.3 and the waiver of STEAG's termination rights set
forth in Sections 8.1.
Notwithstanding anything contained in this Section 2.8 above, the
Closing shall not occur, and STEAG shall not sell or transfer to Xxxxxxx, and
Xxxxxxx shall not acquire ownership of, any of the STEAG Subsidiaries, prior to
January 1, 2001.
For the purposes of this Section 2.8, the condition set forth in Section
7.1(g) shall be deemed satisfied if, concurrently with the taking of the actions
referred to in clauses (a), (b) and (c) above of this Section 2.8 on the STEAG
Early Condition Satisfaction Date, the CFM Early Satisfaction Date Actions are
taken.
2.9 Post-Closing Adjustments. The following adjustments will be made
with regard to the profits and losses, cash position and capitalization of the
STEAG Subsidiaries following the Closing:
(a) As promptly as practicable, but in no event more than 60 days
following the Closing Date, Xxxxxxx shall prepare and deliver to STEAG (i)
audited income statements of STEAG RTP Systems GmbH and STEAG MicroTech GmbH for
the year ended December 31, 2000 (the "Year 2000 Income Statements"), and (ii) a
statement of the aggregate cash and cash equivalents of the combined STEAG
Subsidiaries as of December 31, 2000 (the "Closing Cash Statement" and, together
with the Year 2000 Income Statements, the "Closing Financial Statements"). The
Year 2000 Income Statements shall be prepared in accordance with German GAAP (as
defined in Section 3.5) applied on a basis consistent with the accounting
principles used in preparation of the income statements for STEAG RTP Systems
GmbH and STEAG MicroTech GmbH referred to in Section 3.5(a). The Year 2000
Income Statements shall be audited by PricewaterhouseCoopers ("PWC"), using
procedures and methods consistent with past practice; provided that Xxxxxxx'x
auditors, Xxxxxx Xxxxxxxx ("AA"), shall be permitted to participate in such
audits. The Closing Cash Statement shall be certified by PWC. STEAG will make
available such STEAG employees who are reasonably necessary for the preparation
of the Closing Financial Statements, using the books and records of the STEAG
Subsidiaries, to assist Xxxxxxx in preparing the Closing Financial Statements.
(b) Unless within 10 business days after its receipt of the
Closing Financial Statements, STEAG delivers to Xxxxxxx a detailed written
statement describing its objections to the Year 2000 Income Statements or the
Closing Cash Statement, such Closing Financial Statements shall be final and
binding. If STEAG delivers such a written objection statement to Xxxxxxx, the
parties and their respective auditors will use reasonable efforts to resolve any
disputes, but if a final resolution is not reached within 20 business days after
Xxxxxxx has submitted its objections, any remaining disputes will be resolved by
an internationally recognized firm of independent certified public accountants
(excluding PWC and AA) mutually selected by Xxxxxxx and STEAG or, if they are
unable to agree, by PWC and AA (the "Reviewing Accountants"). The Reviewing
Accountants shall be instructed to resolve any matters in dispute as promptly as
practicable and, in any event, within 30 days after the dispute is submitted to
them. The determination of the Reviewing Accountants will be final and binding.
Xxxxxxx and STEAG will each pay one-half of the fees and expenses of the
Reviewing Accountants. Xxxxxxx and STEAG shall cooperate with each other and the
Reviewing
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Accountants in connection with the matters contemplated by this Section 2.9,
including by furnishing such information and access to such books, records
(including accountants' work papers), personnel and properties as may be
reasonably requested.
(c) Within 5 days after the Closing Financial Statements become
final, in accordance with the Profit Transfer Contracts (as defined in Section
3.5(c)), (i) Xxxxxxx will cause STEAG RTP Systems GmbH and/or STEAG MicroTech
GmbH to transfer the net profit, if any, for fiscal year 2000 to STEAG, or (ii)
STEAG will reimburse STEAG RTP Systems GmbH and/or STEAG MicroTech GmbH for the
net loss, if any, for fiscal 2000.
(d) If, after taking into account any profit and loss
reimbursement pursuant to Section 2.9(c), the aggregate cash balance of the
combined STEAG Subsidiaries would exceed $10,075,000, Xxxxxxx shall cause the
additional cash in excess of $10,075,000 to be transferred to STEAG at the time
of any payments under Section 2.9(c); provided, that Xxxxxxx shall not be
obligated to transfer more than DM20,000,000 of such excess cash. If, after
taking into account any profit and loss reimbursement pursuant to Section
2.9(c), the aggregate cash balance of the combined STEAG Subsidiaries would be
less than $10,075,000, STEAG shall contribute to the STEAG Subsidiaries
(allocated among the STEAG Subsidiaries as agreed by the parties) cash in the
amount of such deficit at the time of any payments under Section 2.9(c );
provided, that STEAG shall not be obligated to contribute more than DM20,000,000
of such deficit.
2.10 Transfer of U.S. STEAG Subsidiaries to Newco. Not later than 10
days prior to the Closing, STEAG may, at its sole discretion, transfer the
shares of each of the STEAG Subsidiaries incorporated in the U.S.A. that STEAG
owns directly to Newco. In such event, notwithstanding anything to the contrary
contained in this Agreement, (i) STEAG shall have no obligation to transfer the
shares of such U.S. STEAG Subsidiaries to Xxxxxxx at the Closing, and (ii) at
the time of any contribution or reimbursement to or from the STEAG Subsidiaries
pursuant to Section 2.9(c), STEAG shall contribute to the STEAG Subsidiaries (or
the profit to be transferred to STEAG shall be reduced by) an amount equal to
$12,300,000.
ARTICLE III.
REPRESENTATIONS AND WARRANTIES OF STEAG
STEAG represents and warrants to Xxxxxxx as follows, except as disclosed
in a document of even date herewith and delivered by STEAG to Xxxxxxx referring
to the representations and warranties in this Agreement (the "STEAG Disclosure
Schedule"). (The STEAG Disclosure Schedule will be arranged in paragraphs
corresponding to the numbered and lettered paragraphs contained in this Article
III, and the disclosure in any such numbered and lettered section of the STEAG
Disclosure Schedule shall qualify only the corresponding section in this Article
III, except to the extent disclosure in any numbered and lettered section of the
STEAG Disclosure Schedule is specifically cross-referenced in another numbered
and lettered section of the STEAG Disclosure Schedule.)
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3.1 Due Incorporation.
(a) STEAG and each of the STEAG Subsidiaries is a corporation
duly organized, validly existing, and, where such term is recognized under
applicable law, in good standing under the laws of its jurisdiction of
organization, with all requisite corporate power and authority to own, lease,
and operate its properties and to carry on its business as now being conducted.
STEAG and each of the STEAG Subsidiaries is qualified to do business and is,
where such term is recognized under applicable law, in good standing as a
foreign corporation in each jurisdiction where the nature of the properties
owned, leased, or operated by it and the business transacted by it require such
qualification, except where the failure to be so qualified would not reasonably
be expected to have a STEAG Material Adverse Effect (as defined in Section 3.6
hereof). The jurisdictions in which the STEAG Subsidiaries are qualified to do
business as a foreign corporation are set forth next to each such entity's name
on Section 3.1 of the STEAG Disclosure Schedule. True, correct, and complete
copies of STEAG's Memorandum and Articles of Association (Satzung) and
Management Board (Vorstand) Rules of Procedure (Geschaeftsordnung), and the
organizational documents of each STEAG Subsidiary have been delivered to
Xxxxxxx.
(b) Section 3.1 of the STEAG Disclosure Schedule sets forth the
name of each STEAG Subsidiary, the nation or jurisdiction of its incorporation
or organization, a description of the equity ownership interest in each such
STEAG Subsidiary by STEAG, any other STEAG Subsidiary, and/or any other person,
and a brief description of the principal line or lines of business conducted by
each such entity. Except as set forth on Section 3.1 of the STEAG Disclosure
Schedule, all of the issued and outstanding shares or other units of capital
stock of each STEAG Subsidiary are validly issued, fully paid, nonassessable,
and free of preemptive rights, and are owned, directly or indirectly, by STEAG
free and clear of any liens, claims, encumbrances, security interests, equities,
charges, and options of any nature whatsoever, and there are no outstanding
subscriptions, options, calls, contracts, voting trusts, proxies, or other
commitments, understandings, restrictions, arrangements, rights, or warrants,
including any right of conversion or exchange under any outstanding security,
instrument, or other agreement, obligating any such subsidiary to issue,
deliver, or sell, or cause to be issued, delivered, or sold, additional shares
of its capital stock or obligating it to grant, extend, or enter into any such
agreement or commitment (collectively, "Encumbrances"). None of the STEAG
Subsidiaries are subject or party to any profit distribution, profit-sharing or
profit transfer agreements other than the Profit Transfer Contracts as defined
in Section 3.5(c). At the Closing, Xxxxxxx will receive good and valid title to
shares or other units of capital stock representing one hundred percent (100%)
of the equity ownership interest of Newco and each Direct STEAG Subsidiary, and
Newco will hold good and valid title to each Foreign STEAG Subsidiary, free and
clear of any Encumbrances.
3.2 Due Authorization. STEAG has full corporate power and authority to
enter into this Agreement and to consummate the transactions contemplated
hereby. The execution, delivery, and performance by STEAG of this Agreement have
been duly and validly approved and authorized by the Management Board (Vorstand)
and the Supervisory Board (Aufsichtsrat) of STEAG and, except for resolutions
and corporate formalities required to implement Section 1.1, no other actions or
proceedings on the part of STEAG are necessary to authorize this Agreement and
the transactions contemplated hereby. STEAG has duly and validly executed
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and delivered this Agreement. This Agreement constitutes the legal, valid, and
binding obligation of STEAG enforceable against it in accordance with its terms,
except as such enforceability may be limited by applicable bankruptcy,
insolvency, fraudulent transfer, moratorium, reorganization, or other laws from
time to time in effect which affect creditors' rights generally and by general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
3.3 Non-Contravention/Consents and Approvals.
(a) The execution and delivery of this Agreement by STEAG does
not, and the performance by STEAG of its obligations hereunder and the
consummation of the transactions contemplated hereby, will not conflict with,
result in a violation or breach of, constitute (with or without notice or lapse
of time or both) a default under, result in or give to any person any right of
payment or reimbursement, termination, cancellation, modification or
acceleration of, or result in the creation or imposition of any lien upon any of
the assets or properties of STEAG or any STEAG Subsidiary under, any of the
terms, conditions or provisions of (i) Memorandum and Articles of Association
(Satzung) or Management Board (Vorstand) Rules of Procedure, or the articles of
incorporation or bylaws (or other comparable charter documents) of STEAG or any
STEAG Subsidiary, or (ii) subject to the taking of the actions described in
paragraph (b) of this Section 3.3, (x) any statute, law, rule, regulation, or
ordinance (together, "Laws") applicable to STEAG and the STEAG Subsidiaries, or
any judgment, decree, order, writ, permit, or license, of any Governmental
Entity (as defined in paragraph (b) below), applicable to STEAG or any STEAG
Subsidiary or any of their respective assets or properties, or (y) any contract,
agreement, or commitment to which STEAG or any STEAG Subsidiary is a party or by
which STEAG or any STEAG Subsidiary or any of their respective assets or
properties is bound, excluding from the foregoing clauses (x) and (y) conflicts,
violations, breaches, defaults, terminations, modifications, accelerations, and
creations and impositions of liens which would not reasonably be expected to
have a STEAG Material Adverse Effect or would not result in the inability of
STEAG to consummate the transactions contemplated by this Agreement.
(b) No consent, approval, order, or notice to or authorization
of, or registration, declaration, or filing with, any United States federal,
state, local, or foreign court, administrative agency or commission, or other
governmental entity or instrumentality (including a stock exchange or other
self-regulatory body) (a "Governmental Entity"), is required to be made or
obtained by STEAG or any of the STEAG Subsidiaries for the execution and
delivery of this Agreement or the consummation by STEAG of the transactions
contemplated hereby, the failure to obtain which would reasonably be expected to
have a STEAG Material Adverse Effect or prevent or materially delay the
consummation of the transactions contemplated hereby, except for:
(i) the filing of a pre-merger notification report by
STEAG or its ultimate parent entity under the Xxxx-Xxxxx-Xxxxxx Antitrust
Improvements Act of 1976, as amended (the "HSR Act"), and the expiration or
termination of the applicable waiting period thereunder;
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(ii) the filing of required documents with the relevant
Governmental Entities of the countries or political subdivisions in which STEAG
is qualified to transact business, including, if applicable, any filing under
the German Act Against Restraints on Competition of 1958 (Gesetz gegen
Wettbewerbsbeschraenkungen), and the expiration or termination of the waiting
period thereunder;
(iii) ministerial notices, filings and registrations with
local Governmental Entities in connection with the transfers of the Direct
Subsidiary Shares to Newco by STEAG; and
(iv) such other filings, authorization orders and
approvals as may be required of state and local Governmental Entities (the
"Local Approvals") which are specified in Schedule 3.3 hereto.
3.4 Capital Structure.
(a) Section 3.4 of the STEAG Disclosure Schedule sets forth for
each of the STEAG Subsidiaries:
(i) where such concept is recognized under applicable
legal and accounting principles, the number of authorized shares or other units
of each class or series of capital stock;
(ii) the number of shares or other units of each class or
series of capital stock which are issued and outstanding as of the date of this
Agreement;
(iii) where applicable, the registered share capital;
(iv) the number of shares of other units of each class or
series of capital stock, if any, which are held in the treasury of such entity
as of the date of this Agreement;
(v) the number of shares or other units of each class or
series of capital stock, if any, which are reserved for issuance, indicating
each particular reservation; and
(vi) the aggregate number of shares or other units of each
class or series of capital stock, if any, subject to employee stock options or
other rights to purchase or receive capital stock granted under any stock option
or other stock-based employee or non-employee director benefit plans.
(b) There are no authorized, issued, reserved for issuance, or
outstanding, (i) securities of STEAG or any of the STEAG Subsidiaries
convertible into or exchangeable for shares of capital stock or voting
securities of the STEAG Subsidiaries, or (ii) warrants, calls, options, or other
rights to acquire from the STEAG Subsidiaries, or any obligation of any of the
STEAG Subsidiaries to issue, any shares of capital stock or voting securities or
securities convertible into or exchangeable or exercisable for capital stock or
voting securities of the STEAG Subsidiaries; and, except for this Agreement,
there are no outstanding obligations of the STEAG Subsidiaries to repurchase,
redeem, or otherwise acquire any such securities or to issue, deliver, or sell,
or cause to be issued, delivered, or sold, any such securities.
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3.5 Financial Statements; Undisclosed Liabilities; Other Documents.
(a) For purposes of this Agreement, the "STEAG Financial
Statements" shall mean the separate audited financial statements of each of the
STEAG Subsidiaries as of December 31, 1999 and December 31, 1998 (including all
notes thereto) and the unaudited combined, consolidated financial statements of
the STEAG Subsidiaries as of December 31, 1999 and December 31, 1998, consisting
of the balance sheets at such dates and the related statements of income for the
years then ended (except as otherwise specified in Section 3.5(a) of the STEAG
Disclosure Schedule). The audited STEAG Financial Statements for each STEAG
Subsidiary have been prepared in accordance with generally accepted accounting
principles ("GAAP") applicable in the respective countries in which each STEAG
Subsidiary is incorporated or organized, and the unaudited combined,
consolidated STEAG Financial Statements have been prepared in accordance with
U.S. GAAP, in each case consistently applied. The STEAG Financial Statements
present fairly the financial position of the STEAG Subsidiaries as at the dates
thereof and the results of operations of the STEAG Subsidiaries for the periods
covered thereby, except for the absence of notes to the unaudited combined,
consolidated STEAG Financial Statements.
(b) The STEAG Subsidiaries do not have any liabilities or
obligations of any nature, whether accrued, absolute, contingent, or otherwise,
except (i) as set forth on or reflected in the December 31, 1999 unaudited
combined, consolidated balance sheet of the STEAG Entities (the "STEAG Base
Balance Sheet") or the notes to the December 31, 1999 audited STEAG Financial
Statements for each of the STEAG Subsidiaries, (ii) liabilities and obligations
incurred since December 31, 1999 which are either incurred in the ordinary
course of its business consistent with past practice, or, if incurred outside
the ordinary course of business, are not substantial in amount, (iii) such other
liabilities and obligations that, individually and in the aggregate, do not have
and would not reasonably be expected to have a STEAG Material Adverse Effect,
and (iv) as otherwise set forth on the STEAG Disclosure Schedule.
(c) The Profit Transfer Contracts, dated September 30 and 26,
1997, respectively, between STEAG, on the one hand, and STEAG RTP Systems GmbH
and STEAG MicroTech GmbH, on the other hand (the "Profit Transfer Contracts")
shall have terminated on or before December 31, 2000; provided that such German
STEAG Subsidiaries will continue to be obligated in accordance with such
agreements to transfer any profits or losses for the year ending December 31,
2000 at such time after December 31, 2000 and in such manner as is set forth in
Section 2.9.
3.6 No Material Adverse Effects or Changes. Except as described on
Section 3.6 of the STEAG Disclosure Schedule, or as disclosed in or reflected in
the STEAG Financial Statements, or as contemplated by this Agreement, since
December 31, 1999, none of the STEAG Subsidiaries has (i) taken any of the
actions set forth in subparagraphs (a) through (r) of Section 5.1 hereof, (ii)
suffered any STEAG Material Adverse Effect, and no facts or conditions exist
which are reasonably likely to have, in the aggregate, a STEAG Material Adverse
Effect, (iii) suffered any damage, destruction, or Loss to any of its assets or
properties which is material to the STEAG Subsidiaries, taken as a whole
(whether or not covered by insurance), or (iv) increased the base compensation
of any executive officer of any of the STEAG Subsidiaries, other than in the
ordinary course of business consistent with past practice by more than 10%.
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"Loss" shall mean liabilities, losses, costs, claims, damages, penalties, and
expenses (including attorneys' fees and expenses and costs of investigation and
litigation). "STEAG Material Adverse Effect" shall mean an effect on the
business, operations, assets, liabilities, results of operations, cash flows or
condition (financial or otherwise), of all or any of the STEAG Subsidiaries,
which is materially adverse to the STEAG Subsidiaries, taken as a whole;
provided, that any Loss (including loss of business) suffered by STEAG or any of
the STEAG Subsidiaries as a result of certain patent litigation between CFM and
certain STEAG affiliates or the settlement thereof shall not be deemed to
constitute a STEAG Material Adverse Effect for purposes of this Agreement.
3.7 Properties.
(a) Except as disclosed on Section 3.7 of the STEAG Disclosure
Schedule, the STEAG Subsidiaries (i) have good and valid title to all of the
tangible and intangible assets, properties, and rights reflected in the STEAG
Base Balance Sheet or acquired after December 31, 1999 (other than assets leased
under the leases set forth in Section 3.7 of the STEAG Disclosure Schedule and
assets disposed of in the ordinary course of business since the date of the
STEAG Base Balance Sheet), and (ii) at the Closing Date will have good and valid
title to all material tangible and intangible assets, properties, and rights
referred to in clause (i) above, in each case free and clear of any lien,
encumbrance, pledge, or similar interest, except for liens for Taxes not yet due
and payable and other imperfections of title that, individually and in the
aggregate, are not substantial in character or amount and do not materially
interfere with the business of the STEAG Subsidiaries as presently conducted
("Permitted Liens"). The tangible and intangible assets, properties and rights
owned by the STEAG Subsidiaries taken together are sufficient to permit the
conduct of such business as presently conducted.
(b) Except as otherwise identified in Section 3.7 of the STEAG
Disclosure Schedule hereto, the material tangible assets of each of the STEAG
Subsidiaries, including all mobile equipment, are, in the aggregate, in good
condition and repair, reasonable wear and tear excepted, and are, in the
aggregate, in condition suitable for the use to which they are put in the
respective business of each of the STEAG Subsidiaries.
(c) Set forth on Section 3.7(b) of the STEAG Disclosure Schedule
is a complete list of the facilities in which the STEAG Subsidiaries operate or
conduct business, and for each such facility identifying the title of the lease,
the date of expiration, the monthly rent and the landlord. True and complete
copies of every such lease have been delivered to Xxxxxxx or its counsel.
3.8 Intellectual Property. Except as disclosed in Section 3.8 of the
STEAG Disclosure Schedule hereto:
(a) All of the trademarks, trade names, service marks, patents,
copyrights (including any registrations of or pending applications for any of
the foregoing), technology, trade secrets, inventions, know-how, designs,
computer programs, mask works, processes, and all other intangible assets,
properties, and rights used by any STEAG Subsidiary in the conduct of its
business, other than such items the loss or absence of which (individually or in
the aggregate) would not have a STEAG Material Adverse Effect (the "STEAG
Intellectual
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Property"), are either (i) owned by the relevant STEAG Subsidiary free and clear
of any lien, encumbrance, pledge, or similar interest and are not subject to any
license, royalty or other agreement or (ii) licensed by the relevant STEAG
Subsidiary pursuant to an agreement described in Section 3.8(g).
(b) None of the STEAG Intellectual Property has been since
January 1, 1998 or is the subject of any pending or, to STEAG's knowledge,
threatened (in writing) litigation or claim of infringement.
(c) No license or royalty agreement to which any STEAG Subsidiary
is a party (including any agreement regarding Licensed Intellectual Property as
defined below) is, to STEAG's knowledge, in breach or default by any party
thereto or the subject of any notice of termination given or threatened (in
writing), which breach, default or termination would reasonably be expected to
have a STEAG Material Adverse Effect.
(d) To STEAG's knowledge, none of the products manufactured or
sold by the STEAG Subsidiaries, nor any process, method, part, design, or
material they employ, nor the marketing, distribution and use by the STEAG
Subsidiaries of any such product or any service, infringe any trademark, service
xxxx, trade name, copyright, trade secret, patent, or confidential or
proprietary rights of a third party and the STEAG Subsidiaries have not received
any written notice contesting their right to use any STEAG Intellectual
Property, which claim or contestation, if successful, would reasonably be
expected to have a STEAG Material Adverse Effect.
(e) To the extent that any STEAG Intellectual Property is
licensed by a third party to any STEAG Subsidiary (such STEAG Intellectual
Property referred to as "Licensed Intellectual Property"), the consummation of
the transactions contemplated hereunder will not (i) constitute a breach or
default under any such license agreement which would give the other contracting
party a right to terminate such agreement; (ii) alter or diminish the rights
assigned or transferred to Xxxxxxx or Newco from that originally granted to any
STEAG Subsidiary (as the case may be) under such agreement; or (iii) alter or
increase the obligations delegated or transferred to Xxxxxxx or Newco from that
originally imposed on any STEAG Subsidiary (as the case may be) under such
agreement.
(f) STEAG has disclosed to Xxxxxxx any standard forms of
Assignment Agreement generally signed by employees of STEAG Subsidiaries. To
STEAG's knowledge, all employees of the STEAG Subsidiaries who are employed for
the purpose of the development, invention or creation of any STEAG Intellectual
Property have signed an agreement which is substantially similar to the
aforementioned form which, when signed by an employee, is valid and enforceable
against such employee.
(g) Section 3.8(g) of the STEAG Disclosure Schedule sets forth a
true and complete list of (i) all material agreements regarding Licensed
Intellectual Property; (ii) all patents and patent applications, registered
trademarks and service marks, registered copyrights, registered mask works,
trade names and service marks and any applications therefor, included in the
STEAG Intellectual Property (other than any Licensed Intellectual Property), and
specifies the jurisdictions in which such STEAG Intellectual Property has been
issued or registered or in
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which an application for such issuance and registration has been filed,
including the respective registration or application numbers and the names of
all registered owners; and (iii) all agreements to which any of the STEAG
Intellectual Property (other than any Licensed Intellectual Property) may be
subject.
(h) There are no exclusive licenses, exclusive distributorship
agreements, or noncompetition agreements with respect to the use of any STEAG
Intellectual Property or the development, sale, or distribution of any products
of any STEAG Subsidiary, or any other material restrictions regarding the right
of any of the STEAG Subsidiaries to fully exploit any STEAG Intellectual
Property anywhere in the world. None of the STEAG Subsidiaries is a party to any
reseller or distribution agreement, other than agreements that can be cancelled
or terminated without cost or penalty upon notice of sixty (60) days or less.
3.9 Insurance. Section 3.9 of the STEAG Disclosure Schedule hereto
contains an accurate and complete list of all policies of fire, liability,
worker's compensation, title, and other forms of insurance owned or held by any
STEAG Subsidiary. All such policies are in full force and effect, all premiums
with respect thereto covering all periods up to and including the Closing Date
have been, or prior to the Closing Date, will be, paid and no notice of
cancellation or termination has been received with respect to any such policy
except as would not have a STEAG Material Adverse Effect. STEAG has delivered to
Xxxxxxx a true and complete copy or description of all insurance policies,
including all occurrence-based policies, applicable to the STEAG Subsidiaries,
since January 1, 1998. Except as set forth in Section 3.9 of the STEAG
Disclosure Schedule, none of the STEAG Subsidiaries has been unable to obtain
insurance with respect to its assets or operations since January 1, 1998.
3.10 International Employee Plans. Section 3.10 of the STEAG Disclosure
Schedule contains a complete list or a description of each material compensation
scheme, retirement plan or program, collective agreement with a union or
worker's council, employee loan, bonus, and/or incentive system, stock option,
stock purchase, stock bonus, phantom stock, stock appreciation right, or fringe
benefits, whether written or, to STEAG's knowledge, unwritten, that has been
adopted or maintained by any of the STEAG Subsidiaries, whether formally or, to
STEAG's knowledge, informally, for the benefit of employees outside the United
States ("STEAG International Employee Plans"). Each STEAG International Employee
Plan has been established, maintained, and administered in material compliance
with its terms and conditions and with the requirements prescribed by any and
all statutory or regulatory laws that are applicable to such STEAG International
Employee Plan. No STEAG International Employee Plan has unfunded liabilities,
that as of the Closing Date, will not be offset by insurance or fully accrued.
Except as required by law, no condition exists that would prevent any of the
STEAG Subsidiaries (or Xxxxxxx following the Strategic Business Combination)
from terminating or amending any STEAG International Employee Plan at any time
for any reason.
3.11 United States Employee Matters and ERISA. With regard to those
employees of any STEAG Subsidiary which is located within the United States (a
"US STEAG Subsidiary"):
(a) Section 3.11 of STEAG Disclosure Schedule contains a true and
complete list of each employee benefit plan, program, policy, arrangement, or
agreement which is or has been sponsored, maintained, or contributed to by any
US STEAG Subsidiary covering
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employees, former employees, directors, or former directors of such US STEAG
Subsidiary or their beneficiaries, or providing benefits to such persons in
respect of services provided to any such entity, including, but not limited to,
any employee benefit plans within the meaning of Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), and any severance
or change in control agreement, plan, policy, or program between the US STEAG
Subsidiary and any employee thereof (collectively, the "US STEAG Benefit
Plans"). For purposes of this Section 3.11, "US STEAG Subsidiary" includes any
STEAG Subsidiary which has employees in the U.S., other than employees of STEAG
subsidiaries incorporated outside the U.S.A. on temporary assignment or
secondment in the U.S.A.
(b) Contributions. All contributions and other payments required
to be made for any period through the date to which this representation speaks,
by any US STEAG Subsidiary to any US STEAG Benefit Plan (or to any person
pursuant to the terms thereof) have been timely made or paid in full, or, to the
extent not required to be made or paid on or before the date to which this
representation speaks, have been properly reflected in the STEAG Financial
Statements.
(c) Qualification; Compliance. Each of the US STEAG Benefit Plans
intended to be "qualified" within the meaning of Section 401(a) of the Code has
either obtained from the Internal Revenue Service (the "IRS") a favorable
determination letter as to its qualified status under the Code, including all
amendments to the Code which are currently effective, or has time remaining to
apply under applicable Treasury Regulations or Internal Revenue Service
pronouncements for a determination or opinion letter and to make any amendments
necessary to obtain a favorable determination or opinion letter; and, to the
knowledge of STEAG, no circumstances exist that could reasonably be expected to
result in the revocation of any such determination. Each US STEAG Subsidiary is
in compliance in all material respects with, and each of the US STEAG Benefit
Plans is and has been operated in all material respects in compliance with, all
applicable laws, rules, and regulations governing such plan, including, without
limitation, ERISA and the Code. Each US STEAG Benefit Plan intended to provide
for the deferral of income, the reduction of salary or other compensation, or to
afford other income tax benefits, complies in all material respects with the
requirements of the applicable provisions of the Code or other laws, rules, and
regulations required to provide such income tax benefits. There are no pending
or, to the knowledge of STEAG, threatened claims under or in respect of any US
STEAG Benefit Plan by or on behalf of any employee, former employee, director,
former director, or beneficiary thereof, or otherwise involving any US STEAG
Benefit Plan (other than routine claims for benefits).
(d) Title I or IV Liabilities. No event has occurred and, to the
knowledge of STEAG, there exists no condition or set of circumstances that would
reasonably be expected (and none of the transactions contemplated hereunder are
reasonably likely) to subject (i) any US STEAG Subsidiary to any material
liability (whether to a governmental agency, a multiemployer plan, or any other
person or entity) arising under or based upon any provision of Title I or Title
IV of ERISA or (ii) STEAG, any US STEAG Subsidiary or any entity which under
Code Section 414(b), (c), (m) or (o) would be required to be a single employer
with any US STEAG Subsidiary to any material liability (whether to a
governmental agency, a multiemployer plan or any other person or entity) arising
under or based upon any provision under Title IV of ERISA.
