ACQUISITION AGREEMENT ONE
This Agreement made this 14th day of June, 1999 by and between L'AIR
LIQUIDE, SA a limited liability corporation organized under the laws of France
(hereinafter referred to as "A") and AIR PRODUCTS AND CHEMICALS, INC, a
corporation organized under the laws of Delaware, USA (hereinafter referred to
as "B").
WHEREAS, A and B have separately been invited by the Board of Directors of
THE BOC GROUP PLC (hereinafter referred to as "Target") to submit bids or
proposals for the purchase of all the outstanding shares of Target; and
WHEREAS, A has separately submitted to the Board of Directors of Target
[*] successive bids to purchase the shares of Target, and each such bid has
been rejected; and
WHEREAS, B has separately submitted to the Board of Directors of Target
[*] successive bids to purchase the shares of Target, and each such bid has
been rejected; and
WHEREAS, the Board of Directors of Target has encouraged A and B to make
another bid, also advising each of A and B that another party has submitted a
bid but not disclosing the price; and
WHEREAS, A and B have independently determined that each of them cannot
justify raising their last rejected bid any further, for financial and other
business reasons, including the raising of the funds necessary and the risks
attendant thereto; and
WHEREAS, A and B believe that the only way in which they may be in a
position to raise the bid price for the shares of Target, as desired by the
Board of Directors of Target, is by making a joint proposal to the Board of
Directors of Target, since, based on the current
-------------------
*This information has been omitted pursuant to a Request for Confidential
Treatment and such information has been filed separately with the Securities
and Exchange Commission.
1
respective operation of each of A and B, various portions of the businesses of
C are more valuable to one party than to the other;
Now, therefore, A and B agree as follows:
1. From and after the date of this Agreement to termination hereof, neither
A nor B will separately submit (or express or imply an intention to submit) a
proposal to the Board of Directors of Target or any other party to purchase (or
agree to purchase or actually purchase) (a) all or some of the shares of Target
or (b) any business or assets of the Target group (other than in the ordinary
course of business). Provided however that each of A and B may (having giving
notice to the other) confirm to Target that its latest proposal as rejected by
the Target Board meeting held on 9 June 1999 remains open and unchanged, except
to the extent necessary to make such proposal consistent with this Agreement.
Subject thereto, neither party will amend the terms of such latest proposal (nor
express or imply any intention so to do), which proposal may be implemented in
accordance with clause 3.
2. Subject to clause 3, A and B will work together to formulate, agree upon
and submit a joint proposal to the Board of Directors of Target to offer to
acquire all the share capital of Target, exchanging between themselves such
information as may be necessary, but not including the details of their previous
proposals to Target, or any confidential information which would cause either A
or B to be in breach of any confidentiality obligation to Target. Therefore, A
and B will have present whenever the joint proposal is discussed between them or
with Target their respective counsel to verify that this provision is complied
with and that no competitively sensitive information about one of them is
disclosed to the other.
3. A and B intend that the business of the Target group will be shared
equally between them. If for any reason the latest proposal, as referred to in
clause 1 above, of either A or B is accepted by the Board of Directors of
Target, then the party whose proposal is accepted will in good faith enter into
put and call options with the other over shares and assets
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of the Target group so that the principles for the sharing of the assets of the
Target group contained in the attached draft agreement of the parties (under
which they propose to submit the joint proposal to the Board of Directors of
Target) will be substantially fulfilled, except that the equal sharing ratio
will change to [*] for the party whose proposal is accepted and [*] for the
other party (or such other proportion as may be agreed by the parties). Those
clauses indicated with a tick on, and the schedules to, the attached draft will
be deemed to be incorporated in this Agreement mutatis mutandis.
4. In the circumstances set out in clause 3, the parties shall share in the
said [*] proportion the costs and expenses incurred by each of them in
relation to (a) the offer for Target (to the extent that such costs and expenses
are of the type and at a rate customarily incurred in, and payable following
announcement of, a public takeover offer in the UK) and (b) the sharing of the
assets/shares of Target group (including any related costs, including taxation,
incurred in the Target group).
5. This Agreement shall terminate on [*], unless any offer for
Target as contemplated by this Agreement is announced, in which event this
Agreement shall not be so terminated but shall continue until such offer lapses
or is withdrawn or until [*] (if later).
