SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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SCHEDULE 13D
Under the Securities Exchange Act of 1934
APPLIED FILMS CORPORATION
-------------------------
(Name of Issuer)
Common Stock, no par value
--------------------------
(Title of Class of Securities)
038197109
--------------------------
(CUSIP Number)
Thomas Emch
Unaxis Management Ltd.
Hofwiesenstrasse 135
P.O.Box 2409
CH-8021 Zurich
Switzerland
011-41-1-360-9696
--------------------------
(Name, Address and Telephone Number of
Person Authorized to Receive Notices and
Communications)
Copy to:
W. Jeffrey Lawrence Dr. Thomas Konig
Shearman & Sterling Shearman & Sterling
Broadgate West Mainzer Landstrasse 16
9 Appold Street 60325 Frankfurt am Main
London EC2 2AP Germany
United Kingdom
Tel: 011-44-20-7655-5000 Tel: 011-49-69-9711-1000
December 31, 2000
--------------------------
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box |_|.
<PAGE>
CUSIP No. 038197109
------------------------------------------------------------------
(1) Name of Reporting Person(s) UNAXIS DEUTSCHLAND GMBH (formerly
---------------------------------
BALZERS PROCESS SYSTEMS GMBH)
-----------------------------------------------------------------------
S.S. or I.R.S. Identification No. of Above Person
----------------------
(2) Check the Appropriate Box if a Member of a Group (See Instructions)
|_| (a)
|_| (b)
(3) SEC Use Only
-----------------------------------------------------------
-----------------------------------------------------------------------
(4) Source of Funds (See Instructions) OO
(5) Check if Disclosure of Legal Proceedings is Required Pursuant to
Item 2(d) or 2(e). |_|
(6) Citizenship or Place of Organization Germany
----------------------------------
-------------------
Number of (7) Sole Voting Power NONE
Shares -------------------
Beneficially (8) Shared Voting Power 673,353
Owned by -------------------
Each (9) Sole Dispositive Power NONE
Reporting -------------------
Person With (10) Shared Dispositive Power 673,353
------------------- -------------------
(11) Aggregate Amount Beneficially Owned by Each Reporting Person
673,353 Shares
-----------------------------------------------------------------------
(12) Check if the Aggregate Amount in Row (11) Excludes Certain Shares
(See Instructions) |_|
(13) Percent of Class Represented by Amount in Row (11) 10.3%
--------------------
(14) Type of Reporting Person (See Instructions) OO
---------------------------
<PAGE>
CUSIP No. 038197109
------------------------------------------------------------------
(1) Name of Reporting Person(s) UNAXIS DEUTSCHLAND HOLDING GMBH
------------------------------------------
S.S. or I.R.S. Identification No. of Above Person
----------------------
(2) Check the Appropriate Box if a Member of a Group (See Instructions)
|_| (a)
|_| (b)
(3) SEC Use Only
-----------------------------------------------------------
-----------------------------------------------------------------------
(4) Source of Funds (See Instructions) OO
(5) Check if Disclosure of Legal Proceedings is Required Pursuant to
Item 2(d) or 2(e). |_|
(6) Citizenship or Place of Organization Germany
----------------------------------
-------------------
Number of (7) Sole Voting Power NONE
Shares -------------------
Beneficially (8) Shared Voting Power 673,353
Owned by -------------------
Each (9) Sole Dispositive Power NONE
Reporting -------------------
Person With (10) Shared Dispositive Power 673,353
------------------- -------------------
(11) Aggregate Amount Beneficially Owned by Each Reporting Person
673,353 Shares
-----------------------------------------------------------------------
(12) Check if the Aggregate Amount in Row (11) Excludes Certain Shares
(See Instructions) |_|
(13) Percent of Class Represented by Amount in Row (11) 10.3%
--------------------
(14) Type of Reporting Person (See Instructions) OO
---------------------------
<PAGE>
CUSIP No. 038197109
------------------------------------------------------------------
(1) Name of Reporting Person(s) UNAXIS HOLDING AG
------------------------------------------
S.S. or I.R.S. Identification No. of Above Person
----------------------
(2) Check the Appropriate Box if a Member of a Group (See Instructions)
|_| (a)
|_| (b)
(3) SEC Use Only
-----------------------------------------------------------
-----------------------------------------------------------------------
(4) Source of Funds (See Instructions) OO
(5) Check if Disclosure of Legal Proceedings is Required Pursuant to
Item 2(d) or 2(e). |_|
(6) Citizenship or Place of Organization Switzerland
----------------------------------
-------------------
Number of (7) Sole Voting Power NONE
Shares -------------------
Beneficially (8) Shared Voting Power 673,353
Owned by -------------------
Each (9) Sole Dispositive Power NONE
Reporting -------------------
Person With (10) Shared Dispositive Power 673,353
------------------- -------------------
(11) Aggregate Amount Beneficially Owned by Each Reporting Person
673,353 Shares
-----------------------------------------------------------------------
(12) Check if the Aggregate Amount in Row (11) Excludes Certain Shares
(See Instructions) |_|
(13) Percent of Class Represented by Amount in Row (11) 10.3%
--------------------
(14) Type of Reporting Person (See Instructions) CO
---------------------------
<PAGE>
Item 1. Security and Issuer.
-------------------
The class of equity securities to which this Statement on
Schedule 13D relates is the Common Stock, no par value (the "Issuer Common
Stock"), of Applied Films Corporation, a Colorado corporation (the "Issuer"),
with its principal executive offices located at 9586 I-25 Frontage Road,
Longmont, CO 80504, U.S.A.
Item 2. Identity and Background.
-----------------------
This Statement on Schedule 13D is being filed by Unaxis
Deutschland GmbH (formerly Balzers Process Systems GmbH), Unaxis Deutschland
Holding GmbH and Unaxis Holding AG (collectively, the "Reporting Persons").
Unaxis Deutschland GmbH ("Unaxis GmbH"), a limited liability
company incorporated under the laws of Germany, has its principal executive
offices at Wilhelm-Rohn-Strasse 25, D-63450 Hanau, Germany and is a provider of
information technology for data storage. At December 31, 2000, 100% of Unaxis
GmbH's share capital was owned by Unaxis Holding Deutschland GmbH.
Unaxis Deutschland Holding GmbH ("UXHDE"), a limited liability
company incorporated under the laws of Germany, has its principal executive
offices at Wilhelm-Rohn-Strasse 25, D-63450 Hanau, Germany and is the holding
company for the operations of the Unaxis group in Germany providing certain
central functions, such as financial, human resources, legal and export control.
At December 31, 2000, approximately 99.5% of UXHDE's share capital was owned by
Unaxis Holding AG.
Unaxis Holding AG, a Swiss stock corporation ("Parent"), has
its principal executive offices at Hofwiesenstrasse 135, CH-8021 Zurich,
Switzerland and is the ultimate parent company of a diversified industrial group
providing information technology in the area of equipment manufacturing,
semiconductor, data storage, display and optics and surface technology in the
area of ware protection.
The directors and executive officers of the Reporting Persons
are set forth on Exhibit A attached hereto. Exhibit A sets forth the following
information with respect to each such person: (i) name; (ii) business address;
(iii) present principal occupation or employment and the name, principal
business and address of any corporation or other organization in which such
employment is conducted; and (iv) citizenship.
During the last five years, neither the Reporting Persons nor,
to the best knowledge of the Reporting Persons, any person named in Exhibit A
attached hereto has been (a) convicted in a criminal proceeding (excluding
traffic violations or similar misdemeanors) or (b) a party to a civil proceeding
of a judicial or administrative body of competent jurisdiction and as a result
of such proceeding was or is subject to a judgment, decree or final order
enjoining future violations of, or prohibiting or mandating activities subject
to, federal or state securities laws or finding any violation with respect to
such laws.
Item 3. Source and Amount of Funds or Other Consideration.
-------------------------------------------------
Unaxis GmbH acquired the shares of Issuer Common Stock owned
by it on December 31, 2000 (the "Closing Date") upon the consummation of the
transactions
<PAGE>
contemplated by a Share Purchase and Exchange Agreement, dated as of October
18, 2000, as amended by an Amendment Agreement thereto, dated as of December 29,
2000 (as so amended, the "Share Purchase Agreement"), entered into by the
Issuer, AFCO GmbH & Co. KG, a limited partnership under German law ("AFCO"),
Unaxis GmbH and Parent, pursuant to which Unaxis GmbH was entitled to receive
673,353 shares of Issuer Common Stock. The shares of Issuer Common Stock
acquired by Unaxis GmbH form part of the consideration received by Unaxis GmbH
in exchange for the sale of the LAD Business (see Item 4 below).
The foregoing description of the Share Purchase Agreement does
not purport to be complete and is qualified in its entirety by reference to such
agreement, which is attached hereto as Exhibit B and which is incorporated
herein by reference in its entirety.
Item 4. Purpose of Transaction.
----------------------
The Share Purchase Agreement provided for the sale of the
large area coating business of Parent (the "LAD Business"). Parent reorganized
its LAD Business by transferring all of the assets and certain liabilities
(including employments) of the LAD Business operated in Germany, Belgium and
Korea to new entities (the "New LAD Entities"). The portion of the LAD Business
operated in Germany was transferred to a newly established German KG ("NewCo
KG"). Unaxis GmbH is the sole limited partner of NewCo KG and NewCo GmbH, a
wholly owned subsidiary of Unaxis GmbH, is the general partner of NewCo KG.
Pursuant to the Share Purchase Agreement, Unaxis GmbH sold to
AFCO the limited partnership interest in NewCo KG (the "KG Interest") and the
share in NewCo GmbH (the "GmbH Interest" and together with the KG Interest, the
"Shares") owned by Unaxis GmbH. In addition, on the Closing Date, Parent sold
and transferred to the Issuer or its designated subsidiary the shares in the New
LAD Entities other than NewCo KG and NewCo GmbH (the "Foreign Shares") as well
as the assets and liabilities of the LAD Business operated in the U.S., Hongkong
and Japan on the basis of separate agreements and/or transfer documents. The
parties agreed to transfer to the Issuer or its designated subsidiaries the LAD
Business operated in China and Taiwan as promptly as permitted by law after the
Closing Date.
The aggregate consideration owed by AFCO for the acquisition
of the Shares and by the Issuer or its designated subsidiary for the Foreign
Shares and the Foreign Assets and Liabilities equalled (a) US$ 60,000,000,
subject to adjustment (the "Cash Component") and (b) 673,353 shares of Issuer
Common Stock (the "Stock Component"). As provided by the Share Purchase
Agreement, the Stock Component was delivered by AFCO to Unaxis GmbH on the
Closing Date.
In the Share Purchase Agreement, the Issuer has agreed to
ensure that immediately after the Closing Date a person nominated by Unaxis GmbH
is appointed to the Board of Directors of the Issuer (the "Board"). For the
period during which Unaxis GmbH continues to own 10% or more of the outstanding
shares of Issuer Common Stock or purchases additional shares as set forth below,
a person nominated by Unaxis GmbH to the Board will be proposed to the
stockholders' meeting of the Issuer for election. If Unaxis GmbH sells any of
its shares of Issuer Common Stock and subsequently owns less than 10% of the
outstanding shares of Issuer Common Stock for any reason, including because of
additional shares issued by the Issuer, Unaxis GmbH's right to a seat on the
Board will be
2
<PAGE>
lost immediately. If Unaxis GmbH has not sold any of its shares of Issuer Common
Stock and falls below 10% of the total outstanding shares of Issuer Common Stock
because the Issuer issues additional shares or takes other corporate action: (a)
Unaxis GmbH will be permitted to purchase additional shares of Issuer Common
Stock either from the Issuer or in the open market to keep its ownership at or
above 10%; (b) If Unaxis GmbH does not purchase enough shares of Issuer Common
Stock to restore its ownership to 10% or more of the total outstanding shares of
Issuer Common Stock, it will lose its right to a seat on the Board immediately,
subject to paragraph (c) below; (c) If Unaxis GmbH has spent US$2 million to
purchase shares of Issuer Common Stock pursuant to paragraph (a) above, and
still owns less than 10% of the outstanding shares of Issuer Common Stock,
Unaxis GmbH will nonetheless retain its right to a seat on the Board until one
year after the Closing Date. At such time as Unaxis GmbH loses its right to a
seat on the Board, Unaxis GmbH will cause the director nominated by it to resign
within ten days. Thereafter, the Issuer will have no further obligation to
nominate Unaxis GmbH's designee to the Board, even if Unaxis GmbH's ownership of
Issuer Common Stock later increases above 10% of the total outstanding shares of
Issuer Common Stock.
In the Share Purchase Agreement, Unaxis GmbH agreed not to
sell, transfer or otherwise dispose of the shares of Issuer Common Stock which
it has acquired as part of the Stock Component for a period of nine months
following the Closing Date. In addition, Unaxis GmbH agreed, except for the
shares of Issuer Common Stock acquired pursuant to the terms of the Share
Purchase Agreement, that it will not and will cause its affiliates not to
acquire additional shares of Issuer Common Stock after the Closing Date for so
long as a nominee of Unaxis GmbH is a member of the Board and a period of six
months after the Unaxis GmbH nominee has resigned as described above, however at
least for a period of two years after the Closing Date, in open market
transactions or otherwise, without the prior written consent of the Issuer.
Upon the expiration of the restrictions set forth above, the
Reporting Persons from time to time intend to review their investment in the
Issuer on the basis of various factors, including the Issuer's business,
financial condition, results of operations and prospects, general economic and
industry conditions, the securities markets in general and those for the
Issuer's securities in particular, as well as other developments and other
investment opportunities. Based upon such review, the Reporting Persons will
take such actions in the future as the Reporting Persons may deem appropriate in
light of the circumstances existing from time to time. If the Reporting Persons
believe that further investment in the Issuer is attractive, whether because of
the market price of the Issuer's securities or otherwise, it may acquire shares
of Issuer Common Stock or other securities of the Issuer either in the open
market or in privately negotiated transactions. Similarly, depending on market
and other factors, the Reporting Persons may determine to dispose of some or all
of the shares of Issuer Common Stock currently owned by the Reporting Persons or
otherwise acquired by the Reporting Persons either in the open market or in
privately negotiated transactions.
Except as set forth in this Statement or the Share Purchase
Agreement, neither the Reporting Persons nor, to the best knowledge of the
Reporting Persons, any of the individuals named in Exhibit A hereto have
formulated any plans or proposals which relate to or would result in: (a) the
acquisition by any person of additional securities of the Issuer, (b) an
extraordinary corporate transaction involving the Issuer or any of its
subsidiaries, (c) a sale or transfer of a material amount of the assets of the
Issuer or any of its subsidiaries, (d) any change in the present board of
directors or management of the Issuer, (e) any material change in the Issuer's
capitalization or dividend policy, (f) any other material change in the Issuer's
business or corporate structure, (g) any change in the Issuer's charter or
bylaws or other instrument corresponding thereto or other action which may
impede the acquisition of control of the Issuer by any person, (h) causing a
class of the Issuer's securities to be deregistered or delisted, (i) a class of
equity securities of the Issuer becoming eligible for termination of
registration or (j) any action similar to any of those enumerated above.
The foregoing description of the Share Purchase Agreement does
not purport to be complete and is qualified in its entirety by reference to such
agreement, which is attached hereto as Exhibit B and which is incorporated
herein by reference in its entirety.
Item 5. Interest in Securities of the Issuer.
------------------------------------
As a result of the consummation of the transactions
contemplated by the Share Purchase Agreement, the Reporting Persons may be
deemed to each be the beneficial owners of 673,353 shares of Issuer Common Stock
for purposes of Rule 13d-1(a) promulgated under the Securities Exchange Act of
1934, as amended, which represents approximately 10.3% of the shares of Issuer
Common Stock outstanding. To the knowledge of the Reporting Persons, there are
no shares of Issuer Common Stock which are beneficially owned by any other
person referred to in Exhibit A hereto. The Reporting Persons may be deemed to
have shared power to vote and to dispose of the 673,353 shares of Issuer Common
Stock held by Unaxis GmbH.
Except as set forth herein, to the knowledge of the Reporting
Persons, neither the Reporting Persons nor any other person referred to in
Exhibit A hereto beneficially owns or has acquired or disposed of any shares of
Issuer Common Stock during the past 60 days.
Item 6. Contracts, Arrangements, Understandings or Relationships with
Respect to Securities of the Issuer.
