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Exhibit 2.1
NUMBER 895 OF THE DEED ROLE FOR 2000
D O N E
at Frankfurt am Main
on September 29, 2000
Before me, the undersigned notary public
DR. STEFAN SCHMINCK
with his business address at
Schaumainkai 7
60594 Frankfurt am Main
appeared, all personally known,
1. Klaus Steinweg, Bonhoefferstrasse 40, 58 511 Ludenscheid
The appeared ad 1) declared not to act in his own name but acting as the
managing director with single power of representation and exempted from the
limitations under Section 181 Civil Code for
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Lydall Gerhardi Verwaltungs GmbH, Ludenscheid, registered in the commercial
register of the local court Ludenscheid under HR B 15 69 - EXHIBIT A, acting in
its capacity as the general partner of
Lydall Gerhardi GmbH & Co KG, Ludenscheid, registered in the commercial register
of the local court Ludenscheid under HR A 797 EXHIBIT B.
and
2. Christoph Huberty, An der Egge 16, 58093 Hagen,
and
3. Reinhard Hoffmann, Zum Tilo 20, 57413 Finnentrop-Ronkhausen.
The appeared ad 2) and ad 3) declared not to act in their own names but acting
as the appointed but not yet registered managing directors with single power of
representation and exempted from the limitations under Section 181 Civil Code in
the name of
CM 00 Vermogensverwaltung 307 GmbH, registered in the commercial register of the
local court Munchen under HR B 13 22 94 - EXHIBIT C, the change of the firm name
to Gerhardi Kunststofftechnik GmbH, the seat moved to Ludenscheid and the change
of the purpose of the company resolved according to the deed no. 893 of the deed
file 2000 of the notarizing notary but not yet registered in the commercial
registry.
Asked whether previously having been involved in the meaning of Section 3 para 1
no 7 Notarization Act (BeurkG) the appeared stated that not to have been the
case.
The appeared then requested the notarization of the following:
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SPIN OFF AND TRANSFER AGREEMENT
PREAMBLE
1. Lydall Gerhardi GmbH & Co KG is registered in the commercial register of the
local court Ludenscheid under HR A 797 with its seat in Ludenscheid,
hereinafter "TRANSFERRING COMPANY"
The partnership capital of the TRANSFERRING COMPANY amounts to DM 1.200.000,00
(in words one million twohundredthousand Deutsche Mark).
Lydall Deutschland Holding GmbH with its seat in Ludenscheid, registered in the
commercial register of the local court Ludenscheid under HR B 29 15 - EXHIBIT D
- is the only limited partner in the TRANSFERRING COMPANY.
Lydall Gerhardi Verwaltungs GmbH, Ludenscheid, registered in the commercial
register of the local court Ludenscheid under HR B 15 69, with a stated capital
of DM 100.000,00 is the only general partner in the TRANSFERRING COMPANY.
According to the Articles of Association of the TRANSFERRING COMPANY the purpose
of the company is the manufacturing of metal works of all kinds, the operation
of a semi-finished metal works plant, the manufacturing of semi- and complete
goods made out of plastic as well as trading with the above mentioned goods. The
company is entitled to be active in other branches of industry, to acquire or
lease other businesses or to make agreements of common interest or similar
agreements with other companies or associations.
2. CM 00 Vermogensverwaltung 307 GmbH with its seat in Munich is registered in
the commercial register of the local court in Munich under HR B 13 22 94 with a
stated capital of Euro 25.000,00 fully paid up,
hereinafter "RECEIVING COMPANY
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The TRANSFERRING COMPANY is the sole quotaholder of the RECEIVING COMPANY. By
way of resolution, deed No 893/ 2000 of the notarizing Notary public dated
September 29, 2000, not yet register in the commercial register inter alia the
purpose of the RECEIVING COMPANY has been changed as follows:
The purpose of the company is the manufacturing of metal works of all kinds, the
operation of a semi-finished metal works plant, the manufacturing of semi- and
complete goods made out of plastic as well as trading with the above mentioned
goods. The company is entitled to any acts possibly serving the above mentioned
purpose. The company may acquire companies of similar or equal kind and own
interests therein. The company may form domestic and/or foreign branches.