6. This Agreement is governed by and shall be construed in accordance with
English law. References to A or B shall include persons (other than the other
party) acting in concert with the relevant party.
7. Neither party shall assign this Agreement to any other person, except
affiliates controlled by a party, without the consent of the other party in
writing.
8. Each party recognizes the irreparable harm that would occur to the other
party if either party breaches its obligations under this Agreement.
Accordingly, if either party
-------------------
*This information has been omitted pursuant to a Request for Confidential
Treatment and such information has been filed separately with the Securities
and Exchange Commission.
3
shall breach any of its obligations hereunder, the other party shall, in
addition to any claim for damages incurred or any other legal remedies available
to it, be entitled to injunctive relief and/or specific performance with respect
to any such breach.
9. Each clause shall represent a separate obligation of the parties and
shall not be affected by the invalidity of any clause.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
day first above written.
A B
By XXXXXX XXXX By XXXX XXXX XXXXX
Witnessed by Xxxx Xxxxxxxxxx Witnessed by Xxxx Xxxxx
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APPENDIX I
ACQUISITION AGREEMENT TWO
This Agreement is made this ___ day of June 1999 by and between A and B.
WHEREAS, A and B, at the invitation of the Board of Directors of C, have
separately submitted several bids or proposals to acquire all of the outstanding
shares of C, which proposals have been rejected, and A and B have independently
determined that each of them cannot justify further increasing their respective
last rejected bids, for financial and other business reasons, including the
raising of necessary funds and the risks attendant thereto.
WHEREAS, A and B believe that the only way in which they may be in a
position to raise the price bid for the shares of C, as desired by the Board of
Directors of C, is by making a joint bid to the Board of Directors of C, since
various portions of the businesses of C are more valuable to one party than to
the other.
WHEREAS, A and B intend to jointly develop a proposal for the possible
acquisition of C (the "Proposed Acquisition") and desire to set forth the
general terms and conditions upon which they will jointly negotiate the Proposed
Acquisition, as well as the terms and principles upon which the Proposed
Acquisition will be implemented and the assets and businesses of C will be
allocated to each of the parties or jointly operated by them, recognizing that
various asset divestitures will be required by the antitrust authorities of
certain jurisdictions in order for the parties to consummate the Proposed
Acquisition.
WHEREAS, in connection with the foregoing, A and B have entered into
acquisition Agreement One, [dated the date hereof,] covering certain matters
relating to the joint proposal.
NOW, THEREFORE, the parties agree as follows:
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X 1. Formation and Functions of Special Committee.
--------------------------------------------
(a) A and B each hereby designate the following representatives who
shall constitute a ___ member special committee (the "Committee") that will be
responsible for all negotiations, meetings and other contacts with C on behalf
of the parties in connection with the Proposed Acquisition.
A B
- -
(b) The Committee (or such of its individual members or other
representatives as shall be designated by the Committee from time to time) shall
be the contact group for all communications between A and B, on the one hand,
and C, on the other. The Committee shall be authorized to act upon the consent
or approval of at least two representatives, which consent or approval includes
at least one of the representatives appointed by each party. In the event the
Committee cannot agree upon any matter, such matter shall be referred to the
Chairman of A, ___, in the case of A, and the Chairman of B, _____, in the case
of B, who shall confer together in order to mutually agree on an appropriate
resolution of the matter. The Committee shall be responsible for supervising all
negotiations with C and all other matters relating to the Proposed Acquisition
and the implementation of all other provisions of this Agreement, provided that
each party may form such working groups to report to that party's Committee
members as it may determine and may rely on such representatives, advisors and
other experts as it may deem appropriate. Each party may appoint successor
representatives so that the total number of Committee representatives always
totals _____. The Committee shall continue in existence throughout the
consummation of the Proposed Acquisition and the implementation of the other
matters provided for in this Agreement, including the period during which the
parties are jointly operating any assets or businesses of C acquired in the
Proposed Acquisition. The Committee shall in all matters
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observe the preeminent principle that the parties could not anticipate all of
the issues that will arise in making the Proposed Acquisition and implementing
the allocation between the parties of the assets and businesses of C in
accordance with the terms of this Agreement, and, therefore, the Committee is
intended to resolve all questions with a spirit of fairness and understanding of
each party's needs, attempting to avoid minor matters, in order to enable the
parties to acquire their respective portions of such assets and businesses in
accordance with the principles of this Agreement. Without attempting to limit
the functions of the Committee, it shall have the following duties:
(i) settling the terms and conditions of the Proposed Acquisition,
including price and other offer terms, and any agreements entered into with C
or other parties relating thereto;
(ii) supervising the allocation of the assets and businesses of C
between the parties in accordance with the principles set forth herein and
the process of determining the final allocations of such assets and businesses;
(iii) settling the terms and conditions of appropriate joint venture or
other agreements between A and B covering the conduct of those portions of the
assets and businesses of C that will be owned and operated on a joint ownership
basis by the parties following consummation of the Proposed Acquisition, as well
as of appropriate arrangements to ensure the independent operation, following
the consummation of the Proposed Acquisition, of assets and businesses required
to be divested by the antitrust authorities of relevant jurisdictions;
(iv) supervising the various filings and submissions with governmental
bodies and agencies, in order to obtain all necessary statutory, governmental
and regulatory approvals for the Proposed Acquisition; and
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(v) considering and resolving any concerns which may be raised by
either party or its representatives relating to the transactions contemplated
by this Agreement, including the Proposed Acquisition and the subsequent asset
and business allocations and joint operation of certain businesses of C, in
order to enable the parties to proceed in accordance with the general principles
expressed herein.