-----------------------------------
Except as provided in this Statement and the Share Purchase
Agreement, none of the persons named in Item 2 has any contracts, arrangements,
understandings or relationships (legal or otherwise) with any persons with
respect to any securities of the Issuer, including, but not limited to, transfer
or voting of any of the securities of the Issuer, finder's fees, joint ventures,
loan or option arrangements, puts or calls, guarantees of profits, division of
profits or loss, or the giving or withholding of proxies.
3
<PAGE>
Item 7. Material to Be Filed as Exhibits.
--------------------------------
Exhibit A - Directors and Officers of the Reporting Persons.
Exhibit B - Share Purchase and Exchange Agreement, dated as of October
18, 2000 among Applied Films Corporation, AFCO GmbH & Co. KG,
Unaxis Deutschland GmbH (formerly Balzers Process Systems
GmbH) and Unaxis Holding AG and Amendment Agreement thereto,
dated as of December 29, 2000.
Exhibit C - Joint Filing Agreement among the Reporting Persons pursuant to
Rule 13d-1(k)(l)(iii).
4
<PAGE>
Signature
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this Statement is true, complete and
correct.
January 10, 2001
UNAXIS DEUTSCHLAND GMBH
By: /s/ Volker Grafe
-----------------------------------
Name: Volker Grafe
Title: Managing Director
UNAXIS DEUTSCHLAND HOLDING GMBH
By: /s/ Volker Grafe
-----------------------------------
Name: Volker Grafe
Title: Managing Director
UNAXIS HOLDING AG
By: /s/ Kurt Mueck
-----------------------------------
Name: Kurt Mueck
Title: Executive Vice President
By: /s/ Dr. Thomas Emch
-----------------------------------
Name: Dr. Thomas Emch
Title: General Counsel
5
<PAGE>
EXHIBIT INDEX
Exhibit No. Description Page No.
----------- ----------- --------
A Directors and Officers of the Reporting Persons.
B Share Purchase and Exchange Agreement, dated as of
October 18, 2000 among Applied Films Corporation,
AFCO GmbH & Co. KG, Unaxis Deutschland GmbH
(formerly Balzers Process Systems GmbH) and Unaxis
Holding AG and Amendment Agreement thereto, dated
as of December 29, 2000.
C Joint Filing Agreement among the Reporting Persons
pursuant to Rule 13d-1(k)(l)(iii).
6
<PAGE>
EXHIBIT A
---------
The name, business address, present position and principal occupation
and citizenship of each of the directors and executive officers of the Reporting
Persons are set forth below. Each occupation set forth opposite an individual's
name, unless otherwise indicated, refers to employment with the Reporting
Person.
Unaxis Deutschland GmbH
-----------------------
<TABLE>
<CAPTION>
Name Business Address Position with Citizenship
---- ---------------- the Reporting Person -----------
and Principal Occupation
------------------------
<S> <C> <C> <C>
Karl A. Rahm Unaxis Deutschland GmbH, Managing Director Swiss
Junkersstrasse 1, D-63755
Alzenau, Germany
Helmut Unaxis Deutschland GmbH, Managing Director German
Frankenberger Siemensstrasse 100,
D-63755 Alzenau, Germany
Volker Grafe Unaxis Deutschland Holding Managing Director; German
GmbH, Wilhelm-Rohn-Strasse Managing Director, Unaxis
25, D-63450 Hanau, Germany Deutschland Holding GmbH,
Wilhelm-Rohn-Strasse 25, D-63450
Hanau, Germany
</TABLE>
Unaxis Holding AG
-----------------
<TABLE>
<CAPTION>
Name Business Address Position with Citizenship
---- ---------------- the Reporting Person -----------
and Principal Occupation
------------------------
<S> <C> <C> <C>
Dr. Willy Kissling Unaxis Holding AG, Chairman of the Board of Directors Swiss
Hofwiesenstrasse 135, and Chief Executive Officer
CH-8021 Zurich, Switzerland
Jakob Schmuckli Unaxis Holding AG, Vice-Chairman of the Board of Swiss
Hofwiesenstrasse 135, Directors
CH-8021 Zurich, Switzerland
Peter Kupfer Peter Kupfer Member of the Board of Directors; Swiss
Unternehmensberatung, Consultant, Peter Kupfer
Rotfluhstrasse 83, CH-8702 Consultancy, Rotfluhstrasse 83,
Zollikon, Switzerland CH-8702 Zollikon, Switzerland
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Name Business Address Position with Citizenship
---- ---------------- the Reporting Person -----------
and Principal Occupation
------------------------
<S> <C> <C> <C>
Dr. Pius Baschera Hilti AG, Member of the Board of Directors; Swiss
Feldkircherstrasse, Chief Executive Officer, Hilti AG,
Postfach 166, FL-9494 Feldkircherstrasse, Post-fach 166,
Schaan, Liechtenstein FL-9494 Schaan, Liechtenstein
Dr. Lothar Spath Jenoptik AG, Member of the Board of Directors; German
Carl-Zeiss-Strasse 1, D- Chief Executive Officer, Jenoptik
07743 Jena, Germany AG, Carl-Zeiss-Strasse 1, D- 07743
Jena, Germany
Dr. Markus Rauh Swisscom AG, Schochengasse Member of the Board of Directors; Swiss
6, CH-9001 St. Gallen, President, Swisscom AG,
Switzerland Schochengasse 6, CH-9001 St. Gallen,
Switzerland
Bruno Widmer Bruno Widmer Consulting, Member of the Board of Directors; Swiss
Seefeldstrasse 299, Consultant, Bruno Widmer Consulting,
CH-8008 Zurich, Seefeldstrasse 299, CH-8008 Zurich,
Switzerland Switzerland
</TABLE>
A-2
<PAGE>
EXHIBIT B
A.Prot. 2000/308
NOTARIAL DEED
SHARE PURCHASE AND EXCHANGE AGREEMENT
Negotiated at Basel/Switzerland this 18th (eighteenth) day of October 2000 (two
thousand).
Before me, the undersigned Notary Public
STEPHAN CUENI
at Basel/Switzerland appeared today:
1. Mr. Thomas T. Edman, born May 20, 1962, US-citizen, with private
domicile at 4376 Park Ct., Boulder, CO 80301, USA identified by his
US-passport,
2. Mr. Lawrence D. Firestone, born March 24, 1958, US-citizen, with private
domicile at 325 Roxbury Circle, CO Springs, Colorado 80906, USA,
identified by his US-passport,
Messrs. Edman and Firestone according to their declarations not acting
in their own names but
a) jointly as President and CEO (Mr. Edman) and CFO (Mr. Firestone)
respectively in the name and on behalf of
Applied Films Corporation, a Colorado Corporation having its registered
office at 9586 I-25 Frontage Rd., Longmont, CO 80504, USA,
- hereinafter referred to as "AFC" -
b) Mr. Firestone as appointed but not yet registered managing director
(Geschaftsfuhrer) with sole representation power in the name and on
behalf of
Isartor Holding Einundzwanzigste GmbH (to be renamed AFCO Verwaltungs
GmbH), with registered head office at D-80331 Munchen, c/o Wessing,
Isartorplatz 8, registered with the Commercial Register at the Local
Court of Munich under HRB 133554, acting not for itself, but as
representative of
AFCO GmbH & Co. KG, a newly formed and not yet registered limited
partnership under German law, with business address at D-80331 Munchen,
Isartorplatz 8, to be registered in the Commercial Register at the Local
Court of Munich in Section A,
- hereinafter referred to as "Alpha Subsidiary" -
<PAGE>
3. Mr. Volker Grafe, born July 5, 1950, German citizen, with private
domicile at D-52525 Heinsberg, Rembrandtstrasse 6, identified by his
German passport,
according to his declarations not acting in his own name but in the name
and on behalf of
Balzers Process Systems GmbH, a German limited liability company having
its registered seat at D-63450 Hanau, Wilhelm-Rohn-Strasse 25,
registered with the Commercial Register at the Local Court of Hanau
under HRB 5392, presenting the attached certified copy of a registration
application,
- hereinafter referred to as "BPS" -
4. Dr. Thomas Emch, born June 11, 1950, Swiss citizen, with private
domicile at CH-8914 Aeugst a.A., Im Uerenberg 10, identified by his
Swiss passport,
according to his declarations not acting in his own name but in the name
and on behalf of
Unaxis Holding AG, a Swiss stock corporation having its registered
office at CH-8047 Zurich, Hofwiesenstrasse 135, registered with the
Commercial Register of Zurich, Switzerland, under No.
CH-020.3.919.027-3, presenting the attached written power of attorney
and presenting a certified extract from the Commercial Register, a copy
of which is attached hereto,
- hereinafter referred to as "Unaxis" -
The persons appeared requested that this Deed including its Annexes and Exhibits
be recorded in English. The acting notary public who is in sufficient command
of the English language and ascertained that the persons appeared are also in
command of the English language. After having been instructed by the notary
public, the persons appeared waived the right to obtain the assistance of a
certified interpreter; or a certified translation.
The acting notary explained to the persons appeared the contents of ss. 3 para.
1 (7) of the German Notarization Act (Beurkundungsgesetz). The persons appeared
confirmed to the notary that he has not been involved in the transaction within
the meaning of ss. 3 para. 1 (7) of the German Notarization Act.
The persons appeared, acting as indicated, asked for the Notarization of the
following:
SHARE PURCHASE AND EXCHANGE AGREEMENT
PREAMBLE
A. The Unaxis group is a diversified industrial group having its
headquarters in Zurich, Switzerland. The ultimate parent company of the
group is Unaxis whose shares are listed at the Zurich Stock Exchange
(SWX). One of the group's business divisions is the large area coating
business consisting of the following segments: Display Coatings, Web
Coating for capacitors and decorative and packaging applications,
Architectural and Automotive Inline Glass Coating and Diffusion Barrier
for beverage
B-2
<PAGE>
bottle coating as well as Customer Service (the "LAD Business"). The LAD
Business is described in more detail in Annex A 1. The LAD Business is
presently operated by certain Unaxis subsidiaries listed in Annex A 2
which also conduct other business activities.
B. The Unaxis group is in the process of a major reorganization of all of
its activities in order to focus on certain defined core businesses. In
this process, Unaxis intends to sell the LAD Business. Prior to such
sale, the LAD Business will be reorganized in order to establish a group
of entities exclusively owning and operating the LAD Business. For this
purpose, all assets and certain liabilities of the LAD Business except
for the activities in Shanghai, China, and in Singapore, if any, will be
transferred to new entities (the "New LAD Entities") as described in
more detail in the memorandum attached as Annex B (the "Reorganization
Memorandum"). The portion of the LAD Business operated in Germany will
be transferred to a newly established German KG ("NewCo KG"). BPS will
be the sole limited partner of NewCo KG and NewCo GmbH, a wholly-owned
subsidiary of BPS, will be the general partner of NewCo KG.
C. AFC is a corporation incorporated under the laws of the State of
Colorado. AFC operates a business in the area of the production of thin
film coating equipment and the production of thin film coated glass (the
"AFC Business"). AFC is the sole limited partner of Alpha Subsidiary and
Alpha Subsidiary GmbH, a wholly-owned German subsidiary of AFC, is the
general partner of Alpha Subsidiary.
D. AFC and BPS have agreed on a transaction in which Alpha Subsidiary will
acquire all shares and limited partnership interests in the New LAD
Entities and AFC or another designated subsidiary of AFC will take over
the assets and liabilities (including employments) of the LAD activities
in Shanghai, China, and in Singapore, if any. BPS will as consideration
receive a cash payment and AFC shares representing approximately 10% of
AFC's common voting stock.
NOW, THEREFORE, the Parties agree as follows:
Article 1
Corporate Reorganization of the LAD Business
1.1 Subject to the following provisions, BPS shall ensure that the LAD
Business will be reorganized as set forth in the Reorganization
Memorandum (the "LAD Reorganization") on or prior to December 31, 2000.
The LAD Reorganization will be carried out with economic effect as of
December 31, 2000 or any other date prior to December 31, 2000 approved
by AFC and BPS. A preliminary contribution balance sheet of the portion
of the LAD Business operated in Germany as of June 30, 2000 is attached
hereto as Annex 1.1.1, a draft contribution agreement
(Einbringungsvertrag) is attached as Annex 1.1.2 and preliminary lists
of assets, intellectual property rights and contracts and agreements to
be transferred to NewCo KG are attached hereto as Annex 1.1.3. A
preliminary list of the employments which will be transferred to the New
LAD Entities is attached as Annex 1.1.4. The preliminary contribution
balance sheet and the draft contribution agreement (including exhibits)
(collectively the
B-3
<PAGE>
"Reorganization Documentation") as well as Schedules 1(b), 1(d), 3(c)1,
3(c)2, 3(c)3 and 15 (Part I) of the BPS Disclosure Memorandum referred
to in Article 5 hereof (the "Preliminary Schedules") will be further
developed, completed and updated by BPS in consultation with AFC after
the signing of this Agreement in order to properly reflect the scope of
the LAD Business as operated as of the date of the effectiveness of the
LAD Reorganization, provided that prior to the consummation of the LAD
Reorganization the finalized Reorganization Documentation and any
changes of the Preliminary Schedules shall be submitted by BPS to AFC
for approval, such approval not to be unreasonably (nicht ohne wichtigen
Grund) withheld. The preliminary list of employments to be transferred
to the New LAD Entities will be updated as agreed between BPS and AFC
from time to time.
1.2 As of the Closing Date as defined in Sec. 2.4 hereof, the New LAD
Entities shall only have the following liabilities, obligations and
other legal commitments of any kind and based on whatever legal reason,
whether absolute or contingent, mature or immature, liquidated or
unliquidated, known or unknown, disclosed or undisclosed (collectively
the "Liabilities")
(a) all Liabilities to be transferred to, or to be assumed by, the New
LAD Entities in the LAD Reorganization, including, but not limited
to, Liabilities arising from any contracts or agreements to be
transferred to, or to be assumed by, the New LAD Entities, or
incurred after the LAD Reorganization by any of the New LAD
Entities (i) as expressly provided for in this Agreement, (ii)
with AFC's prior consent or (iii) in the ordinary course of
business on or before the Closing Date which have not been
discharged; and
(b) any Liabilities other than the Liabilities referred to in
sub-para. (a) above if they are reflected as liabilities or are of
the type and within the amount of any of the provisions
established in the Final Closing Balance Sheets as defined in Sec.
3.5 hereof.
(the above Liabilities hereinafter "Assumed Liabilities")
On or after the Closing Date, the New LAD Entities shall not have any
Liabilities arising out of the operation of the LAD Business prior to
the Closing Date or arising out of the LAD Reorganization other than the
Assumed Liabilities.
1.3 BPS hereby agrees to indemnify from and after the Closing Date AFC,
Alpha Subsidiary and the New LAD Entities against any and all
Liabilities, including reasonable attorney's fees and disbursements of
AFC, Alpha Subsidiary or any of the New LAD Entities, as the case may
be, incurred in connection with any such Liability including, but not
limited to, Liabilities relating to tax or environmental matters,
arising out of the operation of the LAD Business prior to the Closing
Date or arising out of the LAD Reorganization, other than the Assumed
Liabilities.
Notwithstanding the foregoing provisions, BPS shall not be obligated to
indemnify AFC, Alpha Subsidiary or any of the New LAD Entities, as the
case may be, to the extent that:
(a) the aggregate claims for indemnity under the foregoing
provisions are equal to or less than US $ 100,000 (in words:
one hundred thousand),
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provided that if the above threshold is exceeded the entire
amount of the claim shall be indemnified (Freigrenze), or
(b) AFC fails to give notice pursuant to the provisions of Sec.
1.5 hereof of (i) claims for indemnity under the foregoing
provisions regarding tax matters within six (6) months after
the relevant administrative or court decision has become
final, (ii) claims for indemnity under the foregoing
provisions regarding environmental matters within six (6)
months after the relevant administrative or court decision
has become final, however on or before December 31, 2005 at
the latest, or (iii) any other claims for indemnity under the
foregoing provisions on or before September 30, 2002, or
(c) AFC, Alpha Subsidiary or the respective New LAD Entity
receives payment from an insurer or any other third party for
any of such claims, losses, damages, costs, expenses,
attorney fees or disbursements suffered by AFC, Alpha
Subsidiary or any of the New LAD Entities that are otherwise
subject to indemnification under the foregoing provisions, or
(d) the Liabilities to be indemnified hereunder have resulted in
a reduction of the Purchase Price pursuant to Article 3, or
(e) the increase of a tax liability of any of the New LAD
Entities to be indemnified hereunder would result in a
decrease of the taxable income of the respective New LAD
Entity in future fiscal years, provided that such decrease
shall be discounted as per the Closing Date at a rate of 5.5%
p.a.