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(e) Documents Made Available. STEAG has made available to Xxxxxxx
a true and correct copy of each collective bargaining agreement to which any US
STEAG Subsidiary is a party or under which any US STEAG Subsidiary has
obligations and, with respect to each US STEAG Benefit Plan, where applicable,
(i) such plan, including all amendments thereto, and the most recent summary
plan description, (ii) the five (5) most recent annual reports filed with the
IRS, (iii) each related trust agreement and insurance contract, (iv) the most
recent determination of the IRS with respect to the qualified status of such US
STEAG Benefit Plan, (v) the most recent actuarial report or valuation for the
most recent three (3) years, (vi) compliance and nondiscrimination tests for the
last three (3) plan years, (vii) all insurance policies and certificates
purchased by or to provide benefits under such plan, (viii) all contracts and
agreements to which any US STEAG Subsidiary is a party with third party
administrators, actuaries, investment managers, consultants, and other
independent contractors that relate to such plan, and (ix) standard Consolidated
Omnibus Budget Reconciliation Act of 1985 ("COBRA") forms and notices and (x)
every private letter ruling, prohibited transaction exemption or other ruling or
determination from the IRS, Department of Labor, Pension Benefit Guaranty
Corporation, or other Governmental Entity with respect to such plan. To the
knowledge of STEAG, in the case of each US STEAG Benefit Plan, no employee
handbook or similar employee communication relating to such plan nor any written
communication of benefits under such plan from the administrator thereof, in
either case that has not been delivered or made available to Xxxxxxx, describes
the terms of such plan in a manner that is materially inconsistent with the
documents and summary plan descriptions relating to such plan that have been
made available pursuant to the foregoing sentence.
(f) Post-Retirement Obligations. No US STEAG Benefit Plan
provides post-retirement health or welfare benefits to any individual, other
than as required by Section 601 et seq. of ERISA and Section 4980B of the Code
or any other laws, rules, or regulations.
3.12 Labor Matters. Each STEAG Subsidiary has conducted and currently is
conducting its business in compliance in all material respects with all laws
relating to employment and employment practices, terms, and conditions of
employment, wages, and hours and nondiscrimination in employment. Except as
disclosed in Section 3.12 of the STEAG Disclosure Schedule, there are, and
during the past three years there have been, no labor strikes, slow-downs or
work stoppages pending or, to STEAG's knowledge, threatened against or involving
any STEAG Subsidiary. Except as disclosed in Section 3.12 of the STEAG
Disclosure Schedule, none of the employees of any STEAG Subsidiary is covered by
any collective bargaining agreement, no collective bargaining agreement is
currently being negotiated, and, to STEAG's knowledge, no attempt is currently
being made or during the past three years has been made to organize any
employees of any STEAG Subsidiary to form or enter a labor union or similar
organization.
3.13 Tax Returns and Audits. For the purposes of this Agreement, a "Tax"
or, collectively, "Taxes" means any and all federal, state, local, foreign, and
other taxes, assessments, and other governmental charges, duties, impositions,
and liabilities, including taxes based upon or measured by gross receipts,
income, profits, sales, use, and occupation, and value added, ad valorem,
transfer, gains, franchise, capital stock, severance, withholding, payroll,
recapture, employment, excise, unemployment insurance, social security, business
license, occupation, business organization, stamp, environmental, and property
taxes, together with all
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interest, penalties, and additions imposed with respect to such amounts. "Tax
Return" as used in this Agreement, means a report, return, or other information
required to be supplied to a Governmental Entity with respect to Taxes
including, where permitted or required, combined or consolidated returns for any
group of entities that includes STEAG or any STEAG Subsidiary, as the case may
be, or Xxxxxxx or any Xxxxxxx Subsidiary, as the case may be.
Except as set forth in Section 3.13 of the STEAG Disclosure Schedule
hereto:
(a) Filing of Timely Tax Returns. Each STEAG Subsidiary has filed
(or there has been filed on its behalf) all material Tax Returns required to be
filed by each of them under applicable law. All such Tax Returns were and are in
all material respects true, complete, and correct and filed on a timely basis.
(b) Payment of Taxes. Each STEAG Subsidiary has, within the time
and in the manner prescribed by law, paid all Taxes required to have been paid
except for those contested in good faith and for which adequate reserves have
been taken.
(c) Tax Liens. There are no Tax liens upon the assets of any
STEAG Subsidiary except liens for Taxes not yet due.
(d) Withholding Taxes. Each STEAG Subsidiary has complied in all
material respects with the provisions of applicable law relating to the
withholding of Taxes, including the requirement, within the time and in the
manner prescribed by law, to withhold from employee wages and pay over to the
proper Governmental Entities all amounts required.
(e) Extensions of Time for Filing Tax Returns. No STEAG
Subsidiary has requested any extension of time within which to file any Tax
Return, which Tax Return has not since been filed.
(f) Waivers of Statute of Limitations. No STEAG Subsidiary has
executed any outstanding waivers or comparable consents regarding the
application of the statute of limitations with respect to any Taxes or Tax
Returns.
(g) Expiration of Statute of Limitations. The statute of
limitations for the assessment of all Taxes has expired for all applicable Tax
Returns of each STEAG Subsidiary or those Tax Returns have been examined by the
appropriate taxing authorities for all periods through the date hereof, and no
deficiency for any Taxes has been proposed, asserted, or assessed against any
STEAG Subsidiary that has not been resolved and paid in full.
(h) Audit, Administrative and Court Proceedings. No audits or
other administrative proceedings or court proceedings are presently pending with
regard to any Taxes or Tax Returns of any STEAG Subsidiary.
(i) Powers of Attorney. No power of attorney currently in force
has been granted by any STEAG Subsidiary concerning any Tax matter.
(j) Tax Rulings. No STEAG Subsidiary has received a Tax Ruling
(as defined below) or entered into a Closing Agreement (as defined below) with
any taxing authority
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that would reasonably be expected to have a continuing STEAG Material Adverse
Effect after the Closing Date. "Tax Ruling," as used in this Agreement, shall
mean a written ruling of a taxing authority relating to Taxes. "Closing
Agreement," as used in this Agreement, shall mean a written and legally binding
agreement with a taxing authority relating to Taxes.
(k) Availability of Tax Returns. STEAG has made available to
Xxxxxxx complete and accurate copies of (i) all Tax Returns, and any amendments
thereto, filed by any STEAG Subsidiary since January 1, 1998, (ii) all audit
reports received from any taxing authority relating to any Tax Return filed by
any STEAG Subsidiary and (iii) any Closing Agreements entered into by any STEAG
Subsidiary with any taxing authority.
(l) Tax Sharing Agreements. No STEAG Subsidiary is a party to any
agreement relating to allocating or sharing of Taxes.
(m) Liability for Others. No STEAG Subsidiary has any liability
for Taxes of any person other than STEAG and the STEAG Subsidiaries (i) under
any applicable law as a transferee or successor, (ii) by contract, or (iii)
otherwise, excluding potential obligations to pay tax liabilities for foreign
consultants or employees not to exceed $250,000 in the aggregate.
(n) Affiliated Group. None of the STEAG Subsidiaries is and none
has been a member of an affiliated group of corporations filing a consolidated
income tax return, or a group of corporations filing a consolidated, combined,
or unitary income tax return under applicable tax law, other than a group the
common parent of which is or was STEAG itself, STEAG's parent company or another
STEAG Subsidiary.
(o) Accounting Adjustments. None of the STEAG Subsidiaries has
agreed to make, nor is it required to make, any material adjustments under
applicable tax law by reason of a change in accounting method or otherwise.
(p) Partnerships or Joint Ventures. None of the STEAG
Subsidiaries is and none has been a member of a limited liability company or a
party to any joint venture, partnership, or other arrangement or contract that
is reported as a partnership for income tax purposes.
(q) Indemnities. None of the STEAG Subsidiaries has entered into
any indemnity for the benefit of any person in connection with any Tax such as
would reasonably be expected to result in a STEAG Material Adverse Effect.
3.14 Environmental Matters. Except as disclosed in Section 3.14 of the
STEAG Disclosure Schedule:
(a) Compliance. Each STEAG Subsidiary is in compliance with all
applicable Environmental Laws (as defined in Section 3.14(g)(ii) hereof), and
neither STEAG nor any STEAG Subsidiary has received any written communication
from any person or Governmental Entity that alleges that any STEAG Subsidiary is
not in compliance with applicable Environmental Laws, except where the failure
to be in such compliance would not in the aggregate reasonably be expected to
have a STEAG Material Adverse Effect. STEAG has provided Xxxxxxx with complete
and correct copies of or access to all reports, studies,
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assessments, and test results in its possession relating to any storage, use, or
disposal of Hazardous Materials (as defined in Section 3.14(g)(iii) hereof) by
any STEAG Subsidiary or on any property owned, leased to, controlled by, used by
or adjacent to that of any STEAG Subsidiary.
(b) Environmental Permits. Each STEAG Subsidiary has obtained or
has applied for all environmental, health and safety permits, and governmental
authorizations (collectively, the "Environmental Permits") necessary for the
construction of its facilities or the conduct of its operations, and all such
Environmental Permits are in good standing or, where applicable, a renewal
application has been timely filed and is pending agency approval, and each STEAG
Subsidiary is in compliance with all terms and conditions of the Environmental
Permits, except where the failure to be in compliance would not in the aggregate
reasonably be expected to have a STEAG Material Adverse Effect, and STEAG
believes that any transfer, renewal, or reapplication for any Environmental
Permit required as a result of the Strategic Business Combination can be
accomplished in the ordinary course of business.
(c) Environmental Claims. There are no Environmental Claims (as
defined in Section 3.14(g)(i) hereof) pending or, to STEAG's knowledge,
threatened (i) against any STEAG Subsidiary or joint ventures, or (ii) against
any real or personal property or operations that any STEAG Subsidiary owns,
leases, or manages, in whole or in part.
(d) Releases. To STEAG's knowledge, there have been no Releases
(as defined in Section 3.14(g)(iv) hereof) of any Hazardous Material (as defined
in Section 3.14(g)(iii) hereof) on, at, upon, into or from any property owned,
leased to, controlled by or used by any STEAG Subsidiary, nor has there been any
Release of Hazardous Material, including, but, not limited to, the off-site
disposal of Hazardous Material, that would reasonably be expected to form the
basis of any Environmental Claim against any STEAG Subsidiary, except any
Environmental Claims that, individually or in the aggregate, would not have a
STEAG Material Adverse Effect.
(e) USTs, ACM and Lead-Based Paint. To STEAG's knowledge, there
are no underground storage tanks or related piping located on, at, upon, into or
from any property owned, leased to, controlled by or used by any STEAG
Subsidiary, nor is there any asbestos or asbestos-containing material or
lead-based paint in, on or at any property or any facility or equipment owned,
leased or operated in connection with the business of any STEAG Subsidiary which
would reasonably be expected to result in a STEAG Material Adverse Effect.
(f) Predecessors. STEAG has no knowledge of any Environmental
Claim pending or threatened, or of any Release of Hazardous Materials that would
reasonably be likely to form the basis of any Environmental Claim, in each case
against any person or entity (including, without limitation, any predecessor of
any STEAG Subsidiary) whose liability any STEAG Subsidiary has or may have
retained or assumed either contractually or by operation of law or against any
real or personal property which any STEAG Subsidiary formerly owned, leased or
managed, in whole or in part which would reasonably be expected to result in a
STEAG Material Adverse Effect.
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(g) As used in this Agreement:
(i) "Environmental Claim" means any and all
administrative, regulatory, or judicial actions, suits, demands, demand letters,
directives, claims, liens, investigations, proceedings, or notices of
noncompliance or violation by any person or entity (including any Governmental
Entity) alleging liability or potential liability (including, without
limitation, potential responsibility for or liability for enforcement costs,
investigatory costs, cleanup costs, governmental response costs, removal costs,
remedial costs, natural resources damages, property damages, personal injuries,
fines or penalties) arising out of, based on or resulting from (A) the presence,
or Release or threatened Release into the environment, of any Hazardous
Materials at any location, whether or not owned, operated, leased, or managed by
any STEAG Subsidiaries or joint ventures (for purposes of this Section 3.14);
(B) circumstances forming the basis of any violation, or alleged violation, of
any Environmental Law; or (C) any and all claims by any third party seeking
damages, contribution, indemnification, cost recovery, compensation, or
injunctive relief resulting from the presence or Release of any Hazardous
Materials.
(ii) "Environmental Laws" means all applicable federal,
state, local, and foreign laws, rules, regulations, and requirements of common
law relating to pollution, the environment (including, without limitation,
ambient air, surface water, groundwater, land surface, or subsurface strata) or
protection of human health as it relates to Hazardous Materials, including,
without limitation, laws and regulations relating to Releases or threatened
Releases of Hazardous Materials, or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport, or
handling of Hazardous Materials.
(iii) "Hazardous Materials" means (a) any petroleum or
petroleum products, radioactive materials, asbestos, urea formaldehyde foam
insulation and transformers or other equipment that contain dielectric fluid
containing polychlorinated biphenyls ("PCBs") in regulated concentrations; (b)
any chemicals, materials, or substances which are now defined as or included in
the definition of "hazardous substances," "hazardous wastes," "hazardous
materials," "extremely hazardous wastes," "restricted hazardous wastes," "toxic
substances," "toxic pollutants," or words of similar import, under any
Environmental Law; and (c) any other chemical, material, substance, or waste,
which is regulated under any Environmental Law in a jurisdiction in which STEAG
or any of its subsidiaries or joint ventures operate.
(iv) "Release" means any release, spill, emission,
leaking, injection, deposit, disposal, discharge, dispersal, leaching or
migration into the atmosphere, soil, surface water, groundwater, or property.
3.15 Litigation.
(a) Except as disclosed in Section 3.15 of the STEAG Disclosure
Schedule or in the STEAG Financial Statements (including the notes thereto),
there are no actions, suits, arbitrations, regulatory or other proceedings,
litigation, or governmental investigations by or before any court, arbitration
or Governmental Entity (collectively, a "Legal Proceeding"), which is now
pending or, to STEAG's knowledge, threatened (in writing) against or affecting
any of the STEAG Subsidiaries, or any of the STEAG Subsidiaries' officers or
directors in their
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capacity as such, or any of the STEAG Subsidiaries' respective properties or
businesses, which, if decided adversely to the STEAG Subsidiaries, would
reasonably be expected to have a STEAG Material Adverse Effect. Except as
disclosed in Section 3.15 of the STEAG Disclosure Schedule, none of the STEAG
Subsidiaries is currently subject to any order, judgment, decree, injunction,
stipulation, or consent order of or with any court or other Governmental Entity.
Since January 1, 1998, none of the STEAG Subsidiaries has entered into any
agreement to settle or compromise any Legal Proceeding pending or threatened
against it which has involved any obligation other than the payment of money or
for which any STEAG Subsidiary, as the case may be, has any continuing
obligation.
(b) There are no claims or Legal Proceedings pending or, to
STEAG's knowledge, threatened (in writing) by or against STEAG with respect to
this Agreement or in connection with the transactions contemplated hereby or
thereby.
(c) Except as set forth on Section 3.15 of the STEAG Disclosure
Schedule, to STEAG's knowledge, there are no pending or threatened (in writing)
claims against any director, officer, employee, or agent of the STEAG
Subsidiaries in their capacity as such, or any other Person which, if decided
adversely to such Person, would reasonably be expected to give rise to any claim
for indemnification against any STEAG Subsidiary.
3.16 Compliance with Applicable Laws. Except as disclosed in Section
3.16 of the STEAG Disclosure Schedule, each STEAG Subsidiary holds all permits,
licenses, variances, exemptions, orders, and approvals of all Governmental
Entities which are required for the operation of their respective businesses,
except those the absence of which would not reasonably be expected to have a
STEAG Material Adverse Effect (the "STEAG Permits"). Each STEAG Subsidiary is in
compliance with the terms of the STEAG Permits, except where the failure so to
comply would not reasonably be expected to have a STEAG Material Adverse Effect.
Except as disclosed in Section 3.16 of the STEAG Disclosure Schedule, to STEAG's
knowledge, neither STEAG nor any STEAG Subsidiary is in violation of any law,
ordinance, or regulation of any Governmental Entity, except for possible
violations which individually and in the aggregate do not have a STEAG Material
Adverse Effect.
3.17 Contracts; No Defaults. Except as described in Section 3.17 of the
STEAG Disclosure Schedule, none of the STEAG Subsidiaries is a party to or
subject to any agreement, contract, or commitment, written or, to the knowledge
of STEAG, oral (including, without limitation, leases of real property), which
(i) has expected receipts or expenditures by any of the STEAG Subsidiaries,
alone or in the aggregate, in excess of $5 million, other than purchase orders
from customers and purchase orders to suppliers in the ordinary course of
business, (ii) requires, as its primary purpose, any of the STEAG Subsidiaries
to indemnify any Person, (iii) grants any exclusive material licenses or
distributorships to any party, (iv) evidences indebtedness for borrowed or
loaned money of $1 million or more, including guarantees of such indebtedness
(other than trade accounts receivable and trade accounts payable), or (v) has an
initial term of more than one year and is not cancelable without significant
penalties by any of the STEAG Subsidiaries on 60 days' or less notice (other
than employment agreements with a current term of three years or less) (each of
the items described under (i) through (v), a "Material Contract"). None of the
STEAG Subsidiaries is in default or, to STEAG's knowledge, alleged to be in
default under any such Material Contract and, to STEAG's knowledge, no other
party
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thereto is in default except as would not reasonably be expected to have a STEAG
Material Adverse Effect. To STEAG's knowledge, nothing has occurred which, with
or without the passage of time or giving of notice or both, would constitute a
default by any STEAG Subsidiary or by any other party under any such Material
Contract except as would not reasonably be expected to have a STEAG Material
Adverse Effect. STEAG has not received any written or, to its knowledge, oral,
notification that any such Material Contract is not likely to be renewed. The
Strategic Business Combination contemplated by this Agreement will not create a
default under or permit the termination of or otherwise adversely affect any
such Material Contract in a manner that would reasonably be expected to have a
STEAG Material Adverse Effect. Except as described in Section 3.17 of the STEAG
Disclosure Schedule hereto, neither STEAG nor any STEAG Subsidiary is required
to give any notice to any person regarding this Agreement or the transactions
contemplated hereby pursuant to the terms of any such Material Contract.
3.18 Change in Control and Severance Payments. Except as set forth on
Section 3.18 of the STEAG Disclosure Schedule, none of the STEAG Subsidiaries
have any material plans, programs, or agreements to which they are parties, or
to which they are subject, pursuant to which payments (or acceleration of
benefits) may be required upon, or may become payable directly or indirectly as
a result of, a change of control of any of the STEAG Subsidiaries (including by
reason of the consummation of the Strategic Business Combination), or otherwise
upon termination of employment of any individual with any STEAG Subsidiary.
3.19 Year 2000. As of the date hereof, the computer systems used by any
of the STEAG Subsidiaries, and any third party service providers used by any of
the foregoing, have not exhibited any material deficiencies with respect to
formatting in connection with processing any dates after December 31, 1999
("Year 2000 Problem"). All issues and modifications, if any, regarding the Year
2000 Problem compliance by the STEAG Subsidiaries have been resolved by
third-party service providers and the STEAG Subsidiaries. To STEAG's knowledge,
there is no inability on the part of any customer, insurance company, or service
provider with which the STEAG Subsidiaries transact business to timely remedy
their own deficiencies in respect of the Year 2000 Problem, which inability,
individually or in the aggregate, would reasonably be expected to have a STEAG
Material Adverse Effect.
3.20 Broker's/Finder's Fees. Except for Xxxxxx Xxxxxxx & Co.
Incorporated, neither STEAG nor any officer, director, or employee of STEAG has
employed any broker, finder, or investment banker or incurred any liability for
any brokerage or investment banking fees, commissions, or finders' fees in
connection with the transactions contemplated by this Agreement.
3.21 Interim Operations of Newco. Newco is a newly organized
Gesellschaft mit beschraenkter Haftung formed solely for the purpose of engaging
in the transactions contemplated by this Agreement. Prior to the Closing, Newco
will not have conducted any business, incurred any liabilities, or engaged in
any other transactions, other than entering into this Agreement and doing such
acts as are necessary in its capacity as a holding company with respect to the
Foreign STEAG Subsidiaries under this Agreement.
3.22 Investment. STEAG is an "accredited investor" as defined in Rule
501(a) under the Securities Act of 1933, as amended. In making its investment
decision to acquire the
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Xxxxxxx Shares, STEAG is not relying on any oral or written representations or
assurances from Xxxxxxx or any other person other than as set forth in this
Agreement, in a document executed by a duly authorized representative of Xxxxxxx
making reference to this Agreement, or the Xxxxxxx SEC Documents (as defined in
Section 4.5). STEAG has such experience in business and financial matters that
it is capable of evaluating the risk of its investment in the Xxxxxxx Shares and
determining the suitability of its investment. By reason of STEAG's business and
financial and the business and financial experience of STEAG's professional
advisors, STEAG has the capacity to protect its own interest in connection with
the Strategic Business Combination. STEAG represents that it is able to bear the
economic risk of an investment in the Xxxxxxx Shares. STEAG understands that no
United States federal or state agency or similar agency of any other country has
passed upon or made any recommendation or endorsement of Xxxxxxx, this
transaction, or the acquisition of the Xxxxxxx Shares.
ARTICLE IV.
REPRESENTATIONS AND WARRANTIES OF XXXXXXX
Xxxxxxx represents and warrants to STEAG as follows, except as disclosed
in a document of even date herewith and delivered by Xxxxxxx to STEAG referring
to the representations and warranties in this Agreement (the "Xxxxxxx Disclosure
Schedule"). (The Xxxxxxx Disclosure Schedule will be arranged in paragraphs
corresponding to the numbered and lettered paragraphs contained in this Article
IV, and the disclosure in any such numbered and lettered section of the Xxxxxxx
Disclosure Schedule shall qualify only the corresponding section in this Article
IV, except to the extent disclosure in any numbered and lettered section of the
Xxxxxxx Disclosure Schedule is specifically cross-referenced in another numbered
and lettered section of the Xxxxxxx Disclosure Schedule.)
4.1 Due Incorporation, Subsidiaries, and Due Authorization.
(a) Due Incorporation. Xxxxxxx is a corporation duly organized,
validly existing, and in good standing under the laws of Delaware, with all
requisite corporate power and authority to own, lease, and operate its
properties and to carry on its business as now being conducted. Xxxxxxx is
qualified to do business and is in good standing as a foreign corporation in
each jurisdiction where the nature of the properties owned, leased, or operated
by it and the business transacted by it require such qualification, except where
the failure to be so qualified would not reasonably be expected to have a
Xxxxxxx Material Adverse Effect (as defined in Section 4.6 hereof). True,
correct, and complete copies of Xxxxxxx'x Certificate of Incorporation and
By-Laws, as amended, have been delivered to STEAG.
(b) Subsidiaries. Except as set forth in Section 4.1 of the
Xxxxxxx Disclosure Schedule, Xxxxxxx has no direct or indirect subsidiaries,
either wholly or partially owned, and Xxxxxxx does not hold any economic,
voting, or management interest in any Person or own any security issued by any
Person. For purposes of this Agreement, any direct or indirect subsidiary of
Xxxxxxx, whether wholly or partially owned, is a "Xxxxxxx Subsidiary." Except as
set forth on in Section 4.1 of the Xxxxxxx Disclosure Schedule hereto, all of
the issued and outstanding shares of capital stock of each Xxxxxxx Subsidiary
are validly issued, fully paid, nonassessable, and free of preemptive rights,
and are owned, directly or indirectly, by Xxxxxxx free and clear of any
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liens, claims, encumbrances, security interests, equities, charges, and options
of any nature whatsoever, and there are no outstanding subscriptions, options,
calls, contracts, voting trusts, proxies, or other commitments, understandings,
restrictions, arrangements, rights or warrants, including any right of
conversion or exchange under any outstanding security, instrument, or other
agreement, obligating any such subsidiary to issue, deliver, or sell, or cause
to be issued, delivered, or sold, additional shares of its capital stock or
obligating it to grant, extend, or enter into any such agreement or commitment.
(c) Due Authorization. Xxxxxxx has full corporate power and
authority to enter into this Agreement and to consummate the transactions
contemplated hereby. The execution, delivery, and performance by Xxxxxxx of this
Agreement have been duly and validly approved by the Board of Directors of
Xxxxxxx, and no other actions or proceedings on the part of Xxxxxxx are
necessary to authorize this Agreement and the transactions contemplated hereby,
other than the approval of the Xxxxxxx Stockholder Proposal (as defined in
Section 4.2(b)(iii)) by the stockholders of Xxxxxxx. Xxxxxxx has duly and
validly executed and delivered this Agreement. This Agreement constitutes the
legal, valid, and binding obligation of Xxxxxxx, enforceable against it in
accordance with its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, fraudulent transfer, moratorium,
reorganization, or other laws from time to time in effect which affect
creditors' rights generally and by general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law).
4.2 Non-Contravention; Consents and Approvals.
(a) The execution and delivery of this Agreement by Xxxxxxx does
not, and the performance by of its obligations hereunder and the consummation of
the transactions contemplated hereby will not, conflict with, result in a
violation or breach of, constitute (with or without notice or lapse of time or
both) a default under, result in or give to any person any right of payment or
reimbursement, termination, cancellation, modification, or acceleration of, or
result in the creation or imposition of any lien upon any of the assets or
properties of Xxxxxxx under any of the terms, conditions, or provisions of (i)
the Certificate of Incorporation or Bylaws of Xxxxxxx, or (ii) subject to
obtaining the necessary approval by the stockholders of Xxxxxxx and the taking
of the actions described in paragraph (b) of this Section 4.2, (x) any Law
applicable to Xxxxxxx or any judgment, decree, order, writ, permit, or license
of any Governmental Entity applicable to Xxxxxxx or (y) any contract, agreement,
or commitment to which Xxxxxxx is a party or by which Xxxxxxx or any of its
assets or properties is bound, excluding from the foregoing clauses (x) and (y)
conflicts, violations, breaches, defaults, terminations, modifications,
accelerations, and creations and impositions of liens which would not reasonably
be expected to have a Xxxxxxx Material Adverse Effect or result in the inability
of Xxxxxxx to consummate the transactions contemplated by this Agreement.
(b) No consent, approval, order, or notice to or authorization
of, or registration, declaration, or filing with any Governmental Entity is
required to be made or obtained by Xxxxxxx in connection with the execution and
delivery of this Agreement or the consummation by Xxxxxxx of the transactions
contemplated hereby, the failure to obtain which would reasonably be expected to
have a Xxxxxxx Material Adverse Effect or prevent or materially delay the
consummation of the transactions contemplated hereby, except for:
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(i) the filing of a pre-merger notification report under
the HSR Act and the expiration or termination of the applicable waiting period
thereunder, and, if applicable, the filing of required documents with relevant
Governmental Entities of the countries or political subdivisions in which the
STEAG Subsidiaries or CFM conduct business including, if applicable, any filing
under the German Act Against Restraints on Competition of 1958 (Gesetz gegen
Wettbewerbsbeschraenkungen) and the expiration or termination of the waiting
period thereunder;
(ii) the approval of the Xxxxxxx Shares for listing on
NASDAQ upon official notice of issuance;
(iii) the approval by the stockholders of Xxxxxxx of a
single proposal (the "Xxxxxxx Stockholder Proposal") that provides for: (A) the
Share Issuance and the issuance of shares of Xxxxxxx Common Stock pursuant to
the CFM Agreement, and (B) if necessary to effect the Strategic Business
Combination and/or the CFM Merger, an increase in the shares reserved under
Xxxxxxx'x stock option plans (the "Plan Reserve Increase"); and
(iv) the consents and approvals specified on Section 4.2
of the Xxxxxxx Disclosure Schedule.
4.3 Capitalization.
(a) The authorized capital stock of Xxxxxxx consists of
60,000,000 shares of Xxxxxxx Common Stock, par value $0.001 per share, and
2,000,000 shares of Preferred Stock, par value $0.001 per share. On the date
hereof, there are issued and outstanding 20,887,000 shares of Xxxxxxx Common
Stock and no shares of Preferred Stock. All of the issued and outstanding shares
of Xxxxxxx Common Stock are, and the Xxxxxxx Shares, when issued in accordance
with the terms of this Agreement, will be, duly and validly authorized and
issued and outstanding, fully paid, and nonassessable. On the date hereof, there
are 6,575,000 shares of Xxxxxxx Common Stock reserved for issuance under Xxxxxxx
stock option plans, of which 1,523,204 shares are subject to outstanding
options, and no shares are reserved for issuance upon exercise of outstanding
warrants.