X 2. Proposal Letter and Presentation of Proposal.
--------------------------------------------
(a) A and B will agree upon the form of a proposal letter to be
delivered to C (the "Proposal Letter"), the final form of which shall be
approved by the Committee.
(b) The Committee shall be responsible for determining the manner,
timing and method by which the Proposal Letter will be presented to and
negotiated with C and for establishing and coordinating the procedures for
responding to any requests for information or comment from, or otherwise
communicating with, the press or other media, as well as determining the content
of any such responses or communications.
\ 3. Financing.
---------
Each party covenants and agrees that it has or will have sufficient
funds available, whether in the form of borrowings, equity or any combination
thereof, so as to enable it to proceed with the terms of the Proposal Letter and
to conclude the Proposed Acquisition in accordance with the obligations
undertaken herein and therein.
X 4. Structure of Proposed Acquisition.
---------------------------------
The parties intend that the Proposed Acquisition would be effected
through an offer for all of the outstanding shares of C under the relevant laws
of England and the United States (the "Offer") followed by a compulsory
acquisition of any shares not acquired in the offer if permitted by English law
(the "Compulsory Acquisition"). The
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Offer and the Compulsory Acquisition would be made by a new company incorporated
by the parties under the laws of [England], with each party owning, directly or
indirectly through wholly-owned subsidiaries, 50% of the outstanding share
capital of the new company. Following the Offer and the Compulsory Acquisition,
the parties intend to allocate the assets and businesses acquired through the
Proposed Acquisition as provided in this Agreement.
X 5. Offer Price and Allocation of Assets and Businesses.
---------------------------------------------------
X (a) Offer Price
(i) The price to be offered by the parties in the Proposed
Acquisition shall be as mutually agreed and set forth in the Proposal Letter or
as otherwise determined by the Committee.
(ii) A and B shall each be responsible to fund 50% of the
aggregate cash purchase price to be paid in the Proposed Acquisition.
\ (b) Actual Aggregate Purchase Price.
For purposes of this Section 5, the "actual aggregate purchase
price" shall mean the sum of (i) the purchase price paid to acquire outstanding
ordinary shares of C pursuant to the Offer and any Compulsory Acquisition or
otherwise within the period of _____ months following the making of the Offer,
(ii) any funds expended to acquire or cancel outstanding options to purchase
ordinary shares of C to the extent not included in (i) above, and (iii) the
aggregate amount of outstanding indebtedness for borrowed money of C group at
the date the Proposed Acquisition is consummated. For purposes of this
Agreement, the Proposed Acquisition shall be deemed to have been consummated
upon the acquisition of more than [*] of the ordinary shares of C in the Offer.
-------------------
*This information has been omitted pursuant to a Request for Confidential
Treatment and such information has been filed separately with the Securities
and Exchange Commission.
9
\ (c) [*].
The parties agree that, as soon as practicable following the
consummation of the Proposed Acquisition, the [*] of C will be sold (whether to
unaffiliated third parties, to A or to B) in accordance with such procedures
and utilizing such advisors as the parties may mutually agree. The net proceeds
of such sales shall be shared between the parties equally. For purposes of
this Section 5, the "modified aggregate purchase price" for the Proposed
Acquisition shall be the actual aggregate purchase price less the deemed fair
market values of the [*] as set forth on Schedules I and II hereto.