1.4 AFC hereby agrees to indemnify from and after the Closing Date BPS and
all affiliates of BPS as defined in ss.ss. 15 et seq. of the German
Stock Corporation Law (Aktiengesetz) against any and all Assumed
Liabilities or any Liabilities arising out of the operation of the LAD
Business after the Closing Date other than Liabilities the existence of
which constitutes a breach of any of the BPS Representations as defined
in Article 5 hereof to be compensated pursuant to Article 6 hereof,
including reasonable attorney's fees and disbursements incurred in
connection with such Liabilities.
Notwithstanding the foregoing provisions, AFC shall not be obligated to
indemnify BPS or any of the affiliates of BPS, as the case may be, to
the extent that:
(a) the aggregate claims for indemnity under the foregoing provisions
are equal to or less than US $ 100,000 (in words: one hundred
thousand), provided that if the above threshold is exceeded the
entire amount of the claim shall be indemnified (Freigrenze), or
(b) BPS fails to give notice pursuant to the provisions of Sec. 1.5
hereof of claims for an indemnity against any of the Assumed
Liabilities under the foregoing provisions on or before September
30, 2002, it being understood that for claims for an indemnity
against any of the Liabilities arising out of the
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operation of the LAD Business after the Closing Date no time
limitation shall apply, or
(c) BPS or the respective BPS affiliate receives payment from an
insurer or any other third party for any of such claims, losses,
damages, costs, expenses, attorney fees or disbursements suffered
by BPS or the respective BPS affiliate that are otherwise subject
to indemnification under the foregoing provisions.
1.5 A party against which a claim for indemnification is made pursuant to
Sec. 1.3 or 1.4 (an "Indemnifying Party") shall not be liable under such
provisions unless the following procedural rules have been complied
with:
1.5.1 Third-Party Claims
(a) Promptly and without undue delay after receipt by an entity
entitled to be indemnified under Sec. 1.3 or 1.4 (an "Indemnified
Party") of notice of the assertion of any claim or demand with
respect to any of the Liabilities referred to in Sec. 1.3 or 1.4,
such Indemnified Party will give written notice to the
Indemnifying Party of such assertion of a claim or demand and
reject the fulfillment unless otherwise agreed between the
Indemnifying and the Indemnified Party.
(b) Promptly and without undue delay after receipt by an Indemnified
Party of notice of the commencement of any legal proceedings
relating to any of the Liabilities referred to in Sec. 1.3 or 1.4
against it, such Indemnified Party will give written notice to the
Indemnifying Party of the commencement of such proceeding.
(c) If any legal proceedings are brought against an Indemnified Party,
the Indemnifying Party will, unless the claim involves taxes
(para. 1.5.2 below), be entitled to participate in such proceeding
and, to the extent that it wishes (unless (i) the Indemnifying
Party is also a party to such proceeding and the Indemnified Party
determines in good faith that joint representation would be
inappropriate or (ii) the Indemnifying Party fails to provide
reasonable assurances to the Indemnified Party of its financial
capacity to defend such proceeding and provide indemnification
with respect to such proceeding), to assume the defense of such
proceeding on behalf of the Indemnified Party with counsel
satisfactory to the Indemnified Party. If the Indemnifying Party
assumes the defense of a proceeding, (i) it will be conclusively
established for purposes of this Agreement that the claims made in
that proceeding are within the scope of and subject to
indemnification by the Indemnifying Party; and (ii) no compromise
or settlement of such claims may be effected by the Indemnifying
Party without the Indemnified Party's consent (such consent not to
be unreasonably withheld) unless the sole relief provided is
monetary damages that are paid in full by the Indemnifying Party
concurrently with the compromise or settlement. If notice is given
to an Indemnifying Party of the commencement of any proceeding and
the Indemnifying Party does not within ten (10) days give notice
to the Indemnified Party of its election to assume the defense of
such proceeding, the Indemnifying Party will be bound by any
determination made in such proceeding or any compromise or
settlement effected by the Indemnified Party with its consent
(such consent not to be
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unreasonably withheld), provided that the Indemnified Party shall
pursue such proceeding with the care and diligence of a prudent
businessman (Sorgfalt eines ordentlichen Kaufmanns) with counsel
reasonably satisfactory to the Indemnifying Party.
1.5.2 Tax Matters
If, in connection with the audit of any return of any of the New LAD
Entities or any predecessors with respect to the LAD Business or any tax
assessments for a period on or before Closing Date, a proposed
adjustment is asserted in writing with respect to any taxes asserted
against any of the New LAD Entities for which BPS is required to
indemnify the respective New LAD Entity pursuant to Sec. 1.3 hereof, AFC
shall notify BPS in writing of such proposed adjustment within 5 (five)
business days after receipt thereof. Upon notice to BPS within 5 (five)
business days after receipt of a notice of such proposed adjustment from
AFC, BPS may assume (at its own cost and expense) on behalf of the
respective New LAD Entity control of the contestation of such proposed
adjustment. Otherwise, the respective New LAD Entity shall pursue the
contestation of such proposed adjustment with the care and diligence of
a prudent businessman.
1.5.3 The parties will make available to each other and each other's
personnel, agents, accountants and other professional advisors all of
the relevant documents, books and records and provide all necessary
information relating to any matters for which an indemnity is claimed
under Sec. 1.3, 1.4 or 1.5 and each party will render to the other
assistance as may be reasonably required in order to insure the proper
and adequate defense in such matters.
1.6 After the Closing, NewCo KG will implement the transfer of the LAD
facilities currently located in Hanau to the new site in Alzenau as
described in detail in Annex 1.6 (the "Restructuring Program") in its
own name and for its own account.
BPS shall reimburse NewCo KG for the costs and expenses incurred in the
implementation of the Restructuring Program in accordance with the
following provisions provided that Alpha Subsidiary shall cause NewCo KG
to comply with the following requirements:
1.6.1 Any contracts to perform any of the work to be conducted by third-party
contractors as specified in Part II of Annex 1.6 ("Restructuring
Contracts") which NewCo KG intends to conclude with any third party
contractors regarding the implementation of the Restructuring Program
must be submitted by NewCo KG to BPS at least four (4) weeks prior to
their execution for review and approval, such approval not to be
unreasonably withheld. If BPS does not respond to NewCo KG within four
(4) weeks after it has received the full documentation of the
Restructuring Contracts, BPS shall be deemed to give such approval,
provided that NewCo KG shall immediately provide to BPS any additional
information regarding the Restructuring Contracts as reasonably
requested by BPS from time to time.
NewCo KG shall submit to BPS monthly accounts showing all payments to be
made by NewCo KG in the respective period under the Restructuring
Contracts executed in accordance with the foregoing provisions including
invoices issued by the respective contractors, acceptance protocols
(Abnahmeprotokolle), if any, and other auditable
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evidence for review and approval, such approval not to be unreasonably
withheld. If BPS does not respond to NewCo within two (2) weeks after it
has received the full documentation, BPS shall be deemed to give such
approval, provided that NewCo KG shall immediately provide to BPS any
additional information regarding such payments as reasonably requested
by BPS from time to time. Any payments shall only be made by NewCo KG
upon review and approval by BPS, such approval not to be unreasonably
withheld (the "Approved Restructuring Payments"). NewCo KG shall submit
to BPS appropriate proof of payment for any Approved Restructuring
Payments which have been made.
1.6.2 NewCo KG shall submit to BPS at least two (2) weeks prior to the
commencement of the implementation of the restructuring measures to be
carried out by NewCo KG employees as specified in Part II of Annex 1.6
("Restructuring Measures") a schedule for the implementation of such
Restructuring Measures setting out the nature of such Restructuring
Measures, the employees assigned to the implementation of the
Restructuring Measures, their hourly salary rates and pro-rata fringe
benefits according to their employment contracts, the number of hours
projected for such assignments and the dates for which the Restructuring
Measures are scheduled ("Measure Schedule") for review and approval,
such approval not to be unreasonably withheld. If BPS does not respond
to NewCo KG within two (2) weeks after it has received the Measure
Schedule, BPS shall be deemed to give such approval, provided that NewCo
KG shall immediately provide to BPS any additional information as
reasonably requested by BPS from time to time.
NewCo KG shall ensure that the Restructuring Measures are implemented in
accordance with the Measure Schedule and submit to BPS monthly accounts
showing the status of the implementation of the Restructuring Measures,
the amount of hours actually spent by the assigned employees in such
period and the amount of the accrued internal employee cost (hourly
salary rates and pro-rata fringe benefits) for review and approval, such
approval not to be unreasonably withheld (the labor cost shown in the
monthly accounts as approved by BPS is referred to as "Approved Labor
Cost"). If the amount of hours and/or the internal labor cost projected
in the Measures Schedule are exceeded by more than ten percent (10 %),
NewCo KG shall give detailed explanations on the reasons to allow BPS to
make a proper evaluation of the situation and take the appropriate
measures to comply with the Measure Schedule.
1.6.3 In the implementation of the Restructuring Program, NewCo KG shall act
with the care and diligence of a prudent businessman (Sorgfalt eines
ordentlichen Kaufmanns).
NewCo KG shall instruct NewCo KG's auditors to audit and confirm to BPS
all details given by NewCo KG to BPS regarding the implementation of the
Restructuring Program, the Restructuring Contracts, the Approved
Restructuring Payments, the Restructuring Measures and the Approved
Labor Cost.
BPS is entitled to review the status of the implementation of the
Restructuring Program at any time and participate in the acceptance
(Abnahme) of all measures from the respective contractors. For the
purpose of such review, NewCo KG shall give BPS and its personnel,
agents, accountants and other professional advisors access to all
relevant business sites, allow the inspection of all relevant documents,
books and records and provide all relevant information.
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1.6.4 Upon completion of the Restructuring Program in accordance with the
provisions of this Sec. 1.6, BPS shall reimburse to NewCo KG any
Approved Restructuring Payments and Approved Labor Costs incurred in the
implementation of the Restructuring Program to the extent that they
exceed the reserve for the implementation of the Restructuring Program
established in the Final Closing Balance Sheets against submission of
appropriate proof of payment.
Article 2
Purchase and Sale of the Shares, the Foreign Shares
and the Foreign Assets and Liabilities
2.1 BPS sells to Alpha Subsidiary with effect as of the Closing, which
accepts such sale
(a) the limited partnership interest in the amount of EURO 100,000 (in
words: one hundred thousand) in NewCo KG (the "KG Interest"), and
(b) the share in the nominal amount of EURO 25,000 (in words:
twenty-five thousand) in NewCo GmbH (the "GmbH Share") (the KG
Interest and the GmbH Share hereinafter collectively referred to
as the "Shares").
2.2 Subject to the conditions precedent set forth in Article 8 and subject
to the further condition that the cash payments pursuant to Sec. 3.2
para. 3.2.1 and 3.2.3, the delivery of shares of AFC voting common stock
pursuant to Sec. 3.2 para. 3.2.2 and the repayment of the IKB Loan, if
required pursuant to Sec. 4.2, are made in accordance with such
provisions, BPS hereby assigns the KG Interest (subject to registration
in the Commercial Register) and the GmbH Share as of the Closing Date to
Alpha Subsidiary which accepts such assignment (such assignment
hereinafter the "Closing").
2.3 Alpha Subsidiary hereby agrees to indemnify from and after the Closing
BPS against any liability as limited partner of NewCo KG
(Kommanditistenhaftung) resulting from any repayments of limited
partnership capital (Einlagenruckgewahr) after the Closing.
2.4 The last day of the month during which all of the conditions precedent
set forth in Article 8 have been satisfied or waived in accordance with
Article 8 shall be the "Closing Date" as referred to herein, or such
other date as the parties may mutually agree.
2.5 Unaxis and AFC agree that the shares in the New LAD Entities other than
NewCo KG and NewCo GmbH (the "Foreign Shares") as well as the assets and
liabilities (including employments) of the LAD Business located in
Shanghai, China, and in Singapore, if any, (the "Foreign Assets and
Liabilities") shall be sold to AFC or its designated subsidiary and,
subject to the conditions referred to in Sec. 2.2 above, transferred to
AFC or its designated subsidiary on the Closing Date. Such sales and
transfers shall be made on the basis of separate agreements and/or
transfer documents to be executed in due form as required in the
respective jurisdictions by the respective subsidiaries of Unaxis
holding the Foreign Shares and the Foreign Assets and Liabilities on the
one hand and AFC or its designated subsidiary on the other hand without
undue delay after the signing of this Agreement, it being understood
that any
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sellers' representations and warranties, indemnities or covenants
relating to the Foreign Shares and the Foreign Assets and Liabilities
shall be exclusively stipulated in this Agreement.
Article 3
Consideration
3.1 Subject to the adjustments set forth in Sec. 3.4 below, the aggregate
consideration owed by Alpha Subsidiary for the acquisition of the Shares
and by AFC or its designated subsidiary for the Foreign Shares and the
Foreign Assets and Liabilities shall be equal to (a) US $ 60,000,000 (in
words: sixty million) (the "Cash Component") and (b) 673,353 (in words:
six hundred seventy-three thousand three hundred fifty-three) no par
value shares of AFC voting common stock (the "Stock Component"). The
Cash Component and the Stock Component, subject to adjustment pursuant
to this Agreement, are collectively referred to herein as the purchase
price (the "Purchase Price").
3.2 The Purchase Price shall be paid by AFC (also on behalf of Alpha
Subsidiary for the Shares and its designated subsidiary, if any, for the
Foreign Shares and the Foreign Assets and Liabilities) as follows:
3.2.1 A cash payment of US $ 50,000,000 (in words: fifty million) shall be
paid by Alpha Subsidiary on the Closing Date by wire transfer of
immediately available funds at AFC's expense to such account(s) as BPS
may specify in writing to AFC at least three business days prior to the
Closing Date.
3.2.2 673,353 shares of AFC voting common stock shall be delivered by Alpha
Subsidiary on the Closing Date to BPS.
3.2.3 A cash payment in EURO in the amount of US $ 10,000,000 (in words: ten
million), converted into EURO at the average exchange rate as officially
quoted by the Frankfurt Foreign Currency Exchange (amtlicher Mittelkurs)
on the last business day immediately preceding the Closing Date, (the
"Adjustment Escrow Cash Amount") will be paid by Alpha Subsidiary on the
Closing Date to a joint bank account of BPS and Alpha Subsidiary to be
opened with Deutsche Bank, Frankfurt, prior to the Closing Date.
3.3 The Adjustment Escrow Cash Amount plus interest thereon as accrued shall
be released by Deutsche Bank only in accordance with joint written
instructions of BPS and AFC upon final resolution of the post-closing
adjustments pursuant to Sec. 3.5.
3.4 The Purchase Price owed by Alpha Subsidiary and AFC or its designated
subsidiary pursuant to Sec. 3.1 shall be subject to a post-closing
adjustment determined in accordance with the following provisions and
BPS and AFC shall give joint written instructions to Deutsche Bank to
disburse the Adjustment Escrow Amount plus interest thereon as accrued
as follows:
3.4.1 If the aggregate sum of net equity (bilanzielles Reinvermogen) of the
New LAD Entities and of the operations of the LAD Business in Shanghai,
China and in Singapore, if any, as of the Closing Date as defined for
each of the New LAD Entities
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in Annex 3.4.1 and determined on a non-consolidated basis on the basis
of the Final Closing Balance Sheets in accordance with the provisions of
Sec. 3.5 ("LAD Net Equity") is equal to, or in excess of, zero, then
Deutsche Bank shall disburse the entire Adjustment Escrow Cash Amount
plus interest thereon as accrued to BPS within five (5) business days
after determination of the Final Closing Balance Sheets pursuant to Sec.
3.5. In addition, Alpha Subsidiary shall pay by wire transfer of
immediately available funds at AFC's expense within such five (5)
business-day period to BPS's account referred to in para. 3.2.1 the EURO
amount by which the LAD Net Equity exceeds zero plus interest thereon as
from the Closing Date in the amount of 6.0 % p.a.