(b) Except for this Agreement and the CFM Agreement, and except
as set forth above and in Section 4.3 of the Xxxxxxx Disclosure Schedule, there
are no shares of Xxxxxxx Common Stock or other equity securities (whether or not
such securities have voting rights) of Xxxxxxx issued or outstanding or any
subscriptions, options, warrants, calls, rights, convertible securities, or
other agreements or commitments of any character and no preemptive or similar
rights obligating Xxxxxxx to issue, transfer, or sell any shares of capital
stock or other securities (whether or not such securities have voting rights) of
Xxxxxxx. Except for this Agreement and the CFM Agreement, and except as set
forth in Section 4.3 of the Xxxxxxx Disclosure Schedule hereto, there are no
outstanding contractual obligations of Xxxxxxx which relate to the purchase,
sale, issuance, repurchase, redemption, acquisition, transfer, disposition,
holding, or voting of any shares of capital stock or other securities of
Xxxxxxx. Xxxx Xxxxxxx has entered into the Voting Agreement.
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4.4 Financial Statements; Undisclosed Liabilities; Other Documents.
(a) For purposes of this Agreement, "Xxxxxxx Financial
Statements" shall mean the audited financial statements of Xxxxxxx as of
December 31, 1999 and December 31, 1998 (including all notes thereto), and the
unaudited financial statements of Xxxxxxx included in Xxxxxxx'x Quarterly Report
on Form 10-Q for the quarter ended March 26, 2000, consisting of the
consolidated balance sheets at such dates and the related consolidated
statements of income, stockholders' equity, and cash flows for each of the
twelve-month periods ended December 31, 1999, December 31, 1998, and December
31, 1997, and the three month period ended March 26, 2000. The Xxxxxxx Financial
Statements have been prepared in accordance with US GAAP consistently applied
and present fairly the financial position, assets and liabilities of Xxxxxxx as
at the dates thereof and the revenues, expenses, results of operations, and cash
flows of Xxxxxxx for the periods covered thereby.
(b) Xxxxxxx and the Xxxxxxx Subsidiaries do not have any
liabilities or obligations of any nature, whether accrued, contingent, absolute,
or otherwise, except (i) as set forth or reflected in the March 26, 2000 balance
sheet (the "Xxxxxxx Base Balance Sheet") in Xxxxxxx'x Form 10-Q for the fiscal
quarter ended March 26, 2000; (ii) such other liabilities and obligations that
individually and in the aggregate, do not have and would not reasonably be
expected to have a Xxxxxxx Material Adverse Effect; (iii) liabilities and
obligations incurred since March 26, 2000 which are either incurred in the
ordinary course of its business consistent with past practices or, if incurred
outside the ordinary course of business are not substantial in amount; and (iv)
as otherwise set forth on the Xxxxxxx Disclosure Schedule.
4.5 SEC Filings. Except as set forth in Section 4.5 of the Xxxxxxx
Disclosure Schedule hereto, Xxxxxxx has timely filed all required forms,
reports, and other documents with the SEC since November 1, 1997, all of which
complied when filed, in all material respects, with all applicable requirements
of the Securities Act and Securities Exchange Act, as applicable. Xxxxxxx has
heretofore delivered to STEAG complete and correct copies of (i) its Annual
Report on Form 10-K for the fiscal year ended December 31, 1999, (ii) its
Quarterly Report on Form 10-Q for the fiscal quarter ended Xxxxx 00, 0000, (xxx)
all proxy statements relating to Xxxxxxx'x meetings of shareholders (whether
annual or special) since November 1, 1997 and (iv) all other reports, forms and
other documents filed by Xxxxxxx with the SEC since November 1, 1997 (together,
the "Xxxxxxx SEC Documents"). Except as set forth on Section 4.5 of the Xxxxxxx
Disclosure Schedule hereto, as of their respective dates, such reports, forms
and other documents (including all exhibits and schedules thereto and documents
incorporated by reference therein) did not contain any untrue statement of
material fact or omit to state a material fact required to be stated therein, or
necessary to make the statements therein, in light of the circumstances in which
they were made, not misleading. The audited financial statements and the
unaudited interim financial statements of STEAG included or incorporated by
reference in such reports, forms and other documents were prepared in accordance
with GAAP consistently applied during the periods involved (except as may be
otherwise indicated in the notes thereto), and fairly present the financial
position of Xxxxxxx as of the dates thereof and the results of its operations
and changes in financial position for the periods then ended (subject, in the
case of any unaudited interim financial statements, to normal year-end
adjustments).
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4.6 No Material Adverse Effects or Changes. Except as listed on Section
4.6 of the Xxxxxxx Disclosure Schedule hereto, as contemplated by this
Agreement, or as described in Xxxxxxx'x Quarterly Report on Form 10-Q for the
fiscal quarter ended March 26, 2000, since January 1, 2000, neither Xxxxxxx nor
any Xxxxxxx Subsidiary has (i) taken any of the actions set forth in
subparagraphs (a) through (k) of Section 5.2 hereof, (ii) suffered any Xxxxxxx
Material Adverse Effect, and no facts or conditions exist which are reasonably
likely to have, in the aggregate, a Xxxxxxx Material Adverse Effect, or (iii)
suffered any damage, destruction, or Loss to any of its assets or properties
which is material to Xxxxxxx (whether or not covered by insurance). "Xxxxxxx
Material Adverse Effect" shall mean an effect on the business, operations,
assets, liabilities, results of operations, cash flows or condition (financial
or otherwise) of Xxxxxxx and the Xxxxxxx Subsidiaries, taken as a whole, which
is materially adverse to Xxxxxxx and the Xxxxxxx Subsidiaries on a consolidated
basis.
4.7 Properties.
(a) Except as disclosed on Section 4.7 of the Xxxxxxx Disclosure
Schedule hereto, Xxxxxxx and each Xxxxxxx Subsidiary (i) has good and valid
title to all of the tangible and intangible assets, properties, and rights
reflected in the Xxxxxxx Base Balance Sheet or acquired after March 26, 2000
(other than assets leased under the leases set forth in Section 4.7 of the
Xxxxxxx Disclosure Schedule hereto and assets disposed of in the ordinary course
of business since the date of the Xxxxxxx Base Balance Sheet), and (ii) at the
Closing Date will have good and valid title to all of such material tangible and
intangible assets, properties, and rights referred to in clause (i) above, in
each case free and clear of any lien, encumbrance, pledge or similar interest,
except for Permitted Liens.
(b) Except as otherwise identified in Section 4.7 of the Xxxxxxx
Disclosure Schedule hereto, the material tangible assets of Xxxxxxx and each
Xxxxxxx Subsidiary, taken as a whole, including all mobile equipment, are, in
the aggregate, in good condition and repair, reasonable wear and tear excepted,
and are, in the aggregate, in condition suitable for the use to which they are
put in Xxxxxxx'x business.
4.8 Intellectual Property. Except as disclosed on Section 4.8 of the
Xxxxxxx Disclosure Schedule hereto:
(a) All of the trademarks, trade names, service marks, patents,
copyrights (including any registrations of or pending applications for any of
the foregoing), technology, trade secrets, inventions, know-how, designs,
computer programs, processes, and all other intangible assets, properties, and
rights used by Xxxxxxx or any Xxxxxxx Subsidiary in the conduct of its business,
other than such items the loss or absence of which (individually or in the
aggregate) would not have a Xxxxxxx Material Adverse Effect (the "Xxxxxxx
Intellectual Property"), are either (i) owned by Xxxxxxx or any Xxxxxxx
Subsidiary free and clear of any liens, and are not subject to any license,
royalty, or other agreement or (ii) licensed by Xxxxxxx or the relevant Xxxxxxx
Subsidiary pursuant to a valid and subsisting license agreement.
(b) None of the Xxxxxxx Intellectual Property has been since
January 1, 1998 or is the subject of any pending or, to Xxxxxxx'x knowledge,
threatened (in writing) litigation or claim of infringement.
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(c) No license or royalty agreement to which Xxxxxxx or any
Xxxxxxx Subsidiary is a party, including any agreement regarding Licensed
Intellectual Property as defined below, is, to Xxxxxxx'x knowledge, in breach or
default by any party thereto or the subject of any notice of termination given
or threatened (in writing), which breach, default or termination would
reasonably be expected to have a Xxxxxxx Material Adverse Effect.
(d) To Xxxxxxx'x knowledge, none of the products manufactured or
sold by Xxxxxxx or any Xxxxxxx Subsidiary, nor any process, method, part,
design, nor material they employ, nor the marketing and use by Xxxxxxx or any
Xxxxxxx Subsidiary of any such product or any service, infringe any trademark,
service xxxx, trade name, copyright, trade secret, patent, or confidential or
proprietary rights of another and Xxxxxxx and the Xxxxxxx Subsidiaries have not
received any written notice contesting their right to use any Xxxxxxx
Intellectual Property, which claim or contestation, if successful, would
reasonably be expected to have a Xxxxxxx Material Adverse Effect.
(e) Xxxxxxx has disclosed to STEAG any standard forms of
Assignment Agreement generally signed by employees of Xxxxxxx Subsidiaries. To
Xxxxxxx'x knowledge, all employees of the Xxxxxxx Subsidiaries who are employed
for the purpose of the development, invention or creation of any Xxxxxxx
Intellectual Property have signed an agreement which is substantially similar to
the aforementioned form which, when signed by an employee, is valid and
enforceable against such employee.
(f) There are no exclusive licenses, exclusive distributorship
agreements, or noncompetition agreements with respect to the use of any Xxxxxxx
Intellectual Property or the development, sale, or distribution of any Xxxxxxx
products, or any other material restrictions regarding the right of Xxxxxxx or
any of the Xxxxxxx Subsidiaries to fully exploit Xxxxxxx Intellectual Property
anywhere in the world. Neither Xxxxxxx nor any of the Xxxxxxx Subsidiaries is a
party to any reseller or distribution agreement, other than agreements that can
be cancelled or terminated without cost or penalty upon notice of sixty (60)
days or less.
4.9 Insurance. Section 4.9 of the Xxxxxxx Disclosure Schedule hereto
contains an accurate and complete list of all policies of fire, liability,
worker's compensation, title, and other forms of insurance owned or held by
Xxxxxxx or any Xxxxxxx Subsidiary. All such policies are in full force and
effect, all premiums with respect thereto covering all periods up to and
including the Closing Date have been, or prior to the Closing Date, will be,
paid and no notice of cancellation or termination has been received with respect
to any such policy except as would not have a Xxxxxxx Material Adverse Effect.
Xxxxxxx has delivered to STEAG a true and complete copy or description of all
insurance policies, including all occurrence-based policies, applicable to
Xxxxxxx or the Xxxxxxx Subsidiaries, since January 1, 1998. Except as set forth
in Section 4.9 of the Xxxxxxx Disclosure Schedule, neither Xxxxxxx nor any
Xxxxxxx Subsidiary has been unable to obtain insurance with respect to its
assets or operations since January 1, 1998.
4.10 Employee Matters and ERISA. Except as set forth in Section 4.10 of
the Xxxxxxx Disclosure Schedule hereto:
(a) Benefit Plans. Section 4.11 of the Xxxxxxx Disclosure
Schedule contains a true and complete list of each employee benefit plan,
program, policy, arrangement, or
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agreement which is or has been sponsored, maintained, or contributed to by
Xxxxxxx and the Xxxxxxx Subsidiaries covering employees, former employees,
directors, or former directors of Xxxxxxx and the Xxxxxxx Subsidiaries or their
beneficiaries, or providing benefits to such persons in respect of services
provided to any such entity, including, but not limited to, any employee benefit
plans within the meaning of Section 3(3) of ERISA, and any severance or change
in control agreement, plan, policy, or program between Xxxxxxx and the Xxxxxxx
Subsidiaries and any employee thereof (collectively, the "Xxxxxxx Benefit
Plans"). Neither Xxxxxxx nor any Xxxxxxx Subsidiary is obligated to contribute
to any "multi-employer plan" as defined in Section 3(37) ERISA. Section 4.11 of
the Xxxxxxx Disclosure Schedule separately lists each Xxxxxxx Benefit Plan that
has been adopted or maintained by any Xxxxxxx Subsidiary, whether formally or
informally, for the benefit of employees outside of the United States ("Xxxxxxx
International Benefit Plans").
(b) Contributions. All contributions and other payments required
to be made for any period through the date to which this representation speaks,
by Xxxxxxx or any Xxxxxxx Subsidiary to any Xxxxxxx Benefit Plan (or to any
person pursuant to the terms thereof) have been timely made or paid in full, or,
to the extent not required to be made or paid on or before the date to which
this representation speaks, have been properly reflected in the Xxxxxxx
Financial Statements.
(c) Qualification; Compliance. Each of the Xxxxxxx Benefit Plans
intended to be "qualified" within the meaning of Section 401(a) of the Code has
either obtained from the IRS a favorable determination letter as to its
qualified status under the Code, including all amendments to the Code which are
currently effective, or has time remaining to apply under applicable Treasury
Regulations or Internal Revenue Service pronouncements for a determination or
opinion letter and to make any amendments necessary to obtain a favorable
determination or opinion letter; and, to the knowledge of Xxxxxxx, no
circumstances exist that could reasonably be expected to result in the
revocation of any such determination. Xxxxxxx and each Xxxxxxx Subsidiary is in
compliance in all material respects with, and each of Xxxxxxx Benefit Plans is
and has been operated in all material respects in compliance with, all
applicable laws, rules, and regulations governing such plan, including, without
limitation, ERISA and the Code. Each Xxxxxxx Benefit Plan intended to provide
for the deferral of income, the reduction of salary or other compensation, or to
afford other income tax benefits complies in all material respects with the
requirements of the applicable provisions of the Code or other laws, rules, and
regulations required to provide such income tax benefits. There are no pending
or, to the knowledge of Xxxxxxx, threatened claims under or in respect of any
Xxxxxxx Benefit Plan by or on behalf of any employee, former employee, director,
former director, or beneficiary thereof, or otherwise involving any Xxxxxxx
Benefit Plan (other than routine claims for benefits).
(d) Title I or IV Liabilities. No event has occurred and, to the
knowledge of Xxxxxxx, there exists no condition or set of circumstances that
would reasonably be expected (and none of the transactions contemplated
hereunder are reasonably likely) to subject Xxxxxxx or any Xxxxxxx Subsidiary to
any material liability (whether to a governmental agency, a multiemployer plan,
or any other person or entity) arising under or based upon any provision of
Title I or Title IV of ERISA.
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(e) Documents Made Available. Xxxxxxx has made available to STEAG
a true and correct copy of each collective bargaining agreement to which Xxxxxxx
is a party or under which Xxxxxxx has obligations and, with respect to each
Xxxxxxx Benefit Plan, where applicable, (i) such plan, including all amendments
thereto, and the most recent summary plan description, (ii) the five (5) most
recent annual reports filed with the IRS, (iii) each related trust agreement and
insurance contract, (iv) the most recent determination of the IRS with respect
to the qualified status of such Xxxxxxx Benefit Plan, (v) the most recent
actuarial report or valuation for the most recent three (3) years, (vi)
compliance and nondiscrimination tests for the last three (3) plan years, (vii)
all insurance policies and certificates purchased by or to provide benefits
under such plan, (viii) all contracts and agreements to which Xxxxxxx or any
Xxxxxxx Subsidiary is a party with third party administrators, actuaries,
investment managers, consultants and other independent contractors that relate
to such plan, (ix) standard COBRA forms and notices, and (x) every private
letter ruling, prohibited transaction exemption, or other ruling or
determination from the IRS, Department of Labor, Pension Benefit Guaranty
Corporation, or other Governmental Entity with respect to such plan. To the
knowledge of Xxxxxxx, in the case of each Xxxxxxx Benefit Plan, no employee
handbook or similar employee communication relating to such plan nor any written
communication of benefits under such plan from the administrator thereof, in
either case that has not been delivered or made available to STEAG, describes
the terms of such plan in a manner that is materially inconsistent with the
documents and summary plan descriptions relating to such plan that have been
made available pursuant to the foregoing sentence.
(f) Post Retirement Obligations. No Xxxxxxx Benefit Plan provides
post-retirement health or welfare benefits to any individual, other than as
required by Section 601 et seq. of ERISA and Section 4980B of the Code or any
other laws, rules, or regulations.
4.11 Labor Matters. Xxxxxxx and each Xxxxxxx Subsidiary have conducted
and currently are conducting their businesses in compliance in all material
respects with all laws relating to employment and employment practices, terms
and conditions of employment, wages and hours, and nondiscrimination in
employment. Except as disclosed on Section 4.11 of the Xxxxxxx Disclosure
Schedule hereto, there are, and during the past three years there have been, no
labor strikes, slow-downs or work stoppages pending or, to Xxxxxxx'x knowledge,
threatened against or involving Xxxxxxx or any Xxxxxxx Subsidiary. Except as
disclosed in Section 4.11 of the Xxxxxxx Disclosure Schedule, none of the
employees of Xxxxxxx or any Xxxxxxx Subsidiary is covered by any collective
bargaining agreement, no collective bargaining agreement is currently being
negotiated and, to Xxxxxxx'x knowledge, no attempt is currently being made or
during the past three years has been made to organize any employees of Xxxxxxx
or the Xxxxxxx Subsidiaries to form or enter a labor union or similar
organization.
4.12 Tax Returns and Audits. Except as set forth in Section 4.12 of the
Xxxxxxx Disclosure Schedule hereto:
(a) Filing of Timely Tax Returns. Xxxxxxx and each Xxxxxxx
Subsidiary have filed (or there has been filed on its behalf) all material Tax
Returns required to be filed by it under applicable law. All such Tax Returns
were and are in all material respects true, complete, and correct, and filed on
a timely basis.
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(b) Payment of Taxes. Xxxxxxx and each Xxxxxxx Subsidiary have,
within the time and in the manner prescribed by law, paid all Taxes required to
have been paid except for those contested in good faith and for which adequate
reserves have been taken.
(c) Tax Liens. There are no Tax liens upon the assets of Xxxxxxx
except liens for Taxes not yet due.
(d) Withholding Taxes. Xxxxxxx and each Xxxxxxx Subsidiary have
complied in all material respects with the provisions of applicable law relating
to the withholding of Taxes, including the requirement, within the time and in
the manner prescribed by law, to withhold from employee wages and pay over to
the proper governmental authorities all amounts required.
(e) Extensions of Time for Filing Tax Returns. Neither Xxxxxxx
nor any Xxxxxxx Subsidiary has requested any extension of time within which to
file any Tax Return, which Tax Return has not since been filed.
(f) Waivers of Statute of Limitations. Neither Xxxxxxx nor any
Xxxxxxx Subsidiary has executed any outstanding waivers or comparable consents
regarding the application of the statute of limitations with respect to any
Taxes or Tax Returns.
(g) Expiration of Statute of Limitations. The statute of
limitations for the assessment of all Taxes has expired for all applicable Tax
Returns of Xxxxxxx and each Xxxxxxx Subsidiary or those Tax Returns have been
examined by the appropriate taxing authorities for all periods through the date
hereof, and no deficiency for any Taxes has been proposed, asserted or assessed
against Xxxxxxx or any Xxxxxxx Subsidiary that has not been resolved and paid in
full.
(h) Audit, Administrative and Court Proceedings. No audits or
other administrative proceedings or court proceedings are presently pending with
regard to any Taxes or Tax Returns of Xxxxxxx or any Xxxxxxx Subsidiary.
(i) Powers of Attorney. No power of attorney currently in force
has been granted by Xxxxxxx or any Xxxxxxx Subsidiary concerning any Tax matter.
(j) Tax Rulings. Neither Xxxxxxx nor any Xxxxxxx Subsidiary has
received a Tax Ruling or entered into a Closing Agreement with any taxing
authority that would reasonably be expected to have a continuing Xxxxxxx
Material Adverse Effect after the Closing Date.
(k) Tax Sharing Agreements. Neither Xxxxxxx nor any Xxxxxxx
Subsidiary is a party to any agreement relating to allocating or sharing of
Taxes.
(l) Liability for Others. Neither Xxxxxxx nor any Xxxxxxx
Subsidiary has any liability in excess of $250,000 for Taxes of any person other
than Xxxxxxx and the Xxxxxxx Subsidiaries (i) under any applicable law, as a
transferee or successor, (ii) by contract or (iii) otherwise.
(m) Affiliated Group. Neither Xxxxxxx nor any Xxxxxxx Subsidiary
is or has been a member of an affiliated group of corporations filing a
consolidated, combined, or unitary
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income tax return under applicable tax law other than a group the common parent
of which is or was Xxxxxxx itself (or a Xxxxxxx subsidiary).
(n) Accounting Adjustments. Neither Xxxxxxx nor any Xxxxxxx
Subsidiary has agreed to make, nor is required to make, any material adjustment
under applicable tax law by reason of a change in accounting method or
otherwise.
(o) Partnerships or Joint Ventures. Neither Xxxxxxx nor any
Xxxxxxx Subsidiary is or has been a member of a limited liability company or a
party to any joint venture, partnership, or other arrangement or contract that
is reported as a partnership for federal income tax purposes.
(p) Indemnities. Neither Xxxxxxx nor any Xxxxxxx Subsidiary has
entered into an indemnity for the benefit of any person in connection with any
Tax such as would reasonably be expected to have a Xxxxxxx Material Adverse
Effect.
(q) Availability of Tax Returns. Xxxxxxx has made available to
STEAG complete and accurate copies of (i) all Tax Returns, and any amendments
thereto, filed by Xxxxxxx and any Xxxxxxx Subsidiary since January 1, 1998, (ii)
all audit reports received from any taxing authority relating to any Tax Return
filed by Xxxxxxx or any Xxxxxxx Subsidiary and (iii) any Closing Agreements
entered into by Xxxxxxx or any Xxxxxxx Subsidiary with any taxing authority.
4.13 Environmental Matters. Except as disclosed in Section 4.13 of the
Xxxxxxx Disclosure Schedule hereto:
(a) Compliance. Xxxxxxx and each Xxxxxxx Subsidiary is in
compliance with all applicable Environmental Laws and Xxxxxxx has not received
any written communication from any person or Governmental Entity that alleges
that Xxxxxxx or any Xxxxxxx Subsidiary is not in compliance with applicable
Environmental Laws, except where the failure to be in such compliance would not
in the aggregate reasonably be expected to have a Xxxxxxx Material Adverse
Effect. Xxxxxxx has provided STEAG with complete and correct copies of or access
to all reports, studies, assessments, and test results in its possession
relating to any storage, use, or disposal of Hazardous Materials by Xxxxxxx and
any Xxxxxxx Subsidiary or on any property owned, leased to, controlled by, used
by or adjacent to that of Xxxxxxx or any Xxxxxxx Subsidiary.
(b) Environmental Permits. Xxxxxxx and each Xxxxxxx Subsidiary
have obtained or have applied for all Environmental Permits necessary for the
construction of their facilities or the conduct of their operations, and all
such Environmental Permits are in good standing or, where applicable, a renewal
application has been timely filed and is pending agency approval, and Xxxxxxx
and each Xxxxxxx Subsidiary is in compliance with all terms and conditions of
the Environmental Permits, except where the failure to be in compliance would
not in the aggregate reasonably be expected to have a Xxxxxxx Material Adverse
Effect, and Xxxxxxx believes that any transfer, renewal or reapplication for any
Environmental Permit required as a result of the Strategic Business Combination
can be accomplished in the ordinary course of business.
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(c) Environmental Claims. There are no Environmental Claims
pending or threatened (i) against Xxxxxxx or any Xxxxxxx Subsidiary, any
subsidiary or joint ventures, or (ii) against any real or personal property or
operations Xxxxxxx or any Xxxxxxx Subsidiary owns, leases or manages, in whole
or in part.
(d) Releases. To Xxxxxxx'x knowledge, there have been no Releases
of any Hazardous Materials on, at, upon, into or from any property owned, leased
to, controlled by or used by Xxxxxxx or any Xxxxxxx Subsidiary, nor has there
been any Release of Hazardous Materials, including, but, not limited to, the
off-site disposal of Hazardous Materials, that would reasonably be expected to
form the basis of any Environmental Claim against Xxxxxxx or any Xxxxxxx
Subsidiary, except any Environmental Claims that, individually or in the
aggregate, would not have a Xxxxxxx Material Adverse Effect.
(e) USTs, ACM and Lead-Based Paint. To Xxxxxxx'x knowledge, there
are no underground storage tanks or related piping located on, at, upon, into or
from any property owned, leased to, controlled by or used by Xxxxxxx or any
Xxxxxxx Subsidiary, nor is there any asbestos or asbestos-containing material or
lead-based paint in, on or at any property or any facility or equipment owned,
leased or operated in connection with the business of Xxxxxxx or any Xxxxxxx
Subsidiary which would reasonably be expected to result in a Xxxxxxx Material
Adverse Effect.
(f) Predecessors. Xxxxxxx has no knowledge of any Environmental
Claim pending or threatened, or of any Release of Hazardous Materials that would
reasonably be likely to form the basis of any Environmental Claim, in each case
against any person or entity (including, without limitation, any predecessor of
Xxxxxxx or any Xxxxxxx Subsidiary) whose liability Xxxxxxx has or may have
retained or assumed either contractually or by operation of law or against any
real or personal property which Xxxxxxx or any Xxxxxxx Subsidiary formerly
owned, leased or managed, in whole or in part which would reasonably be expected
to result in a Xxxxxxx Material Adverse Effect.
4.14 Litigation.
(a) Except as disclosed in Section 4.14 of the Xxxxxxx Disclosure
Schedule hereto or in the Xxxxxxx Financial Statements (including the notes
thereto), there are no actions, suits, arbitrations, regulatory proceedings or
other litigation, proceedings or governmental investigations by or before any
court, arbitration or Governmental Entity which is now pending or, to Xxxxxxx'x
knowledge, threatened (in writing) against or affecting Xxxxxxx, Xxxxxxx
Subsidiaries or any of their officers or directors in their capacity as such, or
any of their respective properties or businesses which, if decided adversely to
Xxxxxxx or the Xxxxxxx subsidiaries, would reasonably be expected to have a
Xxxxxxx Material Adverse Effect. Except as set forth in Section 4.14 of the
Xxxxxxx Disclosure Schedule, all of the proceedings pending against Xxxxxxx and
Xxxxxxx Subsidiaries are covered and being defended by insurers (subject to such
deductibles as are set forth in such Schedule). Except as disclosed in Section
4.14 of the Xxxxxxx Disclosure Schedule hereto, neither Xxxxxxx nor any Xxxxxxx
Subsidiary is currently subject to any order, judgment, decree, injunction,
stipulation or consent order of or with any court or other Governmental Entity.
Since January 1, 2000, neither Xxxxxxx nor any Xxxxxxx Subsidiary has entered
into any agreement to settle or compromise any proceeding pending or
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threatened against it which has involved any obligation other than the payment
of money or for which Xxxxxxx or any Xxxxxxx Subsidiary, as the case may be, has
any continuing obligation.
(b) There are no claims, actions, suits, proceedings, or
investigations pending or, to Xxxxxxx'x knowledge, threatened (in writing) by or
against Xxxxxxx with respect to this Agreement or in connection with the
transactions contemplated hereby.
(c) Except as set forth in Section 4.14 of the Xxxxxxx Disclosure
Schedule, to Xxxxxxx'x knowledge, there are no pending or threatened (in
writing) claims against any director, officer, employee or agent of Xxxxxxx or
the Xxxxxxx Subsidiaries, in their capacity as such, or any other Person which,
if decided adversely to such Person would reasonably be expected to give rise to
any claim for indemnification against Xxxxxxx or any Xxxxxxx Subsidiary.
4.15 Compliance with Applicable Laws. Except as disclosed in Section
4.15 of the Xxxxxxx Disclosure Schedule hereto, Xxxxxxx and each Xxxxxxx
Subsidiary holds all permits, licenses, variances, exemptions, orders and
approvals of all Governmental Entities which are required for the operation of
its business, except those the absence of which would not reasonably be expected
to have a Xxxxxxx Material Adverse Effect (the "Xxxxxxx Permits"). Xxxxxxx and
each Xxxxxxx Subsidiary is in compliance with the terms of Xxxxxxx Permits,
except where the failure so to comply would not reasonably be expected to have a
Xxxxxxx Material Adverse Effect. Except as disclosed in Section 4.15 of the
Xxxxxxx Disclosure Schedule, to Xxxxxxx'x knowledge, Xxxxxxx and each Xxxxxxx
Subsidiary is not in violation of any law, ordinance or regulation of any
Governmental Entity, except for possible violations which individually and in
the aggregate do not have a Xxxxxxx Material Adverse Effect.