\ (d) Schedules I and II.
Schedules I and II hereto have been prepared by A and B,
respectively, to reflect the initial values which each party attributes to each
country or region set forth thereon, which Schedules reflect allocations of all
of the assets and businesses of C in approximately equal shares between the
parties, and to designate the party which will have the primary right to be
allocated such country or region (or, in those cases indicated in such Schedule,
the proportionate asset sharing in such countries between the parties) in
accordance with the procedures hereinafter set forth. The parties agree that
the assets and businesses of C located in England shall have an agreed value
equal to __% of the modified aggregate purchase price as set forth on
Schedules I and II and that the aggregate values of the assets and businesses
of C located in England and the United States shall equal approximately [ *]
of the modified aggregate purchase price. The actual allocation of the specific
assets and businesses of C located in England and the United States between the
parties will be finally agreed upon prior to the consummation of the Proposed
Acquisition. The parties acknowledge that the percentages of the modified
aggregate purchase price allocated to England on Schedules I and II are based
on the parties' agreed upon estimate of the recurring EBIT of the English
-------------------
*This information has been omitted pursuant to a Request for Confidential
Treatment and such information has been filed separately with the Securities
and Exchange Commission.
10
operations of C for C's fiscal year ended September 30, 1998. Accordingly,
should the parties, based upon their review of the recurring EBIT or EBITDA of
the English operations of C for the twelve month period ending June 30, 1999
when the underlying financial information become available to the parties,
determine (using the same methodology as used in the estimate above) that the
EBIT or EBITDA of the English operations has changed, whether positive or
negative, more than ___% from the fiscal 1998 estimate, the above percentage to
be attributed to such operations shall be revised to reflect the EBIT or EBITDA
for the twelve month period ending June 30, 1999 and appropriate corresponding
adjustments shall be made to the Schedule I and Schedule II values for countries
or regions other than England.
\ (e) Allocation Process for Countries and Regions other than England.
---------------------------------------------------------------
(i) As soon as practicable following the consummation of the
Proposed Acquisition, the parties will determine the allocation between them of
the assets and businesses located outside of England on the country or region
basis as set forth on Schedules I and II, in accordance with the procedure
hereinafter set forth.
(ii) With respect to each country or region other than England
set forth on Schedules I and II, the party having the primary right to be
allocated that country or region (or portion thereof) as indicated on
Schedules I and II (the "primary party") shall give written notice to the other
party of the value which the primary party is willing to allocate to such
country or region, which value may be more or less than the values referred to
in Schedules I and II.
(iii) The party receiving such written notice of the primary
party's value for a country or region (or portion thereof) shall be entitled to
give written notice to the primary party setting forth an increased value for
such country or region (or portion thereof), provided
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that such increased value exceeds the primary party's value by at least [*]. If
no such notice of an increased value is provided, the assets and business of C
located in such country or region (or portion thereof) shall be allocated to the
primary party. If such notice of an increased value is provided, the primary
party may elect to accept such increased value, in which case the assets and
business of C located in such country or region (or portion thereof) will be
allocated to the primary party at such increased value, or to reject such
increased value, in which case such assets and business (or portion thereof)
will be allocated to the other party at such increased value.
\ (f) It is intended that the aggregate values ultimately allocated
between the parties pursuant to clauses (d) and (e) above will, as nearly as
possible, result in equal 50% shares in such values for each party. Since the
allocation of the assets and businesses of C located in England will result in
an allocation of __ % to A and __ % to B, it is intended that the allocations to
be made under clause (e) above should result in an allocation of ___ % to A and
__% to B, based on the aggregate of the values allocated to countries or regions
other than England determined in accordance with the procedure set forth in
clause (e). If the procedure provided for in this clause (f) results in an
aggregate allocation to either party under clauses (d) and (e) of less than 50%
but more than [*], the difference shall be made up by a cash payment from the
party with the allocation greater than 50% based on the values as finally
determined in accordance with clauses (d) and (e). If such procedure results in
such allocation to either party being [*] or less, the parties shall agree on
such adjustments to the apportionment of the assets and businesses of C located
in those countries or regions apportioned to one to the parties as are necessary
to meet the above [*] test, provided that such adjustments shall be made in the
order of the countries and/or regions having the highest values.