3.4.2 If the LAD Net Equity is lower than zero, then the Purchase Price shall
be reduced by the "Adjustment Amount" where the "Adjustment Amount" is a
positive number equal to the amount in EURO by which the LAD Net Equity
is lower than zero. The Adjustment Amount, if any, shall be paid to
Alpha Subsidiary within five (5) business days after determination of
the Final Closing Balance Sheet pursuant to Sec. 3.5 as follows:
(a) If the Adjustment Amount reduced by the Assignment Consideration
as defined in Sec. 4.1, if any, is equal to or less than the
Adjustment Escrow Cash Amount, then Deutsche Bank shall pay to
Alpha Subsidiary that portion of the Adjustment Escrow Cash Amount
equal to the Adjustment Amount reduced by the Assignment
Consideration as defined in Sec. 4.1, if any, plus interest
thereon as accrued and disburse the remaining portion of the
Adjustment Escrow Cash Amount, if any, plus interest thereon as
accrued to BPS.
(b) If the Adjustment Amount reduced by the Assignment Consideration
as defined in Sec. 4.1, if any, exceeds the Adjustment Escrow Cash
Amount, then Deutsche Bank shall pay to AFC the entire Adjustment
Escrow Cash Amount plus interest thereon as accrued and, in
addition, BPS shall pay to Alpha Subsidiary by wire transfer
within five (5) business days after demand by Alpha Subsidiary the
EURO amount by which the Adjustment Amount reduced by the
Assignment Consideration as defined in Sec. 4.1, if any, exceeds
the Adjustment Escrow Cash Amount plus interest thereon as from
the Closing Date at a rate of 6.0 % p.a.
3.4.3 Any payments made by Alpha Subsidiary or Deutsche Bank to BPS in
accordance with the provisions of Sec. 3.2 and 3.4 (including any
set-off of the Assignment Consideration, if any, pursuant to para. 3.4.2
(a) or (b)) are made with full release effect (schuldbefreiende Wirkung)
for Alpha Subsidiary and AFC or its designated subsidiary vis-a-vis
Unaxis, BPS and the Unaxis subsidiaries selling the Foreign Shares and
the Foreign Assets and Liabilities and BPS will receive the payments
also on behalf of Unaxis and/or such Unaxis subsidiaries and be
responsible for the disbursement of the received amounts as internally
agreed. Any payments made by BPS or Deutsche Bank to Alpha Subsidiary in
accordance with the provisions of Sec. 3.2 and 3.4 are made with full
release effect for BPS vis-a-vis Alpha Subsidiary and AFC or its
designated subsidiary and Alpha Subsidiary will receive the payments
also on behalf of AFC and its designated subsidiary, if any, and be
responsible for the disbursement of the received amounts as internally
agreed.
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3.5 The Final Closing Balance Sheets, the LAD Net Equity and the Adjustment
Amount, if any, will be determined as follows:
(a) Within sixty (60) days after the Closing Date, AFC shall ensure
the preparation of (i) balance sheets of each of the New LAD
Entities and of the operations of the LAD Business in Shanghai,
China and Singapore, if any, (pro forma), as of the Closing Date
(the "Proposed Closing Balance Sheets"), denominated in Deutsche
Mark and prepared in accordance with IAS accounting principles and
the principles of the Unaxis Reporting Manual as applicable as of
the date hereof and the principles set forth in Annex 3.5 (a), and
(ii) a report (the "AFC Report") calculating the LAD Net Equity
and the Adjustment Amount, if any, and provide a copy of the
Proposed Closing Balance Sheets and the AFC Report to BPS. At all
times during the preparation of the Proposed Closing Balance
Sheets and the AFC Report, AFC and its personnel, agents,
accountants and other professional advisors involved in the
preparation thereof shall, and AFC shall cause NewCo KG and its
personnel, agents, accountants and other professional advisors
involved to cooperate with and permit BPS and its personnel,
agents, auditors, accountants and other professional advisors and
allow them to observe such preparation.
(b) BPS shall have thirty (30) days after receipt of the Proposed
Closing Balance Sheets and the AFC Report to review such documents
and determine whether it agrees with AFC's Proposed Closing
Balance Sheets and determination of the Adjustment Amount. During
such period of time and in order to further enable BPS to conduct
such review, AFC shall make available to BPS and its personnel,
agents, accountants and other professional advisors (i) the books
and records (including relevant workpapers) used in the
preparation of the Proposed Closing Balance Sheets and (ii) AFC's
personnel, agents, auditors or accountants responsible for the
preparation of the Proposed Closing Balance Sheets and the AFC
Report. In the event that BPS disagrees with the Proposed Closing
Balance Sheet or the AFC Report as to the determination of the
Adjustment Amount, BPS shall notify AFC in writing of such
disagreement within such 30 day period.
(c) If BPS and AFC disagree on the Proposed Closing Balance Sheets or
the AFC Report, then BPS and AFC shall attempt to resolve such
disagreement by meeting and conferring in good faith during the
15-day period following BPS's written notification to AFC of its
disagreement.
If BPS and AFC are unable to resolve their disagreement within
such 15-day period, BPS and AFC agree to retain the Frankfurt
office of KPMG Deutsche Treuhandgesellschaft Aktiengesellschaft
Wirtschaftsprufungsgesellschaft (the "Accounting Mediator") to
mediate the dispute. The Accounting Mediator shall conduct such
mediation as expert arbitrator (Schiedsgutachter). The Accounting
Mediator shall render a decision, if possible within a three
months period, regarding the disputed Adjustment Amount, which
decision shall be final and binding, and judgment upon the
decision rendered by the Accounting Mediator may be entered by any
court of competent jurisdiction. The Accounting Mediator shall
also decide on the allocation of the costs of the
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mediation procedure in accordance with ss.ss. 91 et seq. of the
German Civil Procedure Rules (Zivilprozessordnung).
(d) The Proposed Closing Balance Sheets shall be the "Final Closing
Balance Sheets" unless BPS notifies AFC of its disagreement in
accordance with sub-para. (b). If BPS timely notifies AFC of its
disagreement, the Proposed Closing Balance Sheets as adjusted as a
result of the foregoing dispute resolution process set forth in
sub-para. (c) shall be the "Final Closing Balance Sheets".
Article 4
Assignment of Intercompany Loans;
Repayment of IKB Loan
4.1 On the date on which the payments set forth in Para. 3.4.1 or 3.4.2 are
made, Unaxis shall assign to Alpha Subsidiary which shall accept such
assignment all claims of Unaxis against NewCo KG for repayment of any
intercompany loans owed by NewCo KG to Unaxis as of the Closing Date as
reflected in the Final Closing Balance Sheets plus any interest accrued
thereon after the Closing Date against payment of an amount equal to the
principal amount of such intercompany loans and any interest accrued
thereon (the "Assignment Consideration"). To the extent that the
Assignment Consideration is not fully discharged by a set-off pursuant
to Sec. 3.4.2(a) or (b), if any, it shall be paid by Alpha Subsidiary by
wire transfer of immediately available funds at Alpha Subsidiary's
expense on the date of assignment to an account of Unaxis as specified
at least three business days in advance.
4.2 On the Closing Date, Alpha Subsidiary shall repay, on behalf and for the
account of NewCo KG, the loan granted by IKB Deutsche Industrie Bank AG
("IKB") to BPS on the basis of the credit facility dated November 3,
1998 and transferred to NewCo KG in the LAD Reorganization in the amount
outstanding as of the Closing Date plus any interest accrued thereon
(the "Outstanding IKB Loan"), provided that such repayment shall be made
as a loan granted by Alpha Subsidiary to NewCo KG. The Outstanding IKB
Loan shall be reflected as liability of NewCo KG in the Final Closing
Balance Sheets. Alpha Subsidiary is not obligated to repay the
Outstanding IKB Loan if IKB has effectively waived and released the
mortgage on the Hanau site securing the Outstanding IKB Loan by written
declaration on or before the Closing Date.
Article 5
Representations and Warranties
Except as disclosed in the BPS Disclosure Memorandum (Annex 5 A) as
updated in accordance with Article 1 hereof, BPS represents and warrants
in the form of an independent guarantee that the statements set forth in
Annex 5 A are true and correct as of the date hereof and as of the
Closing Date or such other date as expressly provided in Annex 5 A ("BPS
Representations"), provided that the BPS Representations are made to AFC
or the designated AFC subsidiary (Section 2.5) to the extent that they
relate to the Foreign Shares and Foreign Assets and Liabilities and to
Alpha Subsidiary in all other respects. Except as disclosed in the AFC
Disclosure
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Memorandum (Annex 5 B), AFC represents and warrants in the form of an
independent guarantee to BPS that the statements set forth in Annex 5 B
are true and correct as of the date hereof and as of the Closing Date or
such other date as expressly provided in Annex 5 B ("AFC
Representations") (each AFC the designated AFC subsidiary or Alpha
Subsidiary as the case may be and BPS with respect to the
representations and warranties given by it hereinafter referred to as
the "Representing Party" and with respect to the representations and
warranties given by the respective other party hereinafter referred to
as "Claimant").
Except as set forth in Annex 5 B or Annex 5 A, any representations and
warranties of BPS or AFC, respectively, shall be excluded.
Article 6
Breach of Representations and Warranties
6.1 In case of a breach of any of the representations and warranties set
forth in Article 5 which has not been cured on or prior to the Closing
Date, the Representing Party shall attempt to remedy the breach. If the
Representing Party fails to remedy the breach within a reasonable
period, such period not to exceed two (2) months after the Representing
Party has received written notification of the breach by the Claimant,
the following provisions shall apply.
6.2 In case of a breach of any of the representations and warranties set
forth in Article 5 which has not been cured on or before the Closing
Date, the Representing Party shall, subject to the provisions in
sub-para. (a) or (b), respectively, and the limitations set forth in
Sec. 6.3 below, be obligated to compensate the Claimant (i) in case of a
breach of the BPS Representations in an amount equal to the damages
suffered by AFC Subsidiary or the damages suffered by any of the New LAD
Entities as a result of the breach or (ii) in case of a breach of the
AFC Representations in an amount equal to the damages suffered by BPS.
In case of a breach of any of the AFC Representations set forth in Sec.
3 of Annex 5 A, damages owed by AFC to BPS shall be calculated according
to the measure of damages for misrepresentations and omissions
determined pursuant to Rule 10b-5 of the United States Securities
Exchange Act of 1934, as amended, as determined pursuant to the laws of
the United States. In case of a breach of any of the other AFC
Representations or any of the BPS Representations, any liability for
loss of profit, any value reductions due to lost earnings or damages not
directly relating to the ownership of the Shares, the Foreign Shares or
the AFC voting common shares issued pursuant to Article 3 hereof,
respectively, or to the LAD Business or the AFC Business, respectively
shall be excluded and the legal principles as to the calculation of
damages, mitigation of damages and offsetting of losses by advantages
due to the damaging event (Schadensberechnung, Schadensminderung,
Vorteilsausgleichung) pursuant to ss.ss. 249 et seq. of the German Civil
Code shall apply.
The compensation owed by the Representing Party pursuant to the
foregoing provisions shall be made as follows:
(a) In case of a breach of any of the BPS Representations, BPS shall
make a cash payment equal to the compensation owed by BPS pursuant
to the above provisions to Alpha Subsidiary
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(b) In case of a breach of any of the AFC Representations, AFC shall
make a cash payment equal to the compensation owed by AFC pursuant
to the above provisions to BPS.
6.3 Any liability of the Representing Party hereunder shall be excluded to
the extent that the claims of the Claimant or the underlying
circumstances are (i) covered by payments received from insurance
companies or any other third parties, or (ii) covered by any other
indemnity provisions under this Agreement. Any liability of BPS
hereunder shall be further excluded to the extent (i) that the claims of
AFC or the underlying circumstances are reflected as liabilities or of
the type and within the amount of any of the provisions (reserves) in
any of the Final Closing Balance Sheets or have otherwise resulted in a
reduction of the Purchase Price pursuant to Article 3, or (ii) that any
liability is fully discharged or satisfied below the amount at which it
is reflected in any of the Final Closing Balance Sheets, or (iii) that
any provisions in any of the Final Closing Balance Sheets have become
unnecessary or excessive, or (iv) of any amount recovered in respect of
any accounts receivable written off in any of the Final Closing Balance
Sheets.
Any claims of the Representing Party shall be excluded to the extent
that such claims or the underlying circumstances have been disclosed to
the Claimant or any of its officers, directors, employees, agents,
accountants or other professional advisors in any of the documents
listed in Annex 6.3. A complete set of copies of the documents listed in
Annex 6.3 is deposited with the certifying notary and will be kept by
the notary until AFC and BPS jointly instruct him to release the
documents, but at the latest after ten years after the signing.
The Claimant may assert any claims for breach of any of the
representations and warranties given in Article 5 only if (i) the value
of each claim exceeds an amount of US $ 5,000 (in words: US $ five
thousand) and (ii) the value of the aggregate of all claims exceeds an
amount of US $ 100,000 (in words: one hundred thousand) (Freigrenze).
All claims of AFC, Alpha Subsidiary and the New LAD Entities for a
breach of any of the BPS Representations are limited to a maximum
aggregate amount of US $ 15,000,000 (in words: fifteen million) (the
"BPS Overall Liability Limitation"), provided that BPS's liability for
the compensation of any Failed Expenses as defined hereinafter shall,
within the BPS Overall Liability Limitation, be limited to an amount of
US $ 7,500,000 (in words: seven million five hundred thousand). Failed
Expenses shall mean any specific costs and expenses of any of the New
LAD Entities actually incurred for which no value has been received due
to an interruption of the business operations resulting from a breach of
any of the BPS Representations. All claims of BPS for a breach of any of
the AFC Representations are limited to a maximum amount of US $
2,500,000 (in words: two million five hundred thousand).
6.4 In case of a breach of the representation and warranty set forth in Sec.
1b of Annex 5 A or Sec. 2 of Annex 5 B relating to the transfer of
unrestricted ownership of the Shares or the AFC voting common shares,
respectively, and if the Claimant would be entitled to a compensation
pursuant to Sec. 6.1-6.3 above, the Claimant has the option to rescind
this Agreement prior to the Closing in lieu of asserting a claim for
compensation. If the rescission right is exercised, ss.ss. 346 et seq.
of the German Civil Code shall apply. The rescission right may only be
exercised prior to the Closing within one month after the Claimant has
obtained knowledge of its rescission right,
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however, at the latest until the end of the respective limitation period
set forth in Sec. 6.6 below.
6.5 Any liability of the Representing Party for a breach of any of the
representations and warranties given in Article 5 other than as set
forth in Sec. 6.1-6.4 above shall be excluded. Furthermore, any other
rights or claims of a party based on any legal grounds other than a
breach of any of the representations and warranties given in Article 5
(whether or not relating to factual circumstances covered by any of the
representations and warranties given in Article 5), including claims for
damages, reduction of purchase price (Minderung), cancellation
(Wandlung), rescission (Rucktritt) or challenge (Anfechtung) of this
Agreement or any other release from this Agreement, be it based on
contract, tort, negligence in the pre-signing phase (culpa in
contrahendo) or after signing (positive Vertragsverletzung) or
otherwise, shall be excluded unless based on fraudulent, willful or
grossly negligent conduct (Arglist, Vorsatz, grobe Fahrlassigkeit) of
the respective other party or in case of a breach of covenants expressly
provided for in this Agreement.
6.6 Any claims under this Article 6 relating to the breach of any
representations and warranties set forth in Sec. 1b of Annex 5 A or Sec.
2 of Annex 5 B shall be time-barred five (5) years after the Closing
Date and any claims under this Article 6 relating to the breach of any
of the other representations and warranties set forth in Annex 5 A and
Annex 5 B shall be time-barred on September 30, 2002.
6.7 In the event that a party asserts claims against the other party for
compensation, damages or otherwise, the other party will ensure that the
party asserting the claim and its personnel, agents, accountants and
other professional advisors are given access to the relevant business
sites and are allowed to inspect all relevant documents, books and
records and obtain all relevant information from the officers,
directors, personnel, agents, accountants and other professional
advisors of the other party or the respective subsidiary of the other
party.