4.16 Contracts; No Defaults. Except as described in Section 4.16 of the
Xxxxxxx Disclosure Schedule, neither Xxxxxxx nor any Xxxxxxx Subsidiary is a
party to or subject to any agreement, contract, or commitment, written or, to
the knowledge of Xxxxxxx, oral (including, without limitation, leases of real
property), which (i) has expected receipts or expenditures by Xxxxxxx or any
Xxxxxxx Subsidiary, alone or in the aggregate, in excess of $2 million, other
than purchase orders from customers and purchase orders to suppliers in the
ordinary course of business, (ii) requires, as its primary purpose, Xxxxxxx or
any Xxxxxxx Subsidiary to indemnify any Person, (iii) grants any exclusive
material licenses or distributorships to any party, (iv) evidences indebtedness
for borrowed or loaned money of $1 million or more, including guarantees of such
indebtedness (other than trade accounts receivable and trade accounts payable),
or (v) has an initial term of more than one year and is not cancelable without
significant penalties by Xxxxxxx or any Xxxxxxx Subsidiary on 60 days' or less
notice or (other than employment agreements with a current term of three years
or less) (each of the items described under (i) through (v), a "Material
Contract"). Neither Xxxxxxx nor any Xxxxxxx Subsidiary is in default or alleged
to be in default under any such Material Contract and, to Xxxxxxx'x knowledge,
no other party thereto is in default except as would not reasonably be expected
to have a Xxxxxxx Material Adverse Effect. To Xxxxxxx'x knowledge, nothing has
occurred which, with or without the passage of time or giving of notice or both,
would constitute a default by Xxxxxxx or any Xxxxxxx Subsidiary or by any other
party under any such Material Contract except as would not reasonably be
expected to have a Xxxxxxx Material Adverse Effect. Xxxxxxx has not received any
written or, to its knowledge, oral, notification that any such Material Contract
is not likely to be renewed. The Strategic Business Combination contemplated
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by this Agreement will not create a default under or permit the termination of
or otherwise adversely affect any such Material Contract in a manner that would
reasonably be expected to have a Xxxxxxx Material Adverse Effect. Except as
described in Section 4.16 of the Xxxxxxx Disclosure Schedule hereto, neither
Xxxxxxx nor any Xxxxxxx Subsidiary is required to give any notice to any person
regarding this Agreement or the transactions contemplated hereby pursuant to the
terms of any such Material Contract.
4.17 Change in Control and Severance Payments. Except as set forth in
Section 4.17 of the Xxxxxxx Disclosure Schedule, neither Xxxxxxx nor any Xxxxxxx
Subsidiary has any material plans, programs or agreements to which it is a
party, or to which it is subject, pursuant to which payments (or acceleration of
benefits) may be required upon, or may become payable directly or indirectly as
a result of, or by reason of the consummation of the Strategic Business
Combination.
4.18 Year 2000. As of the date hereof, the computer systems used by
Xxxxxxx, any Xxxxxxx Subsidiary and any third party service providers used by
either of the foregoing have not exhibited any material deficiencies with
respect to formatting for the Year 2000 Problem. All issues and modification, if
any, regarding Year 2000 Problem compliance by Xxxxxxx or Xxxxxxx Subsidiaries
have been resolved by third-party service providers and Xxxxxxx. To Xxxxxxx'x
knowledge, there is no inability on the part of any customer, insurance company
or service provider with which Xxxxxxx or Xxxxxxx Subsidiaries transact business
to timely remedy their own deficiencies in respect of the Year 2000 Problem,
which inability, individually or in the aggregate, would reasonably be expected
to have a Xxxxxxx Material Adverse Effect.
4.19 Brokers and Finders. Except for Alliant Partners, neither Xxxxxxx
nor any officer, director, or employee of Xxxxxxx has employed any brokers,
finder or investment banker or incurred any liability for any brokerage or
investment banking fees, commissions or finders' fees in connection with the
transactions contemplated by this Agreement.
4.20 Opinion of Financial Advisor. Xxxxxxx has received the opinion of
Alliant Partners to the effect that the shares of Xxxxxxx Common Stock to be
issued to STEAG in the Strategic Business Combination and the shares of Xxxxxxx
Common Stock to be issued to stockholders of CFM pursuant to the CFM Merger,
taken together, are fair from a financial point of view to the holders of
Xxxxxxx Common Stock, and a true and correct copy of such opinion has been
provided to STEAG.
4.21 Vote Required. The approval of the Xxxxxxx Stockholder Proposal by
the affirmative vote of a majority of the votes cast in person or by proxy by
the holders of Xxxxxxx Common Stock is the only vote of the holders of any class
or series of the capital stock of Xxxxxxx required to approve the Xxxxxxx
Stockholder Proposal.
4.22 Investment Company Act. Xxxxxxx and each Xxxxxxx Subsidiary (i) is
not an "investment company," or a company "controlled" by, or an "affiliated
company" with respect to, an "investment company" within the meaning of the
Investment Company Act of 1940, as amended (the "Investment Company Act"), or
(ii) satisfies all conditions for an exemption from the Investment Company Act,
and, accordingly, neither Xxxxxxx nor any Xxxxxxx Subsidiary is required to be
registered under the Investment Company Act.
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4.23 CFM Agreement. Xxxxxxx has furnished to STEAG a true and complete
copy of the proposed CFM Agreement, as well as the disclosure schedules thereto
and the proposed related stock option and voting agreements contemplated by the
recitals thereto, in each case in the form in which such document is being
executed by the respective parties thereto concurrently with the execution of
this Agreement by STEAG and Xxxxxxx.
ARTICLE V.
CONDUCT PRIOR TO THE CLOSING
5.1 Conduct of Business of STEAG Subsidiaries. During the period from
the date of this Agreement and continuing until the earlier of the termination
of this Agreement or the Closing, STEAG and Newco agree (except to the extent
expressly contemplated by this Agreement or as consented to in writing by
Xxxxxxx), to carry on the business of the STEAG Subsidiaries in the ordinary
course in substantially the same manner as heretofore conducted; to pay and to
cause to be paid the debts and Taxes of the STEAG Subsidiaries when due subject
to good faith disputes over such debts or Taxes, to pay or perform other
obligations when due, and to use all reasonable efforts to preserve intact its
present business organizations, keep available the services of the present
officers, employees and consultants of the STEAG Subsidiaries and preserve the
STEAG Subsidiaries' relationships with customers, suppliers, distributors,
licensors, licensees, and others having business dealings with the STEAG
Subsidiaries. STEAG agrees to promptly notify Xxxxxxx of any event or occurrence
described in clauses (a) through (s) below. Without limiting the foregoing,
except as expressly contemplated by this Agreement (including with respect to
the formation and capitalization of Newco and the transfer of the Foreign
Subsidiaries Shares to Newco) or Section 5.1 of the STEAG Disclosure Schedule,
STEAG shall not allow, cause or permit any of the STEAG Subsidiaries to do,
cause, or permit any of the following as to any of them, without the prior
written consent of Xxxxxxx:
(a) Charter Documents. Cause or permit any amendments to any of
their Memorandum and Articles of Association (Satzung), Management Board
(Vorstand) Rules of Procedure (Geschaftsordnung), Articles, Bylaws, or other
applicable organizational or charter documents;
(b) Dividends; Changes in Capital Stock. Declare or pay any
dividends on or make any other distributions (whether in cash, stock, or
property) in respect of any of their capital stock, or split, combine, or
reclassify any of their capital stock or issue or authorize the issuance of any
other securities in respect of, in lieu of, or in substitution for shares of
their capital stock, or repurchase or otherwise acquire, directly or indirectly,
any shares of their capital stock except from former employees, directors, and
consultants in accordance with agreements providing for the repurchase of shares
in connection with any termination of service;
(c) Stock Option Plans, Etc. Accelerate, amend, or change the
period of exercisability or vesting of options or other rights granted under any
of their stock plans or authorize cash payments in exchange for any options or
other rights granted under any of such plans;
(d) Issuance of Securities. Issue, deliver, or sell or authorize
or propose the issuance, delivery, or sale of, or purchase or propose the
purchase of, any shares of their capital
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stock or securities convertible into, or subscriptions, rights, warrants, or
options to acquire, or other agreements or commitments of any character
obligating them to issue any such shares or other convertible securities other
than the issuance of shares of their common stock pursuant to the exercise of
stock options, warrants, or other rights therefore outstanding as of the date of
this Agreement;
(e) Intellectual Property. Transfer to any person or entity any
rights to STEAG Intellectual Property other than in the ordinary course of
business consistent with past practice;
(f) Exclusive Rights. Enter into or amend any agreements pursuant
to which any other party is granted exclusive marketing or other exclusive
rights of any type or scope with respect to any of the STEAG Products or STEAG
Intellectual Property;
(g) Dispositions. Sell, lease, license, or otherwise dispose of
or encumber any of their properties or assets which are material individually or
in the aggregate, to the STEAG Subsidiaries, taken as a whole, except in the
ordinary course of business, consistent with past practice;
(h) Indebtedness. Incur any indebtedness for borrowed money or
guarantee any such indebtedness or issue or sell any debt securities or
guarantee any debt securities of others other than intercompany loans from STEAG
or any of its affiliates which loans will be cancelled at or prior to Closing;
(i) Agreements. Enter into, terminate, or amend, in a manner
which will adversely affect the business of the STEAG Subsidiaries (i) any
agreement involving an obligation to pay or the right to receive $2,000,000 or
more, (ii) any agreement relating to the license, transfer, or other disposition
or acquisition of STEAG Intellectual Property rights or rights to market or sell
STEAG Products, or (iii) any other agreement which is or would be a Material
Contract, other than, in the case of clauses (i), (ii) and (iii), in the
ordinary course of business;
(j) Payment of Obligations. Pay, discharge, or satisfy in an
amount in excess of $2,000,000 in the aggregate, any claim, liability, or
obligation (absolute, accrued, asserted or unasserted, contingent, or otherwise)
arising other than in the ordinary course of business, other than the payment,
discharge, or satisfaction of liabilities reflected or reserved against in the
STEAG Financial Statements;
(k) Capital Expenditures. Make any capital expenditures, capital
additions, or capital improvements in excess of $2,000,000 beyond the aggregate
amounts provided in the operation plans for the STEAG Subsidiaries in effect on
the date of the Agreement;
(l) Insurance. Materially reduce the amount of any material
insurance coverage provided by existing insurance policies, other than in the
ordinary course of business;
(m) Termination or Waiver. Terminate or waive any right of
substantial value, other than in the ordinary course of business;
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(n) Employee Benefit Plans; New Hires; Pay Increases. Amend any
STEAG Employee Plan or STEAG International Employee Plan or adopt any plan that
would constitute a STEAG Employee Plan or STEAG International Employee Plan
except as required by law, regulation or tax qualification requirement, hire any
new executive officer-level employee or hire additional employees such that the
number of worldwide employees of the STEAG Subsidiaries exceeds, in aggregate,
120% of the worldwide aggregate number of such employees on the date of this
Agreement, pay any special bonus (except payments made pursuant to written
agreements outstanding on the date hereof), or increase the benefits, salaries,
or wage rates of its employees except in the ordinary course of business in
accordance with its standard past practice; provided, that the STEAG
Subsidiaries may pay such reasonable special bonuses and grant such reasonable
increases in salaries, wages and other benefits as STEAG deems appropriate in
order to attract or retain its employee work force and management personnel at
levels consistent with current practice;
(o) Severance Arrangements. Grant any severance or termination
pay or benefits (i) to any director or officer or (ii) to any other employee of
a US STEAG Subsidiary except payments made pursuant to written agreements
outstanding on the date hereof and/or disclosed on the STEAG Disclosure Schedule
and except for reasonable severance or termination arrangements as STEAG deems
appropriate in order to attract or retain its employee work force and management
personnel at levels consistent with current practice;
(p) Acquisitions. Acquire or agree to acquire by merging or
consolidating with, or by purchasing a substantial portion of the assets of, or
by any other manner, any business or any corporation, partnership, association,
or other business organization or division thereof or otherwise acquire or agree
to acquire any assets which are material individually or in the aggregate, to
the business of any of the STEAG Subsidiaries;
(q) Taxes. Other than in the ordinary course of business, make or
change any material election in respect of Taxes, adopt or change any material
accounting method in respect of Taxes, file any material Tax Return or any
amendment to a material Tax Return, enter into any closing agreement pertaining
to material matters, settle any material claim or assessment in respect of
Taxes, or consent to any extension or waiver of the limitation period applicable
to any material claim or assessment in respect of Taxes;
(r) Revaluation. Revalue any of its assets, including without
limitation writing down the value of inventory or writing off notes or accounts
receivable other than in the ordinary course of business or as required by
applicable law or regulations; or
(s) Other. Agree in writing or otherwise to take, any of the
actions described in Sections 5.1(a) through (r) above, or take any action which
would cause a material breach of its representations or warranties contained in
this Agreement or prevent it from materially performing or cause it not to
materially perform its covenants hereunder.
5.2 Conduct of Business of Xxxxxxx. During the period from the date of
this Agreement and continuing until the earlier of the termination of this
Agreement or the Closing, Xxxxxxx agrees (except to the extent expressly
contemplated by this Agreement or as consented to in writing by STEAG), to carry
on the business of Xxxxxxx in the ordinary course in
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substantially the same manner as heretofore conducted; to pay and to cause to be
paid the debts and Taxes of Xxxxxxx and the Xxxxxxx Subsidiaries when due
subject to good faith disputes over such debts or Taxes and to pay or perform
other obligations when due, and to use all reasonable efforts to preserve intact
its present business organizations, keep available the services of the present
officers, key employees and consultants of Xxxxxxx and preserve Xxxxxxx'x
relationships with customers, suppliers, distributors, licensors, licensees, and
others having business dealings with Xxxxxxx, to the end that Xxxxxxx'x good
will and ongoing businesses shall be unimpaired at the Closing. Xxxxxxx agrees
to promptly notify STEAG of any event or occurrence not in the ordinary course
of business for Xxxxxxx, and of any event which could have a Xxxxxxx Material
Adverse Effect. Without limiting the foregoing, except as expressly contemplated
by this Agreement or Section 5.2 of the Disclosure Schedule, Xxxxxxx shall not
do, cause, or permit any of the following, without the prior written consent of
STEAG:
(a) Charter Documents. Cause or permit any amendments to its
Certificate of Incorporation or Bylaws;
(b) Dividend; Changes in Capital Stock. Declare or pay any
dividends on or make any other distributions (whether in cash, stock, or
property) in respect of any of its capital stock, or split, combine, or
reclassify any of its capital stock or issue or authorize the issuance of any
other securities in respect of, in lieu of, or in substitution for shares of
their capital stock, or repurchase or otherwise acquire, directly or indirectly,
any shares of its capital stock except from former employees, directors, and
consultants in accordance with agreements providing for the repurchase of shares
in connection with any termination of service;
(c) Transfer of Material Assets. Sell, transfer, convey, assign
or otherwise dispose of its material assets or properties, except sales of
inventory in the ordinary course of business, consistent with past practice;
(d) Waiver of Claims. Waive, release or cancel any claims against
third parties or debts owing to it, or any rights which have any value in an
amount greater than $5,000,000;
(e) Change in Accounting. Make any changes in its accounting
systems, policies, principles or practices, other than as may be required by
reason of changes in GAAP or rules and regulations of the SEC pertaining to
accounting principles or practices;
(f) Capital Expenditures. Authorize or make any capital
expenditures which individually or in the aggregate are in excess of
$25,000,000;
(g) Tax Elections. Make or change any Tax election or Tax
accounting method or settle or compromise any material federal, state, local or
foreign Tax dispute, or waive or extend the statute of limitations in respect of
any such Taxes or make any other Tax filings other than in the ordinary course
of business and consistent with past practice or incident to the filing for
extensions for Tax Reports;
(h) Settlement. Pay or agree to pay any amount in settlement or
compromise of any suits or claims of liability in an amount more than
$10,000,000;
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(i) Issuances. Issue, sell, transfer, pledge, dispose of or
encumber any shares of, or securities convertible into or exchangeable for, or
options, warrants, calls, commitments or rights of any kind to acquire, any
shares of capital stock of any class or series of Xxxxxxx or any of its
Subsidiaries, other than (i) issuances of Common Stock pursuant to the exercise
of employee or director stock options outstanding on the date of this Agreement
or that are granted in accordance with clause (iii) below, (ii) the issuance of
up to 4,500,000 shares of Xxxxxxx Common Stock, plus the assumption of
unexercised options to purchase stock of CFM, in the CFM Merger, (iii)
additional options or stock-based awards to acquire Xxxxxxx Common Stock granted
under the terms of any employee or director stock option or compensation plan or
arrangement of Xxxxxxx as in effect as of this Agreement in the ordinary course
consistent with past practice, or (iv) the issuance of up to 2,000,000 shares of
Xxxxxxx Common Stock in connection with acquisitions of assets or businesses;
(j) Certain Transactions. Adopt a plan or agreement of complete
or partial liquidation, dissolution, merger, consolidation, restructuring,
recapitalization or other reorganization of Xxxxxxx or any of its significant
Subsidiaries, other than transactions permitted under Sections 5.3(b) and (c);
(k) Dispositions. Sell, lease, license or otherwise dispose of
any of their properties or assets which are material individually or in the
aggregate to the business of Xxxxxxx and its subsidiaries, taken as a whole,
except in the ordinary course of business, consistent with past practice; or
(l) Other. Take or agree in writing or otherwise to take, any of
the actions described in Sections 5.2(a) through (k) above, or any action which
would cause a material breach of its representations or warranties contained in
this Agreement or prevent it from materially performing or cause it not to
materially perform its covenants hereunder.
5.3 Other Negotiations.
(a) Prior to the termination of this Agreement pursuant to
Article VIII (the "Exclusivity Period"), STEAG will not (and it will use its
best efforts to assure that its officers, directors, employees, agents and
affiliates do not on its behalf) take any action (directly or indirectly) to
solicit, initiate, seek, encourage or support any inquiry, proposal or offer
(whether written or oral) from, furnish any information to, or participate in
any negotiations with, any corporation, partnership, person or other entity or
group (other than discussions with Xxxxxxx) regarding any acquisition of STEAG
or the STEAG Subsidiaries, any merger or consolidation with or involving STEAG
or the STEAG Subsidiaries, or any acquisition of any material portion of the
stock or assets of STEAG or any of the STEAG Subsidiaries. STEAG agrees that any
such negotiations in progress as of the date hereof will be terminated or
suspended during the Exclusivity Period. During the Exclusivity Period, STEAG
will immediately notify Xxxxxxx regarding any contact by any third party
regarding any offer, proposal or inquiry regarding any such acquisition or
financing of STEAG or any of the STEAG Subsidiaries. In no event will STEAG or
any of the STEAG Subsidiaries accept or enter into an agreement concerning any
such third party transaction during the Exclusivity Period. During the
Exclusivity Period, STEAG will immediately notify Xxxxxxx regarding any contact
by any third party regarding any offer proposal or inquiry regarding any such
acquisition.
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(b) During the Exclusivity Period, Xxxxxxx will not (and it will
use its best efforts to assure that its officers, directors, employees, agents
and affiliates do not on its behalf) take any action (directly or indirectly) to
solicit, initiate, seek, or encourage any inquiry, proposal or offer (whether
written or oral) from any corporation, partnership, person or other entity or
group (other than discussions with STEAG), or, except in response to an
unsolicited inquiry, proposal or offer (whether written or oral) from any such
person, furnish any information to, or participate in any negotiations with any
such person, regarding (i) any merger or consolidation with or involving Xxxxxxx
which results in the stockholders of Xxxxxxx prior to such transaction owning
less than 50% of the capital stock of the surviving corporation, or any
acquisition of any material portion of the stock or assets of Xxxxxxx (an
"Acquisition Transaction") or (ii) any acquisition, whether by merger, stock
acquisition, asset acquisition, joint venture, partnership or otherwise, by
Xxxxxxx of any business which competes with STEAG or the STEAG Subsidiaries in
the RTP, CVD, wet processing or copper businesses. Xxxxxxx agrees that any such
negotiations in progress as of the date hereof will be terminated or suspended
during the Exclusivity Period. In no event will Xxxxxxx accept or enter into an
agreement concerning any such third party transaction during the Exclusivity
Period. During the Exclusivity Period, Xxxxxxx will immediately notify STEAG
regarding any contact by any third party regarding any offer, proposal or
inquiry regarding any such acquisition.
(c) Notwithstanding the foregoing provisions of this Section 5.3,
Xxxxxxx and STEAG will each have the right to conduct discussions with and
furnish information to CFM with regard to the CFM Merger and the Strategic
Business Combination, and further provided that Xxxxxxx and STEAG agree to
provide each other prompt updates regarding any such discussions.
Notwithstanding the foregoing provisions of this paragraph 5.3, Xxxxxxx is
permitted to pursue negotiations with and furnish information in connection with
potential transaction(s) disclosed to STEAG in writing prior to the date of this
Agreement, and to enter into and consummate agreements to effectuate such
transaction(s).
5.4 German Counterpart Agreement. As promptly as practicable following
the date of this Agreement, Xxxxxxx and STEAG shall execute and deliver the
German-law-governed agreement attached as Exhibit D hereto (the "Counterpart
Agreement"), which shall be notarized in accordance with German law or as
otherwise agreed among the parties.
ARTICLE VI.
ADDITIONAL AGREEMENTS AND COVENANTS
6.1 Covenant to Satisfy Conditions. Subject to the terms and conditions
hereof, each party hereto shall use its reasonable commercial efforts to take
all action required of it to satisfy the conditions set forth in Article VII,
and otherwise to fulfill its obligations under the terms of this Agreement and
to facilitate the consummation of the transactions contemplated hereby. No party
shall, nor shall any party permit any of its subsidiaries to, willfully take any
action that would or is reasonably likely to result in a material breach of any
provision of this Agreement or in any of its representations and warranties set
forth in this Agreement being untrue in any material respect on and as of the
Closing Date.
6.2 Proxy Materials and Stockholder Approval. As soon as practicable
after the date hereof, Xxxxxxx will prepare and file with the SEC, at its own
expense, a joint proxy
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statement/prospectus relating to the Xxxxxxx Stockholder Proposal (the "Proxy
Statement") to be presented for voting and adoption at meetings of the Xxxxxxx
stockholders (the "Xxxxxxx Stockholders' Meeting") and the shareholders of CFM.
Xxxxxxx will duly call, give notice of, convene and hold the Xxxxxxx
Stockholders' Meeting as promptly as practicable to consider and vote on the
Xxxxxxx Stockholder Proposal. Subject to its fiduciary obligations under
applicable law, the Board of Directors of Xxxxxxx shall recommend to Xxxxxxx'x
stockholders the approval of the Xxxxxxx Stockholder Proposal. The Proxy
Statement will comply as to form in all material respects with all applicable
laws, including the Securities Exchange Act of 1934, as amended. STEAG shall
provide such information about the STEAG Subsidiaries as Xxxxxxx shall
reasonably request. The information supplied by Xxxxxxx for inclusion in the
Proxy Statement shall not, on the date the Proxy Statement is first mailed to
Xxxxxxx'x stockholders or at the Closing, contain any statement which, at such
time, is false or misleading with respect to any material fact, or omit to state
any material fact necessary in order to make the statements made therein, in
light of the circumstances under which they are made, not false or misleading,
or omit to state any material fact necessary to correct any statement in any
earlier communication which has become false or misleading. Notwithstanding the
foregoing, Xxxxxxx makes no representation, warranty or covenant with respect to
any information supplied by STEAG in writing expressly for inclusion in the
Proxy Statement. The information supplied by STEAG in writing expressly for
inclusion in the Proxy Statement shall not, on the date the Proxy Statement is
first mailed to Xxxxxxx'x stockholders, nor at the Closing, contain any
statement which, at such time, is false or misleading with respect to any
material fact, or omit to state any material fact necessary in order to make the
statements therein, in light of the circumstances under which it is made, not
false or misleading; or omit to state any material fact necessary to correct any
statement in any earlier communication which has become false or misleading.
Notwithstanding the foregoing, STEAG makes no representation, warranty or
covenant with respect to any information contained in the Proxy Statement which
was not provided in writing by STEAG expressly for inclusion in the Proxy
Statement. Each of STEAG and Xxxxxxx agrees to provide promptly to the other
such information concerning its business and financial statements and affairs
as, in the reasonable judgment of the providing party or its counsel, may be
required or appropriate for inclusion in the Proxy Statement or in any
amendments or supplements thereto, and to cause its counsel and auditors to
cooperate with the other's counsel and auditors in the preparation of the Proxy
Statement. Xxxxxxx will promptly advise STEAG, and STEAG will promptly advise
Xxxxxxx, in writing if at any time prior to the Closing either Xxxxxxx or STEAG
shall obtain knowledge of any facts that might make it necessary or appropriate
to amend or supplement the Proxy Statement in order to make the statements
contained or incorporated by reference therein not misleading or to comply with
applicable law (including information relating to CFM). If at any time prior to
the Closing Date any event with respect to Xxxxxxx, its officers, and directors
or any of its subsidiaries shall occur which is or should be described in an
amendment of, or a supplement to, the Proxy Statement, such event shall be so
described and the presentation in such amendment or supplement of such
information will not contain any statement which, at the time and in light of
the circumstances under which it is made, is false or misleading in any material
respect or omits to state any material fact required to be stated therein or
necessary in order to make the statements therein, in light of the circumstances
under which they were made, not false or misleading.
6.3 Integration Committee. To facilitate transition and integration
planning, Xxxxxxx, STEAG and CFM will maintain an integration committee (the
"Integration Committee")
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consisting of the CEO's of Xxxxxxx, CFM and STEAG, Dr. Ludger Viefhues and the
future head of integration planning for Xxxxxxx, which will continue to develop
the organization and staffing plan prior to Closing. As of the Closing, the
Xxxxxxx Board of Directors will establish and appoint in accordance with the
procedures for establishing committees set forth in Xxxxxxx'x By-laws an
"Executive Staffing Committee," consisting of Xx. Xxxxxx Xxxxxxxx and Xxxx
Xxxxxxx (and, if agreed by Xxxxxxx and STEAG, one additional representative of
each of STEAG and Xxxxxxx), which will remain in place for one year following
closing, and will be responsible during that period for making key personnel
decisions (including the hiring and firing of CEO, CFO, COO, general managers
for divisions). A mutually acceptable independent Xxxxxxx board member will be
appointed as a tiebreaker in the event the Executive Staffing Committee reaches
deadlock on an issue.
6.4 Employee Benefits. For a period of two years following the Closing,
Xxxxxxx will provide or cause benefits to be provided to all employees of the
STEAG Subsidiaries who were employees of US STEAG Subsidiaries who were so
employed immediately prior to the Closing ("STEAG Employees") that are no less
favorable in the aggregate to the benefits provided to the STEAG Employee on the
date of this Agreement, and thereafter will provide STEAG Employees with
benefits comparable to those provided to similarly-situated and located
employees of Xxxxxxx. Time of service with STEAG Subsidiaries shall be credited
for all purposes, other than benefit accrual, under any comparable plans
maintained by Xxxxxxx, except to the extent such credit would result in a
duplication of benefits. Notwithstanding the foregoing, to the extent a Xxxxxxx
sabbatical plan remains in effect for employees in a particular country, the
service credited to STEAG Employees under the Xxxxxxx employee benefit programs
shall not be considered for purposes of eligibility to participate in Xxxxxxx'x
sabbatical plan. Xxxxxxx and STEAG agree that where applicable with respect to
any medical or dental benefit plan of Xxxxxxx, (i) Xxxxxxx shall waive, with
respect to any STEAG Employee, any pre-existing condition exclusion and
actively-at-work requirements (to the extent such exclusion or requirement would
not have applied under the applicable Xxxxxxx employee benefit plan) and (ii)
any covered expenses incurred on or before the Closing by a STEAG Employee or a
STEAG Employee's covered dependents shall be taken into account for purposes of
satisfying applicable deductible, coinsurance and maximum out-of-pocket
provisions after the Closing to the same extent as such expenses would be taken
into account if incurred by similarly situated employees of Xxxxxxx. STEAG
Employees shall receive compensation no less favorable than their current
salaries. Xxxxxxx acknowledges the obligations of German companies toward their
employees. Xxxxxxx shall provide continuation health care coverage to all STEAG
Employees and their qualified beneficiaries who incur a qualifying event after
the Closing Date in accordance with and to the extent required, under the
continuation health care coverage requirements of Section 4980D of the Code and
Sections 601 through 608 of ERISA ("COBRA"). STEAG shall be responsible for
providing continuation coverage and all related notices to the extent required
by law to any STEAG Employee (or qualified beneficiary) who incurs a "qualifying
event" under COBRA on or before the Closing Date. STEAG and/or the relevant
STEAG Subsidiary, as applicable, will terminate the STEAG RTP Systems Inc.
401(k) Savings Plan immediately prior to Closing, unless Xxxxxxx, in its sole
and absolute discretion, agrees to sponsor and maintain such plan by providing
STEAG with written notice of such election at thirty (30) days before the
Closing Date. Unless Xxxxxxx provides such notice to STEAG, Xxxxxxx shall
receive from STEAG evidence that the STEAG RTP Systems Inc. 401(k) Savings Plan
has been terminated pursuant to resolutions of the relevant STEAG Subsidiary's
Board of Directors (the
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form and substance of which resolutions shall be subject to review and approval
by Xxxxxxx), effective as of the day immediately preceding the Closing Date.
6.5 Sale of Shares Pursuant to Regulation D. The parties hereto
acknowledge and agree that the Xxxxxxx Shares issuable to STEAG pursuant to
Article II hereof, shall constitute "restricted securities" under the Securities
Act. Until such time as such shares are no longer "restricted securities" under
the Securities Act, the certificates of Xxxxxxx Common Stock shall bear the
legend set forth in Section 2.5 hereof.
6.6 Access to Information.
(a) STEAG and its counsel and advisors shall have reasonable
access during normal business hours to all books, records, assets and contracts
of or relating to Xxxxxxx, and Xxxxxxx and its counsel and advisors shall have
reasonable access during normal business hours to all books, records, assets and
contracts of or relating to the STEAG Subsidiaries, in each case to complete
such party's respective diligence investigation for the purposes of the
Strategic Business Combination. Key personnel shall be made available by each
party as necessary to assist in this diligence effort. Each party will permit
the other party on prior notice to contact key customers and suppliers as part
of the due diligence process.