3. By way of this agreement all assets and liabilities of the business units
Ludenscheid and Ibbenburen of the TRANSFERRING COMPANY including all rights and
obligations associated with these business units - hereinafter the "BUSINESS" -
shall be spun off to the RECEIVING COMPANY with the TRANSFERRING COMPANY
continuing (Sections 123 para 3 no 1 in connection with 124 ff., 138 ff., 141 ff
Transfer Act - UmwG). The business unit Meinerzhagen shall remain with the
TRANSFERRING COMPANY.
4. To the extent the appeared refer to Exhibits, there are included in deed
no.891/2000 of the notarizing notary as of September 29, 2000, that has been
available in its original during the notarization. The contents of
aforementioned deed is known to the parties and they waive the reading and the
attachment of the deed in question.
In consideration of the above the parties agree to the following:
SPIN OFF AND TRANSFER AGREEMENT
SECTION 1 FIRM NAME AND SEAT OF PARTIES
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Lydall Gerhardi GmbH & Co KG, Ludenscheid, as the TRANSFERRING COMPANY, and CM
00 Vermogensverwaltung 307 GmbH, Munich (as mentioned above, move of corporate
seat to Ludenscheid resolved but not yet registered with the commercial
registry), as the RECEIVING COMPANY, are the participating companies in this
spin off.
SECTION 2 TRANSFER OF ASSETS
The TRANSFERRING COMPANY herewith transfers the assets and liabilities listed
below together with all rights and obligations to the RECEIVING COMPANY with the
TRANSFERRING COMPANY continuing.
The following shall apply in particular to the transfer of the assets and
liabilities to the RECEIVING COMPANY:
1. Fixed assets:
a) As part of the spin off the fixed assets listed in EXHIBIT 2.1.a. which
economically belong to the business unit in Ibbenburen are transferred from the
TRANSFERRING COMPANY to the RECEIVING COMPANY.
b) As part of the spin off the fixed assets listed in EXHIBIT 2.1.b. which
economically belong to the business unit in Ludenscheid are transferred from the
TRANSFERRING COMPANY to the RECEIVING COMPANY.
c) As part of the spin off the fixed assets listed in EXHIBIT 2.1.c. which
economically belong to the business unit in Ludenscheid forming part of the
administration there, are transferred from the TRANSFERRING COMPANY to the
RECEIVING COMPANY.
d) As part of the spin off only the patents listed in the 6th column of the list
marked "Ibbenburen" and/or "Ludenscheid" EXHIBIT 2.1.d - are transferred from
the TRANSFERRING COMPANY to the RECEIVING COMPANY.
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e) The TRANSFERRING COMPANY is the sole owner of the following real property :
REAL ESTATE LUDENSCHEID:
<TABLE>
<CAPTION>
NR. GEMARKUNG BAND BLATT FLURSTUCK GROSSE 2
HA A M
--- --------- ---- ----- --------- --------------
<S> <C> <C> <C> <C> <C> <C> <C>
1 Lud. - Stadt 1813 11 - 5 93
2 Lud. - Stadt 1813 9 - 7 98
5 Lud. - Stadt 1813 132 - 97 39
6 Lud. - Stadt 1813 131 - - 41
8 Lud. - Stadt 1813 156 - - 79
9 Lud. - Stadt 1813 10 2/8 - 01 70
10 Lud. - Stadt 1813 157 - 01 10
11 Lud. - Stadt 1813 160 - - 03
12 Lud. - Stadt 1813 159 - - 04
</TABLE>
Encumbrances: Mortgage current. No. 7 in Section III in the amount of DM
11.000.000,- in favor of Deutsche Bank
REAL PROPERTY IBBENBUREN:
<TABLE>
<CAPTION>
NR. GEMARKUNG BAND BLATT FLURSTUCK GROSSE 2
HA A M
--- --------- ---- ----- --------- --------------
<S> <C> <C> <C> <C> <C> <C> <C>
5 Ibbenburen 7288 26 - 49 61
6 Ibbenburen 7288 74 - 26 91
7 Ibbenburen 0635 94 - 90 44
8 Ibbenburen 0635 95 - 58 15
9 Ibbenburen 0635 27 - 35 53
10 Ibbenburen 0635 28 1 11 84
11 Ibbenburen 0635 73 - 29 59
</TABLE>
Encumbrances in Section III:
Real estate register of Ibbenburen, folio 7288 under current number 5 a
mortgage in the amount of DM 50.000 in favor of Fa. Karl Lohmann KG,
transferred to Stadtsparkasse Ibbenburen, as well as a further mortgage
in the amount of DM 350.000,00 under current no. 7 in favor of
Stadtsparkasse Emsdetten, transferred to Stadtsparkasse Ibbenburen;
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Real estate register of Ibbenburen, folio 0635 under current no. 1 -
10, altogether 10 mortgages at DM 120.000 each, in favor of Fa.