Article 7
Covenants prior Closing
7.1 Prior to the Closing Date, BPS shall, and shall cause its affiliates to,
ensure the following:
7.1.1 The LAD Business will be conducted and the properties related to the LAD
Business will be maintained in the usual and ordinary course in
accordance with past practice except as otherwise expressly contemplated
by this Agreement or with the prior written consent of AFC, such consent
not to be unreasonably withheld, and all reasonable efforts shall be
taken to maintain its rights and preserve its relationships with
customers, suppliers and others having business dealings with it;
7.1.2 BPS will promptly (once any officer or director or any other employee of
BPS has knowledge thereof) inform AFC in writing if BPS shall discover
any breach of any of the BPS Representations and Warranties or of any
covenant hereunder by BPS;
7.1.3 BPS will, and will cause its affiliates to, cooperate with AFC and Alpha
Subsidiary and use their best efforts to give all notices and to obtain
all governmental, third party,
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or other consents, transfers, approvals, orders, qualifications and
waivers necessary for the consummation of the transactions contemplated
hereby, and to cause the other conditions to AFC's obligation to close
to be satisfied (including, without limitation, the execution and
delivery of all agreements contemplated hereunder to be so executed and
delivered). BPS will promptly complete and file any required document
and information required in connection with any governmental or agency
filings for any pre-merger approvals required by the EU Commission, the
German Federal Cartel Office, the Federal Trade Commission or, if
mandatory, any other authority and will pay, without attorneys' fees,
one-half of all filing fees associated with such filings for approval of
the transactions contemplated in this Agreement;
7.1.4 BPS will confer on a regular and frequent reasonable basis with
representatives of AFC to report on operational matters and the general
status of on-going operations and will use reasonable best efforts to
take all actions necessary, and to cause its Affiliates to take all
actions necessary to consummate the transactions contemplated in this
Agreement;
7.1.5 BPS shall (i) preserve intact the business organization and good will of
the LAD Business, keep available the services of its officers and
employees as a group and maintain satisfactory relationships with
suppliers, distributors, customers and others having business
relationships with it, (ii) not take any action which would render, or
which reasonably may be expected to render, any of the BPS
Representations and Warranties untrue, and (iii) notify AFC of any
emergency or other change in the normal course of the LAD Business or in
the operation of the properties of the LAD Business and of any
governmental or third party complaints, investigations or hearings (or
communications indicating that the same may be contemplated) if such
emergency, change, complaint, investigation or hearing would be
material, individually or in the aggregate, to the business, operations
or financial condition of the New LAD Entities and the LAD Business or
to BPS's or AFC's ability to consummate the transactions contemplated by
this Agreement;
7.1.6 BPS shall maintain commercially reasonable and appropriate insurance
coverage for the LAD Business consistent with past practice;
7.1.7 BPS shall give AFC the opportunity to meet with BPS's customers together
with representatives of BPS.
7.1.8 BPS and NewCo KG shall, subject to the prior approval of Alpha
Subsidiary, such approval not to be unreasonably withheld, enter into
intercompany service agreements relating to the use of the Hanau casino
by LAD employees and the joint use of certain facilities in Japan, Hong
Kong, South Korea, USA and Taiwan on commercially reasonable terms and
conditions.
7.2 Prior to the Closing Date, BPS will not, and ensure that the entities
operating the LAD Business from time to time will not, except as
otherwise expressly contemplated by this Agreement:
7.2.1 take any action that would materially adversely affect the ability of
any party to this Agreement to consummate the transactions contemplated
by this Agreement or to perform its covenants and agreements under this
Agreement;
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7.2.2 incur any additional debt or other obligation for borrowed money
relating to the LAD Business except in the ordinary course of business;
7.2.3 sell, merge or consolidate any material portion of the LAD Business to
or with a third party or agree to do any of the foregoing or have any
discussions or negotiations regarding the foregoing or provide any
information to anyone in connection with the foregoing;
7.2.4 grant any increase in compensation or benefits to the employees
belonging to the LAD Business, or pay any severance, termination or
bonus payment except in the ordinary course of business consistent with
past practice, or as required by usual business practice (betriebliche
Ubung), law or contracts in effect prior to the date of this Agreement;
7.2.5 except in the ordinary course of business and consistent with past
practice or with the prior written consent of AFC, such consent not to
be unreasonably withheld (i) enter into, modify, amend or terminate any
material contract regarding the LAD Business, (ii) waive, release, or
compromise or assign any material rights or claims regarding the LAD
Business, or (iii) incur or contract for any material capital
expenditures, obligations or liabilities regarding the LAD Business.
7.3 Prior to the Closing Date, AFC and Alpha Subsidiary will ensure the
following:
7.3.1 The AFC Business will be conducted and the properties related to the AFC
Business will be maintained in the usual and ordinary course in
accordance with past practice except as otherwise expressly contemplated
by this Agreement and all reasonable efforts shall be taken to maintain
its rights and preserve its relationships with customers, suppliers and
other having business dealings with it;
7.3.2 AFC and Alpha Subsidiary will promptly (once any officer or director or
any other employee has knowledge thereof) inform BPS in writing if AFC
or Alpha Subsidiary shall discover any breach of any of the AFC
Representations and Warranties or of any breach of any covenant
hereunder by AFC;
7.3.3 AFC and Alpha Subsidiary will cooperate with BPS and use their
reasonable best efforts to give all notices and to obtain all
governmental, third party or other consents, transfers, approvals,
orders, qualifications and waivers necessary for the consummation of the
transactions contemplated hereby and to cause the other conditions to
BPS's obligations to close to be satisfied (including, without
limitation, the execution and delivery of all agreements contemplated
hereunder to be so executed and delivered). AFC will promptly complete
and file any required document and information required in connection
with any governmental or agency filings for any pre-merger approvals
required by the EU Merger Control Commission, the German Cartel Office
or the Hart-Scott-Rodino Act, and will pay one-half of all filing fees
associated with such filings for approval of the transactions
contemplated in this Agreement without attorneys' fees;
7.3.4 AFC and Alpha Subsidiary will use reasonable best efforts to take all
actions necessary to consummate the transactions contemplated by this
Agreement;
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7.3.5 AFC and Alpha Subsidiary will (i) use their best efforts to preserve
intact their business organization and good will, keep available the
services of their officers and employees as a group and maintain
satisfactory relationships with suppliers, distributors, customers and
others having business relationships with them; (ii) not take any action
which would render, or which reasonably may be expected to render, any
of the AFC Representations and Warranties untrue and (iii) notify BPS of
any emergency or other change in the normal course of its business or in
the operation of its properties and of any governmental or third party
complaints, investigations or hearings (or communications indicating
that the same may be contemplated) if such emergency, change, complaint,
investigation or hearing would be material, individually or in the
aggregate, to the business, operations or financial condition of AFC or
to BPS's or AFC's ability to consummate the transactions contemplated by
this Agreement; and
7.3.6 AFC will execute an agreement with BPS regarding the registration of the
AFC common voting stock received by BPS as Stock Component in the form
attached hereto as Annex 7.3.6 (the "Registration Rights Agreement").
7.3.7 As promptly as practicable after the signing of this Agreement, AFC
shall prepare and file with the United States Securities and Exchange
Commission (the "SEC") a proxy statement and any amendment or supplement
thereto (the "Proxy Statement") to be sent to the stockholders of AFC in
connection with the meeting of AFC's stockholders to consider the
transactions contemplated herein (the "AFC Stockholders' Meeting").
Copies of the Proxy Statement shall be provided to NASDAQ in accordance
with its rules. AFC shall use all reasonable efforts to cause the Proxy
Statement to be delivered to the AFC's stockholders as soon as it
becomes definitive. AFC or BPS, as the case may be, shall furnish all
information concerning AFC or the LAD Business as the other party may
reasonably request in connection with such actions and the preparation
of the Proxy Statement. AFC shall cause the Proxy Statement and all
other documents that AFC is responsible for filing with the SEC in
connection with the transactions contemplated herein to comply as to
form and substance in all material respects with the applicable
requirements of (i) the United States Securities Exchange Act of 1934,
as amended (the "Exchange Act"), (ii) the rules and regulations of the
NASDAQ National Market, (iii) the Securities Act and (iv) the Colorado
General Corporation Law (the "CGCL").
The Proxy Statement shall include the approval and the declaration of
advisability of this Agreement and the transactions contemplated herein
and the recommendation of the Board of Directors of AFC to AFC's
stockholders that they vote in favor of the adoption of this Agreement.
7.3.8 Subject to the receipt of a letter from Broadview International LLC
dated not more than five days prior to the date of the Proxy Statement
(the "Updated Fairness Opinion"), updating its fairness opinion issued
prior to the date hereof that, in its opinion, the Purchase Price is
fair from a financial point of view to the shareholders of AFC, AFC
shall call and hold the AFC Stockholders' Meeting as promptly as
practicable, for the purpose of voting upon the approval of this
Agreement and the transactions contemplated hereby. AFC shall use all
reasonable efforts to solicit from its shareholders proxies in favor of
the adoption of this Agreement pursuant to the Proxy Statement and shall
take all other action necessary or advisable to secure the
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vote or consent of shareholders required by the CGCL or applicable stock
exchange requirements to obtain such approval.
7.3.9 At the signing of this Agreement, AFC shall submit to BPS a written
confirmation by one or more banks to the effect that as per the signing
funds of at least US $ 55,000,000 (in words: fifty-five million) in form
of free deposits, credit facilities or commitment letters are
immediately available to AFC and could be used for payment of the Cash
Portion. In the period between the signing of this Agreement and the
Closing, AFC shall submit to BPS at the end of each month further
written confirmations by one or more banks to the effect that as per
such dates funds of at least US $ 60,000,000 (in words sixty million) in
form of free deposits, credit facilities or commitment letters are
immediately available to AFC and could be used for payment of the Cash
Portion.
7.4 Prior to the Closing, AFC and Alpha Subsidiary will not, except as
otherwise expressly contemplated by this Agreement:
7.4.1 take any actions that would materially adversely affect the ability of
any Party to this Agreement to consummate the transactions contemplated
by this Agreement or to perform its covenants and agreements under this
Agreement;
7.4.2 sell, merge or consolidate any material portion of the AFC Business to
or with a third party or acquire by purchase, merger or otherwise any
material assets or business or agree to any of the foregoing;
7.4.3 call a shareholders' meeting for the purpose of adopting shareholders'
resolutions regarding capital increases or capital reductions, any
changes of the Articles of Incorporation or the distribution of profits
except as contemplated by this Agreement; or
7.4.4 issue any shares or other securities including, but not limited to,
convertible bonds or stock options or create any rights or claims for
the issuance of any such shares or other securities or redeem or cancel
any shares or other securities of AFC except in connection with
financing this transaction or in connection with AFC's stock option and
stock purchase plans in place at the time of the signing of this
Agreement.
7.5 Each of the parties hereto will use all reasonable efforts and will take
all actions necessary to consummate the transactions contemplated by
this Agreement and to cause all the conditions to the transactions set
forth in Article 8 to be satisfied.
7.6 AFC, Alpha Subsidiary and BPS shall cooperate in good faith and use
their best efforts to obtain as promptly as possible the consents to the
transfer of the contracts listed in Annex 7.6 to NewCo KG in the LAD
Reorganization from the respective contractual parties. AFC and Alpha
Subsidiary shall provide all necessary assurances to such contractual
parties as reasonably requested by them as a precondition for granting
their consent.
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Article 7A
General Condition Precedent
This Agreement is entered into subject to the condition precedent, that
the parties hereto will agree on the Annexes referred to herein and on
the Schedules referred to in Annexes 5A and 5B hereto in accordance with
Section 12.6. hereof. This Agreement shall not be deemed executed and is
not complete unless the execution of one or more additional Notarial
Deeds containing all the Annexes and Schedules.
Article 8
Conditions Precedent for Consummation
The consummation (Vollzug) of this Agreement is subject to the
satisfaction of each of the following conditions precedent:
8.1 all consents of, filings and registrations with, and notifications to,
all regulatory authorities required by EU Merger Control, German cartel
law or the U.S. Antitrust Improvement Act shall have been obtained or
made and shall be in full force and effect and all waiting periods
required by applicable law shall have expired. In case the release of
any of the transactions contemplated hereby shall be granted by any of
the merger control authorities only subject to the fulfillment of
conditions, the parties hereto shall be obliged to fulfill such
conditions if this is economically acceptable for the parties.
8.2 The respective contractual parties to the contracts listed in Annex 7.6
have given their written consent to the transfer of such contracts to
NewCo KG.
8.3 No court or governmental authority of competent jurisdiction shall have
enacted, issued, promulgated, enforced or entered any law, order or
injunction (whether temporary, preliminary or permanent) or taken any
other action that prohibits, restricts or makes illegal the consummation
of the transactions contemplated by this Agreement or cause such
transactions to be rescinded on or prior to the day immediately
preceding the day which will otherwise be the Closing Date.
8.4 NewCo KG has a valid lease agreement with BuL Vermietungsgesellschaft
mbH regarding the Hanau site substantially in the form as attached
hereto as Annex 8.4.1, but providing for monthly rent reductions
commensurate with the reduced use of space by NewCo at the end of the
respective months, and a valid lease agreement with Victoria Mathias
Verwaltungsgesellschaft/Lahmeyer Grundbesitz GmbH & Co. KG regarding the
Alzenau site substantially in the form as attached hereto as Annex 8.4.2
8.5 The shareholders of AFC shall have approved this Agreement and the
transactions contemplated by this Agreement in the AFC Stockholders'
Meeting.
8.6 NewCo KG has a valid commercialization agreement with The Coca-Cola
Company, Atlanta and with Krones AG, Neutraubling, substantially in the
form as attached hereto as Annex 8.6.
8.7 The LAD Reorganization shall have become effective in accordance with
the LAD Reorganization Memorandum.
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8.8 AFC and BPS shall have executed the Registration Rights Agreement.
The conditions specified in Sec. 8.1 and 8.3 may be waived by BPS and
AFC, the conditions specified in Sec. 8.2, 8.4, 8.5, 8.6 and 8.7 may be
waived by AFC and the condition specified in Sec. 8.8 may be waived by
BPS, provided that no such waiver will be effective unless it is set
forth in writing by the respective parties. If the condition set forth
in Sec. 8.5 is waived by AFC in accordance with the preceding provision,
Sec. 7.3.7, 7.3.8, 9.1(d) (ii) and 11.6 shall be unapplicable
Article 9
Termination
9.1 Notwithstanding any other termination or rescission pursuant to
applicable law, this Agreement may be terminated at any time prior to
the Closing:
(a) by mutual written consent of AFC (also on behalf of Alpha Subsidiary)
and BPS (also on behalf of Unaxis);
(b) by either AFC (also on behalf of Alpha Subsidiary) or BPS (also on
behalf of Unaxis) if there has been a material breach on the part of the
other party of the representations and warranties or covenants or
obligations set forth in this Agreement, which is not cured within
thirty (30) days of a notice to the breaching party except when such
breach cannot be expected to have, individually or in the aggregate, a
material adverse effect on the economic, financial or earnings position
(Vermogens-, Finanz- oder Ertragslage) of the LAD Business or the AFC
Business, respectively, taken as a whole; or
(c) by either AFC (also on behalf of Alpha Subsidiary) or BPS (also on
behalf of Unaxis) if there has been a material adverse change in the
economic, financial or earnings position (Vermogens-, Finanz- oder
Ertragslage) of the LAD Business or the AFC Business, respectively,
taken as a whole which has occurred after the signing of this Agreement;
or
(d) by either AFC (also on behalf of Alpha Subsidiary) or BPS (also on
behalf of Unaxis) if (i) events (other than referred to in sub-para (ii)
hereof) have occurred which have made it impossible to satisfy a
condition precedent under Article 8 which has not been waived in
accordance with Article 8, or (ii) the AFC Stockholders' Meeting is not
held (unless AFC waives the condition set forth in Sec. 8.5 in
accordance with Article 8 and proceeds towards Closing as contemplated
by this Agreement), in particular due to the failure of Broadview
International LLC to give the Updated Fairness Opinion, or the
shareholders of AFC do not give their approval to this Agreement and the
transactions contemplated herein in the AFC Stockholders' Meeting,
provided that AFC may not terminate the Agreement pursuant to this Sec.
9.1 para. (d) without paying the Termination Fee (as defined in Sec.
11.6) concurrently with such termination, or (iii) the Closing has not
occurred on or prior to July 1, 2001 by reason of the failure of any
other condition precedent under Article 8 which has not been waived in
accordance with Article 8; provided that neither AFC nor BPS will be
entitled to terminate this Agreement pursuant to this Sec. 9.1(d) if
such party's breach of this Agreement has prevented satisfaction of the
conditions or the consummation of the transactions contemplated hereby;
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(e) by BPS, if AFC fails to submit after the signing of this Agreement any
of the written bank confirmations required pursuant to Sec. 7.3 para.