(b) Subject to compliance with applicable law, from the date
hereof until the Closing, each of Xxxxxxx and STEAG shall confer on a regular
and frequent basis with one or more representatives of the other party to report
material operational matters and the general status of ongoing operations.
(c) No information or knowledge obtained in any investigation
pursuant to this Section 6.6 shall affect or be deemed to modify any
representation or warranty contained herein or the conditions to the obligations
of the parties to consummate the transactions contemplated hereby.
Notwithstanding the foregoing sentence, to the extent that either Xxxxxxx or
STEAG obtains information which the receiving party knows the failure of which
to include in the STEAG Disclosure Schedule or the Xxxxxxx Disclosure Schedule,
as the case may be, would result in a breach of a representation and warranty
herein by the other party, then the party that first obtained such information
shall promptly notify the other in writing of such information and such other
party may supplement or amend the STEAG Disclosure Schedule or the Xxxxxxx
Disclosure Schedule, as the case may be; provided, however, that, if the
disclosure pursuant to such supplement or amendment would constitute a basis
pursuant to Section 7.2(b) or Section 7.3(b), as the case may be, under which
Xxxxxxx or STEAG, respectively, would have the right to not consummate the
Strategic Business Combination and the transactions contemplated hereby, then
Xxxxxxx or STEAG shall have ten (10) days from the date of such amendment or
supplement being delivered to the other party pursuant to Section 10.1 to
terminate this Agreement pursuant to Section (h) or (i), respectively, after
which such amendment or supplement shall be deemed accepted. Notwithstanding any
other provision hereof, if the Closing occurs, any such supplement or amendment
of the STEAG Disclosure Schedule or the Xxxxxxx Disclosure Schedule, as the case
may be, will be effective to cure and correct for all purposes any breach of any
representation, warranty or covenant which would have existed by reason of STEAG
or Xxxxxxx, respectively, not having made such supplement or amendment.
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6.7 Confidentiality. The parties acknowledge that Xxxxxxx and STEAG have
previously executed a Mutual Non-Disclosure Agreement dated February 25, 2000
(the "Non-Disclosure Agreement"), which Non-Disclosure Agreement is hereby
incorporated herein by reference and shall continue in full force and effect in
accordance with its terms.
6.8 Public Disclosure. Unless otherwise permitted by this Agreement,
Xxxxxxx and STEAG shall consult with each other before issuing any press release
or otherwise making any public statement or making any other public (or
non-confidential) disclosure (whether or not in response to an inquiry)
regarding the terms of this Agreement and the transactions contemplated hereby,
and neither shall issue any such press release or make any such statement or
disclosure without the prior approval of the other (which approval shall not be
unreasonably withheld), except as may be required by law or by obligations
pursuant to any listing agreement with any national securities exchange or with
the NASDAQ Stock Market (in which case the disclosing party shall, to the extent
practicable within the time available to comply therewith, use its reasonable
efforts to obtain the consent of the other party prior to such disclosure).
6.9 Regulatory Approval; Further Assurances.
(a) Each party shall use all reasonable efforts to file, as
promptly as practicable after the date of this Agreement, all notices, reports,
and other documents required to be filed by such party with any Governmental
Entity with respect to the Strategic Business Combination and the other
transactions contemplated by this Agreement, and to submit promptly any
additional information requested by any such Governmental Entity. Without
limiting the generality of the foregoing, STEAG and Xxxxxxx shall, promptly
after the date of this Agreement, prepare and file the notifications required
under the HSR Act in connection with the Strategic Business Combination, and
such filings as are required under the Act Against Restraints on Competition of
1958 (Gesetz gegen Wettbewerbsbeschrankungen). Each party shall use all
reasonable efforts to furnish to each other all information required for any
application or other filing to be made pursuant hereto in connection with the
Strategic Business Combination and the other transactions contemplated by this
Agreement. STEAG and Xxxxxxx shall respond as promptly as practicable to (i) any
inquiries or requests received from the Federal Trade Commission or the
Department of Justice for additional information or documentation and (ii) any
inquiries or requests received from any state attorney general or other
Governmental Entity in connection with antitrust or related matters. Each of
STEAG and Xxxxxxx shall give the other party prompt notice of the commencement
of any Legal Proceeding by or before any Governmental Entity with respect to the
Strategic Business Combination or any of the other transactions contemplated by
this Agreement, keep the other party informed as to the status of any such Legal
Proceeding, and promptly inform the other party of any communication to or from,
and any proposed undertaking or agreement with the Federal Trade Commission, the
Department of Justice or any other Governmental Entity regarding any such
filings or the Strategic Business Combination. STEAG and Xxxxxxx will consult
and cooperate with one another in connection with any analysis, appearance,
presentation, memorandum, brief, argument, opinion, or proposal made or
submitted in connection with any Legal Proceeding under or relating to the HSR
Act, the Xxxxxxx Act, as amended, the Xxxxxxx Act, as amended, the Federal Trade
Commission Act, as amended, and any other federal, state or foreign statutes,
rules, regulations, orders, decrees, administrative or judicial doctrines or
other laws that are designed to prohibit, restrict or regulate actions having
the purpose or effect of monopolization
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or restraint of trade (collectively, "Antitrust Laws"). In addition, each party
shall give the other prior notice of, and except as may be prohibited by any
Governmental Entity or by any legal requirement, in connection with any Legal
Proceeding under or relating to the Antitrust Laws or any other similar Legal
Proceeding, each of STEAG and Xxxxxxx will permit authorized representatives of
the other party to be present at and participate in each meeting or conference
relating to any such Legal Proceeding and to have access to and be consulted in
connection with any document, opinion, or proposal made or submitted to any
Governmental Entity in connection with any such Legal Proceeding.
(b) Each of Xxxxxxx and STEAG shall use all reasonable efforts to
resolve such objections, if any, as may be asserted by any Governmental Entity
with respect to the transactions contemplated by this Agreement under the
Antitrust Laws. In connection therewith, if any Legal Proceeding is instituted
(or threatened to be instituted) challenging any transaction contemplated by
this Agreement is violative of any Antitrust Law, each of Xxxxxxx and STEAG
shall cooperate and use all reasonable efforts vigorously to contest and resist
any such Legal Proceeding, and to have vacated, lifted, reversed, or overturned
any decree, judgment, injunction or other order whether temporary, preliminary
or permanent (each an "Order"), that is in effect and that prohibits, prevents,
or restricts consummation of the Strategic Business Combination or any other
transactions contemplated by this Agreement, including, without limitation, by
vigorously pursuing all available avenues of administrative and judicial appeal
and all available legislative action, unless by mutual agreement Xxxxxxx and
STEAG decide that litigation is not in their respective best interests.
Notwithstanding the foregoing or any other provisions of this Agreement, nothing
in this Section 6.9(b) shall limit a party's right to terminate this Agreement
pursuant to Article VIII, so long as such party has up to then complied in all
material respects with its obligations under this Section 6.9(b). Each of STEAG
and Xxxxxxx shall use all reasonable efforts to take such action as may be
required to cause the expiration of the notice periods under the HSR Act or
other Antitrust Laws with respect to such transactions as promptly as possible
after the execution of this Agreement. Notwithstanding anything to the contrary
in this Agreement, neither Xxxxxxx nor STEAG shall be required to hold separate
(including by trust or otherwise) or divest any of their respective businesses
or assets.
6.10 Legal Requirements. Subject to 6.9(b), each of STEAG, and Xxxxxxx
will, and will cause their respective subsidiaries to, take all reasonable
actions necessary to comply promptly with all legal requirements which may be
imposed on them with respect to the consummation of the transactions
contemplated by this Agreement and will promptly cooperate with and furnish
information to any party hereto necessary in connection with any such
requirements imposed upon such other party in connection with the consummation
of the transactions contemplated by this Agreement and will take all reasonable
actions necessary to obtain (and will cooperate with the other parties hereto in
obtaining) any consent, approval, order or authorization of or any registration,
declaration, or filing with, any Governmental Entity or other person, required
to be obtained or made in connection with the taking of any action contemplated
by this Agreement.
6.11 Stock Option Grants. Effective on the Closing, the Board of
Directors of Xxxxxxx will xxxxx options to purchase 850,000 shares of Xxxxxxx
Common Stock (as adjusted for any stock split, stock dividend, reverse stock
split and recapitalization) to directors, officers and employees of the STEAG
subsidiaries under existing Xxxxxxx Stock Option Plans, with an
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exercise price equal to the fair market value of Xxxxxxx Common Stock on the
date of the Closing and with other terms consistent with outstanding Xxxxxxx
Stock options.
6.12 Conveyance Taxes. STEAG and Xxxxxxx shall cooperate in the
preparation, execution, and filing of all returns, questionnaires, applications,
or other documents regarding any property transfer or gains, sales, use, value
added, stock transfer, and stamp Taxes, any transfer, recording, registration,
and other fees or any similar taxes that become payable in connection with the
transactions contemplated by this Agreement that are required or permitted to be
filed on or before the Closing. Each party shall pay any such Taxes or fees
imposed on it by any taxing authority (and any penalties and interest with
respect to such Taxes and fees) that become payable in connection with the
transactions contemplated by this Agreement.
6.13 STEAG Intercompany Indebtedness; Transfer to Newco.
(a) As soon as practicable after the date of this Agreement,
STEAG will cause agreements or instruments of transfer with respect to the
transfer of the Foreign STEAG Subsidiaries to Newco to be duly executed and, to
the extent necessary, filed or registered. Thereafter, STEAG will use
commercially reasonable efforts to cause Newco to become the owner, in
accordance with all applicable legal requirements, of the Foreign Subsidiary
Shares.
(b) As soon as practicable after the date of this Agreement but,
in any event, prior to the Closing, STEAG will take such action as is reasonably
necessary to cause all indebtedness of any of the STEAG Subsidiaries to STEAG or
any of its affiliates (other than another STEAG Subsidiary), other than Excluded
Indebtedness (as defined in the next sentence) to be cancelled without any
payment on the part of such STEAG Subsidiaries. The term Excluded Indebtedness
means: (i) accounts payable to STEAG Electronic Systems spol s r.o.; (ii) any
reimbursement obligations under any other provision of this Agreement; (iii)
rental payments owed under leases between any STEAG Subsidiary and STEAG Walsum
Immobilien AG; (iv) obligations under the Profit Transfer Contracts; and (v)
obligations to reimburse payments made by STEAG to or on behalf of certain
employees in France. As of the date of this Agreement, the amount of
indebtedness of the STEAG Subsidiaries to STEAG that will be forgiven pursuant
to this Section 6.13(b) is approximately DM 200,000,000.
6.14 Non-Solicitation of Employees. Xxxxxxx and STEAG each agrees that,
without the prior written consent of the other, it will not, and will cause its
controlled affiliates not to, during the term of this Agreement and for a period
of one year from the date of termination of this Agreement directly or
indirectly (including through instruction to its agents) solicit for employment
any person who is now employed by the other; provided however, that neither
Xxxxxxx nor STEAG nor any of their respective affiliates is prohibited from
making general, public solicitations for employment for any position or from
employing any current employee of the other party who contacts the party on his
or her own initiative and without impermissible solicitation by such party. The
obligations set forth in this Section 6.14 will survive the termination of this
Agreement.
6.15 NASDAQ Listing. Xxxxxxx will use its reasonable commercial efforts
to cause the Xxxxxxx Shares issuable pursuant to the terms of this Agreement to
be approved for listing on
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NASDAQ, subject to official notice of issuance, as promptly as practicable after
the date of this Agreement and in any event prior to the Closing.
6.16 Directors; Nominating Committee; Officers. Xxxxxxx shall cause the
actions required to be taken as of Closing under Section 1 of the Stockholder
Agreement to be taken on or prior to the Closing Date, including (a) causing the
Board of Directors of Xxxxxxx to be expanded from five (5) to seven (7) members;
(b) causing two (2) persons designated by STEAG to be appointed to the Board of
Directors of Xxxxxxx; (c) causing one of the STEAG designees to be named
Chairman of the Board of Directors of Xxxxxxx; and (d) causing Xxxxxxx'x Bylaws
to be amended. During the period between the Early Condition Satisfaction Date,
if applicable, and the Closing Date, Xxxxxxx will provide the STEAG designees
with notice of all meetings of the Board (at such times and with such additional
information as is provided to current directors) and shall permit such STEAG
designees to attend, either in person or by videoconference, all such meetings,
subject to such STEAG designees agreeing to keep confidential all information
disclosed in connection with such meetings.
6.17 Name. The name of the company resulting from the Strategic Business
Combination (the "Company") will be Xxxxxxx or such other name, if any, which
the parties, acting through the Integration Committee, mutually determine to be
more beneficial to the company's business, such determination to be made in a
timely manner. In the event that a different name is agreed upon, Xxxxxxx shall
take such corporate and other action as is reasonably necessary to effect such
name change. Within one year after the Closing Date, Xxxxxxx will cause the
names of each of the STEAG Subsidiaries to be changed so as to no longer include
the name "STEAG," and from and after the first anniversary of the Closing Date,
Xxxxxxx shall, and shall cause its subsidiaries to, otherwise discontinue the
use of the name "STEAG". Notwithstanding the foregoing, Xxxxxxx and its
subsidiaries may continue to use any current product names and trademarks
containing the name "STEAG" to the extent associated with any products currently
manufactured and sold by the STEAG Subsidiaries, as well as modified, but
otherwise substantially similar, versions of such products.
6.18 Access to Business Records. From and after the Closing, each party
shall afford the other reasonable access to all preclosing business records of
or directly relating to the STEAG Subsidiaries, upon reasonable notice during
ordinary business hours for all reasonable business purposes, and each party
shall permit the other party to make copies of any such records and retain
possession of such copies.
ARTICLE VII.
CONDITIONS TO THE STRATEGIC BUSINESS COMBINATION
7.1 Conditions to Each Party's Obligation to Consummate the Strategic
Business Combination. The respective obligations of each party to consummate the
Strategic Business Combination shall be subject to the satisfaction on or prior
to the Closing Date of the following conditions, except that, to the extent
permitted by applicable law, such conditions may be waived in writing by the
joint action of the parties hereto; provided, however, that the condition
specified in Section 7.1(g) hereof may be waived only by a written instrument
executed by each of Xxxxxxx, STEAG and CFM:
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(a) Stockholder Approval. The stockholders of Xxxxxxx shall have
approved the Xxxxxxx Stockholder Proposal in accordance with Xxxxxxx'x
Certificate of Incorporation and By-laws, applicable state corporate laws and
the rules and listing requirements of NASDAQ and in accordance with this
Agreement.
(b) No Injunctions or Restraints; Illegality. No temporary
restraining order, preliminary or permanent injunction, or other order issued by
any court of competent jurisdiction or any other Governmental Entities, or other
legal or regulatory restraint or prohibition preventing the consummation of the
Strategic Business Combination shall be and remain in effect, nor shall there be
any action taken, or any law, statute, rule, regulation, decree or order been
enacted, adopted, entered, enforced, or deemed applicable to the Strategic
Business Combination, which remains in effect and which makes the consummation
of the Strategic Business Combination illegal.
(c) Regulatory Approval. Any waiting period applicable to the
Strategic Business Combination or any of the transactions contemplated hereby,
including but not limited to a waiting period under HSR Act or the Act Against
Restraint on Competition of 1958 (Gesetz gegen Wettbewerbeschrenkuyen) shall
have expired or been terminated, and any other required U.S. or German
regulatory approvals, including, but not limited to, any approvals required by
the German cartel office or the European Union or any council, commission, or
subdivision thereof, shall have been obtained. STEAG and each of the STEAG
Subsidiaries, and Xxxxxxx shall have timely obtained from each Governmental
Entity all approvals, waivers, and consents, if any, necessary for consummation
of the Strategic Business Combination and the several transactions contemplated
hereby, including such approvals, waivers, and consents as may be required under
the Securities Act, and under state Blue Sky laws.
(d) NASDAQ Listing. The Xxxxxxx Shares issuable pursuant to the
Strategic Business Combination shall have been approved for listing by NASDAQ
upon official notice of issuance.
(e) Legal Proceedings. There shall not be pending any Legal
Proceeding by any Governmental Entity or other person: (i) challenging or
seeking to restrain or prohibit the consummation of the Strategic Business
Combination; (ii) relating to the Strategic Business Combination and seeking to
obtain from Xxxxxxx, STEAG, or the STEAG Subsidiaries any damages or other
relief that would be material to either Xxxxxxx or STEAG; (iii) seeking to
prohibit or limit in any material respect Xxxxxxx'x ability to vote, receive
dividends with respect to, or otherwise exercise ownership rights with respect
to the stock of the STEAG Subsidiaries; (iv) seeking to prohibit or limit in any
material respect STEAG's ability to vote, receive dividends with respect to, or
otherwise exercise ownership rights with respect to the Xxxxxxx Shares, (v)
which would materially and adversely affect the right of Xxxxxxx to own the
assets or operate the business of the STEAG Subsidiaries; (vi) seeking to compel
Xxxxxxx, STEAG or any of their controlled affiliates to dispose of or hold
separate any material assets, (vii) which is reasonably likely to have a STEAG
Material Adverse Effect or a Xxxxxxx Material Adverse Effect, or (viii) which is
reasonably likely to enjoin, restrain or prohibit any integration of any
operations of the STEAG Subsidiaries with those of Xxxxxxx or Xxxxxxx'x
Subsidiaries.
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(f) Transfers to Newco. Newco shall have become the owner, in
accordance with all applicable legal requirements, of the outstanding capital
stock of all of the Foreign STEAG Subsidiaries.
(g) Closing of CFM Merger. The closing of the CFM Merger shall
occur concurrently with the Closing.
7.2 Conditions to Obligations of Xxxxxxx. The obligations of Xxxxxxx to
consummate the Strategic Business Combination and the transactions contemplated
under the Agreement shall be further subject to the satisfaction, at or prior to
the Closing, of the following conditions, except as may be waived by Xxxxxxx in
writing:
(a) Compliance With Agreements and Covenants. STEAG and the STEAG
Subsidiaries each shall have performed and complied in all material respects
with all of its covenants, obligations and agreements contained in this
Agreement to be performed and complied with on or prior to the Closing Date.
(b) Representations and Warranties. The representations and
warranties of STEAG contained herein (i) shall be true and correct in all
material respects, on and as of the date of this Agreement, and (ii) shall also
be true and correct, on and as of the Closing Date with the same force and
effect as though made on and as of the Closing Date, except for such
inaccuracies which in the aggregate do not constitute, and are not reasonably
expected to result in, a STEAG Material Adverse Effect (disregarding for
purposes of evaluating whether subsection (b)(ii) of this condition is
satisfied, any "Material Adverse Effect" or other materiality qualifications
contained in such representations and warranties).
(c) Closing Certificate. Xxxxxxx shall have received a
certificate signed by authorized officers of STEAG, dated the Closing Date,
certifying that the conditions set forth in Section 7.2(a) and 7.2(b) have been
satisfied.
(d) Consents and Approvals. Xxxxxxx shall have received written
evidence reasonably satisfactory to it that all consents and approvals required
to be obtained in connection with the Strategic Business Combination and the
transactions contemplated hereby have been obtained and shall be in full force
and effect, and all required filings have been made, other than those consents
and approvals which, individually and in the aggregate, would not have a Xxxxxxx
Material Adverse Effect.
(e) No STEAG Material Adverse Effect. No STEAG Material Adverse
Effect shall have occurred and no event shall have occurred which, in the
reasonable judgment of Xxxxxxx, is reasonably likely to have a STEAG Material
Adverse Effect.
(f) Stockholder Agreement. STEAG shall have executed the
Stockholder Agreement substantially in the form set forth as Exhibit B (the
"Stockholder Agreement"), with full force and effect from and after the Closing.
(g) Opinion. Counsel for STEAG in the U.S.A. shall have delivered
to Xxxxxxx an opinion in the form attached hereto as Exhibit 7.2(g).
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(h) Transition Services Agreement. STEAG shall have executed a
Transition Services Agreement to be mutually agreed by STEAG and Xxxxxxx, acting
through the Integration Committee, and having terms consistent with the key
points set forth in Exhibit C (the "Transition Services Agreement"), with full
force and effect from and after the Closing.
(i) Subsidiary Director Resignations. Xxxxxxx shall have received
the written resignations, effective as from the Closing Date, of the directors
of all of the STEAG Subsidiaries, except for those employee/directors whom the
parties have mutually agreed, through the Integration Committee, to retain
immediately following the Closing.
(j) Other Closing Documents. Xxxxxxx shall have received the
share certificates evidencing the STEAG Shares, the documents and instruments
required for the notarization and transfer of the STEAG Shares and such other
closing and transfer documents as Xxxxxxx shall reasonably request to effect and
consummate the Strategic Business Combination and the transactions contemplated
hereby, in each case in form and substance reasonably satisfactory to Xxxxxxx
and its counsel.
7.3 Conditions to Obligations of STEAG. The obligations of STEAG to
consummate the Strategic Business Combination under this Agreement shall be
further subject to the satisfaction, at or prior to the Closing, of the
following conditions except as may be waived by STEAG in writing:
(a) Compliance with Agreements and Covenants. Xxxxxxx shall have
performed and complied in all material respects with all of its covenants,
obligations and agreements contained in this Agreement, to be performed and
complied with on or prior to the Closing Date.
(b) Representations and Warranties. The representations and
warranties of Xxxxxxx contained herein (i) shall be true and correct on and as
of the date of this Agreement in all material respects, and (ii) shall also be
true and correct on and as of the Closing Date with the same force and effect as
though made on and as of the Closing Date, except for such inaccuracies which,
in the aggregate, do not constitute and are not reasonably expected to result
in, a Xxxxxxx Material Adverse Effect (disregarding for purposes of evaluating
whether subsection (b)(ii) of this condition is satisfied, any "Material Adverse
Effect" or other materiality qualifications contained in such representations
and warranties).
(c) Closing Certificate. STEAG shall have received a certificate
signed by the Chief Executive Officer and Chief Financial Officer of Xxxxxxx,
dated the Closing Date, certifying that the conditions set forth in Section
7.3(a) and 7.3(b) have been satisfied.
(d) Consents and Approvals. STEAG shall have received written
evidence reasonably satisfactory to it that all consents and approvals required
to be obtained in connection with the Strategic Business Combination and the
transactions contemplated hereby have been obtained and shall be in full force
and effect, and all required filings have been made other than those consents
and approvals which, individually and in the aggregate, would not have a STEAG
Material Adverse Effect.
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(e) No Xxxxxxx Material Adverse Effect. No Xxxxxxx Material
Adverse Effect shall have occurred and no event shall have occurred which, in
the reasonable judgment of STEAG, is reasonably likely to have a Xxxxxxx
Material Adverse Effect.
(f) Other Closing Documents. STEAG shall have received share
certificates evidencing the Xxxxxxx Shares and such other documents and
instruments as STEAG shall reasonably request to effect and consummate the
Strategic Business Combination and the transactions contemplated hereby, in each
case in form and substance reasonably satisfactory to STEAG and its counsel.
(g) Stockholder Agreement. Xxxxxxx and Xxxx Xxxxxxx shall have
executed the Stockholder Agreement, with full force and effect from and after
the Closing.
(h) Transition Services Agreement. Xxxxxxx shall have executed
the Transition Services Agreement, with full force and effect from and after the
Closing.
(i) Opinion. Counsel for Xxxxxxx shall have delivered to STEAG an
opinion in the form attached hereto as Exhibit 7.3(i).
(j) Composition of Board of Directors; Officers; Nominating
Committee; Bylaws. The actions required under Section 1 of the Stockholder
Agreement as of Closing shall have been taken.
(k) Option Grants. The grants of options contemplated under
Section 6.11 of this Agreement shall have been made effective as of the Closing.
ARTICLE VIII.
TERMINATION, AMENDMENT AND WAIVER
8.1 Optional Termination. This Agreement may be terminated at any time
prior to the Closing by action taken or authorized by the Board of Directors or
the Supervisory Board, as applicable, of the terminating party or parties and,
except as provided below, whether before or after approval of the Xxxxxxx
Stockholder Proposal by the stockholders of Xxxxxxx:
(a) By mutual written consent of Xxxxxxx, STEAG and CFM;
(b) By either Xxxxxxx or STEAG, if the Closing shall not have
occurred on or before February 28, 2001 (the "Termination Date"); provided,
however, that the right to terminate this Agreement under this Section 8.1(b)
shall not be available to any party whose failure to fulfill any obligation
under this Agreement has been the cause of, or resulted in, the failure of the
Effective Time to occur on or before the Termination Date;
(c) By either Xxxxxxx or STEAG, if any Governmental Entity (i)
shall have issued an order, decree or ruling or taken any other action (which
the parties shall have used their reasonable commercial efforts to resist,
resolve or lift, as applicable, in accordance with Section 6.9) permanently
restraining, enjoining or otherwise prohibiting the transactions contemplated by
this Agreement, and such order, decree, ruling or other action shall have become
final and nonappealable or (ii) shall have failed to issue an order, decree or
ruling or to
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take any other action, and such denial of a request to issue such order, decree,
ruling or take such other action shall have become final and nonappealable
(which order, decree, ruling or other action the parties shall have used their
reasonable commercial efforts to obtain, in accordance with Section 6.9), in the
case of each of (i) and (ii) which is necessary to fulfill the conditions set
forth in Article VII, as applicable; provided, however, that the right to
terminate this Agreement under this Section 8.1(c) shall not be available to any
party whose failure to use their reasonable commercial efforts has been the
cause of such action or inaction;
(d) By either Xxxxxxx or STEAG, if the approval of the
stockholders of Xxxxxxx contemplated by this Agreement shall not have been
obtained by reason of the failure to obtain the required vote at a duly held
meeting of Xxxxxxx stockholders (including any adjournment or postponement
thereof) at which the vote was taken; provided, however, that a party shall not
be permitted to terminate this Agreement pursuant to this Section 8.1(d) if the
failure to obtain such approval is attributable to a failure on the part of such
party to perform any material obligation required to be performed by such party;
(e) By STEAG, if (i) Xxxxxxx shall have materially breached its
obligations under this Agreement by reason of a failure to call the Xxxxxxx
Stockholders Meeting in accordance with this Agreement or a failure to prepare
and mail to its stockholders the Proxy Statement as required hereunder, (ii)
Xxxxxxx'x Board of Directors shall have failed to recommend that Xxxxxxx'x
stockholders vote in favor of approval of the Xxxxxxx Stockholder Proposal or
shall have withdrawn, modified or changed in a manner adverse to STEAG such
recommendation, whether or not permitted by the terms of this Agreement (iii)
Xxxxxxx shall have entered into a definitive acquisition agreement for an
Acquisition Transaction involving Xxxxxxx, or (iv) an Acquisition Transaction
involving Xxxxxxx shall have occurred, or (v) Xxxxxxx shall have materially
breached its obligations under Section 5.3(b), or (vi) Xxxx Xxxxxxx shall have
materially breached his obligations under the Voting Agreement;
(f) By Xxxxxxx if (i) Xxxxxxx shall have entered into a
definitive acquisition agreement for an Acquisition Transaction or (ii) an
Acquisition Transaction involving Xxxxxxx shall have occurred;
(g) By Xxxxxxx, if STEAG shall have materially breached its
obligations under Section 5.3(a), but only if such breach results in STEAG
entering into a third party acquisition agreement prohibited by such provision
or otherwise materially adversely affects Xxxxxxx'x ability to consummate the
transactions contemplated by this Agreement;
(h) By Xxxxxxx if (i) any of STEAG's representations and
warranties shall have been inaccurate as of the date of this Agreement or shall
have become inaccurate as of a date subsequent to the date of this Agreement (as
if made on such subsequent date), such that the condition set forth in Section
7.2(b) would not be satisfied or (ii) any of STEAG's covenants contained in this
Agreement shall have been breached such that the condition set forth in Section
7.2(a) would not be satisfied; provided, however, that if an inaccuracy in the
representations and warranties of STEAG arising as of a date subsequent to this
Agreement is curable by STEAG by the Termination Date and STEAG is continuing to
exercise all reasonable efforts to cure such inaccuracy, then Xxxxxxx may not
terminate this Agreement under this Section 8.1(h) on account of such
inaccuracy;
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(i) By STEAG if (i) any of Xxxxxxx'x representations and
warranties shall have been inaccurate as of the date of this Agreement or shall
have become inaccurate as of a date subsequent to the date of this Agreement (as
if made on such subsequent date), such that the condition set forth in Section
7.3(b) would not be satisfied or (ii) if any of Xxxxxxx'x covenants contained in
this Agreement shall have been breached such that the condition set forth in
Section 7.3(a) would not be satisfied; provided, however, that if an inaccuracy
in Xxxxxxx'x representations and warranties arising as of a date subsequent to
the date of this Agreement is curable by Xxxxxxx by the Termination Date and
Xxxxxxx is continuing to exercise all reasonable efforts to cure such
inaccuracy, then STEAG may not terminate this Agreement under this Section
8.1(i) on account of such inaccuracy; or
(j) By STEAG, if the Closing Stock Price (as defined in this
Section 8.1(l)) is less than $20.00 (subject to appropriate adjustment in the
event of a Capital Change). The "Closing Stock Price" shall mean the average of
the closing sale prices of Xxxxxxx Common Stock as reported in the Wall Street
Journal on the basis of information provided by the Nasdaq National Market for
each of the twenty trading days immediately preceding (but not including) the
date two (2) business days prior to the earlier of (i) the satisfaction or
waiver of each of the conditions set forth in Article VII hereof and (ii) the
STEAG Early Condition Satisfaction Date, if applicable. Notwithstanding the
foregoing, STEAG shall not be permitted to terminate this Agreement pursuant to
this Section 8.1(j) if the Closing Stock Price is at least $15.78, provided that
Xxxxxxx, in its sole discretion, elects to deliver to STEAG at the Closing a
Xxxxxxx Note (as defined below) as additional consideration for the sale of the
STEAG Shares by STEAG to Xxxxxxx, which Xxxxxxx note is in a principal amount
equal to the product obtained by multiplying 11,850,000 by the difference
between $20.00 and the Closing Stock Price. A "Xxxxxxx Note" is an unsecured
promissory note payable by Xxxxxxx with a term of three (3) years, with simple
interest payable annually at LIBOR plus 2%.