-------------------
*This information has been omitted pursuant to a Request for Confidential
Treatment and such information has been filed separately with the Securities
and Exchange Commission.
12
X (g) In connection with any asset dispositions (other than of the [*]
of C) required to be made in connection with securing regulatory approvals of
the Proposed Acquisition in any jurisdiction, the parties agree that the party
making the disposition shall be solely responsible for such disposition and
such disposition shall be for the sole account of such party; provided, however,
that the parties agree that assets so required to be divested shall be placed
under independent management following the consummation of the Proposed
Acquisition, with the party for whose account the assets are being divested
retaining the economic interest therein. Each party shall have a 60-day right
of first refusal in respect of any asset disposition to be made by the other
party, so long as the sale of the relevant assets to the first party is
permitted by the relevant antitrust authorities, which right shall be to
acquire the relevant assets on terms not less favorable to the first party than
those contained in any offer for such assets which the other party has
determined to accept.
\ 6. Government Approvals.
--------------------
(a) The parties acknowledge that the Proposed Acquisition will be
subject to review by regulatory authorities in certain jurisdictions. In this
connection, among other filings, A and B will be making filings under [Europe]
and under the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976 ("HSR Act")
in the United States.
(b) A and B each agrees to use all reasonable efforts to take, or
cause to be taken, all actions and to do, or cause to be done, all things
necessary or advisable to consummate as promptly as practicable the Proposed
Acquisition and to cooperate with each other in connection with the foregoing.
In furtherance of the foregoing, A and B shall use all reasonable efforts to
resolve such objections, if any, as may be asserted with respect to the Proposed
Acquisition under any applicable law or regulation to enable the Proposed
Acquisition to be completed in an expeditious manner.
-------------------
*This information has been omitted pursuant to a Request for Confidential
Treatment and such information has been filed separately with the Securities
and Exchange Commission.
13
(c) Each of the parties shall promptly inform the other of any
communication from any government or governmental or multinational authority
regarding the Proposed Acquisition. If either party or any affiliate thereof
receives a request for additional information or documentary material from any
such government or authority with respect to the Proposed Acquisition, then such
party will endeavor in good faith to make, or cause to be made, as soon as
reasonably practicable, an appropriate response in compliance with such request.
(d) Without limiting the general nature of the parties' obligations
set forth in clause (b) above, the following rules shall apply with respect
to divestitures, if any, requested by the competent authorities. Each of the
parties will make such divestitures, or agree to make such divestitures, as
may be reasonably requested or required by any antitrust authorities to enable
the Proposed Acquisition to be completed in an expeditious manner. [Any such
divestitures shall be for the account of the party making the same, and] any
divested assets may be sold to either A or B if allowed by the relevant
antitrust authorities.
(e) Following the consummation of the Proposed Acquisition, the
parties agree that they will exhaust all legal remedies in an effort to obtain
all necessary approvals, including but not limited to appeals to the highest
appellate court, tribunal or other body having jurisdiction over the matter in
dispute, will seek rehearings where necessary and will continue with the
approval processes until final determinations have been received.
(f) It is the parties' intent, to the extent practicable, to proceed
with the consummation of the Proposed Acquisition at such time as all
regulatory approvals have been received from the antitrust regulatory
authorities of [the European Economic Community, the United States, Canada and
Australia], notwithstanding the fact that final approvals have not been received
in one or more of the other jurisdictions involved.
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\ 7. Intellectual Property.