7.3.9 and such failure remains uncured for five (5) days after notice to
AFC by BPS. If BPS terminates this Agreement pursuant to this Sec. 9.1
(e), AFC shall pay to BPS an amount of US $ 2,000,000 (in words: two
million).
9.2 The termination rights set forth hereunder must be exercised by the
respective party by written declaration to the other party or parties
within a period of fifteen (15) days after the respective party has
obtained knowledge of its right to terminate this Agreement.
9.3 In the event of termination of this Agreement by either AFC or BPS as
provided above, this Agreement will forthwith become void and there will
be no liability on the part of any party to this Agreement to any other
party, except for the obligation of the parties in Sec. 9.1(d) (ii), 9.1
(e), 11.6 and Article 12, and except that nothing herein will relieve
any party from any breach of this Agreement prior to such termination.
Article 10
Non-competition
For a period of two (2) years after the Closing Date, BPS and Unaxis agree
10.1 without the prior written consent of AFC not to engage, directly or
indirectly, in any business anywhere in the world that develops,
manufactures or supplies products of the kind developed, manufactured or
supplied by the business as described in Annex 10.1, it being understood
that the scope of this non-compete obligation is exclusively determined
on the basis of Annex 10.1 and the contents of Annex A.1 are not
relevant for the determination of the scope of this non-compete
obligation, and
10.2 not to own an interest in, manage, operate, control or participate in or
be connected with, any person that competes with AFC in the LAD
Business, without the prior written consent of AFC, provided, however,
that, for the purposes of this Sec. 10.2, ownership of securities having
not more than five (5) percent of the outstanding voting power of any
competitor which is a listed company on any stock exchange or traded
actively on any over-the-counter market shall not be deemed to be in
violation of this Sec. 10.2, so long as BPS has no other connection or
relationship with such competitor,
10.3 not to negotiate or start collaboration with The Coca-Cola Company or
Krones AG regarding diffusion barriers for beverage bottles.
(the obligations contained in Sec. 10.1 and 10.2 and 10.3 above referred
to as the "BPS Non-Competition Obligation"),
Unaxis shall ensure and guarantees that the BPS Non-Competition
Obligation will be observed and complied with also by its subsidiaries
in the meaning of Sec. 15 et seq. German Stock Corporation Law.
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Article 11
Additional Agreements
11.1 No press releases related to this Agreement and the transactions
contemplated herein, or other announcements to the employees, customers
or suppliers of the AFC Business or the LAD Business will be issued
without the mutual approval of all parties hereto, except any public
disclosure which any party in good faith believes, based upon the
written opinion of counsel, is required by law or regulation (in which
case the disclosing party shall notify the other parties of the form of
the release and discuss changes thereto in good faith at least three
business days prior to such disclosure).
11.2 AFC shall ensure that immediately after the Closing Date a person
nominated by BPS is appointed to AFC's Board of Directors. For the
period during which BPS continues to own 10 % or more of AFC's
outstanding voting common stock or purchases additional shares pursuant
to sub-para. (a) below, a person nominated by BPS for the Board of
Directors of AFC will be proposed to AFC Stockholders' Meeting for
election. If BPS sells any of its AFC shares and subsequently owns less
than ten percent (10%) of AFC's outstanding stock for any reason,
including because of additional shares issued by AFC before or after its
sale of stock, its right to a board seat will be lost immediately. If
BPS has not sold any of the AFC shares and falls below ten percent (10%)
of the total outstanding shares of AFC common stock because AFC issues
additional shares or takes other corporate actions:
(a) BPS will be permitted to purchase additional shares either from AFC
(pursuant to Sec. 11.3 or otherwise) or in the open market to keep its
ownership at or above 10%.
(b) If BPS does not purchase enough shares to restore its ownership of AFC
common stock to 10% or more of the total outstanding common stock, it
will lose its right to board seat immediately, subject to paragraph (c)
below
(c) If BPS has spent U.S. $2 million to purchase AFC common stock pursuant
to paragraph (a) above, and still owns less than 10 % of AFC's
outstanding common stock, BPS will nonetheless retain its right to an
AFC board seat until one year after the date of Closing.
At such time as BPS loses its right to a board seat of AFC, BPS will
cause the director nominated by it to resign within ten (10) days.
Thereafter, AFC shall have no further obligation to nominate BPS's
designee to AFC's Board of Directors, even if BPS's ownership of AFC
common stock later increases above 10% of AFC's total outstanding common
stock.
11.3 If after Closing, AFC issues any common stock for cash in a public
offering or private placement and BPS is entitled to purchase additional
shares pursuant to Sec. 11.2(a) above, BPS shall have the right to
purchase in such offering that number of shares of AFC common voting
stock which is required to maintain the percentage ownership of AFC
common voting stock that BPS had immediately prior to such offering. Any
purchase by BPS of AFC common voting stock pursuant to this provision
shall be at the same price and on the same terms offered to other
investors in such offering. AFC shall notify BPS in writing at least
thirty (30) days prior to an issuance of AFC
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common stock for cash in a public offering or private placement (the
"AFC Offering Notice"). The AFC Offering Notice shall contain a
description of the type of offering and the expected price per share. If
BPS desires to participate in such offering, then BPS shall provide to
AFC written notice of such election within twenty (20) days of receiving
the AFC Offering Notice and such election shall specify the number of
shares that BPS elects to purchase pursuant to this provision.
11.4 BPS agrees not to sell, transfer or otherwise dispose of the AFC common
stock which it has acquired as part of the Stock Component as defined in
Sec. 3.1 for a period of nine (9) months following the Closing Date.
11.5 Until this Agreement is terminated by its terms, BPS will not (and BPS
will not cause or permit any director, officer, employee or agent of
BPS, the New LAD Entities or their affiliates) to, (a) solicit, initiate
or encourage the submission of any proposal or offer from any person or
entity (including any of them) relating to any (i) liquidation,
dissolution or recapitalization of, (ii) merger or consolidation with or
into, (iii) acquisition or purchase of assets of any equity interest in,
or (iv) similar transaction or business combination involving the LAD
Entities or any part of the LAD Business, or (b) participate in any
negotiations regarding, furnish any information with respect to, assist
or participate in any other manner any effort or attempt by any other
person to do or seek any of the foregoing. Until this Agreement is
terminated by its terms, BPS, the LAD Entities and their affiliates
shall notify AFC immediately if any person makes any proposal, offer,
inquiry or contact with respect to any of the foregoing without
disclosing such person's identity.
11.6 If the AFC Stockholders' Meeting is not held or if the shareholders of
AFC do not give their approval to this Agreement and the transactions
contemplated herein at the AFC Stockholders' Meeting and this Agreement
is terminated as a result thereof, AFC shall pay to BPS an amount of US
$ 2,000,000 (in words: two million) (the "Termination Fee") promptly
following such termination or concurrent with termination by AFC under
the terms of Sec. 9.1(d).
11.7 BPS agrees that, except for shares of AFC common voting stock to be
acquired pursuant to the terms of this Agreement, BPS will not and will
cause its affiliates not to acquire additional shares of AFC common
voting stock before the Closing and after the Closing for so long as a
nominee of BPS is a member of the board of AFC and a period of six
months after the BPS nominee has resigned pursuant to Sec. 11.2, however
at least for a period of two (2) years after the Closing, in open market
transactions or otherwise, without the prior written consent of AFC.
11.8 Unaxis hereby irrevocably and unconditionally guarantees (as an
independent guarantee) to AFC the due and punctual performance of all of
BPS's obligations arising out of, or in connection with, this Agreement.
In case of a default by BPS with regard to any of such obligations,
Unaxis shall, upon demand by AFC, indemnify AFC or the New LAD Entities,
as applicable, against all losses, damages, costs and expenses arising
out of such default and will perform such obligations as if Unaxis were
substituted for BPS as primary debtor under such obligation.
11.9 AFC hereby irrevocably and unconditionally guarantees (as an independent
guarantee) to BPS the due and punctual performance of all of Alpha
Subsidiary's obligations arising out of, or in connection with, this
Agreement. In case of a default
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by Alpha Subsidiary with regard to any of such obligations, AFC shall,
upon demand by BPS, indemnify BPS against all losses, damages, costs and
expenses arising out of such default and will perform such obligations
as if AFC were substituted for Alpha Subsidiary as primary debtor under
such obligation.
AFC shall ensure that Alpha Subsidiary shall immediately after the date
hereof take all additional steps necessary for a valid entry into this
Agreement by Alpha Subsidiary, if any, and submit to the certifying
Notary proper evidence thereof. AFC and BPS agree that if and as long as
Alpha Subsidiary has not become a party to this agreement AFC will
assume the position of Alpha Subsidiary under this Agreement in all
respects.
Article 12
Miscellaneous
12.1 Costs
Each of the parties shall pay all of its expenses (including fees and
expenses of legal counsel, financial advisors or other representatives
or consultants) incurred by it in connection with the preparation,
negotiation, execution and implementation of this Agreement except as
otherwise provided herein. The costs of the notarization of this Deed
shall be born by BPS and AFC to equal shares.
12.2 Amendment of Agreement
This Agreement may be amended by the parties at any time provided that
any such amendments will be binding only if set forth in writing
executed by each of the parties unless notarization is required by law.
12.3 Notices
All notices, demands and other communications given or delivered under
this Agreement will be in writing and will be deemed to have been given
when personally delivered or delivered by express courier service or
telecopied. Notices, demands and communications to the Parties will,
unless another address is specified in writing, be sent to the address
indicated below:
Notices to Unaxis:
Unaxis-Management Ltd
Hofwiesenstrasse 135
P.O. Box 2409
8021 Zurich
Switzerland
Attn.: Thomas Emch, General Counsel
Facsimile: (+41) 1-360 96 94
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Notices to BPS:
Balzers Process System GmbH
Wilhelm-Rohn-Strasse 25
63450 Hanau
Germany
Attn.: Rechtsabteilung
Facsimile: (+49) 6181 34 11 06
with a copy to
Unaxis
and in both cases
with a copy to
Shearman & Sterling
Mainzer Landstrasse 16
60325 Frankfurt am Main
Germany
Attn.: Dr. Thomas Konig
Facsimile: (+49) 69-9711 1100
Notices to AFC or Alpha Subsidiary:
Applied Films Corporation
9586 I-25 East Frontage Road
Longmont, CO 80504
U.S.A.
Attn.: Lawrence Firestone
Facsimile: (+1) 303-774 3251
with a copy to:
Varnum, Riddering, Schmidt & Howlett LLP
333 Bridge Street, N.W,
P.O. Box 352
Grand Rapids,
Michigan 49501-0352
Attn.: Daniel C. Molhoek
Facsimile: (+1) 616-336 7000
12.4 Binding Agreement; Assignment
This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and permitted assignees.
This Agreement or any rights or obligations hereunder shall not be
assignable by either party except with the prior written consent of the
other party, except that AFC may assign all of its rights hereunder to a
direct or indirect subsidiary of AFC, it being understood that in such
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<PAGE>
case AFC shall remain fully liable for all of AFC's obligations arising
out of, or in connection with, this Agreement.
12.5 Invalid or Unenforceable Provisions
If any of the provisions of this Agreement is or becomes invalid or
unenforceable, the remaining provisions of this Agreement shall remain
unaffected. The invalid or unenforceable provision shall be replaced by
the parties by a valid or enforceable provision which comes as close as
possible to the commercial purpose of the invalid or unenforceable
provision.
12.6 Entire Agreement, Exhibits, Annexes and Schedules
12.6.1 This Agreement and its Annexes and Exhibits contain the entire agreement
between the parties and supersede any prior understandings, agreements
or representations by or between the parties, written or oral, which may
have related to the subject matter hereof in any way.
12.6.2 The Annexes as well as the Schedules to Annexex 5A and 5B, which are not
contained in this present Notarial Deed shall be agreed upon in one or
more separate Notarial Deeds. These separate Notarial Deeds shall refer
to this present Deed and shall form part of this Agreement (and any
references to this Agreement shall also include the Notarial Deeds
containing the Annexes and Schedules) and the Agreement shall be deemed
executed only and when the separate Notarial Deeds are executed and the
parties hereto confirm in the last of such additional Notarial Deeds
that the parties have agreed on all the Annexes and Schedules and that
therefore the Agreement shall be complete. The Notary is hereby
instructed to execute and deliver any Authentic Copy ("Ausfertigungen")
of this present Deed only together with Authentic Copies of the other
Deeds forming part of the Agreement.
12.6.3 Each of the parties hereto hereby grants power of attorney to
- Dr. Astrid Boos-Hersberger, CH-8057 Zurich, In der Hub 26,
- lic.iur. Alexandra Schwank, CH-4102 Binningen, Oberwilerstr. 100,
- Dr. Jennifer Wetterwald, CH-4056 Basel, Klingelbergstrasse 93,
- lic.iur. Nadja Lifschitz, CH-4055 Basel, Spalenring 71,
- lic.iur. Reto Kuhne, CH-4102 Binningen, Ob dem Hugliacker 83,
- Dr.iur. Christoph Meyer, CH-4001 Basel, Gerbergasse 45,
each of them individually, each of them released from the restrictions
imposed by ss. 181 of the German Civil Code or similar restrictions
under other applicable jurisdictions, and each of them with the right to
grant substitute power of attorney, to set forth and to agree upon the
content of the Annexes and Schedules and to confirm that the Annexes and
Schedules so set forth are all the Annexes and Schedules and that
therefore the Agreement will be completed, and hereby instruct the above
persons to proceed in such manner promptly after the present Notarial
Deed has been signed.
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12.7 Choice of Law
This Agreement, its interpretation and all questions arising out of, or
in connection with, this Agreement, shall be governed by German law,
except the UN Convention on Contracts for the Sale of Goods, without
giving effect to any choice of law or conflict of law provisions or
rules, provided that all corporate actions to be conducted pursuant to
this Agreement by AFC with respect to the issuance and delivery of the
shares constituting the Stock Component shall be governed by the law of
the State of Colorado.
12.8 Settlement of Disputes
Any differences, questions or disputes arising out of or in connection
with this Agreement shall be attempted to be settled by an amicable
effort on the part of the Parties. Such effort shall be referred to the
Chief Executive Officers of the Parties if no agreement has been
achieved within three weeks from the date the first request for an
amicable settlement is raised by one of the Parties. The effort shall be
considered to have failed, if within two weeks after reference to the
Chief Executive Officers they have not resolved the matter amicably.
If an attempt for a settlement has failed, the differences, questions or
disputes arising out of or in connection with the Agreement, including
those regarding the breach, termination or validity of the Agreement,
shall be finally settled by arbitration in accordance with ICC rules
with three arbitrators, the place of arbitration in Brussels, Belgium,
and the language being English, without recourse to the ordinary courts
of law. The appointing authority shall be the International Chamber of
Commerce, Paris (ICC).
12.9 Nothing in this Agreement, express or implied, is intended to confer on
any person other than the parties and their respective successors and
assigns any rights or remedies under or by virtue of this Agreement.
(continued on next page)
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<PAGE>
IN WITNESS THEREOF this Notarial Deed has been read aloud to the persons
appearing and was confirmed and approved by the persons appearing. The persons
appearing then signed this Deed. All this was done at the day herebelow written
in the presence of me, the Notary Public, who also signed this Deed and affixed
my official Seal.
Basel, this 18th (eighteenth) day of October 2000 (two thousand)
/s/ Thomas T. Edman
-----------------------------------
/s/ Lawrence D. Firestone
-----------------------------------
/s/ Volker Grafe
-----------------------------------
/s/ Dr. Thomas Emch
-----------------------------------
/s/ Stephan Cueni, Notary
-----------------------------------
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<PAGE>
Rolls-No.: 740 of 2000/03
03100-00 - Frau Joh - December 29st, 2000
NOTARIAL DEED
Negotiated
at
Hanau
on
December 29th, 2000.