In the event of termination of this Agreement and abandonment of the
Strategic Business Combination pursuant to this Article VIII, no party hereto
(or any of its directors or officers) shall have any liability or further
obligation to any other party to this Agreement, except as provided in Section
8.3 hereof and except that (i) nothing herein will relieve any party from
liability for any material breach of this Agreement and (ii) the agreements
contained in Sections 6.15, 8.3 and 10.14 hereof shall survive.
8.2 Automatic Termination. Upon the termination for any reason of the
CFM Agreement prior to the consummation of the Strategic Business Combination,
this Agreement shall automatically terminate without any further action on the
part of either party.
8.3 Effect of Termination.
(a) If STEAG shall terminate this Agreement pursuant to Section
8.1(d) or (e) or Xxxxxxx shall terminate this Agreement pursuant to Section
8.1(f), then Xxxxxxx shall promptly, but in no event later than the date of such
termination, pay STEAG a nonrefundable fee in an amount equal to $20,000,000,
payable by wire transfer of immediately available funds to an account designated
by STEAG.
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(b) If Xxxxxxx shall terminate this Agreement pursuant to Section
8.1(g), then STEAG shall promptly, but in no event later than the date of such
termination, pay Xxxxxxx a nonrefundable fee in an amount equal to $20,000,000,
payable by wire transfer of immediately available funds to an account designated
by Xxxxxxx.
(c) The parties acknowledge that the agreements contained in this
Section 8.3 are an integral part of the transactions contemplated by this
Agreement, and that, without these agreements, none of the parties would enter
into this Agreement; accordingly, if either the STEAG or Xxxxxxx fails promptly
to pay any amount due pursuant to this Section 8.3, and, in order to obtain such
payment, the other party commences a suit which results in a judgment against
such party for the fee set forth in this Section 8.3, such party shall pay to
the other party its costs and expenses (including attorneys' fees and expenses)
in connection with such suit, together with interest on the amount of the fee at
two points above the prime rate of Citibank, N.A. in effect on the date such
payment was required to be made. The parties agree that any remedy or amount
payable pursuant to this Section 8.3 shall not preclude any other remedy or
amount payable hereunder and shall not be an exclusive remedy for any breach of
any representation, warranty, covenant or agreement contained in this Agreement.
8.4 Amendment. This Agreement may be amended by the parties at any time
before or after receipt of approval by Xxxxxxx stockholders of the Xxxxxxx
Stockholder Proposal; provided, however, that after receipt of the Xxxxxxx
stockholder approval, there shall be made no amendment that by law requires
further approval by the stockholders of Xxxxxxx without the further approval of
such stockholders. This Agreement may not be amended except by an instrument in
writing signed on behalf of each of the parties.
8.5 Extension; Waiver. At any time prior to the Closing, the parties
may, to the extent legally allowed, (a) extend the time for the performance of
any of the obligations or other acts of the other party, (b) waive any
inaccuracies in the representations and warranties contained in this Agreement
or in any document delivered pursuant to this Agreement, or (c) subject to the
proviso of Section 8.4, waive compliance with any of the agreements or
conditions contained in this Agreement. Any agreement on the part of a party to
any such extension or waiver shall be valid only if set forth in an instrument
in writing signed on behalf of such party. The failure of any party to this
Agreement to assert any of its rights under this Agreement or otherwise shall
not constitute a waiver of such rights.
8.6 Notice of Termination. Any party wishing to terminate this Agreement
under Section 8.1 shall deliver written notice to the other party, setting forth
the paragraph under Section 8.1 pursuant to which the Agreement is being
terminated and, unless obvious from the nature of the termination clause, a
description of the facts and circumstances forming the basis for such
termination; provided, that any failure to provide such additional details shall
not affect the validity of the termination. Upon the automatic termination of
the Agreement under Section 8.2, Xxxxxxx shall give STEAG written notice
thereof. Any such termination notice shall be delivered in accordance with
Section 10.1 of this Agreement.
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ARTICLE IX.
INDEMNIFICATION
9.1 Indemnification.
(a) Survival of Warranties. The representations and warranties
made by STEAG in Sections 3.1 through 3.4 and by Xxxxxxx in Sections 4.1 through
4.3 shall survive the Closing and continue in full force and effect for a period
of one year following the Closing, except for the last sentence of Section
3.1(b) and the third sentence of Section 4.3(a), each of which shall survive for
an unlimited period of time. The representations and warranties by STEAG set
forth in Section 3.13 shall survive the Closing and continue in full force and
effect until thirty (30) days after the expiration of the applicable statute of
limitations.
(b) STEAG will indemnify and hold harmless Xxxxxxx, its
affiliates and its and their respective officers, directors, agents, attorneys
and employees (hereinafter referred to individually as an "Xxxxxxx Indemnified
Person" and collectively as "Xxxxxxx Indemnified Persons") from and against any
and all losses, costs, damages, liabilities and expenses arising from claims,
demands, actions, causes of action, including, without limitation, legal fees,
(collectively, "Damages") arising out of any misrepresentation or breach of any
of the representations and warranties by STEAG in Sections 3.1 through 3.4 and
3.13. Xxxxxxx will indemnify, defend and hold harmless STEAG, its affiliates and
its and their respective officers, directors, agents, attorneys and employees
(hereinafter referred to individually as a "STEAG Indemnified Person" and
collectively as "STEAG Indemnified Persons") from and against any and all
Damages arising out of any misrepresentation or breach of the representations
and warranties by Xxxxxxx in Sections 4.1 through 4.3. The obligations of STEAG
to indemnify a Xxxxxxx Indemnified Person for any Damages is subject to the
condition that STEAG shall have received an Indemnification Claim (as defined in
Section 9.2) for all Damages for which indemnity is sought on or before the
expiration date for the applicable representation or warranty set forth in
Section 9.1(a) above. The obligation of Xxxxxxx to indemnify a STEAG Indemnified
Person for Damages is subject to the condition that Xxxxxxx shall have received
an Indemnification Claim for all Damages for which indemnity is sought on or
before the expiration date for the applicable representation or warranty set
forth in Section 9.1(a) above.
9.2 Procedures for Indemnification.
(a) As used in this ARTICLE IX, the term "Indemnitor" means the
party against whom indemnification hereunder is sought, and the term
"Indemnitee" means the party seeking indemnification hereunder.
(b) A claim for indemnification hereunder (an "Indemnification
Claim") shall be made by Indemnitee by delivery of a written notice to
Indemnitor requesting indemnification and specifying the basis on which
indemnification is sought in reasonable detail (and shall attach relevant
documentation related to the Indemnification Claim), the amount of the asserted
Damages, and, in the case of a Third Party Claim, containing (by attachment or
otherwise) such other information as Indemnitee shall have concerning such Third
Party Claim.
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(c) If the Indemnification Claim involves a Third Party Claim,
then the procedures set forth in Section 9.3 hereof shall be observed by
Indemnitee and Indemnitor.
(d) If the Indemnification Claim involves a matter other than a
Third Party Claim (as defined below), Indemnitor shall have thirty (30) days to
object to such Indemnification Claim by delivery of a written notice of such
objection to Indemnitee specifying in reasonable detail the basis for such
objection. Failure to timely so object shall constitute a final and binding
acceptance of the Indemnification Claim by Indemnitor, and the Indemnification
Claim shall thereafter be paid by Indemnitor in accordance with Section 9.2(e)
hereof. If an objection is timely delivered by Indemnitor and the dispute is not
resolved within twenty (20) business days from the delivery of such objection
(the "Negotiation Period"), the parties shall be entitled to pursue their
remedies at law and in equity subject to the terms of this Agreement.
(e) Upon determination of the amount of an Indemnification Claim,
whether by (i) an agreement between Indemnitor and Indemnitee, (ii) an
arbitration award or (iii) a final judgment (after expiration of all periods for
appeal of such judgment) or other final nonappealable order, Indemnitor shall
pay the amount of such Indemnification Claim by check within ten (10) days of
the date such amount is determined.
9.3 Defense of Third Party Claims. Should any claim be made, or suit or
proceeding (including, without limitation, a binding arbitration or an audit by
any taxing authority) be instituted against Indemnitee which, if prosecuted
successfully, would be a matter for which Indemnitee is entitled to
indemnification under this Agreement (a "Third Party Claim"), the obligations
and liabilities of the parties hereunder with respect to such Third Party Claim
shall be subject to the following terms and conditions:
(a) Indemnitee shall give Indemnitor written notice of any such
claim promptly after receipt by Indemnitee of notice thereof. Any delay in
giving notice hereunder which does not materially prejudice Indemnitor, shall
not affect Indemnitee's rights to Indemnification hereunder. Indemnitor may, at
its option, (i) undertake control of the defense thereof by counsel of its own
choosing reasonably acceptable to Indemnitee, or (ii) decline to assume control
of but participate in the defense thereof provided that such participation by
Indemnitee shall be at its own expense. Indemnitee may participate in the
defense through its own counsel at its own expense. The assumption of the
defense of any Third Party Claim by Indemnitor shall be an acknowledgment by
Indemnitor that such Third Party Claim is subject to indemnification under the
provisions of this ARTICLE IX and that such provisions are binding on
Indemnitor. If, however, Indemnitor fails or refuses to undertake the defense of
such Third Party Claim within twenty (20) days after written notice of such
claim has been delivered to Indemnitor by Indemnitee, Indemnitee shall have the
right to undertake the defense, compromise and, subject to Section 9.4,
settlement of such Third Party Claim with counsel of its own choosing. In the
circumstances described in the preceding sentence, Indemnitee shall, promptly
upon its assumption of the defense of such Third Party Claim, make an
Indemnification Claim as specified in Section 9.2(b) which shall be deemed an
Indemnification Claim that is not a Third Party Claim for the purposes of the
procedures set forth herein. Failure of Indemnitee to furnish written notice to
Indemnitor of a Third Party Claim shall not release Indemnitor from Indemnitor's
obligations hereunder, except to the extent Indemnitor is prejudiced by such
failure.
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(b) Indemnitee and Indemnitor shall cooperate with each other in
all reasonable respects in connection with the defense of any Third Party Claim,
including making available records relating to such claim and furnishing
employees of Indemnitee as may be reasonably necessary for the preparation of
the defense of any such Third Party Claim or for testimony as witness in any
proceeding relating to such claim.
9.4 Settlement of Third Party Claims. Unless Indemnitor has failed to
fulfill its obligations under this ARTICLE IX, no settlement by Indemnitee of a
Third Party Claim shall be made without the prior written consent by or on
behalf of Indemnitor, which consent shall not be unreasonably withheld or
delayed. If Indemnitor has assumed the defense of a Third Party Claim as
contemplated by Section 9.3, no settlement of such Third Party Claim may be made
by Indemnitor without the prior written consent by or on behalf of Indemnitee,
which consent shall not be unreasonably withheld or delayed. In the event of any
dispute regarding the reasonableness of a proposed settlement, the party that
will bear the larger financial loss resulting from such settlement shall make
the final determination in respect thereto, which determination shall be final
and binding on all involved parties.
9.5 Limitation on Indemnification. Notwithstanding anything contained in
this Article IX to the contrary, except for breaches of Section 3.13 (which
shall not be limited),(a) the maximum aggregate liability of STEAG to Xxxxxxx
Indemnified Persons for indemnification pursuant to Section 9.1(b) shall not
exceed the value of the Xxxxxxx Shares on the Closing Date (the "Transaction
Value"), in the case of a breach of Sections 3.1, 3.2, 3.3 or 3.4, and (b) the
maximum aggregate liability of Xxxxxxx to STEAG Indemnified Persons for
indemnification pursuant to Section 9.1(b) shall not exceed the Transaction
Value. Notwithstanding the preceding sentence, to the extent any breach of
Sections 3.1, 3.2, 3.3 or 3.4 relates to one or more of the STEAG Subsidiaries
denoted as "Foreign Sales Subsidiaries" on Schedule 2.6, the maximum aggregate
liability of STEAG to Xxxxxxx Indemnified Persons for indemnification pursuant
to Section 9.1(b) shall not exceed twice the value of that percentage of the
Xxxxxxx Shares on the Closing Date allocated to such Foreign Sales Subsidiaries
in accordance with Section 2.6.
ARTICLE X.
GENERAL PROVISIONS
10.1 Notices. All notices and other communications hereunder shall be in
writing and shall be deemed duly delivered if delivered personally (upon
receipt), or three (3) business days after being mailed by registered or
certified mail, postage prepaid (return receipt requested), or one (1) business
day after it is sent by commercial overnight courier service, or upon
transmission, if sent via facsimile (with confirmation of receipt) to the
parties at the following address (or at such other address for a party as shall
be specified by like notice):
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(a) if to Mattson, to:
Xxxxxxx Technology, Inc.
0000 Xxxx Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx Xxxxxxx
Fax: (000) 000-0000
Tel: (000) 000-0000
with a copy to:
Xxxx Xxxx Xxxx & Freidenrich LLP
000 Xxxxxxxx Xxxxxx
Xxxx Xxxx, XX 00000
Attention: Xxxxxxx X. Rock
Fax: (000) 000-0000
Tel: (000) 000-0000
(b) if to STEAG or the STEAG Subsidiaries, to:
STEAG Electronic Systems AG
Xxxxxxxxxxxxxxx Xxxxxxx 0-0
X-00000 Xxxxx, Xxxxxxx
Attention: Chief Executive Officer
Fax: 000-00-000-000-0000
Tel: 000-00-000-000-0000
Attention: General Counsel
Fax: 000-00-000-000-0000
Tel: 000-00-000-000-0000
with a copy to:
Xxxxx Xxxxxxxxxx LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx X. Xxxxxx
Fax: (000) 000-0000
Tel: (000) 000-0000
10.2 Definitions. In this Agreement any reference to any event, change,
condition or effect being "material" with respect to any entity or group of
entities means any material event, change, condition or effect related to the
financial condition, properties, assets (including intangible assets),
liabilities, business, operations or results of operations of such entity or
group of entities. In this Agreement, any reference to a party's "knowledge"
means such party's actual knowledge after reasonable inquiry of officers,
directors, and other employees of such party reasonably believed to have
knowledge of such matters; provided, that "such other employees"
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shall be limited to those persons listed on Schedule 10.2 under such party's
name. A "person" means any corporation, proprietorship, firm, partnership,
limited partnership, trust, association, individual, or other entity. In this
Agreement, "affiliate" means, with respect to any person, any other person,
directly or indirectly, controlling, controlled by, or under common control
with, such person, and "control" (including the correlative terms "controlling",
"controlled by" and "under common control with") means the possession, direct or
indirect, of the power to direct or cause the direction of the management and
policies of a person, whether through the ownership of voting securities, by
contract, or otherwise. The term "joint venture" of a person shall mean any
person that is not a subsidiary of such person, in which such person or one or
more of its subsidiaries owns an equity interest, other than equity interests
held for passive investment purposes which are less than 10% of any class of the
outstanding voting securities or equity of any such person.
10.3 Counterparts. This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement and
shall become effective when one or more counterparts have been signed by each of
the parties and delivered to the other parties, it being understood that all
parties need not sign the same counterpart.
10.4 Entire Agreement; Nonassignability. This Agreement and the
documents and instruments and other agreements specifically referred to herein
or delivered pursuant hereto, including the Exhibits, the Schedules, the STEAG
Disclosure Schedule, and the Xxxxxxx Disclosure Schedule constitute the entire
agreement among the parties with respect to the subject matter hereof and
supersede all prior agreements and understandings, both written and oral, among
the parties with respect to the subject matter hereof, including the letter
agreement between the parties dated May 25, 2000, provided that the
Non-Disclosure Agreement shall continue in full force and effect, and shall
survive any termination of this Agreement or the Closing, in accordance with its
terms. This Agreement shall not be assigned by operation of law or otherwise
without the written consent of the other party.
10.5 Severability. In the event that any provision of this Agreement, or
the application thereof becomes or is declared by a court of competent
jurisdiction to be illegal, void, or unenforceable, the remainder of this
Agreement will continue in full force and effect and the application of such
provision to other persons or circumstances will be interpreted so as reasonably
to effect the intent of the parties hereto. The parties further agree to replace
such void or unenforceable provision of this Agreement with a valid and
enforceable provision that will achieve, to the extent possible, the economic,
business, and other purposes of such void or unenforceable provision.
10.6 Remedies Cumulative. Except as otherwise provided herein, any and
all remedies herein expressly conferred upon a party will be deemed cumulative
with and not exclusive of any other remedy conferred hereby, or by law or equity
upon such party, and the exercise by a party of any one remedy will not preclude
the exercise of any other remedy.
10.7 No Survival of Warranties. Except as otherwise provided in Article
IX, none of the representations and warranties in this Agreement or in any
instrument or document delivered pursuant to this Agreement shall survive the
Closing. This Section 10.7 shall not limit any
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covenant or agreement of the parties which by its terms contemplates performance
after the Closing.
10.8 Expenses. In the event that the Strategic Business Combination is
not consummated, all costs and expenses incurred in connection with this
Agreement and the transactions contemplated hereby, including legal, accounting
and investment banking fees, shall be paid by the party incurring such expense,
except as provided in Sections 8.3 and 10.14. In the event the Strategic
Business Combination is consummated, the costs and expenses incurred in
connection with this Agreement and the transactions contemplated hereby,
including legal, accounting and investment banking fees, by (i) STEAG shall be
borne fifty percent (50%) by STEAG and fifty percent (50%) by the STEAG
Subsidiaries, and (ii) Xxxxxxx shall be borne by Xxxxxxx.
10.9 United States Dollars. All references to dollars herein shall mean
United States dollars.
10.10 Governing Law. The assignment and transfer of capital stock of the
Foreign STEAG Subsidiaries to Newco, the issuance of shares of Newco, and the
assignment and transfer of capital stock of Newco and the other Direct STEAG
Subsidiaries to Xxxxxxx (to the extent such actions are conducted in Germany)
shall be governed by and effected in accordance with German law. In all other
respects, this Agreement shall be governed by and effected in accordance with
Delaware law without regard to the principles of conflicts of laws thereof.
10.11 Consent to Jurisdiction. Except with respect tothe matters
described in the first sentence of Section 10.10, each of the parties hereto (a)
consents to submit itself to the personal jurisdiction of any federal court
located in the State of Delaware or any Delaware state court in the event any
dispute arising out of or relates to this Agreement or any of the transactions
contemplated by this Agreement, (b) agrees that it will not attempt to deny or
defeat such personal jurisdiction by motion or other request for leave from any
such court, including, without limitation, a motion to dismiss on the grounds of
forum non conveniens, (c) agrees that it will not bring any action arising out
of or relating to this Agreement or any of the transactions contemplated by this
Agreement in any court other than a federal court sitting in the State of
Delaware or a Delaware state court, and (d) waives any right to a trial by jury
with respect to any claim, counterclaim, or action arising out of or in
connection with this Agreement or the transactions contemplated hereby.
10.12 Rules of Construction. The parties hereto agree that they have
been represented by counsel during the negotiation, preparation and execution of
this Agreement and, therefore, waive the application of any law, regulation,
holding or rule of construction providing that ambiguities in an agreement or
other document will be construed against the party drafting such agreement or
document.
10.13 Third Party Beneficiaries. This Agreement is not intended to and
shall not confer upon any person other than the parties hereto any rights or
remedies hereunder.
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10.14 Certain Payments by Xxxxxxx.
(a) If this Agreement shall automatically terminate pursuant to
Section 8.2 hereof by reason of the CFM Agreement terminating pursuant to
Sections 8.1(g) or (i) of the CFM Agreement, then Xxxxxxx shall promptly, but in
no event later than three (3) business days following the date of such
termination (or such later date as STEAG shall request), make a nonrefundable
cash payment to STEAG in an amount equal to the aggregate amount of all actual
and documented fees and expenses (including all attorneys' fees, accountants'
fees, financial advisory fees and filing fees) that have been paid by or on
behalf of STEAG in connection with the preparation and negotiation of this
Agreement or otherwise in connection with the Strategic Business Combination,
provided that in no event shall such amount exceed $5,000,000, such amount to be
payable by wire transfer of immediately available funds to an account designated
by STEAG.
(b) If (i) this Agreement shall automatically terminate pursuant
to Section 8.2 hereof and (ii) the reason for such termination is that either
Xxxxxxx or CFM has terminated the CFM Agreement under circumstances obligating
(or potentially obligating) CFM to pay Xxxxxxx the termination fee specified in
Section 8.2(b) or (c) of the CFM Agreement, then Xxxxxxx shall, within three (3)
business days of receipt of such termination fee or any portion thereof, remit
to STEAG, in the manner specified in Section 10.14 (a) hereof, one-half of the
amount actually received by Xxxxxxx from CFM.
(c) If (i) this Agreement is terminated by Xxxxxxx pursuant to
Section 8.1(h) and (ii) as a result of such termination, STEAG is required to
pay CFM the $40 million fee specified in Section 3.04(ii) of the Interim Patent
License Agreement dated the date hereof between CFM, a subsidiary of CFM and
STEAG, Xxxxxxx shall, immediately upon request from STEAG, by written notice
given in the manner specified in Section 10.1, that it is required to make or
has made such payment to CFM, remit to CFM or STEAG, as the case may be,
one-half of the amount to be paid as so paid by STEAG to CFM provided that
Xxxxxxx shall not be required to make any payment in advance of, or in an amount
greater than, a payment by STEAG.
(The remainder of this page is left intentionally blank)
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IN WITNESS WHEREOF, STEAG and Xxxxxxx have caused this Agreement to be
executed and delivered by each of them or their respective officers thereunto
duly authorized, all as of the date first written above.
STEAG ELECTRONIC SYSTEMS AG
By: /s/ Xx. Xxxx Xxxx
------------------------------------
Xx. Xxxx Xxxx, CEO
By: /s/ PPE Xxxxxx-Xxxxxxx
------------------------------------
Xx. Xxxxxxxx Xxxxxx-Xxxxxxx
XXXXXXX TECHNOLOGY, INC.
By: /s/ Xxxx Xxxxxxx
------------------------------------
Xxxx Xxxxxxx, Chairman
and Chief Executive Officer
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EXHIBIT A
STEAG ELECTRONIC SYSTEMS AG SUBSIDIARIES
STEAG RTP Systems GmbH
STEAG MicroTech GmbH
STEAG RTP Systems, Inc.
STEAG CVD Systems Ltd.
STEAG CVD Systems, Inc.
STEAG Cutek, Inc.
STEAG Electronic Systems Inc.
STEAG Electronic Systems (UK) Ltd.
STEAG Electronic Systems South East Asia PTE Ltd.
STEAG Electronic Systems Korea Ltd.
STEAG Electronic Systems Japan Co., Ltd.
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EXHIBIT B
STOCKHOLDER AGREEMENT
THIS STOCKHOLDER AGREEMENT (the "Agreement") is entered into as of ___
_, 2000, by and between XXXXXXX TECHNOLOGY, INC., a Delaware corporation (the
"Company"), STEAG ELECTRONIC SYSTEMS AG, an Aktiengesellschaft organized and
existing under the laws of the Federal Republic of Germany ("Stockholder") and
XXXX XXXXXXX, an individual who is a director and the Chief Executive Officer of
the Company ("Xxxxxxx").
A. On June 27, 2000, the Company and Stockholder entered into a
Strategic Business Combination Agreement (the "Combination Agreement") pursuant
to which, subject to satisfaction or waiver of the conditions therein, (i)
Stockholder will sell and transfer 100% of the issued and outstanding capital
stock or other equity ownership interests of certain wholly-owned subsidiaries
of Stockholder to the Company, and (ii) the Company shall issue to Stockholder
11,850,000 shares of restricted common stock, par value $.001 per share ("Common
Stock"), of the Company (the "STEAG Transaction").
B. Upon consummation of the STEAG Transaction, Stockholder will own
approximately, 31.9% of all outstanding shares of Common Stock and Xxxxxxx will
own 3,535,516 shares of Common Stock (or approximately 9.5% of all outstanding
shares of Common Stock).
C. On June 27, 2000, the Company, CFM Technologies, Inc., a Pennsylvania
corporation ("CFM"), and M2C Acquisition Corporation, a Delaware corporation and
wholly-owned subsidiary of the Company ("M2C"), entered into an Agreement and
Plan of Merger (the "CFM Merger Agreement") pursuant to which, subject to
satisfaction or waiver of the conditions therein, and concurrently with the
consummation of the STEAG Transaction, (i) M2C will merge with and into CFM,
resulting in CFM continuing as the surviving corporation and M2C ceasing to
exist as a separate corporation (the "CFM Merger") and (ii) the Company will
issue approximately 4,100,000 shares of Common Stock to the stockholders of CFM
and will assume outstanding CFM stock options in accordance with the CFM Merger
Agreement.
D. The parties believe that it is in the best interests of the Company,
the Stockholder and Xxxxxxx to provide for certain rights and obligations of the
parties with respect to various corporate matters.
NOW THEREFORE, the parties hereto agree as follows:
1. Board Representation; Executive Staffing; Nominating
Committee; Voting Arrangements.
1.1 Board Representation; Executive Staffing. Commencing on the
Effective Date, during the term of this Agreement, the Board of Directors of the
Company shall consist of seven (7) members, two of whom shall be designated by
Stockholder (the "Stockholder Representatives"), one of whom shall be the Chief
Executive Officer of the Company and, subject to Section 1.1(b) below, the
remaining four of whom shall be incumbent Independent
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Directors (as such term and certain other capitalized terms are defined in
Section 8.11) as of the Effective Date, or successors, at least three of whom
shall be Independent Directors, nominated in accordance with the Company's
Bylaws, as amended from time to time (the "Bylaws").
(a) Effective as of the Effective Date (as defined in Section
7.1), the Company shall cause the authorized size of the Board of Directors to
be increased to seven (7) members from five (5) members, and the Company shall
cause two (2) persons designated by Stockholder as the initial Stockholder
Representatives to be appointed to fill the two vacant seats so created. One
such initial Stockholder Representative shall be Xx. Xxxxxx Xxxxxxxx, who shall
be elected and appointed to the class of the Company's Board of Directors
scheduled to be elected at the third (3rd) Annual Meeting of the Company's
stockholders following the Closing (i.e., Class III). The other initial
Stockholder Representative shall be elected and appointed to the class of the
Company's Board of Directors scheduled to be elected at the second (2nd) Annual
Meeting of the Company's stockholders following the Closing (i.e., Class II).
The second initial Stockholder Representative will be identified and designated
by Stockholder in EXHIBIT A attached hereto. If either Stockholder
Representative or any successor thereto ceases to be a director of the Company
at any time prior to the expiration of such Stockholder Representative's
designated term as director, whether as a result of death, resignation,
retirement, disqualification, removal from office or other cause, the Company
shall cause a successor designated by Stockholder to be elected and appointed to
fill the vacancy so created. The Company agrees that, at the request of
Stockholder, as soon as practicable following such request, it will cooperate
with Stockholder to attempt to remove any Stockholder Representative, to the
extent permitted by Delaware law, and to take any action reasonably requested by
Stockholder for that purpose including, without limitation, to call a
stockholders meeting and hold such meeting as soon as practicable following such
request. Stockholder Representatives who are not employees of the Company will
receive the same benefits and compensation as other non-employee directors of
the Company.
(b) To the extent required pursuant to the CFM Merger Agreement,
effective as of the effective time of the CFM Merger, the Company may cause one
person designated by CFM (the "CFM Representative") to serve on the Company's
Board of Directors as a member of Class III of the Board of Directors, in place
of an incumbent Independent Director of the Company. If the CFM Representative
ceases to be a director of the Company prior to the expiration of the CFM
Representative's designated term as director, whether as a result of death,
resignation, retirement, disqualification, removal from office or other cause,
the vacancy so created shall be filled by the Company's Board of Directors, in
accordance with the Company's Bylaws, with an Independent Director or other
person unanimously approved by the Nominating Committee (as defined in Section
1.2).
(c) Effective as of the Effective Date, the members of the
Company's Board of Directors other than the members elected and appointed
pursuant to Section 1.1(a) and (b) herein shall be the Chief Executive Officer
of the Company and the other incumbent directors of the Company as of such date.
(d) Effective as of the Effective Date, the Company shall cause:
(i) Xx. Xxxxxx Xxxxxxxx, a Stockholder Representative, to serve as Chairman of
the Board for a term of one (1) year, and (ii) Xxxxxxx to serve as Vice-Chairman
of the Board and as Chief Executive Officer of the Company.