---------------------
The parties agree that the continued use of the patents, patent
applications, technology, know-how (including operational know-how), trademarks,
tradenames and other intellectual property ("Intellectual Property") of C
after the consummation of the Proposed Acquisition is vital to the successful
operation of the assets and businesses of C to be separately allocated to each
party in accordance with the terms hereof. Because of the varying nature of the
rights and obligations running with Intellectual Property in each of the several
jurisdictions involved, it will be necessary, to insure the continued validity
of these rights worldwide, for the parties to develop ownership structures that
enable each party to obtain the benefits of the rights worldwide and in the
jurisdictions in which each party has acquired the assets and businesses. In
this connection, the parties will, prior to or as soon as practicable following
the consummation of the Proposed Acquisition, enter into supplementary
agreements establishing appropriate mechanisms, whether through direct joint
ownership of the Intellectual Property, ownership through a separate entity,
direct ownership with licensing or otherwise, to appropriately enable each party
to continue to fully and independently use in its own worldwide gases business
(including the businesses acquired from C) such Intellectual Property for
mutually agreed upon periods of time following such consummation, adopting the
most suitable mechanism to avoid the possibility of the abandonment of any such
Intellectual Property. In those jurisdictions where ownership of the
Intellectual Property can be legally transferred to and held by the party
acquiring assets and business located there without risk of loss of the benefits
of the Intellectual Property to the other party in other jurisdictions, it is
the intention of the parties that direct ownership will follow the assets and
businesses so acquired. In those jurisdictions where ownership of the
Intellectual Property cannot be legally transferred without risk of loss, or
where the ownership of the assets and business is held jointly by the parties,
the ownership will be held in such a manner to benefit both parties. To make
certain that the rights in and to the Intellectual Property so acquired are
shared as
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equally as possible, license and other agreements will be given to the
parties to enable each to conduct its business in the jurisdictions and areas
where they hold or will hold such assets or businesses. Any royalties, license
fees or other charges for use of the Intellectual Property will be agreed by the
parties. All rights shall be allocated equally. In addition, the parties will
agree upon such standards as may be appropriate in order to avoid confusion from
the use by the parties of the trademarks and tradenames (such as a requirement,
in connection with any such use, to identify such trademark or tradename with
the A name or the B name, as the case may be). The agreement shall also cover
the basis upon which the parties may use such Intellectual Property on a
long-term basis. Each party agrees that, for a reasonable period of time
following the consummation of the Proposed Acquisition, it shall provide the
other party with reasonable access to those facilities acquired from C and to
relevant personnel in order to enable the other party to become knowledgeable
concerning the technology and know-how (including operational know-how) included
in the Intellectual Property. The parties acknowledge that the provisions of
this section 7 are intended to apply only to the Intellectual Property of C
acquired by the parties as such Intellectual Property exists at the date of
consummation of the Proposed Acquisition and that any intellectual property
developed by A or B after such consummation, whether or not based on the
Intellectual Property acquired from C, shall be the sole property of the party
which develops the same.
\ 8. No Unauthorized Disclosure or Use of Confidential Information.
-------------------------------------------------------------
(a) A may provide B with confidential or proprietary information
relating to the Proposed Acquisition from time to time (the "A Confidential
Information"). B shall not, without the prior written consent of A, disclose or
use any A Confidential Information for any purpose, other than with A in
connection with the evaluation and negotiation of the Proposed Acquisition and
the making of the proposal to make the Proposed Acquisition.
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(b) B may also provide A with confidential or proprietary information
relating to the Proposed Acquisition from time to time (the "B Confidential
Information"). A shall not, without the prior written consent of B, disclose
or use any B Confidential Information for any purpose, other than with B
in connection with the evaluation and negotiation of the Proposed Acquisition
and the making of the proposal to make the Proposed Acquisition.
(c) Any information and analyses concerning C and the businesses
of C contained in this Agreement or heretofore provided by the parties shall be
deemed to be included within the A Confidential Information or the B
Confidential Information, as the case may be, it being acknowledged by the
parties, however, that all such information and analyses are subject to
confirmation by the parties through their own review and examinations and that
neither party is making any representation or warranty to the other party as to
the completeness or accuracy of such information or analyses.
(d) The foregoing restrictions shall not apply to any information
(i) which was in the public domain prior to disclosure to A or B, as the case
may be, (ii) which becomes public knowledge after such disclosure other than
through breach of this Agreement by A or B, as the case may be, (iii) which
A or B, as the case may be, can show to have been in its possession
independently prior to such disclosure, (iv) which A or B, as the case may be,
can show that it received after such disclosure in a legal way from other
sources, (v) to the use by A or its affiliates or B or its affiliates, as the
case may be, of such party's Confidential Information internally in such party's
or its affiliates' industrial gases business, or (vi) to the use by either party
or its affiliates of the Confidential Information concerning C referred to in
clause (c) above internally in their respective industrial gas businesses.
(e) A and B agree to preserve the confidentiality of the B Confidential
Information or the A Confidential Information, as the case may be, as
required by this Agreement for a period of three years from the date of the
termination of this Agreement, the
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consummation of the Proposed Acquisition or the final allocation between the
parties of the assets and businesses of C in accordance with the terms of this
Agreement, whichever is later.