Before me, the undersigned notary
Dr. Frank Bansch
in the district of the higher regional court of Frankfurt (Germany)
appeared today the following persons:
1. Mr. Lawrence D. Firestone, born March 24, 1958, US-citizen, with private
domicile at 325 Roxbury Circle, CO Springs, Colorado 80906, USA,
identified by his US-passport, according to his declarations not acting
in his own name, but as authorized representative of
a) Applied Films Corporation ("AFC"), a Colorado Corporation having
its registered office in Longmont, Colorado, on the basis of a
power of attorney dated December 20th, 2000, a certified copy of
which is attached to this Deed, and
b) AFCO Verwaltungs GmbH, a German limited liability company having
its registered seat in Munich, Germany (County Court Munich, HRB
133554), acting not for itself, but as general partner of AFCO
GmbH & Co. KG ("Alpha Subsidiary"), a newly formed and not yet
registered German limited partnership having its seat in Munchen,
Germany,
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<PAGE>
2. Dr. Thomas Emch, born June 11, 1950, Swiss citizen, with private
domicile at CH-8914 Aeugst a. A., Im Uerenberg 10, personally known,
according to his declarations not acting in his own name, but as
authorized representative of
a) Balzers Process Systems GmbH ("BPS"), a German limited liability
company having its registered seat in Hanau, Germany (County Court
Hanau, HRB 5392), on the basis of a power of attorney dated
december 20th, 2000, a certified copy of which is attached to this
Deed;
b) Unaxis Holding AG ("Unaxis"), a Swiss stock corporation having its
registered office in Zurich, Switzerland, on the basis of a power
of attorney dated December 20th, 2000, a certified copy of which
is attached to this Deed.
The persons appeared requested that this Deed including its Annexes and
Exhibits be recorded in English. The acting notary who is in sufficient
command of the English language and ascertained that the persons
appeared are also in command of the English language. After having been
instructed by the notary, the persons appeared waived the right to
obtain the assistance of a certified interpreter.
The acting notary explained to the persons appeared the contents of ss.
3 para. 1 (7) of the German Notarization Act (Beurkundungsgesetz). The
persons appeared confirmed to the notary that he has not been involved
in the transaction within the meaning of ss. 3 para. 1(7) of the German
Notarization Act.
The persons appeared, acting as stated above, requested the notarization
of the following:
AMENDMENT AGREEMENT
TO THE SHARE PURCHASE AND EXCHANGE AGREEMENT (NOTARIAL DEED
DATED AS OF OCTOBER 18, 2000, A. PROT. 2000/308 OF THE NOTARY
STEPHAN CUENI, BASEL)
Preamble
A. On October 18, 2000, the Parties entered into a Share Purchase and
Exchange Agreement (Notarial Deed A. Prot. 2000/308 of the notary
Stephan Cueni, Basel, Switzerland) attached hereto (without appendices)
as Appendix A (the "Share Purchase and Exchange Agreement") providing
for the sale and transfer of the LAD Business of the Unaxis group to AFC
and certain of its subsidiaries subject to a reorganization of the LAD
group as described in detail in a Reorganization Memorandum attached to
the Share Purchase and Exchange Agreement.
B. Sec. 1.1 of the Share Purchase and Exchange Agreement provides that the
LAD Reorganization will be carried out on the basis of a reorganization
Documentation as defined therein which is attached in a preliminary form
to the Share Purchase and Exchange Agreement and which is to be further
developed, completed and updated by BPS in consultation with AFC.
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<PAGE>
Furthermore, Sec. 1.1 of the Share Purchase and Exchange Agreement
provides that certain disclosure schedules attached in a preliminary
form to the Share Purchase and Exchange Agreement will also be further
developed, completed and updated by BPS in consultation with AFC.
C. The Parties have agreed upon certain amendments to the Share Purchase
and Exchange Agreement, including certain modifications in the LAD
Reorganization, and have completed the Reorganization Documentation and
the Preliminary Schedules.
NOW, THEREFORE, the Parties agree as follows:
Article 1
Appendix 1 hereto contains updated and completed versions of all parts
of the Reorganization Documentation as well as the completed list of
employments as agreed between the Parties.
Article 2
Appendix 2 hereto contains updated and completed versions of the
Preliminary Schedules as agreed between the Parties.
Article 3
3.1 Annex B to the Share Purchase and Exchange Agreement shall be replaced
by a modified Reorganization Memorandum attached hereto as Appendix 3.
3.2 Sec. B, 3rd sentence of the Preamble of the Share Purchase and Exchange
Agreement shall be deleted and replaced by the following provision:
"For this purpose, all assets and certain liabilities (including
employments) of the LAD Business operated in Germany, Belgium and Korea
will be transferred to new entities (the "New LAD Entities") as
described in more detail in the memorandum attached as Annex B (the
"Reorganization Memorandum")."
3.3 Sec. D, first sentence of the Preamble of the Share Purchase and
Exchange Agreement shall be deleted and replaced by the following
provision:
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<PAGE>
"AFC and BPS have agreed on a transaction in which Alpha Subsidiary will
acquire all shares and limited partnership interests in the New LAD
Entities in Germany, and AFC or other designated subsidiaries of AFC
will acquire all shares in the other New LAD Entities, and take over the
assets and liabilities (including employments) of the LAD activities in
USA, Hong Kong, China, Japan and Taiwan (the "Foreign Assets and
Liabilities").
Article 4
Sec. 1.1, fourth sentence of the Share Purchase and Exchange Agreement
shall be deleted and replaced by the following provision:
"A preliminary list of the employments which will be transferred to the
New LAD Entities or to AFC or its designated subsidiary is attached as
Annex 1.1.4."
Article 5
5.1 Sec. 2.2 of the Share Purchase and Exchange Agreement shall be deleted
and replaced by the following provision:
"Subject to the conditions precedent set forth in Article 8 and subject
to the further condition that the cash payment pursuant to Sec. 3.3
para. 3.3.1, the delivery of shares of AFC voting common stock pursuant
to Sec. 3.3 para. 3.3.2, the repayment of the IKB Loan, if required
pursuant to Sec. 4.4, and the cash payment in the amount of US $
4,000,000 (in words: four million) pursuant to Sec. 4A.1, first sentence
is made in accordance with such provisions, BPS hereby assigns the KG
Interest (subject to registration in the Commercial Register) and the
GmbH Share as of the Closing Date to Alpha Subsidiary which accepts such
assignment (such assignment hereinafter the "Closing")."
5.2 Sec. 2.5 first sentence of the Share Purchase and Exchange Agreement
shall be deleted and replaced by the following provision:
"Unaxis and AFC agree that the shares in the New LAD Entities other than
NewCo KG and NewCo GmbH (the "Foreign Shares") as well as the Foreign
Assets and Liabilities shall be sold to AFC or its designated
subsidiaries and, subject to the conditions referred to in Sec. 2.2
above, transferred to AFC or its designated subsidiaries on (and with
respect to Taiwan and China as soon as legally permissible after) the
Closing Date."
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Article 6
Article 3 of the Share Purchase and Exchange Agreement shall be deleted
in its entirety and replaced by the following provision:
"Article 3
Consideration
3.1 Subject to the adjustments set forth in Sec. 3.2 below, the aggregate
consideration owed by (i) Alpha Subsidiary for the acquisition of the
Shares and (ii) AFC or its designated subsidiary for the acquisition of
the Foreign Shares and the Foreign Assets and Liabilities shall be equal
to (a) US $ 60,000,000 (in words: sixty million) adjusted as set forth
below (the "Cash Component") and (b) 673,353 (in words: six hundred
seventy-three thousand three hundred fifty-three) no par value shares of
AFC voting common stock (the "Stock Component"). The Cash Component,
subject to the adjustment pursuant to Sec. 3.2, and the Stock Component
are collectively referred to herein as the purchase price (the "Purchase
Price").
3.2 The Cash Component shall be adjusted as follows:
If the aggregate sum of net equity (bilanzielles Reinvermogen) of the
New LAD Entities and of the Foreign Assets and Liabilities as of the
Closing Date as defined in Annex 3.4.1 and determined on a
non-consolidated basis on the basis of the Final Closing Balance Sheets
in accordance with the provisions of Sec. 3.5 (the "LAD Net Equity") is
in excess of zero, then the Cash Component shall be increased by the
amount of such excess (the "Excess Amount") and if the LAD Net Equity is
lower than zero, then the Cash Component shall be reduced by the amount
of such shortfall (the "Shortfall Amount").
3.3 The Purchase Price shall be paid by AFC (also on behalf of Alpha
Subsidiary for the Shares and its designated subsidiaries, if any, for
the Foreign Shares and the Foreign Assets and Liabilities) as follows:
3.3.1 A cash payment of US $ 50,000,000 (in words: fifty million) shall be
made by AFC on the Closing Date by wire transfer of immediately
available funds at AFC's expense to such account(s) as BPS may specify
in writing to AFC at least three business days prior to the Closing
Date.
3.3.2 673,353 shares of AFC voting common stock shall be delivered by Alpha
Subsidiary on the Closing Date to BPS.
3.3.3 The portion of the Cash Component as adjusted pursuant to Sec. 3.2
exceeding an amount of US $ 50,000,000 (in words: fifty million), if
any, plus interest thereon in the
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<PAGE>
amount of 6.0 % p.a. as from the Closing Date ("Deferred Payment") less
the amount of any disbursements by Deutsche Bank to BPS pursuant to Sec.
4A.2.1 or 4A2.2 shall be paid by AFC within five (5) business days after
the determination of the Final Closing Balance Sheets pursuant to Sec.
3.5 (the "Determination Date") in the same manner as set forth in Sec.
3.3.1. If the Cash Component as adjusted pursuant to Sec. 3.2 is lower
than US $ 50,000,000 (in words: fifty million) an amount equal to such
shortfall plus interest thereon in the amount of 6.0 % p.a. as from the
Closing Date less the amount of the Assignment Consideration, if any,
the Transfer Consideration and any Indemnification Claims which are not
covered by disbursements by Deutsche Bank to BPS pursuant to Sec. 4A.2.3
(a) shall be paid by BPS within five (5) business days after the
Determination Date by wire transfer of immediately available funds at
BPS's expense to such account(s) as AFC may specify in writing to BPS
within two (2) business days after the Determination Date.
3.4 Any payments made by AFC to BPS in accordance with the foregoing
provisions or on behalf of AFC in accordance with Art. 4A are made with
full release effect (schuldbefreiende Wirkung) for Alpha Subsidiary and
AFC or its designated subsidiaries vis-a-vis Unaxis, BPS and the Unaxis
subsidiaries selling the Foreign Shares and the Foreign Assets and
Liabilities and BPS will receive the payments also on behalf of Unaxis
and/or such Unaxis subsidiaries and be responsible for the disbursement
of the received amounts as internally agreed. Any payments made by BPS
to AFC in accordance with the foregoing provisions or on behalf of BPS
in accordance with Art. 4A are made with full release effect for BPS
vis-a-vis Alpha Subsidiary and AFC or its designated subsidiaries and
AFC will receive the payments also on behalf of Alpha Subsidiary and the
designated subsidiaries of AFC, if any, and be responsible for the
disbursement of the received amounts as internally agreed.
3.5 The Final Closing Balance Sheets, the LAD Net Equity and the Excess
Amount or the Shortfall Amount, if any, will be determined as follows:
(a) Within sixty (60) days after the Closing Date, AFC shall ensure
the preparation of (i) balance sheets of each of the New LAD
Entities and the Foreign Assets and Liabilities (pro-forma) as of
the Closing Date (the" Proposed Closing Balance Sheets"),
denominated in Deutsche Mark and prepared in accordance with IAS
accounting principles and the principles of the Unaxis Reporting
Manual as applicable as of the date hereof and the principles set
forth in Annex 3.5 (a), and (ii) a report (the "AFC Report")
calculating the LAD Net Equity and the Excess Amount or the
Shortfall Amount, if any, and provide a copy of the Proposed
Closing Balance Sheets and the AFC Report to BPS. At all times
during the preparation of the Proposed Closing Balance Sheets and
the AFC Report, AFC and its personnel, agents, accountants and
other professional advisors involved in the preparation thereof
shall, and AFC shall cause NewCo KG and its personnel, agents,
accountants and other professional advisors involved to cooperate
with and permit BPS and its personnel, agents, auditors,
accountants and other professional advisors and allow them to
observe such preparation.
(b) BPS shall have thirty (30) days after receipt of the Proposed
Closing Balance Sheets and the AFC Report to review such documents
and determine whether
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<PAGE>
it agrees with AFC's Proposed Closing Balance Sheets and
determination of the Excess Amount or the Shortfall Amount, if
any. During such period of time and in order to further enable BPS
to conduct such review, AFC shall make available to BPS and its
personnel, agents, accountants and other professional advisors
(i) the books and record (including relevant workpapers) used in
the preparation of the Proposed Closing Balance Sheets and (ii)
AFC's personnel, agents, auditors or accountants responsible for
the preparation of the Proposed Closing Balance Sheets and the AFC
Report. In the event that BPS disagrees with the Proposed Closing
Balance Sheet or the AFC Report as to the determination of the
Excess Amount or the Shortfall Amount, if any, BPS shall notify
AFC in writing of such disagreement within such 30 day period.
(c) If BPS and AFC disagree on the Proposed Closing Balance Sheets or
the AFC Report, then BPS and AFC shall attempt to resolve such
disagreement by meeting and conferring in good faith during the
15-day period following BPS's written notification to AFC of its
disagreement.
If BPS and AFC are unable to resolve their disagreement within
such 15-day period, BPS and AFC agree to retain the Frankfurt
office of KPMG Deutsche Treuhandgesellschaft Aktiengesellschaft
Wirtschaftsprufungsgesellschaft (the "Accounting Mediator") to
mediate the dispute. The Accounting Mediator shall conduct such
mediation as expert arbitrator (Schiedsgutachter). The Accounting
Mediator shall render a decision, if possible within a three
months period, regarding the disputed Adjustment Amount, which
decision shall be final and binding, and judgment upon the
decision rendered by the Accounting Mediator may be entered by any
court of competent jurisdiction. The Accounting Mediator shall
also decide on the allocation of the costs of the mediation
procedure in accordance with ss.ss. 91 et seq. of the German Civil
Procedure Rules (Zivilprozessordnung).
(d) The Proposed Closing Balance Sheets shall be the "Final Closing
Balance Sheets" unless BPS notifies AFC of its disagreement in
accordance with sub-para. (b). If BPS timely notifies AFC of its
disagreement, the Proposed Closing Balance Sheets as adjusted as a
result of the foregoing dispute resolution process set forth in
sub-para. (c) shall be the "Final Closing Balance Sheets".
Article 7
7.1 In Sec. 4.1 first sentence, the words "On the date on which the payments
set forth in para. 3.4.1 or 3.4.2 are made" shall be deleted and
replaced by the words "Within five (5) days after the Determination
Date".
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The last sentence of Sec. 4.1 of the Share Purchase and Exchange
Agreement shall be deleted and replaced by the following provision:
"Subject to Sec. 4.3, the Assignment Consideration shall be paid by
Alpha Subsidiary by wire transfer of immediately available funds at
Alpha Subsidiary's expense on the date of assignment to an account of
Unaxis as specified at least three business days in advance".
7.2 The following new Sec. 4.2 shall be added in Article 4 of the Share
Purchase and Exchange Agreement after Sec. 4.1:
"4.2 Within five (5) days after the Determination Date, Alpha Subsidiary
shall pay to BPS the purchase prices owed by the New LAD Entities in
Korea and Belgium for the acquisition of the assets and liabilities
related to the LAD Business in their respective countries in the LAD
Reorganization in accordance with the asset purchase agreements to be
entered into by such New LAD Entities and the respective subsidiaries of
Unaxis plus interest thereon in an amount of 6 % p.a. as from the
Closing Date (the "Transfer Consideration"). Such payment shall be made
subject to Sec. 4.3 in the same manner as set forth in Sec. 4.1, last
sentence. The payment shall be made on behalf of, and with full release
effect for, the New LAD Entities in Korea and Belgium and BPS will
receive such payment on behalf of the respective Unaxis subsidiaries and
be responsible for the disbursement of the received amount as internally
agreed."
7.3 The following new Sec. 4.3 shall be added in Article 4 of the Share
Purchase and Exchange Agreement after Sec. 4.2:
"4.3 The aggregate amount of payments to be made by Alpha Subsidiary
pursuant to Sec. 4.1 and 4.2 shall be reduced by the amount of any
disbursements by Deutsche Bank to BPS pursuant to Sec. 4A.2.3 (a)
or by the reduction of BPS's payment obligation pursuant to Sec.
3.3.3, second sentence, if any."