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(e) Effective as of the Effective Date, the Company shall cause
Dr. Ludger Viefhues to be named Chief Operating Officer/President of the Company
for a term of one year, subject to removal by the Executive Staffing Committee
(as defined below).
(f) Effective as of the Effective Date, the Board of Directors of
the Company will establish an "Executive Staffing Committee," in accordance with
the provisions set forth in the Bylaws with respect to the formation of
committees of the Board of Directors, with members consisting of Xx. Xxxxxx
Xxxxxxxx and Xxxxxxx and, if agreed by the Company and Stockholder, one
additional representative of each of Stockholder and the Company. The Executive
Staffing Committee will remain in place for one year following the Effective
Date, and will be responsible during that period for making key personnel
decisions (including the hiring and firing of the Chief Executive Officer, the
Chief Operating Officer, the Chief Financial Officer and the general managers
for divisions). One (1) Independent Director reasonably acceptable to
Stockholder and the Company will be appointed as a tiebreaker member of the
Executive Staffing Committee in the event the committee reaches deadlock on an
issue or staffing decision.
(g) The Company will cause the nomination of the Stockholder
Representatives for election as directors of the Company at each Annual Meeting
of the Company's stockholders at which the term of an incumbent Stockholder
Representative will expire, until the termination of this Agreement.
1.2 Nominating Committee. Effective as of the Effective Date, the
Company's Bylaws shall establish a nominating committee (the "Nominating
Committee") to evaluate and propose nominees to serve as directors to succeed
the CFM Representative or any Independent Director who leaves office, or to fill
additional vacancies on the Board of Directors not otherwise provided for in
Section 1.1(a) herein. During the term of this Agreement, the Nominating
Committee shall be comprised of three (3) Board members, at least one of whom
shall be a Stockholder Representative. For a period of three (3) years following
the Effective Date, the Nominating Committee shall nominate only those nominees
who have received the unanimous approval of the Nominating Committee members.
The Bylaws will further provide that in the event the Nominating Committee fails
to nominate a nominee within four (4) months after a Board seat becomes vacant,
the Board of Directors may act to elect and appoint a nominee to fill the
vacancy.
1.3 Election of Nominees. Each of Stockholder and Xxxxxxx agrees to be
present and voting and to affirmatively vote for the election of the nominees
for director designated or nominated pursuant to Sections 1.1 and 1.2 herein,
including without limitation, the Stockholder Representatives, at each meeting
of the Company's stockholders at which directors are to be elected.
1.4 Interested Party Transactions. In the event any proposed transaction
between the Company, on the one hand, and Stockholder or any of its Affiliates,
on the other hand, is submitted to the Company's stockholders for their
approval, Stockholder agrees to vote its shares of Voting Stock with regard to
such proposed transaction in the same proportion (for, against or abstain) as
all shares of Voting Stock not owned by Stockholder and represented and voting
at a stockholders' meeting are voted with regard to such proposed transaction;
provided, that the foregoing shall not apply to a transaction among the Company
and its stockholders generally or
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with respect to any transaction provided for in this Agreement including,
without limitation, Stockholder's exercise of its rights under Section 3 hereto.
1.5 Amendment to Bylaws. Prior to or simultaneous with the Closing, the
Company shall cause the Bylaws of the Company to be amended and restated in the
form of Exhibit B hereto.
2. Standstill Restrictions on Further Purchases of Company Stock.
2.1 Restriction on Acquisition of Voting Stock. Except with prior
Disinterested Director Approval, except as otherwise provided in Section 2.4 of
this Agreement and except for any stock issuances by the Company in respect of
any stock split, stock dividend, recapitalization or similar corporate
transaction, or upon exercise of securities issued pursuant to rights
distributed to holders of Common Stock generally, Stockholder shall not (and
Stockholder shall not permit any of its majority-owned and controlled Affiliates
to) acquire, either directly or indirectly, agree to acquire or make a tender or
exchange offer to acquire any shares of Voting Stock of the Company; provided,
however, that the foregoing restriction shall not apply to a transfer by
Stockholder of all or any portion of the Voting Stock held by Stockholder to any
of its Affiliates made in accordance with Section 4.5, or any transfer back to
Stockholder pursuant to such Section 4.5.
2.2 Participation in Solicitations. Except with prior Disinterested
Director Approval, Stockholder shall not (and Stockholder shall not permit any
of its majority-owned and controlled Affiliates to) (i) "solicit" or in any way
participate, directly or indirectly, in the "solicitation" of "proxies," as
those terms are defined in Rule 14a-1 under the Exchange Act, in respect of any
Voting Stock (provided, that Stockholder shall not be deemed to have violated
the restrictions in this clause (i) by virtue of any action taken in connection
with the election of directors pursuant to Section 1 above), (ii) make any
public announcement in response or with respect to an Acquisition Proposal not
solicited or approved by the Company's Board of Directors, (iii) deposit any
shares of Voting Stock in a voting trust or subject any Voting Stock to any
arrangement or agreement with respect to the voting of such Voting Stock with
any Person or "group" (as such term is defined under the Exchange Act) other
than the Company or other entities within Stockholder's control group or (iv)
form or join any "group" (as such term is defined under the Exchange Act) with
any other Person other than entities within Stockholder's control group for the
purpose of voting, holding, purchasing or disposing of Voting Stock or for the
purpose of taking any of the actions set forth in this Section 2.2 or Section
2.1, above.
2.3 Suspension of Standstill Restrictions. The restrictions set forth in
Sections 2.1 and 2.2 shall be suspended in the event that any Person or "group"
(as such term is defined under the Exchange Act) (other than Stockholder, any
Person who is then an Affiliate of Stockholder, or the Company), without the
prior approval of the Board of Directors of the Company, (i) commences a tender
offer for purposes of Rule 14d-2 promulgated under the Exchange Act, (ii)
acquires shares of Voting Stock resulting in such Person or group having
beneficial ownership of Voting Stock representing more than twenty percent (20%)
of the then-outstanding Voting Stock of the Company or (iii) acquires shares of
Voting Stock resulting in such Person or group having beneficial ownership of
Voting Stock representing more than ten percent (10%) of
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the then-outstanding Voting Stock of the Company and commences or publicly
announces its intention to seek to effect a Change of Control, whether through
an Acquisition Transaction or otherwise. Upon the cessation of the event or
events that lead to suspension of the restrictions in Sections 2.1 and 2.2
pursuant to this Section, those restrictions shall be reinstated in accordance
with their terms unless this Agreement has been terminated in accordance with
Section 7.2; provided however that, notwithstanding any provision of Section 2.1
or 2.2 to the contrary, Stockholder shall have no obligation to dispose of any
Voting Stock that Stockholder has acquired or agreed to acquire, or to reverse,
rescind, violate or breach (x) any contractual obligation Stockholder has
undertaken, (y) any other commitment Stockholder has made, the reversal,
rescission, violation or breach of which would have adverse consequences to
Stockholder, or (z) any legal or regulatory requirement imposed on Stockholder,
in each case during any suspension of Sections 2.1 and 2.2 pursuant to this
Section.
2.4 Right to Maintain Ownership. Notwithstanding the provisions of
Section 2.1 to the extent that Stockholder's percentage beneficial ownership is
reduced as a result of any issuance of Voting Stock by the Company (an
"Issuance") for any reason whatsoever, Stockholder may purchase additional
shares of Voting Stock in the open market or in privately negotiated
transactions (to the extent Stockholder has not already exercised its rights
pursuant to Section 3 below with respect to a particular Issuance) as required
to maintain Stockholder's aggregate percentage beneficial ownership of the
Company's outstanding Voting Stock on the Effective Date.
2.5 Notice of Stockholder Position. Upon written request from the
Company, but not more than once each calendar quarter, a duly authorized officer
of Stockholder will certify to the Company in writing the numbers and classes of
shares of Voting Stock beneficially owned by Stockholder and its majority-owned
and controlled Affiliates as of any record date or other date reasonably
requested.
2.6 Notice of Issuances by the Company. The Company shall, as promptly
as practicable, but not later than the date of Issuance, provide written notice
to Stockholder of all Issuances of Voting Stock by the Company, other than
issuances described under Section 3.4 (d) or (e), specifying the number of
shares of Voting Stock being issued and the purchase price therefor; provided,
that with respect to the foregoing Issuances of Voting Stock by the Company in
amounts less than 1% of the shares of Voting Stock outstanding on such date, the
Company may provide notice to Stockholder of such Issuances on a quarterly
basis. Within fifteen days following the end of each fiscal quarter, the Company
shall provide written notice to Stockholder of all Issuances of Voting Stock
described under Section 3.4, (d), and (e), specifying the number of shares of
Voting Stock so issued during the fiscal quarter.
2.7 Company Repurchases. Stockholder shall not be deemed to have
violated its obligations under Section 2.1 by virtue of any increase in the
aggregate percentage of outstanding Voting Stock of the Company beneficially
owned by Stockholder and its Affiliates solely as a result of a recapitalization
of the Company, a repurchase of securities by the Company or other actions taken
by the Company or any of the Company's Affiliates that have the effect of
reducing the number of shares of Voting Stock outstanding.
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2.8 Termination. Notwithstanding any other provision in this Agreement,
all rights and obligations of any party under this Section 2 shall terminate
upon the earlier of (x) the fifth (5th) anniversary of the Closing regardless of
whether such rights and obligations are suspended for any portion of such
five-year period or (y) the termination of this Agreement pursuant to Section 7
hereof.
3. Stockholder Right to Purchase Additional Company Stock.
3.1 Right of Offer to Purchase Additional Shares of Common Stock. Prior
to any sale or issuance by the Company of any shares of Voting Stock (other than
a sale or issuance described in Section 3.4) (a "Proposed Issuance"), the
Company shall give Stockholder advanced written notice (the "Notice of
Issuance") of the Proposed Issuance, setting forth the proposed price, quantity
(which the Company may indicate is a fixed amount to be offered to third
parties, subject to increase to make allowance for issuance to Stockholder) and
other material terms and conditions under which the Company proposes to make
such sale (the date such notice is received by Stockholder is hereinafter
referred to in this Section 3.1 as the "Notice Date"). Stockholder shall have
the right, exercisable as hereinafter provided, to purchase its proportional
share of such Voting Stock (as defined below) on terms which are at least as
favorable to Stockholder as the terms on which the Company sells such Voting
Stock to any other prospective investor. Stockholder shall have twenty (20) days
after the Notice Date to notify the Company in writing that it elects to
purchase some or all of its share of the Voting Stock so offered. If any
material term of the Proposed Issuance is changed from those set forth in the
Notice of Issuance, the Company shall give Stockholder prompt written notice
(the "Revised Notice of Issuance") of the revised terms of the Proposed Issuance
setting forth the revised terms of the Proposed Issuance (the date such Revised
Notice of Issuance is received by Stockholder is hereinafter referred to in this
Section 3 as the "Revised Notice Date"). Stockholder shall have until the later
of (x) five (5) days from the Revised Notice Date or (y) twenty (20) days from
the original Notice Date to notify the Company in writing that it elects to
purchase some or all of its share of the Voting Stock so offered. The
proportional share amount of Voting Stock which Stockholder is entitled to
acquire in the Proposed Issuance shall be equal to (i) the amount of Voting
Stock proposed to be sold or issued by the Company in the Proposed Issuance
(which the Company at its election may indicate to be a fixed amount to be
offered to third parties, subject to increase to make allowance for sales to
Stockholder) multiplied by (ii) a fraction calculated by dividing (A) the number
of shares of Voting Stock owned by Stockholder as of the Notice Date by (B) the
total number of shares of Voting Stock issued and outstanding as of the Notice
Date.
3.2 Company Sale. If, within the later of twenty (20) days after the
Notice Date or five (5) days after the latest Revised Notice Date, Stockholder
does not notify the Company that it desires to purchase a portion of the Voting
Stock proposed to be sold or issued by the Company in a Proposed Issuance, then
the Company may, during a period of ninety (90) days following the end of such
twenty (20) day period or five (5) day period, as the case may be, sell and
issue such Voting Stock not otherwise purchased by Stockholder to other third
parties at a price and upon terms and conditions no more favorable to such
parties than those set forth in the Notice of Issuance.
3.3 Purchase; Payment. If Stockholder elects to purchase Voting Stock
from the Company pursuant to this Section 3, Stockholder and the Company shall
consummate the
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purchase and sale of such Voting Stock in the manner and on the terms and date
of the closing of the Proposed Issuance as set forth in the Notice of Issuance
or Revised Notice of Issuance, as the case may be or, if on a later date, the
second (2nd) business day after all regulatory filings required for the
consummation of such purchase have been obtained. Payment for such Voting Stock
shall be by check (or wire transfer of immediately available funds to an account
designated by the Company by written notice delivered to Stockholder not less
than two (2) business days prior to the scheduled closing of such purchase) or,
at Stockholder's election, to the extent practicable, such other form of
consideration as set forth in the Notice of Issuance or Revised Notice of
Issuance, as the case may be, against delivery of such Voting Stock at the
executive offices of the Company at the time of the scheduled closing therefor.
The Company shall take all such action as may reasonably be required by any
regulatory authority in connection with the exercise by Stockholder of the right
to purchase Voting Stock as set forth in this Section 3.
3.4 Limitation. Stockholder's right to participate in a Proposed
Issuance pursuant to this Section 3 shall not apply to the following sales and
issuances of shares of Voting Stock by the Company on or after the date hereof:
(a) Voting Stock issued to employees, officers, directors and
consultants pursuant to any stock option plan, stock incentive or purchase plan
or agreement approved by the Board of Directors of the Company;
(b) Voting Stock issued pursuant to or upon exercise or
conversion of securities issued in connection with a merger, consolidation,
share exchange, or other reorganization or business combination involving the
Company, in which the Company is the acquiring corporation or stockholders of
the Company immediately prior to such merger, consolidation or other
reorganization or business combination own securities with a majority of the
voting power of the resulting entity;
(c) Common Stock, in an amount up to 1.0% of the Company's
outstanding Common Stock as of the date hereof, in the case of any single
transaction, or 2.5% of the Company's outstanding Common Stock as of the date
hereof, in the aggregate, issued pursuant to or upon exercise or conversion of
securities issued in connection with (A) any equipment financing in an amount in
excess of $10,000,000 or (B) any technology licensings, research or development
agreements or asset acquisitions approved by the Company's Board of Directors;
(d) Common Stock issued upon exercise of securities issued
pursuant to rights distributed to holders of Common Stock generally;
(e) Common Stock issued proportionately to all Stockholders in
connection with any stock split, stock dividend or recapitalization of the
Company; or
(f) Common Stock issued pursuant to the exercise of any stock
options or warrants or any other rights to acquire shares of Common Stock
outstanding on the Effective Date.
3.5 Termination. The right contained in this Section 3 shall terminate
upon the earliest to occur of (i) the closing of any Acquisition Transaction
that results in a Change of
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Xxxxxxx, (xx) the sale of all or substantially all of the Company's assets, or
(iii) termination of this Agreement pursuant to Section 7 hereof.
4. Restrictions on Transfer of Voting Stock by Stockholder.
4.1 Lockup Period. For a period of one (1) year commencing upon the
Effective Date ("Lockup Period"), except with prior Disinterested Director
Approval, Stockholder shall not offer, pledge, sell, contract to sell, sell any
option or contract to purchase, purchase any option or contract to sell, grant
any option, right or warrant to purchase, lend, or otherwise transfer or dispose
of, directly or indirectly, any Voting Stock or enter into any swap or other
arrangement that transfers to another, in whole or in part, any of the economic
consequences of ownership of Voting Stock, whether any such transaction
described in this section is to be settled by delivery of Voting Stock, in cash
or otherwise; provided, however, that Stockholder shall be permitted to transfer
all or any portion of the Voting Stock to an Affiliate of Stockholder in
accordance with Section 4.5.
4.2 Permitted Transfers. Following the Lockup Period, Stockholder shall
not, without first complying with its obligations under Section 4.4 herein, sell
or transfer, directly or indirectly, any shares of Voting Stock, except (i)
pursuant to a bona fide public offering of Voting Stock registered under the
Securities Act (which shall be structured and conducted through an underwriter
or otherwise in a manner reasonably calculated not to result in the transfer of
beneficial ownership of five percent (5%) or more of the total Voting Stock of
the Company then outstanding to a single Person or group (other than a qualified
institutional buyer, as defined in Rule 144A(a)(1), who is purchasing the
securities for investment purposes)); (ii) pursuant to and in compliance with
Rule 144 (but not pursuant to Rule 144A) under the Securities Act; or (iii) to
an Affiliate of Stockholder in accordance with Section 4.5.
4.3 Transfers Subject to Company Approval. Following the Lockup Period,
except with Disinterested Director Approval, Stockholder shall not sell or
transfer, directly or indirectly, more than 2,400,000 shares (as adjusted as a
result of stock dividends, stock splits, recapitalizations and the like after
the date of this Agreement) of Voting Stock in a transaction or series of
related transactions to a single Person or "group" (as such term is defined
under the Exchange Act), except (i) as provided in Section 4.2(i) through (iii);
(ii) pursuant to an Acquisition Transaction that will result in a Change of
Control and that has received Disinterested Director Approval or that has
received approval by a majority of the stockholders of the Company excluding
Stockholder; (iii) following the third (3rd) anniversary of the Effective Date;
or (iv) during the suspension or following termination of the Voting Stock
acquisition restrictions pursuant to Section 2.3(ii), in response to any tender
or exchange offer made by another Person or group to purchase or exchange for
cash or other consideration all outstanding Voting Stock of the Company.
4.4 Right of First Refusal on Permitted Sales by Stockholder.
(a) General. Prior to consummating any sale or transfer of any
Voting Stock, except for sales or transfers described in Section 4.2(i) through
(iii), Stockholder shall give the Company the opportunity to purchase such
Voting Stock in the following manner:
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(i) Stockholder shall give notice (the "Transfer Notice")
to the Company in writing of such intention, specifying the names of the
proposed purchasers or transferees, the securities proposed to be sold or
transferred, the proposed price per share therefor (the "Transfer Price") and
the other material terms upon which such disposition is proposed to be made.
(ii) The Company shall have the right, exercisable by
written notice given by the Company to Stockholder within twenty (20) days after
receipt of such Transfer Notice, to agree to purchase all, but not less than
all, of the securities specified in such Transfer Notice. The Company shall have
the right to pay for such securities: (a) the same amount in cash per share, if
the consideration to be paid by the third party consists of cash, or (b) to the
extent the consideration to be paid by the third party does not consist of cash,
consideration per share equivalent to that offered by the third party, or an
amount of cash having equivalent value as determined, at the expense of the
Company, by an investment banking firm mutually agreed to by the Company and
Stockholder.
(iii) If the Company exercises its right of first refusal
hereunder, the closing of the purchase of the securities with respect to which
such right has been exercised shall take place within ten (10) days after the
Company gives notice of such exercise, or, if later, upon the date on which the
proposed transfer was to occur with the third party. Upon exercise by the
Company of its right of first refusal, the Company and Stockholder shall be
legally obligated to consummate the purchase contemplated thereby and shall use
their reasonable commercial efforts to secure any approvals required in
connection therewith. The Company may elect by notice in writing to Stockholder
that, at the closing of such transaction, the shares be delivered to and payment
made to Stockholder by a designee of the Company, provided that the Company
shall remain liable for its obligations under this Section 4.4.
(iv) If the Company does not exercise its right of first
refusal hereunder within the time specified for such exercise, Stockholder shall
be free, subject to the terms of Section 4.3 herein, during the period of one
hundred and eighty (180) days following the expiration of such time for
exercise, to sell the securities specified in such Transfer Notice on terms no
less favorable to Stockholder than the terms specified in such Transfer Notice.
(b) No Assignment. The rights of first refusal provided by this
Section 4.4 may not be assigned by the Company; provided, however, that the
Company may provide that a purchase of Voting Stock will be made by a designee
in accordance with Section 4.4(a)(iii).
4.5 Affiliate Transfer; Obligation to Transfer Back. As a condition to
the permitted transfer of Voting Stock held by Stockholder to any Affiliate of
Stockholder (each, an "Affiliate Holder"), such Affiliate Holder must agree to
be bound by the terms and conditions of this Agreement and to hold such Voting
Stock subject to all obligations and restrictions applicable to Stockholder,
including Sections 1.3, 2, 4 and 5.11 hereof, in which event such Affiliate
shall be entitled to share, jointly with Stockholder, the rights and benefits
applicable to Stockholder under this Agreement. If any Affiliate Holder ceases
to be an Affiliate of Stockholder, then not later than thirty (30) days
following the date on which the control relationship ends between such Affiliate
Holder and Stockholder, such Affiliate Holder shall transfer its Voting Stock to
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Stockholder or to an Affiliate of Stockholder, or otherwise transfer such Voting
Stock in accordance with Section 4 of this Agreement.
4.6 Merger of Stockholder. For avoidance of doubt, nothing in this
Section 4 shall be deemed to prohibit a transfer of Voting Stock by operation of
law to a successor entity as a result of a merger involving Stockholder.
5. Registration Rights.
5.1 Definitions. For purposes of this Section 5:
(a) The terms "Holder" or "Holders" means Stockholder and/or any
other person who shall subsequently own or have the right to acquire Registrable
Securities or any assignee thereof in accordance with Section 5.10 hereof.
(b) The terms "register," "registered" and "registration" refer
to a registration effected by preparing and filing a registration statement or
similar document in compliance with the Securities Act, and the declaration or
ordering of effectiveness of such registration statement or document.
(c) The term "Registrable Securities" means (i) any shares of
Common Stock issued by the Company to Stockholder pursuant to the Combination
Agreement or subsequently acquired by Stockholder in compliance with Section 3
of this Agreement; (ii) any and all shares of Common Stock issued or issuable
upon exercise, conversion or exchange of equity securities acquired by
Stockholder in compliance with Section 3; (iii) equity securities issued in lieu
thereof in any reorganization; or (iv) equity securities issued in respect of
the stock referred to in (i) or (ii), above, as a result of a stock split, stock
dividend, recapitalization or the like, excluding in all cases, however, any of
the foregoing sold by a Holder pursuant to a registration statement, in a
transaction pursuant to Rule 144 promulgated under the Securities Act, or in any
other transaction in which registration rights are not transferred pursuant to
this Section 5.
(d) The number of shares of "Registrable Securities then
outstanding" shall be determined by the number of shares of Common Stock
outstanding which are, and the number of shares of Common Stock issuable
pursuant to then exercisable or convertible securities which are exercisable or
convertible into, Registrable Securities.
5.2 Company Registration
(a) If (but without any obligation to do so) the Company proposes
to register (including for this purpose a registration effected by the Company
for stockholders other than the Holders) any of its Common Stock under the
Securities Act for sale after the Lockup Period in connection with a secondary
offering of such securities solely for cash (other than a registration relating
solely to the sale of securities to participants in a Company stock option,
stock purchase or similar plan, or a registration relating solely to a
transaction of the type described in Rule 145(a) under the Securities Act), the
Company shall, at such time, promptly give each Holder written notice of such
registration. Upon the written request of any Holder given within twenty (20)
days after mailing of such notice by the Company in accordance with Section 8.3
of this Agreement, the Company shall, subject to the provisions of Section
5.2(b), include in such
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registration (and any related qualification under blue sky laws or other
compliance) and in any underwriting involved therein, all of the Registrable
Securities that each such Holder has requested to be registered.
(b) In connection with any offering involving an underwriting of
shares being issued by the Company, the Company shall not be required under this
Section 5.2 to include any Holder's securities in such underwriting unless such
Holder accepts the terms of the underwriting as agreed upon between the Company
and the underwriters selected by it, and then only in such quantity as will not,
in the opinion of the underwriters, jeopardize the success of the offering by
the Company. In the event that any registration pursuant to this Section 5.2
shall be, in whole or in part, an underwritten public offering of Registrable
Securities, the number of shares of Registrable Securities of the Holders to be
included in such an underwriting may be reduced (pro rata among the requesting
Holders based upon the number of shares of Registrable Securities then
outstanding that are owned by such Holders) if and to the extent that the
managing underwriter advises the Company in writing that in its opinion such
inclusion would materially adversely affect the marketing of the securities to
be sold by the Company therein. If any Holder disapproves of the terms of any
such underwriting, it may elect to withdraw therefrom by written notice to the
Company and the underwriter delivered at least seven (7) days prior to the
effective date of the Registration Statement. Any Registrable Securities or
other securities excluded or withdrawn from such underwriting shall be withdrawn
from such registration. The Holders shall have no right to participate in the
selection of the underwriters for an offering pursuant to this Section 5.2.
(c) The Company shall have the right to terminate or withdraw any
registration initiated by it under this Section 5.2 prior to the effectiveness
of such registration whether or not any Holder has elected to include securities
in such registration.
5.3 Form S-3 Demand Registration.
(a) After the Lockup Period, Holders shall have the right to
request registrations on Form S-3 (such requests shall be in writing and shall
state the number of shares of Registrable Securities to be disposed of and the
intended methods of disposition of such shares by the Holders); provided,
however, that the Company shall not be obligated to effect any such
registration: (i) with effectiveness prior to the end of the Lockup Period, (ii)
if the Holders, together with the holders of any other securities of the Company
entitled to inclusion in such registration, propose to sell Registrable
Securities and such other securities (if any) on Form S-3 at an aggregate price
to the public of less than $5,000,000, (iii) if the Company reasonably
determines, following consultation with its outside counsel, that a Holder's
sale of Registrable Securities pursuant to the registration statement would
require disclosure of material information and such disclosure would be
materially detrimental to the Company, but only for so long as such disclosure
is required and would be materially detrimental; (iv) in a given twelve-month
period, after the Company has effected one (1) such registration pursuant to
this Section 5.3 in any such period; or (v) within sixty (60) days of the
effective date of a Company registration statement of the type described in
Section 5.2 involving an underwritten offering, or within one hundred twenty
(120) days of the effective date of a registration statement in which the
Holders shall have been entitled to participate pursuant to Section 5.2 hereto
and in which there shall have been effectively registered all of the Registrable
Securities as to which registration shall
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have been requested by the Holders, if any; provided; however, that the Company
may not postpone any registration pursuant to clause (iii) above for more than
60 days from the date of such request; and, provided, further that such right to
delay a request shall be exercised by the Company not more than once in any
twelve-month period.
(b) Following receipt of any notice from Holders initiating a
request for registration in accordance with Section 5.3(a), the Company shall
use its best efforts to register under the Act, for public sale in accordance
with the method of disposition specified in such notice from Holders, the number
of shares of Registrable Securities specified in such notice and in all notices
received by the Company. If such method of disposition shall be an underwritten
public offering, the Holders may designate the managing underwriter of such
offering, subject to the approval of the Company, which approval shall not be
unreasonably withheld or delayed. If and to the extent the managing underwriter
of any underwritten public offering conducted pursuant to this Section 5.3
advises the Company in writing that in its opinion the amount of securities
requested to be included in such offering is sufficiently large to materially
adversely affect the marketing of the securities to be sold by the stockholders
therein, the amount of securities to be included in such offering by Persons
other than the Holders shall be reduced.
(c) Subject to the provisions of Section 5.3(b) above, the
Company shall be entitled to include in any registration statement referred to
in this Section 5.3, for sale in accordance with the method of disposition
specified by the requesting Holders, shares of Common Stock to be sold by the
Company for its own account, except as and to the extent that, in the opinion of
the managing underwriter (if such method of disposition shall be an underwritten
public offering), such inclusion would adversely affect the marketing of the
Registrable Securities to be sold. Except for registration statements on Form
X-0, Xxxx X-0 or any successor forms thereto, the Company will not file with the
Commission any other registration statement under the Act with respect to its
Common Stock, whether for its own account or that of other stockholders, from
the date of receipt of a notice from requesting Holders pursuant to this Section
5.3 until the completion of the period of distribution of the registration
contemplated thereby.