Gerhardi & Cie GmbH & Co KG, the TRANSFERRING COMPANY.
As part of the spin off the above mentioned real property including the
registered encumbrances and further including all statutory components of the
real property, in particular any and all existing buildings thereon, are
transferred to the RECEIVING COMPANY. The transfer includes any public levvies,
building restrictions, possible obligations of an owner under environmental
protection laws as well as obligations stemming from contamination, known or
unknown, plus any right and obligation under existing lease agreements.
However, any underlying obligations under registered mortgages shall not be
transferred.
2. Liabilities, Claims and Contractual Relations
a) As part of the spin off those supplier obligations listed in the column
Ludenscheid and Ibbenburen in EXHIBIT 2.2.a. (1) and the customer receivables
listed in EXHIBIT 2.2.a. (2) in the column Ludenscheid and Ibbenburen
transferred from the TRANSFERRING COMPANY to the RECEIVING COMPANY.
b) As part of the spin off the agreements listed in the column "Werk" and marked
"L" and "I" in EXHIBIT 2.2.b shall be transferred from the TRANSFERRING COMPANY
to the RECEIVING COMPANY.
c) The framework agreements with customers listed in the column "WKNR" marked
"4" and "005" in EXHIBIT 2.2.c. with respect to the products listed therein
shall be transferred from the TRANSFERRING COMPANY to the RECEIVING COMPANY with
all rights and obligations including the already manufactured non-finished
products therefore.
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d) As part of the spin-off the licences listed in Exhibit 2.2.d are being
transferred from the TRANSFERRING COMPANY to the RECEIVING COMPANY.
e) As part of the spin-off possession to the items listed in Exhibit 2.2.e
together with the underlying contractual relationships and the duties and rights
stemming therefrom is being transferred from the TRANSFERRING COMPANY to the
RECEIVING COMPANY.
f) As part of the sign-off the insurance relationships listed in Exhibit
2.2.f. are transfered from the TRANSFERRING COMPANY to the RECEIVING COMPANY.
3. Inventory
As part of the spin off the inventory, spare parts of any kind and ancillary
material (Hilfs- und Betriebsstoffe) in the warehouses in Ludenscheid and
Ibbenburen shall be transferred from the TRANSFERRING COMPANY to the RECEIVING
COMPANY with all rights and obligations.
4. Employment Agreements
a) As part of the spin off the employment relationships with the blue-collar
employees (Arbeiter) - EXHIBIT 2.4.a - of the business unit Ludenscheid shall be
transferred from the TRANSFERRING COMPANY to the RECEIVING COMPANY with all
rights and obligations.
b) As part of the spin off the employment relationships of the salaried
employees (Angestellte) - EXHIBIT 2.4.b - of the business unit Ludenscheid shall
be transferred from the TRANSFERRING COMPANY to the RECEIVING COMPANY with all
rights and obligations.
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c) As part of the spin off the employment relationships with the blue collar
employees - EXHIBIT 2.4.c - of the business unit Ibbenburen shall be transferred
from the TRANSFERRING COMPANY to the RECEIVING COMPANY with all rights and
obligations.
d) As part of the spin off the employment relationships of the salaried
employees - EXHIBIT 2.4.d - of the business unit Ibbenburen shall be transferred
from the TRANSFERRING COMPANY to the RECEIVING COMPANY with all rights and
obligations.
e) To the extent apprentices are being listed in the Exhibits a) - d) these
shall also be transferred.