7.4 The old Sec. 4.2 shall become Sec. 4.4.
Article 8
After Art. 4, the following new Article 4A shall be inserted:
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"Article 4A
Security for BPS Claims
The Parties agree that BPS's claims to collect (i) the Deferred Payment
referred to in Sec. 3.3.3, if any, (ii) the Assignment Consideration
referred to in Sec. 4.1, if any, (iii) the Transfer Consideration
referred to in Sec. 4.2 and (iv) any indemnification payments from AFC,
Alpha Subsidiary or NewCo KG in the event that any of the outstanding
payment guarantees and sureties issued by certain banks to LAD customers
or other beneficiaries with regard to existing performance obligations
to be transferred to NewCo KG in the LAD Reorganization as listed in
Annex 4A.1 are called by the respective beneficiaries (the
"Indemnification Claims") shall be secured as follows:
4A.1 On the Closing Date, AFC shall make a cash payment in EURO in the amount
of US $ 4,000,000 (in words: four million) converted into EURO at the
average exchange rate as officially quoted by the Frankfurt Foreign
Currency Exchange (amtlicher Mittelkurs) on the last business day
immediately preceding the Closing Date (the "Conversion Rate") to a
joint bank account of BPS and Alpha Subsidiary (the "Joint Bank
Account") to be opened with Deutsche Bank, Frankfurt, prior to the
Closing Date. Furthermore, two additional cash payments in EURO, each in
the amount of US $ 2.000.000.-- (in words: Two million) converted into
EURO at the Conversion Rate, shall be made by AFC on January 31, 2001
and February 28, 2001, respectively, to the Joint Bank Account. The sum
of all cash payments made by AFC into the Joint Bank Account pursuant to
the following provisions is referred to herein as "Adjustment Escrow
Cash Amount".
4A.2 The Adjustment Escrow Cash Amount plus interest thereon as accrued shall
be released by Deutsche Bank only in accordance with joint written
instructions of BPS and AFC. BPS and AFC shall give the following
instructions to Deutsche Bank:
4A.2.1 If the Deferred Payment (converted into EURO at the Conversion Rate) is
equal to, or in excess of, the Adjustment Escrow Cash Amount plus
interest thereon as accrued, then Deutsche Bank shall disburse to BPS
the entire Adjustment Escrow Cash Amount plus interest thereon as
accrued within five (5) business days after the Determination Date and
AFC's obligation pursuant to Sec. 3.3.3 shall be deemed fulfilled to the
extent that such disbursement is made. Any excess obligation of AFC
pursuant to Sec. 3.3.3 shall remain unaffected.
4A.2.2 If the Deferred Payment (converted into EURO at the Conversion Rate) is
lower than the Adjustment Escrow Cash Amount plus interest thereon as
accrued, then Deutsche Bank shall disburse to BPS that portion of the
Adjustment Escrow Cash Amount plus interest thereon as accrued equal to
the Deferred Payment (converted into EURO at the Conversion Rate) within
five (5) business days after the Determination Date and AFC's obligation
pursuant to Sec. 3.3.3 shall be deemed fulfilled to the extent that such
disbursement is made.
4A.2.3 Any portion of the Adjustment Escrow Cash Amount plus interest thereon
as accrued remaining on the Joint Bank Account after the disbursement
pursuant to Sec. 4A.2.2
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(the "Remaining Escrow Cash Amount") shall be disbursed by Deutsche Bank
as follows:
(a) To the extent that the Assignment Consideration, if any, the
Transfer Consideration or any Indemnification Claims are not paid
by AFC, Alpha Subsidiary or NewCo KG, respectively, as and when
due, Deutsche Bank shall disburse to BPS that portion of the
Remaining Escrow Cash Amount plus interest thereon as accrued
equal to such unpaid amounts plus interest thereon in an amount of
6 % p.a. as from the respective due dates reduced by any Shortfall
Payment Amount payment due from BPS pursuant to Sec. 3.3.3 (the
"Not Outstanding Amount"), provided that BPS's obligation pursuant
to Sec. 3.3.3 shall be deemed fulfilled to the extent that such
deduction is made. If the Remaining Escrow Cash Amount is lower
than the Not Outstanding Amount, BPS shall be entitled to allocate
the disbursement actually received to the Assignment
Consideration, the Transfer Consideration or the Indemnification
Claims. The obligations of AFC, Alpha Subsidiary or NewCo KG
regarding the Assignment Consideration, the Transfer Consideration
or Indemnification Claim shall be deemed fulfilled to the extent
that such disbursement (as allocated by BPS) is made and any
excess obligations shall remain unaffected.
(b) Any portion of the Remaining Escrow Cash Amount plus interest
thereon as accrued not disbursed to BPS pursuant to para. (a)
shall be disbursed by Deutsche Bank to AFC as soon as the
performance obligations covered by payment guarantees and sureties
listed in Annex 4A.1 have been validly transferred to NewCo KG.
Article 9
9.1 Sec. 7.1.6 of the Share Purchase and Exchange Agreement shall be deleted
and replaced by the following provision:
"BPS shall maintain commercially reasonable and appropriate insurance
coverage for the LAD Business consistent with past practice, provided
that BPS and Alpha Subsidiary will attempt to have such insurances
transferred to the New LAD Entities, AFC or its designated subsidiaries
with effect as from the Closing."
9.2 Sec. 7.1.8 of the Share Purchase and Exchange Agreement shall be deleted
and replaced by the following provision:
"7.1.8 The New LAD Entities, AFC or its designated subsidiaries, as the case
may be, on the one hand, and BPS or any other company of the Unaxis
Group currently operating the LAD Business on the other hand, shall,
subject to the prior approval of AFC, such approval not to be
unreasonably withheld, enter into intercompany service agreements
relating to the joint use of certain facilities on commercially
reasonable terms and conditions. BPS shall ensure that the employees of
NewCo KG which will be working at the Hanau site until the completion of
the Restructuring Program as defined in Sec. 1.6 will be allowed to use
the Hanau casino on the same terms and
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conditions as applicable as of the Closing Date. Alpha Subsidiary shall
reimburse to BPS on a pro rata basis the portion of the payment made by
BPS to the caterer operating the Hanau casino corresponding to the
number of NewCo KG's employees working at the Hanau site as compared to
the overall number of employees working at the Hanau site and entitled
to use the Hanau casino from time to time."
9.3 The following new provision shall be added in Article 7 of the Share
Purchase and Exchange Agreement as new Sec. 7.1.9:
"With respect to letters of credit issued in favor of BPS which are to
be transferred to NewCo KG as part of the LAD Business in the LAD
Reorganization and which are not amended or reissued in favor of NewCo
KG on or prior to the Closing, BPS shall use its best efforts to enable
NewCo KG to obtain all payments covered by such letters of credit in
accordance with the terms and conditions of such letters of credit."
9.4 Sec. 7.6, first sentence, of the Share Purchase and Exchange Agreement
shall be deleted and replaced by the following provision:
"AFC, Alpha Subsidiary and BPS shall cooperate in good faith and use
their best efforts to obtain as promptly as possible the consents to the
transfer of the contracts and other legal relationships to be
transferred to NewCo KG or the other New LAD Entities in the LAD
Reorganization and to AFC or its designated subsidiaries, if any, as
part of the Foreign Assets and Liabilities, from the respective
contractual parties."
9.5 The following new provision shall be added in Article 7 of the Share
Purchase and Exchange Agreement as new Sec. 7.7:
"7.7 The Parties shall cooperate in good faith and use their best efforts to
transfer the activities of the LAD Business located in Taiwan ("LAD
Taiwan") and the LAD Business located in China ("LAD China") as promptly
as permitted by law after the Closing to AFC or its designated
subsidiaries. Until such transfers become effective, AFC or its
designated subsidiaries shall in all respects be put into a position as
if LAD Taiwan and LAD China had already been transferred and, in
particular, bear the economic burden and receive the economic benefit
of LAD Taiwan and LAD China.
Article 10
10.1 Sec. 8.2 of the Share Purchase and Exchange Agreement including Annex
7.6 shall be deleted.
10.2 Sec. 8.4 of the Share Purchase and Exchange Agreement shall be amended
to read as follows:
"8.4 NewCo KG has a valid lease agreement with BuL
Vermietungsgesellschaft mbH & Co. KG regarding the Hanau site
substantially in the form as attached hereto as Annex 8.4.1, but
providing for monthly rent reductions commensurate with the
reduced use of space by NewCo KG at the end of the respective
months."
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10.3 Sec. 8.7 of the Share Purchase and Exchange Agreement shall be amended
to read as follows:
"8.7 The LAD Reorganization with respect to the LAD Business in Germany
shall have become effective in accordance with Sec. 1 of the
Reorganization Memorandum."
Article 11
Annex 10.1 of the Share Purchase and Exchange Agreement shall be
replaced by a new version of Annex 10.1 attached hereto as Appendix 4.
Article 12
Sec. 3 (c) third sentence of Annex 5 A to the Share Purchase and
Exchange Agreement shall be deleted and replaced by the following
sentence:
"With regard to the patents, trade and service marks and all
applications for any of the foregoing identified in Schedule 3 (c) 3 of
the BPS Disclosure Memorandum as updated pursuant to Article 1 of this
Agreement (the "Licensed Intellectual Property Rights"), BPS owns such
rights or has a valid license or sublicenses thereof and the licenses
and sublicenses thereof to the LAD Business are valid license
agreements."
Article 13
Alpha Subsidiary shall procure that NewCo KG obtains as soon as possible
the approval of the competent authorities or the relevant third parties
to the transfer of public subsidy relationships which are to be
transferred to NewCo KG as part of the LAD Business. Furthermore, Alpha
Subsidiary shall ensure that NewCo KG complies with the terms and
conditions applicable to the granting of such subsidies until such
approval has been given and AFC and Alpha Subsidiary shall provide all
necessary assurances as reasonably requested by the competent
authorities or relevant third parties for giving their approval.
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<PAGE>
Article 14
Neither AFC, Alpha Subsidiary, nor any of the New LAD Entities shall be
entitled to use the name "Leybold" as a company name or as trademark or
as part thereof or in any other way, provided that Alpha Subsidiary
shall ensure that NewCo KG and NewCo GmbH delete "Leybold" from their
company names as promptly as possible after the Closing and NewCo KG and
NewCo GmbH are entitled to use the name "Leybold" as company name for
such interim period after the Closing Date and shall discontinue to use
the name "Leybold" in any respect thereafter.
Article 15
15.1 All capitalized terms not otherwise defined herein shall have the same
meaning in this Agreement as assigned thereto in the Share Purchase and
Exchange Agreement.
15.2 Costs
Each of the parties shall pay all of its expenses (including fees and
expenses of legal counsel, financial advisors or other representatives
or consultants) incurred by it in connection with the preparation,
negotiation, execution and implementation of this Agreement except as
otherwise provided herein. The costs of the notarization of this Deed
shall be borne by BPS and AFC to equal shares. The costs of the
establishment of branch offices or representative offices of ACF or any
of its subsidiaries, as the case may be, in China, Taiwan and Japan in
connection with the transfer of the LAD Business pursuant to the Share
Purchase and Exchange Agreement, as amended, shall be borne by BPS.
15.3 Amendment of Agreement
This Agreement may be amended by the parties at any time provided that
any such amendments will be binding only if set forth in writing
executed by each of the parties unless notarization is required by law.
15.4 Notices
All notices, demands and other communications given or delivered under
this Agreement will be in writing and will be deemed to have been given
when personally delivered or delivered by express courier service or
telecopied. Notices, demands and communications to the Parties will,
unless another address is specified in writing, be sent to the address
indicated below:
Notices to Unaxis:
Unaxis-Management Ltd
Hofwiesenstrasse 135
P.O. Box 2409
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8021 Zurich
Switzerland
Attn.: Thomas Emch, General Counsel
Facsimile: +41-1-360 9694
Notices to BPS:
Balzers Process Systems GmbH
Wilhem-Rohn-Strasse 25
63450 Hanau
Germany
Attn.: Rechtsabteilung
Facsimile: +49-6181 34 1106
with a copy to Unaxis and in both cases with a copy to:
Shearman & Sterling
Mainzer Landstrasse 16
60325 Frankfurt am Main
Germany
Attn.: Dr. Thomas Konig
Facsimile: (+49) 69-9711 1100
Notices to AFC or Alpha Subsidiary:
Applied Films Corporation
9586 I-25 East Frontage Road
Longmont, CO 80504
U.S.A.
Attn.: Lawrence Firestone
Facsimile: (+1) 303-774 3251
with a copy to:
Varnum, Riddering, Schmidt & Howlett LLP
333 Bridge Street, N.W,
P.O. Box 352
Grand Rapids,
Michigan 49501-0352
Attn.: Daniel C. Molhoek
Facsimile: (+1) 616-336 7000
15.5 Invalid or Unenforceable Provisions
If any of the provisions of this Agreement is or becomes invalid or
unenforceable, the remaining provisions of this Agreement shall remain
unaffected. The invalid or unenforceable provision shall be replaced by
the parties by a valid or enforceable provision which comes as close as
possible to the commercial purpose of the invalid or unenforceable
provision.
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15.6 Choice of Law
This Agreement, its interpretation and all questions arising out of, or
in connection with, this Agreement, shall be governed by German law,
except the UN Convention on Contracts for the Sale of Goods, without
giving effect to any choice of law or conflict of law provisions or
rules, provided that all corporate actions to be conducted pursuant to
this Agreement by AFC with respect to the issuance and delivery of the
shares constituting the Stock Component shall be governed by the law of
the State of Colorado.
15.7 Each of the Parties hereto hereby grants power of attorney to
- Doris Schott with office domicile at Nu(beta)allee 24, 63450
Hanau, Germany,
- Marion Klemm-Dombrowski, with office domicile at Nu(beta)allee 24,
63450 Hanau, Germany
- Melanie Joh, with office domicile at Nu(beta)allee 24, 63450
Hanau, Germany
each of them individually, each of them released from the restrictions
imposed by ss. 181 of the German Civil Code or similar restrictions
under other applicable jurisdictions, and each of them with the right to
grant substitute power of attorney to notarice, to set forth and to
agree upon the content of the Annexes Appendices and Schedules and to
confirm that the Annexes, Appendices and Schedules so set forth are all
the Annexes, Appendices and Schedules and that therefore the Agreement
will be completed, and and/or to sign them hereby instruct the above
persons to proceed in such manner promptly after the present Notarial
Deed has been signed.
15.8 Any provisions of the Share Purchase and Exchange Agreement not
especially amended herein shall remain unaffected.
The above Deed has been read to the persons appeared in the presence of
the notary, approved by them and signed by them and by the notary as
follows.
The other Annexes, Appendices and Exhibits were presented to the Parties
and but not signed by them, but by Miss Melanie Joh instead of them. On
this behalf the notary informed the Parties that the Annexes, Appendices
and Schedules that consist of an inventory of things, rights or legal
relationships which are already in existence do not have to be read to
the Parties according to ss. 14 of the German Notarization Act
(Beurkundungsgesetz) but are nevertheless part of the notarial deed and
this part of the agreement. After the Parties were instructed
accordingly they waived the reading of the above mentioned documents but
not the attachment of the alone mentioned documents to this notarial
record.
sign. Thomas Emch
sign. Lawrence D. Firestone
sign. Dr. Frank Bansch, Notar L. S.
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Exhibit C
---------
JOINT FILING AGREEMENT
The undersigned hereby agree that the Statement on Schedule
13D, dated January 10, 2001 ("Schedule 13D"), with respect to the shares of
common stock, no par value, of Applied Films Corporation is, and any amendments
thereto executed by each of us shall be, filed on behalf of each of us pursuant
to and in accordance with the provisions of Rule 13d-1(k) under the Securities
and Exchange Act of 1934, as amended, and that this Agreement shall be included
as an Exhibit to the Schedule 13D and each such amendment. Each of the
undersigned agrees to be responsible for the timely filing of the Schedule 13D
and any amendments thereto, and for the completeness and accuracy of the
information concerning itself contained therein. This Agreement may be executed
in any number of counterparts, all of which taken together shall constitute one
and the same instrument.
IN WITNESS WHEREOF, the undersigned have executed this
Agreement dated January 10, 2001.
UNAXIS DEUTSCHLAND GMBH
By: /s/ Volker Grafe
---------------------------------
Name: Volker Grafe
Title: Managing Director
UNAXIS DEUTSCHLAND HOLDING GMBH
By: /s/ Volker Grafe
---------------------------------
Name: Volker Grafe
Title: Managing Director
UNAXIS HOLDING AG
By: /s/ Kurt Mueck
---------------------------------
Name: Kurt Mueck
Title: Executive Vice President
By: /s/ Dr. Thomas Emch
---------------------------------
Name: Dr. Thomas Emch
Title: General Counsel