5.4 Obligations of the Company. Whenever required under this Agreement
to effect the registration of any Registrable Securities, the Company shall, as
expeditiously as reasonably possible:
(a) prepare and file with the Commission a registration statement
with respect to such Registrable Securities within 45 days after receipt of
requisite requests from Holders for registration and use its best efforts to
cause such registration statement to become effective and, upon the request of
the Holders of a majority of the Registrable Securities registered thereunder,
keep such registration statement effective for the period of the distribution
contemplated thereby (determined as hereinafter provided);
(b) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in connection
with such registration statement as may be necessary to keep the registration
statement effective for the period specified in paragraph (a) above and comply
with the provisions of the Securities Act with respect to the disposition of all
securities covered by such registration statement;
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(c) furnish to the Holders of Registrable Securities covered by
such registration statement such numbers of copies of a prospectus, including a
preliminary prospectus, in conformity with the requirements of the Securities
Act and such other documents as they may reasonably request in order to
facilitate the disposition of such Registrable Securities;
(d) use its best efforts to register and qualify the securities
covered by such registration statement under such other securities or Blue Sky
laws of such jurisdictions as shall be requested by the Holders thereof,
provided that (i) the Company shall not be required in connection therewith or
as a condition thereto to qualify to do business or to file a general consent to
service of process in any such states or jurisdictions and (ii) notwithstanding
anything in this Agreement to the contrary, in the event any jurisdiction in
which the securities shall be qualified imposes a non-waivable requirement that
expenses incurred in connection with the qualification of the securities be
borne by selling stockholders, such expenses shall be payable pro rata by
selling stockholders;
(e) in the event of any underwritten public offering, enter into
and perform its obligations under an underwriting agreement, in usual and
customary form, with the managing underwriter of such offering. Each Holder
participating in such underwriting shall also enter into and perform its
obligations under such an agreement;
(f) promptly notify each Holder participating in the registration
covered by such registration statement at any time when a prospectus relating
thereto is required to be delivered under the Securities Act of the happening of
any event as a result of which the prospectus included in such registration
statement, as then in effect, includes an untrue statement of a material fact or
omits to state a material fact required to be stated therein or necessary to
make the statements therein not misleading in the light of the circumstances
then existing and at the request of any Holder, within 5 days, prepare and
furnish to such Holder so requesting a reasonable number of copies of a
supplement to or an amendment of such prospectus as may be necessary so that, as
thereafter delivered to the purchasers of such Registrable Securities, such
prospectus shall not include an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they are made, not
misleading; provided that, if the Company reasonably determines, following
consultation with its outside counsel, that such a supplement or amendment would
require disclosure of material information and such disclosure would be
materially detrimental to the Company, then upon written notice to participating
Holders to that effect, each Holder shall suspend any sales or trades of the
Company's securities under any registration statement for so long as the Company
determines such disclosure is required and materially detrimental, but in any
case not longer than thirty (30) days immediately following such notice;
(g) cause all such Registrable Securities registered pursuant to
this Agreement to be listed on each securities exchange or national market
system on which similar securities issued by the Company are then listed or
traded;
(h) furnish, at the request of any Holder requesting registration
of Registrable Securities pursuant to this Agreement, (i) such representations
and warranties to such Holder and
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the underwriters, if any, as is customary in primary underwritten offerings,
(ii) an opinion, dated such date, of the counsel representing the Company for
the purposes of such registration, in form and substance as is customarily given
to underwriters in an underwritten public offering, addressed to the
underwriters, and (iii) a letter dated such date, from the independent certified
public accountants of the Company, in form and substance as is customarily given
by independent certified public accountants to underwriters in an underwritten
public offering, addressed to the underwriters;
(i) make available upon reasonable notice for inspection by each
seller of Registrable Securities, any underwriter participating in any
distribution pursuant to such registration statement, and any attorney,
accountant or other agent retained by such seller of Registrable Securities or
underwriter, all pertinent financial and other records, pertinent corporate
documents and properties of the Company, and cause the Company's officers,
directors and employees to supply all information reasonably requested by any
such seller, underwriter, attorney, accountant or agent in connection with
preparation and verification of such registration statement;
(j) otherwise use its best efforts to comply with all applicable
rules and regulations of the SEC, and make available to its security holders, as
soon as reasonably practicable, an earnings statement covering the period of at
least twelve months, but not more than eighteen (18) months, beginning with the
first month after the effective date of the registration statement, which
earnings statement shall satisfy the provisions of Section 11(a) of the
Securities Act; and
(k) take such other actions as are reasonably required in order
to expedite or facilitate the sale of such Registrable Securities, including,
without limitation, causing management of the Company to participate in "road
show" presentations.
For purposes of Sections 5.4(a) and 5.4(b), the period of
distribution of Registrable Securities in a firm commitment underwritten public
offering shall be deemed to extend until each underwriter has completed the
distribution of all securities purchased by it, and the period of distribution
of Common Stock in any other registration shall be deemed to extend until the
earlier of the sale of all Common Stock covered thereby or 120 days after the
effective date thereof.
5.5 Provision of Information. It shall be a condition precedent to the
obligations of the Company to take any action pursuant to this Section 5 that
the selling Holders shall furnish to the Company such information regarding
themselves, the Registrable Securities held by them and the intended method of
disposition of such securities as shall be required to effect the registration
of the Registrable Securities.
5.6 Expenses of Registration. All expenses other than underwriting
discounts and commissions incurred in connection with registrations, filings or
qualifications of Registrable Securities pursuant to Sections 5.2 and 5.3,
including (without limitation) all registration, filing and qualification fees,
printers' and accounting fees, fees and disbursements of counsel for the
Company, and the reasonable fees and disbursements of one counsel for the
participating Holders, shall be borne by the Company.
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5.7 Indemnification. In the event any Registrable Securities are
included in a registration statement under this Agreement:
(a) To the extent permitted by law, the Company will indemnify
and hold harmless each Holder of such Registrable Securities, the officers and
directors of each such Holder, any underwriter (as defined in the Securities
Act) for such Holder and each person, if any, who controls such Holder or
underwriter within the meaning of the Securities Act or the Exchange Act,
against any losses, claims, damages or liabilities (joint or several) to which
they may become subject under the Securities Act, the Exchange Act or other
federal or state law, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any of the following
statements, omissions or violations (collectively, a "Violation"): (i) any
untrue statement or alleged untrue statement of a material fact contained in
such registration statement, including any preliminary prospectus or final
prospectus contained therein or any amendments or supplements thereto, (ii) the
omission or alleged omission to state therein a material fact required to be
stated therein, or necessary to make the statements therein not misleading, or
(iii) any violation or alleged violation by the Company of the Securities Act,
the Exchange Act, any state securities law or any rule or regulation promulgated
under the Securities Act, the Exchange Act or any state securities law; and the
Company will reimburse each such Holder, officer or director, underwriter or
controlling person for any legal or other expenses reasonably incurred by them
in connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that the indemnity agreement contained
in this Section 5.7(a) shall not apply to amounts paid in settlement of any such
loss, claim, damage, liability or action if such settlement is effected without
the consent of the Company (which consent shall not be unreasonably withheld or
delayed), nor shall the Company be liable in any such case for any such loss,
claim, damage, liability or action to the extent that it arises out of or is
based upon a Violation which occurs in reliance upon and in conformity with
written information furnished expressly for use in connection with such
registration by any such Holder, officer, director, underwriter or controlling
person.
(b) To the extent permitted by law, each selling Holder,
severally and not jointly, will indemnify and hold harmless the Company, each of
its directors, each of its officers who have signed the registration statement,
each person, if any, who controls the Company within the meaning of the
Securities Act, any underwriter and any other Holder selling securities in such
registration statement or any of its directors or officers or any person who
controls such Holder, against any losses, claims, damages or liabilities (joint
or several) to which the Company or any such director, officer, controlling
person, underwriter, or other such Holder or director, officer, controlling
person or underwriter may become subject, under the Securities Act, the Exchange
Act or other federal or state law, insofar as such losses, claims, damages or
liabilities (or actions in respect thereto) arise out of or are based upon any
Violation, in each case to the extent (and only to the extent) that such
Violation occurs in reliance upon and in conformity with written information
furnished by such Holder expressly for use in connection with such registration;
and each such Holder will reimburse any legal or other expenses reasonably
incurred by the Company or any such director, officer, controlling person,
underwriter, or other such Holder or director, officer, controlling person or
underwriter in connection with investigating or defending any such loss, claim,
damage, liability or action; provided, however, that the indemnity agreement
contained in this Section 5.7(b) shall not apply to amounts paid in settlement
of any such loss, claim, damage, liability or action if such settlement is
effected
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without the consent of the Holder from whom indemnification is sought (which
consent shall not be unreasonably withheld or delayed); provided, that, in no
event shall any indemnity under this Section 5.7(b) exceed the gross proceeds
from the offering received by such Holder.
(c) Promptly after receipt by an indemnified party under this
Section 5.7 of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in respect thereof
is to be made against any indemnifying party under this Section 5.7, deliver to
the indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party shall
have the right to retain its own counsel, with the fees and expenses to be paid
by the indemnifying party, if representation of such indemnified party by the
counsel retained by the indemnifying party would be inappropriate due to actual
or potential differing interests between such indemnified party and any other
party represented by such counsel in such proceeding. The failure to deliver
written notice to the indemnifying party within a reasonable time of the
commencement of any such action, shall only relieve such indemnifying party of
any liability to the indemnified party under this Section 5.7 if and to the
extent the indemnifying party is materially prejudiced by such omission, but the
omission so to deliver written notice to the indemnifying party will not relieve
it of any liability that it may have to any indemnified party otherwise than
under this Section 5.7. No indemnifying party, in the defense of any such claim
or litigation against an indemnified party, shall consent to entry of any
judgment or enter into any settlement which does not include as an unconditional
term thereof the giving by the claimant or plaintiff to such indemnified party
of a release from all liability in respect of such claim or litigation, unless
such indemnified party shall otherwise consent in writing.
(d) In order to provide for just and equitable contributions in
any case in which either (i) any Holder exercising registration rights under
Sections 5.2 or 5.3 of this Agreement, or any controlling person of any such
Holder, makes a claim for indemnification pursuant to this Section 5.7 but it is
judicially determined (by the entry of a final judgment or decree by a court of
competent jurisdiction and following the expiration of time to appeal or the
denial of the last right of appeal) that such indemnification may not be
enforced in such case, notwithstanding the fact that this Section 5.7 provides
for indemnification in such case, or (ii) contribution under the Act may be
required on the part of any such Holder or any such controlling person in
circumstances for which indemnification is provided under this Section 5.7;
then, and in each such case, the Company and such Holder shall contribute to the
aggregate losses, claims, damages or liabilities to which they may be subject
(after contribution from others) in such proportion as is appropriate to reflect
both the relative benefit received by such Holder and the relative fault of the
Company and such Holder; provided, however, that, in any such case, (A) no such
Holder will be required to contribute any amount in excess of the net proceeds
received by such selling Holder from the sale of Registrable Securities covered
by such registration statement; and (B) no person or entity guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) will be
entitled to contribution from any person or entity who was not guilty of such
fraudulent misrepresentation. For purposes of the preceding sentence, the
relative benefit received by such Holder shall be deemed to be in the same
proportion as the public offering price of its Registrable Securities offered by
the registration
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statement bears to the public offering price of all securities offered by such
registration statement; and the relative fault of the Company and such Holder
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or omission of a material fact
relates to information supplied by the Company or by such Holder and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
(e) The obligations of the Company and Holders under this Section
5.7 shall survive the completion of any offering of Registrable Securities in a
registration statement filed pursuant to this Agreement, the termination of this
Agreement pursuant to Section 7 hereof and otherwise.
5.8 Reports Under the Exchange Act. With a view to making available to
the Holders the benefits of Rule 144 under the Securities Act and any other rule
or regulation of the Commission that may at any time permit a Holder to sell
securities of the Company to the public without registration, the Company agrees
to:
(a) make and keep public information available, as those terms
are understood and defined in Rule 144, at all times;
(b) file with the Commission in a timely manner all reports and
other documents required of the Company under the Securities Act and the
Exchange Act; and
(c) furnish to any Holder, so long as the Holder owns any
Registrable Securities, forthwith upon request (i) a written statement by the
Company that it has complied with the reporting requirements of Rule 144, the
Securities Act and the Exchange Act, (ii) a copy of the most recent annual or
quarterly report of the Company and such other reports and documents so filed by
the Company and (iii) such other information as may be reasonably requested in
availing any Holder of any rule or regulation of the Commission which permits
the selling of any such securities without registration.
5.9 Assignment of Registration Rights. The rights to cause the Company
to register Registrable Securities pursuant to this Agreement may be assigned by
a Holder; provided, that within a reasonable time after such transfer, the
Company is furnished with written notice of the name and address of such
transferee or assignee and the securities with respect to which such
registration rights are being assigned; and provided, further, that such
assignment shall be effective only if immediately following such transfer the
further disposition of such securities by the transferee or assignee is
restricted under the Securities Act. Any assignee or transferee asserting rights
under this Agreement shall be deemed to have consented to the terms and
conditions hereof. Notwithstanding the foregoing, Holders' rights to cause the
Company to register their Registrable Securities and to keep information
available, granted to them by the Company under this Section 5, may be assigned
(or assigned in part and retained in part) to one or more transferees or
assignees who either (x) are Affiliates of Stockholder or (y) receive
Registrable Securities which, upon full exercise and conversion, represent the
right to obtain at least five hundred thousand (500,000) shares of Registrable
Securities (as adjusted for stock dividends, stock split, recapitalizations and
the like that occur after the date of this Agreement), provided, that (i) the
Company is given written notice by such Holder at the time of or within a
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reasonable time after said transfer or assignment, stating the name and address
of said transferee or assignee and identifying the securities with respect to
which such rights are being assigned, and (ii) upon request by the Company, such
permitted transferee or assignee executes a counterpart to Section 5 of this
Agreement.
5.10 "Market Stand-Off" Agreement. Each Holder hereby agrees that it
shall not, to the extent requested by the Company and an underwriter of Common
Stock (or other securities) of the Company, sell, make short sale of, loan,
grant any option for the purchase of or otherwise transfer or dispose (other
than to donees who agree to be similarly bound) of any Registrable Securities
for a period of time, as agreed to by the Company and the underwriter not to
exceed ninety (90) days, following the effective date of a registration
statement of the Company filed under the Securities Act for an offering in which
the Holder participates; provided, however, that all officers and directors of
the Company and all other persons with registration rights (whether or not
pursuant to this Agreement) except passive, outside investors enter into similar
agreements.
5.11 Termination of Registration Rights. The Company's obligations
pursuant to this Section 5 shall terminate as to any Holder of Registrable
Securities when the Holder can sell all of such Holder's Registrable Securities
pursuant to Rule 144(k) under the Securities Act and shall be suspended, but not
terminated, during any three-month period in which such Holder is entitled to
sell all shares issued or issuable to such Holder under Rule 144. This Section 5
shall expressly survive termination of this Agreement pursuant to Section 7
hereto.
5.12 No Inconsistent Agreements. The Company shall not, on or after the
date of this Agreement, enter into any agreement with respect to its securities
which is inconsistent with the rights granted to the Stockholder and other
Holders in this Section 5 or otherwise conflicts with the provisions of this
Section 5. The Company represents and warrants to Stockholder that the rights
granted to the Holders hereunder do not in any way conflict with and are not
inconsistent with any registration rights granted to any holders of the
Company's securities.
5.13 Limitations on Subsequent Registration Rights. From and after the
date of this Agreement, the Company shall not, without the prior written consent
of Stockholder, enter into any agreement with any holder or prospective holder
of any securities of the Company giving such holder or prospective holder any
registration rights, other than registration rights which are no more favorable
(in terms of rights and limitations) than those granted to Stockholder hereunder
and under which the rights of such third party holder or prospective holder to
include securities in such registration are subordinate to the right of Holders
to include Registrable Securities therein; provided however that the Company may
grant registration rights which are equivalent in priority to the registration
rights granted hereunder to recipients of Voting Stock issued by the Company in
connection with a transaction of the type described in Rule 145(a) under the
Securities Act or a share exchange in which the Company is the acquiring
corporation.
6. Notice of Voting Stock Transfers by Xxxxxxx.
6.1 General. Except as otherwise provided in Section 6.2, ten (10)
business days prior to any sale or transfer of, or entering into any agreement
to sell or transfer, Voting Stock by Xxxxxxx (other than a sale or transfer that
would satisfy section 4.2(i) or (ii) if such sale or
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86
transfer were made by Stockholder), Xxxxxxx shall provide Stockholder written
notice stating: (i) the number of shares of Voting Stock to be sold or
transferred; (ii) the name, address and relationship to Xxxxxxx, if any, of the
purchaser or transferee; and (iii) the cash price or other consideration per
share for which the Voting Stock is to be sold or transferred.
6.2 Exceptions. Section 6.1 shall not apply to any of the following
sales or transfers of Voting Stock by Xxxxxxx:
(a) any transfer to Xxxxxxx'x spouse, lineal descendant or
antecedent, father, mother, brother or sister, the adopted child or adopted
grandchild of Xxxxxxx, or the spouse of any child, adopted child, grandchild or
adopted grandchild of Xxxxxxx, or to a trust or trusts for the exclusive benefit
of Xxxxxxx or his family members as described in this Section 6.2(a), transfers
from Xxxxxxx by devise or descent, or transfers by way of any pledge by Xxxxxxx;
(b) any transfer pursuant to a bona fide loan transaction that
creates a mere security interest; or
(c) sales or transfers not exceeding 100,000 shares in any single
transaction or series of related transactions, or 200,000 shares in the
aggregate in any twelve (12) month period.
7. Effectiveness; Termination.
7.1 Effectiveness. This Agreement shall become effective upon the
Closing of the STEAG Transaction as contemplated by the Combination Agreement
(the "Effective Date") and prior thereto shall be of no force or effect. If the
Combination Agreement shall be terminated in accordance with its terms, this
Agreement shall automatically be deemed to have been terminated and shall
thereafter be of no force or effect.
7.2 Termination. Except with respect to the rights and obligations set
forth in Section 5 which by their terms expressly survive until terminated
pursuant to Section 5.11 and the general provision set forth in Section 8, all
rights, remedies, obligations and liabilities of the parties under this
Agreement shall terminate upon the earliest to occur of:
(a) Stockholder's beneficial ownership of Voting Stock
constituting less than twenty percent (20%) of the then-outstanding Voting
Stock;
(b) Stockholder's beneficial ownership of fifty percent (50%) or
more of the then-outstanding Voting Stock other than as a result of
Stockholder's violation of Section 2 of this Agreement; or
(c) a material breach by the Company of any of its material
obligations under this Agreement. Notwithstanding the foregoing, a good faith
disagreement with respect to the Company's indemnification obligations under
Section 5.7, or the failure by the Company to timely satisfy a notice or filing
obligation under Sections 2.6, 3.1, 5.3, 5.4(a) or 5.8, if such notice or filing
is ultimately made by the Company not more than thirty (30) days after the date
prescribed therefor, shall not result in termination of the parties' rights,
remedies, obligations and liabilities under this Section 7.2(c); provided, that
nothing contained in this Section 7.2(c) shall
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limit any rights Stockholder may have to damages or other remedies, whether at
law or in equity, as a result of any of the breaches described in this Section
7.2(c).
8. Miscellaneous.
8.1 Other Agreements Superseded. This Agreement supersedes all prior
agreements or understandings written or oral between the parties hereto,
relating to the subject matter hereof, and incorporates the entire understanding
of the parties with respect thereto.
8.2 Amendment or Modification; Waiver. This Agreement may be amended or
supplemented only by a written instrument signed by the party against whom the
amendment or supplement is sought to be enforced. The party benefited by any
condition or obligation may waive the same, but such waiver shall not be
enforceable by another party unless made by written instrument signed by the
waiving party. Any waiver by any party of a breach of any provision of this
Agreement on one occasion shall not operate as or be construed to be a waiver of
any breach of any other provision of this Agreement. The failure of a party to
insist upon strict compliance with any term of this Agreement on one or more
occasions shall not be considered a waiver or deprive that party of the right
thereafter to insist upon strict compliance with that term or any other term of
this Agreement.
8.3 Notices. Any notice or other communication under or relating to this
Agreement shall be given in writing and shall be deemed sufficiently given and
served for all purposes when personally delivered or given by telecopy with
receipt verified by printout of the transmitting machine (or otherwise confirmed
in writing, in which case the notice shall be deemed given when such written
confirmation is received):
(a) If to the Company:
Xxxxxxx Technology, Inc.
0000 Xxxx Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Attn: Chief Executive Officer
Fax: 000-000-0000
Attn: Chief Operating Officer
Fax: 000-000-0000
with a copy to:
Xxxx Xxxx Xxxx & Freidenrich LLP
000 Xxxxxxxx Xxxxxx
Xxxx Xxxx, Xxxxxxxxxx 00000
Attn: Xxxxxxx X. Rock, Esq.
Fax: 000-000-0000
(b) If to Stockholder:
STEAG Electronic Systems AG
X-00
00
Xxxxxxxxxxxxxxx Xxxxxxx 0-0
00000 Xxxxx
Xxxxxxx
Attn: Chief Executive Officer
Fax: 000-00-000-000-0000
Attn: General Counsel
Fax: 000-00-000-000-0000
with a copy to:
Xxxxx Xxxxxxxxxx LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxx X. Xxxxxx, Esq.
Fax: 000-000-0000
(c) If to Xxxx Xxxxxxx:
Xx. Xxxx Xxxxxxx
c/o Mattson Technology, Inc.
Xxxxxxx Technology, Inc.
0000 Xxxx Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Fax: 000-000-0000
8.4 Law Governing; Consent to Jurisdiction; Equitable Relief; Attorneys'
Fees.
(a) This Agreement shall be construed in accordance with and
governed by the laws of the State of Delaware, without regard to the principles
of conflicts of laws thereof.
(b) Each of the parties hereto (i) consents to submit itself to
the personal jurisdiction of any federal court located in the State of Delaware
or any Delaware state court in the event of any dispute arising out of or
relating to this Agreement or any of the transactions contemplated by this
Agreement, (ii) agrees that it will not attempt to deny or defeat such personal
jurisdiction by motion or other request for leave from any such court,
including, without limitation, a motion to dismiss on the grounds of forum non
conveniens, (iii) agrees that it will not bring any action arising out of or
relating to this Agreement or any of the transactions contemplated by this
Agreement in any court other than a federal court sitting in the State of
Delaware or a Delaware state court, and (iv) waives any right to a trial by jury
with respect to any claim, counterclaim, or action arising out of or in
connection with this Agreement or the transactions contemplated hereby.
(c) If any provisions of this Agreement is breached, the
nonbreaching party shall be entitled without limiting any other remedy available
at law or equity, to an injunction,
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specific performance or other forms of equitable relief. The nonbreaching party
shall be entitled to recover the costs (including attorneys' fees) of enforcing
its rights and the breaching party's obligations pursuant to this Agreement.
8.5 Successors; Assignability. This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective successors
and permitted assigns. Neither this Agreement nor any right, remedy, obligation
or liability hereunder may be assigned by any of the parties hereto without the
prior written consent of the other parties hereto.
8.6 Counterparts. This Agreement may be executed in any number of
counterparts, and each such executed counterpart shall be deemed to be an
original instrument, but all such executed counterparts together shall
constitute one and the same instrument.
8.7 Parties in Interest. Nothing in this Agreement, express or implied,
is intended to confer any rights or remedies under or by reason of this
Agreement on any Person other than the parties hereto and their respective
permitted successors and assigns, nor is anything in this Agreement intended to
relieve or discharge any obligation of any third Person to any party hereto or
give any third Person any right of subrogation or action over or against any
party hereto.
8.8 Headings. The headings used in this Agreement are provided for
convenience only and this Agreement shall be interpreted as though they did not
appear herein.
8.9 Transactional Expenses. Except as otherwise specifically provided
herein, each party shall pay its own fees and expenses incident to the
negotiation, preparation, execution, delivery and performance of this Agreement
including, without limitation, the fees and expenses of its counsel, accountants
and other advisors.
8.10 Severability. Should any provisions of this Agreement be held by a
court of law to be illegal, invalid or unenforceable, the legality, validity and
enforceability of the remaining provisions of this Agreement shall not be
affected or impaired thereby.
8.11 Certain Definitions. As used in this Agreement, the following terms
have the respective meanings set forth below:
(a) Acquisition Proposal means any offer, proposal, inquiry or
indication of interest contemplating or otherwise relating to any Acquisition
Transaction.
(b) Acquisition Transaction means any transaction or series of
transactions involving:
(i) any merger, consolidation, reorganization, share
exchange, business combination, issuance of securities, recapitalization,
acquisition of securities, tender offer, exchange offer or other similar
transaction (i) in which the Company or any of its Significant Subsidiaries (as
defined in Rule 1-02 of Regulation S-X of the Commission) is a constituent
corporation, (ii) in which a Person or "group" (as defined in the Exchange Act)
of Persons directly or indirectly acquires beneficial or record ownership of
securities representing more than 20% of the outstanding securities of any class
of voting securities of the Company or any of its Significant Subsidiaries or
(iii) in which the Company or any of its Significant
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Subsidiaries issues securities representing more than 20% of the outstanding
securities of any class of voting securities of the Company or any of its
Significant Subsidiaries;
(ii) any sale, lease, exchange, transfer, exclusive
license, acquisition or disposition of any business or businesses or assets that
constitute or account for 20% or more of the consolidated net revenues, net
income or assets of the Company or any of its Significant Subsidiaries; or
(iii) any liquidation or dissolution of any of the Company
or any of its Significant Subsidiaries.
(c) Affiliate means any Person which controls, is controlled by
or is under common control with, another Person. For purposes of this
definition, "control" means with respect to a corporation or limited liability
company the right to exercise, directly or indirectly, more than fifty percent
(50%) of the voting rights attributable to the controlled corporation or limited
liability company and, with respect to any individual, partnership, trust, other
entity or association, the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of the controlled
entity.
(d) Beneficial owner, beneficially own, beneficial ownership and
words of similar import have the meanings ascribed to such terms in Rule 13d-3
of the General Rules and Regulations under the Exchange Act.
(e) Change of Control means (i) the Company's sale of all or
substantially all of its assets, (ii) any transaction or series of related
transactions (including, without limitation, any reorganization, merger or
consolidation) which will result in the holders of the outstanding Voting Stock
immediately prior to such transaction or series of related transactions holding
less than fifty percent (50%) of the voting equity securities of the surviving
entity immediately following such transaction or (iii) any Person or group
(other than Stockholder or any of its Affiliates) becomes the beneficial owner
of more than fifty percent (50%) of the total voting power of the outstanding
voting equity securities of the Company.
(f) Closing means the closing of the STEAG Transaction
contemplated by the Combination Agreement.
(g) Commission means the Securities and Exchange Commission.
(h) Common Stock means the common stock, par value $0.001 per
share, of the Company.
(i) Disinterested Director means a director of the Company who is
not a Stockholder Representative and who is not and has never been an officer,
employee or paid consultant of Stockholder or any of its Affiliates.
(j) Disinterested Director Approval means approval by the Board
of Directors, which approval included votes to approve by a majority of all the
Disinterested Directors, or a public recommendation to the stockholders of the
Company approved by a majority of the Disinterested Directors.
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(k) Exchange Act means the Securities Exchange Act of 1934, as
amended, or any successor rule (together with the rules and regulations of the
Commission promulgated thereunder).
(l) Independent Director means any incumbent director of the
Company as of the Effective Date other than Xxxxxxx, and any future director of
the Company who is not and has never been an officer, employee or paid
consultant of (i) Stockholder or any of its Affiliates or (ii) the Company or
any of its Affiliates.
(m) Person means an individual, partnership, corporation, trust
or unincorporated organization or any federal, state, local or foreign
government or any political subdivision thereof (including, without limitation,
the executive and legislative branches thereof) or any department, commission,
board, bureau, agency, court, panel or other instrumentality of any kind of any
of the foregoing.
(n) Securities Act means the Securities Act of 1933, as amended,
or any successor rule (together with the rules and regulations of the Commission
promulgated thereunder).
(o) Subsidiary means, with respect to any party, any corporation,
limited liability company, partnership, joint venture or other business
association or entity, at least a majority of the voting securities or economic
interests of which is directly or indirectly owned or controlled by such party
or by any one or more of its Subsidiaries.
(p) Voting Stock means Common Stock, any securities convertible
into or exchangeable for Common Stock or any other right or option to acquire
Common Stock of the Company.
[SIGNATURE PAGE FOLLOWS.]
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first written above.
XXXXXXX TECHNOLOGY, INC.
By:
--------------------------------------
Xxxx Xxxxxxx, Chairman and
Chief Executive Officer
STEAG ELECTRONIC SYSTEMS AG
By:
--------------------------------------
Xx. Xxxx Xxxx, Chief Executive Officer
By:
--------------------------------------
Xx. Xxxxxxxx Xxxxxx-Xxxxxxx
XXXX XXXXXXX
-----------------------------------------
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EXHIBIT A
TO STOCKHOLDER AGREEMENT
STOCKHOLDER REPRESENTATIVES
[TO COME]
1
94
EXHIBIT C
TRANSITION SERVICES AGREEMENT
Set forth below are the transition services STEAG is prepared to make available
to Xxxxxxx and Xxxxxxx is prepared to obtain from STEAG following the Closing.
Also set forth are certain key terms that would be included in the Transition
Services Agreement. This list is not intended to be exclusive or to require that
the parties agree on the provision of all of the services listed. The final list
of services and the terms and conditions upon which they will be provided will
be set forth in the Transition Services Agreement.
Services to be provided:
1) IT Services for the German subsidiaries with regard to two issues a) SAP/R3:
Service will be delivered through the RAG subsidiary "RAG Informatik GmbH" b)
Office-services (e-mail; Internet access, etc.)
2) IP Administration STEAG is currently performing the patent administration for
the whole STEAG Electronic Systems semiconductor equipment group, e.g., filing
of patent applications, filing of trademark applications, correspondence with
patent offices and patent attorneys, checking and paying invoices of patent
attorneys, supervision and payment of annual fees, Regulation of employee's
compensation
3) Payroll services for the German subsidiaries, using SAP R/3 HR Monthly
settlement of remuneration using the valid legal settlements; all preparation
and reworking relevant for the settlement; remuneration settlement and servicing
of STEAG MicroTech pensioners.
4) Supplier agreement between STEAG MicroTech and STEAG Electronic Systems spol
s r.o. (Slovakia)
Pricing:
All of the above services will be provided at market rates. In the case of item
4, it will be presumed that the rates and prices charged by STEAG to the
HamaTech group are market rates.
Duration:
The above services will be provided for an initial period of one year; provided
that Xxxxxxx, at its option, may elect to terminate such services earlier upon
at least [90 days] prior written notice.
1