5. All assets, liabilities, contractual relationships and employment
relationships as well as all rights and obligations shall be transferred to the
RECEIVING COMPANY to the extent they are according to the EXHIBITS, on the
transfer date (see Section 4 below) economically allocable to the BUSINESS, even
if they are not specifically listed in the EXHIBITs of this Section 3. This
shall in particular apply to intangible goods or assets acquired and liabilities
assumed until the registration of the spin off in the commercial register at the
seat of the TRANSFERRING COMPANY as well as employment relationships entered
into. To the extent that goods, claims and items are being sold in the regular
course of business by the TRANSFERRING COMPANY after the transfer date (see
Section 4 below), which according to the stipulation in Section 4. a) were
supposed to be transferred to the RECEIVING COMPANY, the surrogate shall replace
them.
SECTION 3 ISSUANCE OF QUOTAS; SPECIFIC RIGHTS AND BENEFITS
1. As consideration for the transfer specified under Section 2 above the
TRANSFERRING COMPANY shall receive additional interests in the company by
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way of increase of its existing quota with a nominal capital of Euro
25.000,00 by Euro 2.475.000,00 to Euro 2.500.000,00 so that the stated
capital of the RECEIVING COMPANY shall then amount to Euro 2.500.000,00. The
amounts stated for the transferred assets shall be at the level of the
RECEIVING COMPANY at the minimum according to their book value, at the
maximum to their fair market value. Any difference of the value stated in
accordance with the above of the transferred assets towards the total nominal
value of the quota of the RECEIVING COMPANY shall be booked into the capital
reserve of the RECEIVING COMPANY. The consideration granted by way of stock
increase shall provide the entitlement to profits as of the transfer date
(see Section 4 below).
2. No cash payments are due.
3. No special rights and benefits for the shareholders of the TRANSFERRING
COMPANY or other parties mentioned in Section 126 para 1 no. 7 and 8 Transfer
Act - UmwG - were granted.
SECTION 4 TRANSFER DATE
4.1 As of September 30, 2000, 11.58 p.m. any acts with respect to assets and
liabilities as well as other rights and obligations transferred to the RECEIVING
COMPANY in accordance with Section 2 above by the TRANSFERRING COMPANY shall be
deemed to have been made on behalf of the RECEIVING COMPANY (Section 126 para 1
no 6 Transfer Act - UmwG).
4.2. With respect to the status of the content and the existence of the assets
transferred according to Section 2 above the SPIN-OFF DATE is material.
SECTION 5 CONSEQUENCES OF THE SPIN OFF FOR THE EMPLOYEES AND THEIR
REPRESENTATIVES
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1. On the basis of the spin off the employment relationships listed in EXHIBITs
2.4.a, 2.4.b, 2.4.c und 2.4.d shall be transferred from the TRANSFERRING COMPANY
to the RECEIVING COMPANY.
2. The RECEIVING COMPANY shall accept all rights and obligations for the
employment relationships existing at the time of transfer in light of the spin
off. To the extent these rights and obligations are dealt with by a collective
bargaining agreement or a collective shop agreement these shall become part of
the individual employment agreement between the RECEIVING COMPANY and the
respective employee and may not be altered to the detriment of the employee
prior to the end of one year following the date of transfer (Section 613a para 1
Civil Code - BGB, Section 324 Transfer Act - UmwG), unless the prerequisites of
the exception to the rule according to Section 613 a para 1 sentence 3 and 4
Civil Code - BGB are applicable (Section 324 Transfer Act - UmwG). According to
Section 324 Transfer Act - UmwG - Section 613 a para 4 Civil Code - BGB remains
unaffected by the effects of the registration of the spin off. With respect to
termination Section 323 Transfer Act - UmwG applies; Section 323 Transfer Act -
UmwG - stipulates that with respect to termination the position of the employee
shall not detrimentally be affected for the duration of two years following the
spin off, if the respective employee had been employed by the TRANSFERRING
COMPANY for more than two years prior to the spin off.