(f) All written materials, schedules, documents and other writings
which are made available by or supplied by one party to the other as A
Confidential Information or B Confidential Information, as the case may be, and
all copies and reproductions thereof, shall at the request of the supplying
party, after the later of the date of the termination of this Agreement, the
consummation of the Proposed Acquisition or the final allocation between the
parties of the assets and businesses of C in accordance with the terms of this
Agreement, be returned to the supplying party or certified in writing by the
other party to having been destroyed.
X 9. Transfers of Products and Administrative and Other Services in the
------------------------------------------------------------------
United States After the U.S Asset Allocations.
----------------------------------------------
As previously indicated, it is the intention of the parties to achieve
an allocation of the assets and businesses of C located in the United States in
equal shares between the parties. Schedule III hereto sets forth the current
view of the parties as to the possible allocation of such assets and businesses,
by plant location, based on the initial review by the parties of information
concerning C's industrial gases operations in the United States available to
them. The parties further recognize that the industrial gases business of C in
the United States has been operated as a single integrated business.
Accordingly, the parties agree that, prior to or immediately after the
consummation of the Proposed Acquisition, they will negotiate in good faith with
each other and with other parties such separate contracts as are customary in
the industry and permitted by law, to be generally in effect for a period of six
months, in order to secure needed administrative services and covering other
matters such as trade product exchanges and purchases and the sources of other
products, in order to fulfill the intention of the parties that each of them be
placed in a position by such contracts to successfully operate
18
the assets and businesses allocated to that party in the United States in the
manner intended by this Agreement. The parties agree that all of the foregoing
arrangements shall be on a direct cost basis. If such initial agreements are
required for a term of longer than six months, the parties will, after
expiration of the initial agreements, negotiate new agreements on such terms as
may be mutually agreed.
X 10. General Principle
-----------------
As indicated herein, it is the intention of the parties that the
Proposed Acquisition and the ultimate allocation of the assets and businesses
of C will be shared on an equal basis. It is further understood that this
principle shall be generally applicable in all areas relating to the Proposed
Acquisition, including the sharing on an equal basis of (i) liabilities
attributable to the assets and businesses of C or arising in connection with
the Proposed Acquisition, such as, in particular, any undisclosed liabilities
which become known subsequent to the consummation of the Proposed Acquisition
or liabilities resulting from any actions or proceedings which may be commenced
by shareholders of C or other parties relating to the Proposed Acquisition, and
(ii) net benefits obtained as a result of the Proposed Acquisition, including
reductions in expenses such as headquarters, research and other common expenses
of C.
\ 11. Governing Law and Jurisdiction
------------------------------
This Agreement shall be governed by the laws of [England], the place
where this Agreement has been negotiated, executed and delivered, without, to
the extent permitted by such laws, giving effect to the conflicts of law rules
thereof. In connection with any action, suit or proceeding arising in connection
with this Agreement or any transaction contemplated hereby, A and B each:
(i) agree that either party may bring a suit, action or other legal proceeding
against the other party only in a court of record of [England]; (ii) consent to
the exclusive jurisdiction over it of any such court in any such suit, action or
proceeding, (iii)
19
waive any objections it may have to the venue of any such court in any such
suit, action or proceeding, and (iv) consent to service of process upon it by
any appropriate method under the laws or rules of the jurisdiction in which such
suit, action or proceeding is commenced.
\ 12. Assignment
----------
Neither party shall have the right to assign its rights or obligations
under this Agreement to any other person, except majority-owned subsidiaries,
without the prior written consent of the other party, which consent shall not be
unreasonably withheld in the case where a party desires to use a less than
majority-owned entity to take title to the assets and businesses located in a
particular country.
\ 13. Notices
-------
All notices, requests or other communications hereunder shall be in
writing, clearly marked "Confidential", and shall be deemed to have been duly
delivered if delivered personally or by telecopier or sent by registered or
certified mail, postage prepaid, return receipt requested, to the parties at
their respective addresses, as follows:
If to A
If to B
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\ 14. Non-Disclosure of Agreement
---------------------------
Each of the parties hereto agrees that, except as may be otherwise
mutually agreed in writing or as may be required by law, it will keep
confidential and will not disclose to any other person the existence of this
Agreement, the contents hereof or the fact that the parties are making a
proposal to effect the Proposed Acquisition or the terms of any such possible
proposal.
X 15. Expenses
--------
Each party agrees to bear and be responsible for its own costs and
expenses, including without limitation those incurred by it or its
representatives in respect of such party's participation on the Committee,
incurred in connection with the Proposed Acquisition.
X 16. Termination
-----------
[to be provided]
X 17. Indemnification
---------------
Each of A and B agree to indemnify and hold harmless the other party
(including, in each case, the directors, officers, employees and representatives
of the other party) from and against any and all losses, claims, liabilities,
damages and expenses (including reasonable fees and disbursements of counsel)
relating to or arising out of any action taken by such party, or its
representatives, in contravention of this Agreement or of any decision, policy
or directive of the Committee or any action taken which has not been authorized
by the Committee or this Agreement.
21
\ 18. Injunction for Breach
---------------------
If either party shall breach any of its obligations hereunder,
including without limitation those relating to maintaining the confidentiality
of, or the use of, the A Confidential Information or the B Confidential
Information, as the case may be, in recognition of the irreparable harm that
would be incurred by the other party, such other party shall, in addition to its
claim for damages incurred or any other legal remedies available to it, be
entitled to an injunction and/or specific performance with respect to any such
breach.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the day and year first above written.
A
By:
------------------------------------
Name:
Title:
B
By:
------------------------------------
Name:
Title:
22
SCHEDULE I
[*] are sold at market value.
This is deducted from the total price and the remainder is applicable to [*].
Example
Total business value at [*] [ * ]
other incl options [ * ]
debt [ * ]
----
[ * ]
[*] [ * ]
-----
[*] [ * ]
----
A B
England [ * ] [ * ] [ * ] [ * ]
US [ * ] [ * ] [ * ] [ * ]
----- ----- ----- -----
[ * ] [ * ] [ * ] [ * ]
Subject to bidding contest
Most likely will be
Canada/Sth America [ * ] [ * ] [ * ]
Australia [ * ] [ * ] [ * ]
J.V. [ * ] [ * ] [ * ]
EU Cont. [ * ] [ * ] [ * ]
Japan [ * ] [ * ] [ * ]
Africa [ * ] [ * ]
India others [ * ] [ * ]
---
[ * ] [ * ] [ * ]
England and USA excl. [ * ] [ * ] [ * ] [ * ]
---- ---- ----
[ * ] [ * ] [ * ]
[ * ]
or give B more [ * ] and [ * ] but have 50% vote.
OPEN QUESTION
-------------------
*This information has been omitted pursuant to a Request for Confidential
Treatment and such information has been filed separately with the Securities
and Exchange Commission.
23
SCHEDULE II 1/2
Total business value at [ * ] [ * ]
other incl options [ * ]
debt [ * ]
[ * ]
[ * ] [ * ]
[ * ] [ * ]
% Pounds Valuation pounds
A B
UK [*] [*] [*] [*]
US [*] [*] [*] [*]
subtotal [*] [*] [*] [*]
Canada [*] [*] [*] [*]
Australia [*] [*] [*] [*]
JV's [*] [*] [*] [*]
EU Cont [*] [*] [*] [*]
Japan [*] [*] [*] [*]
subtotal [*] [*] [*] [*]
Africa [*] [*] [*] [*]
India [*] [*] [*] [*]
Others [*] [*] [*] [*]
subtotal [*] [*] [*] [*]
TOTAL [*] [*] [*] [*]
used [*]
OPEN QUESTION
-------------------
*This information has been omitted pursuant to a Request for Confidential
Treatment and such information has been filed separately with the Securities
and Exchange Commission.
24
SCHEDULE II 2/2
Country Preferences
US - [ * ]
UK - AL gets Jag business [ * ]
Poland - [ * ]
Canada - [ * ]
Mexico - [ * ]
Columbia - [ * ]
Brazil - [ * ]
Venezuela - [ * ]
Japan - [ * ]
Aust. NZ - AP acquires [ * ]
Singapore - [ * ]
Malaysia - [ * ]
Hong Kong - [ * ]
Taiwan - [ * ]
[ * ]
South Africa - [ * ]
India - [ * ]
Thailand - [ * ]
China - [ * ]
Korea - [ * ]
[ * ]
-------------------
*This information has been omitted pursuant to a Request for Confidential
Treatment and such information has been filed separately with the Securities
and Exchange Commission.
25