3. A levying of interest - Interessenausgleich - concerning the employees listed
in EXHIBITs 2.4.a., 2.4.b., 2.4.c. and 2.4.d. has been agreed upon between the
TRANSFERRING COMPANY and the works councils exisiting in the company for the
business unit in Ibbenburen on the one hand and in Meinerzhagen and in
Ludenscheid on the other dated 29.09.2000. The document is attached as EXHIBIT
5.3.
4. The RECEIVING COMPANY has no works council until now. The TRANSFERRING
COMPANY has a joint works council for the business units Ludenscheid and
Meinerzhagen and a works council for the business unit in
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Ibbenburen. According to Section 321 Transfer Act - UmwG - the members of the
works council remain in office and continue the business for those units for
which they were responsible before and thus also for those business units
transferred to the RECEIVING COMPANY. The works councils are required to
immediately appoint an election committee. Their transitionary mandate shall
end as soon as new works councils have been elected in the business units and
the result of the election has been published, however, not later than six
months following the registration of the spin off in the commercial register
at the seat of the RECEIVING COMPANY.
The wording of Section 321 Transfer Act - UmwG - does not provide for a
transitional mandate for other employee representations such as company works
council, economic committee, youth and apprentice representation, speaker
committee, etc.. Nevertheless, the RECEIVING COMPANY accepts transitionary
mandates by way of the levying of interest - Exhibit 5.3.
The RECEIVING COMPANY shall regularly employ more than 500 employees and thereby
more than 100 employees with the consequence that the works council respectively
company works council shall establish an economic committee (Section 106 Works
Council Constitution Act - BetrVerfG). The TRANSFERRING COMPANY shall regularly
employ more than 100 employees; consequently, there will be an economic
committee.
In case separate works councils are being established for the business units in
Ibbenburen and Ludenscheid at the RECEIVING COMPANY, Section 47 Works Council
Constitution Act - BetrVerfG - provides for the establishment of a company works
council.
Units with regularly more than 5 employees which have not reached the age of 18
- adolescent employees - or which are employed as part of their education and
have not yet reached the age of 25, youth and apprentice representations shall
be elected if works councils have been established in these units (Sections 60,
80 para 1 no 5 Works Council Constitution Act - BetrVerfG). As concerns the
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TRANSFERRING COMPANY there are no youth and apprentice employees; the RECEIVING
COMPANY presently employs 5 youths and apprentices.
5. Following the spin off the RECEIVING COMPANY will regularly employ more than
500 employees. Limited liability companies - GmbH's - with more than 500
employees are required under Section 77 Works Council Constitution Act 1952 to
establish a co-determined Supervisory Board consisting of 1/3 employee
representatives. The RECEIVING COMPANY shall establish a co-determined
Supervisory Board with 1/3 of the members being employee representatives.
SECTION 6 FINANCIAL STATEMENT
The spin off will be based on a spin off financial statement of the TRANSFERRING
COMPANY in the form of a closing balance sheet in the meaning of Sections 125,
17 para 2 Transfer Act - UmwG as per September 30, 2000, 11.58 p.m. audited with
an unqualified certificate by the CPA firm Price Waterhouse Coopers, Dortmund
(PwC).
SECTION 7 REAL PROPERTY, STATEMENTS CONCERNING REAL PROPERTY
The TRANSFERRING COMPANY appropriates and the RECEIVING COMPANY applies for an
amendment of the land registers with respect to the transfers under this spin
off and transfer agreement in accordance with Section 2.1.e.
The competent land registers shall receive a certified excerpt from the
commercial register following the registration of the spin off in the commercial
register of the TRANSFERRING COMPANY.
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SECTION 8 SEVERANCE CLAUSE
In case one or more clauses of this deed are void or unenforceable the remaining
clauses shall remain unaffected thereby. The parties undertake to replace the
void or unenforceable clause by such a clause which in its economic effect comes
closest to the void or unenforceable clause, however, is valid and enforceable.
The same shall apply in case of omissions in this agreement.
SECTION 9 EXPENSES, VAT, COPIES
The cost for this deed and its consummation as well as any possible transfer
taxes shall be borne by the TRANSFERRING COMPANY.
To the extent any of the transactions made above trigger VAT the RECEIVING
COMPANY shall owe to the legal VAT to the TRANSFERRING COMPANY. The TRANSFERRING
COMPANY is obliged in that case to issue to the RECEIVING COMPANY a statement
showing the VAT owed. The VAT owed shall be paid by way of transfer of the input
tax claim of the RECEIVING COMPANY to the competent tax authoritiy supplied on
the legal form. The RECEIVING COMPANY herewith accepts such a transfer. In case
the transfer of the input tax claim cannot be effected, irrespective of the
reason therefor, or in case the input tax claim cannot successfully be claimed
for other reasons towards the tax authority in connection with the same VAT
declaration, in which the transfer itself has been declared, the claim shall be
paid by way of payment by the RECEIVING COMPANY.
To the extent the transaction forms a business transfer the RECEIVING COMPANY
shall take over this legal position with respect to VAT in accordance with
Section 1 a Value Added Tax Act - UmstG - in lieu of the TRANSFERRING COMPANY.
This means that in particular the deadlines for corrections as well as other
stipulations concerning the input tax deduction according to Section 15 a VAT
Act shall be continued by the RECEIVING COMPANY. In case of a
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correction of the input tax concerning the assets transferred under this spin
off and transfer agreement in accordance with Section 15 a VAT Act due to
change of use the RECEIVING COMPANY shall bare the cost for input tax
repayments, potential input tax returns shall also be due the RECEIVING
COMPANY.
The following parties shall receive
EXECUTIONS:
- The quotaholder of the TRANSFERRING COMPANY (2);
- the quotaholder of the RECEIVING COMPANY (2);
- the parties of this agreement (2 each).
CERTIFIED COPIES:
- the court of registration of Ludenscheid (2);
- the court of registration of Munich (2);
- the land register in Ibbenburen;
- the land register in Ludenscheid;
- the tax office Ludenscheid, corporate income tax unit no. 3325740735
- the tax office Ludenscheid, real property transfer tax unit.
- the tax office Ibbenburen, real property transfer tax unit
SECTION 10 REMARKS
The notary pointed out to the parties in particular the following:
- The spin off shall only become effective with the registration thereof in
the commercial register of the TRANSFERRING COMPANY.
- At the time of registration of the capital increase in the commercial
register at the seat of the RECEIVING COMPANY the net value of the assets
transferred minus the liabilities transferred may not be lower than the
total
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nominal value of the shares / quotas issued in consideration thereof of
the RECEIVING COMPANY.
- The transferring company shall remain liable for any potiential shortfall
amount.
- The notary pointed out the effects of the registration under Section 131
Transfer Act - UmwG - and the liability stipulations according to Section
133 Transfer Act.
- The notary further informed about Section 613 a Civil Code, the interim
mandate of the works council under Section 321 Transfer Act and the rights
of the employees with respect to termination under Section 323 Transfer
Act.
- The notary has further informed about the potential damage claim against
the representative bodies of the TRANSFERRING COMPANY under Section 25
Transfer Act.
- The notary further informed that additional liability could stem from other
statutes such as Section 25 Commercial Code and Section 75 AO, Section 133
para 1 sentence 2 Transfer Act.
- The notary finally informed that the spin off could trigger real estate
transfer tax and that the parties shall be jointly liable towards the tax
authorities for such a tax.
SECTION 11 POWER OF ATTORNEY
All the appeared asked the notary to implement this deed and herewith grant a
power of attorney to him and his substitute exempting them from the limitations
under Section 181 Civil Code to make any statements in their name necessary for
the implementation of this agreement, make amendments to this deed, in
particular to the extent these are requested from the land register for the
amendment of the land registers.
The appeared herewith grant to the notary as well as
a) Ms. Waltraud Alltmann
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b) Ms. Sandra Assion
- each individually -
both employed by the notary in his notarial office, power of attorney with the
exemption from the limitations under Section 181 Civil Code to make any
statements with respect to the filing of the spin off agreement, which may be
requested by the chamber of commerce and / or the courts of registration in
implementing the spin off. This power of attorney shall include any changes in
the mere wording of this agreement.
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This recording has been read by the notary, approved by the appeared and
personally signed by them as follows:
