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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) February 27, 1995
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Harman International Industries, Incorporated
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(Exact name of registrant as specified in its charter)
Delaware
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(State or other jurisdiction of incorporation)
1-9764 11-2534306
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(Commission File Number) (IRS Employer Identification No.)
1101 Pennsylvania Avenue, N.W., Suite 1010, Washington, D.C. 20004
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (202) 393-1101
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Not Applicable
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(Former name or former address, if changed since last report)
The total number of sequentially numbered pages is 33.
The Exhibit Index appears on page 5.
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Item 2. Acquisition or Disposition of Assets
On February 27, 1995, Harman International Industries,
Incorporated ("Harman") completed its acquisition of 100 percent of
the outstanding shares of Becker GmbH ("Becker") with satisfaction
of all conditions remaining after execution of the share purchase
agreement (the "Agreement") dated February 16, 1995 between Harman,
Roland Becker and Becker Holding S.A. Becker is a leading
manufacturer of automotive OEM and consumer automotive aftermarket
electronics.
Under the terms of the Agreement, Harman paid 9.0 million
Deutschmarks (approximately $6.0 million) and 400,000 shares of
Harman common stock in consideration for all of the issued and
outstanding stock of Becker GmbH, Becker Holding GmbH and Becker
Service und Verwaltungs-GmbH and forgiveness of certain obligations
of Becker due to the selling parties and affiliates. Harman
assumed post-acquisition indebtedness of Becker of 86.0 million
Deutschmarks (approximately $57.7 million). Harman funded its
acquisition of Becker utilizing its revolving credit facility.
Becker, founded in 1945 by Max Egon Becker, is headquartered in
Karlsbad, Germany, and has subsidiary operations in South Africa
and the United States. Becker manufactures and markets automotive
OEM radios and other automotive OEM electronics as well as
automotive aftermarket radios. Becker's principal automotive OEM
customer is Mercedes. Principal manufacturing facilities are
located in Karlsbad, Germany and Woerth-Schaidt, Germany. Harman
currently intends to continue to use Becker's facilities for the
same purposes as they were previously used.
Item 7. Financial Statements and Exhibits
Submission of the financial statements required by Items
7(a)(1), (2) and (b)(1) is impracticable at this time. Harman will
file such financial statements under cover of Form 8-K/A as soon as
practicable, but in no event later than May 12, 1995.
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Attached hereto as Exhibit 2.1 is a copy of the Share Purchase
Agreement, together with copies of the following exhibits and
schedules attached thereto:
EXHIBIT 1 - Power of Attorney *
EXHIBIT A - Definitions
SCHEDULE 3.9 - Becker GmbH German Balance Sheets as of
December 31, 1994 and December 31, 1993 *
* Omitted. The Registrant agrees to furnish supplementally to
the Commission upon request a copy of any omitted Exhibit or
Schedule.
Attached hereto as Exhibit 2.2 is a copy of the press release
dated March 1, 1995 announcing the completion of the acquisition of
Becker.
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Signatures
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Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned hereunto duly authorized.
HARMAN INTERNATIONAL
INDUSTRIES, INCORPORATED
By: /s/ Sandra B. Robinson
_______________________
Sandra B. Robinson
Vice President - Financial
Operations
Date: March 14, 1995
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EXHIBIT INDEX
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Exhibit No. Description Page
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2.1 Share Purchase Agreement 6
2.2 Press Release dated March 1, 1995 32
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EXHIBIT 2.1
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not/4595
Number 20 of the Document Register 1995
Negotiated
at Frankfurt on February 16, 1995
at Bockenheimer Landstrasse 42
where the Notary public appeared upon request of the parties.
Before me
W E R N E R L E I P N I T Z
within the jurisdiction of the Higher Regional Court
of Frankfurt am Main
located at Frankfurt am Main
The following persons appeared today:
1) Mr. William S. Palin, accountant born September 3, 1942,
residing at The White House, Llandyrnog, Denbigh, Clwyd,
Wales, proving his identity by submitting his British-
Passport-No. 297681K, hereinafter not acting on his own behalf
but on behalf of Harman International Industries,
Incorporated, a Corporation organized under the laws of
Delaware, U.S.A., having an address at 8500 Balboa Boulevard,
Northridge, California 91329, U.S.A., accompanied by the legal
advisor of Harman International Industries Incorporated, Mr.
Douglas J. Whipple.
In proof of his right to represent Harman International
Industries he presented a notarized power of attorney dated
February 13, 1995, (Exhibit 1);
2) Mr. Roland Becker, born May 1, 1943, residing in Passage des
Sapins 98, 2905 Courtedoux/Jura, Switzerland, proving his
identity by submitting his Swiss-Passport-No. 500980,
hereinafter acting on his own behalf as well as managing
director with sole power of representation and released from
the restrictions of section 181 of the German Civil Code on
behalf of
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a) Becker Holding GmbH, a limited liability company
(Gesellschaft mit beschraenkter Haftung) organized
under the laws of Germany having an address at Im
Stockmaedle 1, 76307 Karlsbad, Germany, registered
in the Trade Register of the Amtsgericht (Local
Court) of Karlsruhe under No. HR B 1396 E, and
behalf of
b) Becker Service- und Verwaltungs GmbH ("BSVG") a
limited liability company (Gesellschaft mit
beschraenkter Hefting) organized under the laws of
Germany, having a address at Im Stockmaedle 1,
76307 Karlsbad, Germany, registered in the Trade
Register of the Amtsgericht (Local Court) of
Karlsruhe and behalf of
c) Becker Holding S.A., a societe anonyme, organized
under the laws of Switzerland having an address at
Passage des Sapins 98, 2905 Courtedoux/Jura,
Switzerland.
3) Mr. Anton Dittner, residing in Deichstr. 18, Ettlingen,
proving his identity by submitting his Identity Card,
hereinafter acting not on his own behalf but in his capacity
as managing director with sole power of representation on
behalf of Becker GmbH, a limited liability company
(Gesellschaft mit beschraenkter Haftung) organized under the
laws of Germany having an address at Im Stockmaedle 1, 76307
Karlsbad, Germany, registered in the Trade Register of the
Amtsgericht (Local Court) of Karlsruhe under No. HR B 1395 E.
The persons present and the Notary Public are sufficiently familiar
with the English language. The parties therefore requested
notarization of this document in English. Being informed by the
Notary Public that the parties could request a translation of the
document, they are waiving a simultan-translation by the Notary
Public into German.
The person appearing under 2) declared that by selling the shares
according to the subsequent agreement non of the sellers is
transferring all his/its property to the purchaser and that all
sellers own substantial further property besides the shares sold by
this agreement (sections 419, 1365 German Civil Code "BGB").
Thereafter the persons present subsequently declared the following:
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SHARE PURCHASE AGREEMENT
This SHARE PURCHASE AGREEMENT (this "Agreement") made as of
the 16th day of February, 1995 between Harman International
Industries, Incorporated ("Purchaser"), a corporation organized
under the laws of Delaware, U.S.A. having an address at 8500 Balboa
Boulevard, Northridge, California 91329 USA, and Roland Becker
("Shareholder One"), an individual residing in Courtedoux,
Switzerland,, and Becker Holding S.A. ("Shareholder Three"), a
societe anonyme organized under the laws of Switzerland having an
address at [], Courtedoux, Switzerland (Shareholder One and
Shareholder Three are referred to collectively as the "Sellers").
Capitalized terms used and not defined herein shall have the
meanings indicated in Exhibit A to this agreement.
RECITALS
1. Shareholder One holds a share in Becker GmbH, Karlsbad,
Germany (the "Company") which he desires to sell and transfer to
Purchaser. Becker Holding GmbH ("Shareholder Two") holds a share
in the Company. Shareholder One holds a share in Shareholder Two
which he desires to sell and transfer to Purchaser. Shareholder
Two and Shareholder Three hold shares in Becker Service und
Verwaltungs-GmbH ("BSVG") and Shareholder Three desires to sell and
transfer its share to Purchaser.
2. Purchaser desires to purchase such shares on the terms and
conditions stated in this Agreement.
ARTICLE 1
SALE AND PURCHASE
1.1 Objects of Purchase. The Company has a total
registered share capital (Stammkapital) of DM 1,000,000.-- of which
DM 525,000.-- is fully paid up. Shareholder One holds a share in
the nominal amount of DM 550,000.-- in the Company (the "First BG
Share"). Shareholder Two holds a share in the nominal amount of DM
450,000.-- in the Company (the "Second BG Share"). BSVG has a
total registered share capital of DM 6,000,000.--. Shareholder Two
holds a share in the nominal amount of DM 5,800,000.-- in BSVG
(the "First BSVG Share"). Shareholder Three holds a share in the
nominal amount of DM 200,000.-- in BSVG (the "Second BSVG Share").
Shareholder Two has a total registered share capital of DM
2,000,000.--. Shareholder One holds a share in the nominal amount
of DM 2,000,000.-- in Shareholder Two (the "BHG Share") (the First
BG Share, the Second BSVG Share and the BHG Share are collectively
referred to as the "Shares").
1.2 Sale, Purchase and Transfer. Shareholder One hereby
sells and transfers by assignment the First BG Share to Purchaser.
Purchaser hereby accepts such sale and transfer of the First BG
Share. Shareholder Three hereby sells and transfers by assignment
the Second BSVG Share to Purchaser. Purchaser hereby accepts such
sale and transfer of the Second BSVG Share. Shareholder One hereby
sells and transfers by assignment the BHG Share to Purchaser.
Purchaser hereby accepts such sale and transfer
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of the BHG Share. All share transfers include the profit
participation right as of January 1, 1995.
1.3 Conditions Subsequent to Transfer of Shares. The
transfer of the Shares shall revert automatically back to the
Sellers, and for this case the Purchaser offers hereby and Seller
accept the re-sale and the re-assignment of all shares transferred
above under 1.2. This Agreement shall become non-binding upon the
parties hereto (except that claims regarding breaches up to such
time shall be preserved) upon the occurrence of any of the
following conditions subsequent, provided, however, that any such
condition subsequent may be waived, in whole or in part,
conditionally or unconditionally, or the time for the occurrence
therefor extended (but in no event shall such extension exceed
March 31, 1995) by Purchaser in its sole and absolute discretion:
(a) the Company becoming the subject of a bankruptcy
proceeding prior to February 25, 1995 and Purchaser
has notified Shareholder One in writing that it
objects to such proceeding;
(b) Hypobank not having waived by February 25, 1995 all
of its claims whatsoever against all Aquired
Companies and Shareholder One including, without
limitation, its pledge on any Shares, or been
satisfied by payment or otherwise regarding such
claims;
(c) The Company not having completed or been released
from the current compromise proceedings prior to
February 25, 1995; or
(d) Purchaser having not received by February 25, 1995
approval for the transactions contemplated by this
Agreement from the Board of Directors of Harman
International Industries, Incorporated.
Notwithstanding the above conditions subsequent, Purchaser may
not waive the condition subsequent in Section 1.3(b) of this
Agreement with respect to waiver of claims by Hypobank against
Shareholder One and only Shareholder One may waive such condition
subsequent with respect to waiver of claims by Hypobank against
him.
Should any condition subsequent set forth in Section 1.3 occur
without being waived or extended, this Agreement shall no longer be
binding on the parties hereto, but claims of any breaches hereof up
to such point in time shall be preserved.
If the transfer of the shares will be reverted according 1.3
none of the parties is entitled to any compensation whatsoever.
ARTICLE 2
PURCHASE PRICES AND PAYMENTS
2.1 First and Second Share Purchase Prices. The
aggregate consideration (the "Purchase Price") for the Shares is DM
2.500.000.-- (Zweimillionenfuenfhunderttausend), payable DM 1,1 Mio
for the First BG Share, DM 1,2 Mio for the BHG Share both to
Shareholder One and DM 200.000,-- to Shareholder Three. The
Purchase Price shall be
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payable by Purchaser within 10 days from today assuming that all
subsequent conditions set forth in Section 1.3 of this Agreement
have finally failed to occur.
2.2 Calculation Net Worth Difference.
a) Within 45 days after delivery of the Audited
Financial Statements to the Company, Purchaser's Accountant shall
deliver to Shareholder One the Interim Financial Statements along
with a calculation of any Net Worth Difference (as hereinafter
defined). If, as shown on the Interim Financial Statements, the
Net Worth of the Company is less than negative DM 41,000,000.--,
the Net Worth of any Subsidiary is less than DM 1.--, and/or the
Net Worth of Shareholder Two, after writing down its investment in
the share in the Company to DM 0.00, is less than negative DM
42,500,000.--, then: the amounts by which any such Net Worths are
less than the above figures, if any, shall be aggregated (the "Net
Worth Difference"). In considering these negative Net Worths,
three items are known to Purchaser and shall be ignored for
purposes of the calculation of Net Worth Difference. Such items
are: (1) a temperature measurement machine which had a gross cost
of approximately DM 5,600,000.-- and has a net book value of
approximately DM 2,800,000.-- which is not considered as presently
useable by the management of the Company, (2) an entitlement of the
employees of the Company for subordinated Christmas bonus and
holiday pay in an approximate amount of DM 6,000,000.-- not accrued
in the books of the Company and (3) the costs of terminating
Geschaeftsfuehrer agreements amounting to approximately DM
1,000,000.--.
b) Shareholder One shall have 30 days from
Shareholder One's receipt of the Interim Financial Statements and
the calculation of the Net Worth Difference to notify Purchaser in
writing if it objects to any item in such calculation. Any such
notice shall specify the item or items in dispute (a "Disputed
Item" or "Disputed Items"). Any dispute with regard to the Interim
Financial Statements shall not be or be deemed a Disputed Item
unless it affects the calculation of the Net Worth Difference. Any
Disputed Item shall be resolved in the manner set forth in the
separate arbitration agreement.
c) If (A) Shareholder One does not object in
writing to the calculation of the Net Worth Difference within 30
days of Shareholder One's receipt of the Interim Financial
Statements, (B) Purchaser and Shareholder One acknowledge in
writing that the calculation of the Net Worth Difference is
accurate or (C) all Disputed Items with respect to the calculation
of the Net Worth Difference have been resolved in accordance with
the separate arbitration agreement, the calculation of the Net
Worth Difference shall be final and binding on all parties.
2.3 Transfer Taxes. Shareholder One and Purchaser shall each
be liable for and pay 50% of all applicable sales, documentary,
recording, filing, transfer, and other similar taxes and fees
payable as a result of the consummation of the transactions
contemplated by Articles 1 and 2 of this Agreement, except that
Purchaser shall be liable for notarial fees as a result of the
notarization of this Agreement.
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ARTICLE 3
GUARANTEES (GARANTIEN), REPRESENTATIONS AND
WARRANTIES OF THE SELLERS
Shareholder One, in conjunction with the remedies provided by
the indemnification provisions of Article 6 hereof, absolutely and
unconditionally guarantees, represents, and warrants to Purchaser,
as of the date this Agreement finally comes into effect, that:
3.1 Organization; Corporate Power and Authority.
Shareholder One is an individual with all power, authority and
competence to own his property and carry on his business as
presently owned and conducted. Shareholder Two is a Gesellschaft
mit beschraenkter Haftung duly organized and existing under the
laws of Germany and has all necessary power and authority to own
its property and carry on its business as presently owned and
conducted. Shareholder Three is a societe anonyme duly organized
and existing under the laws of Switzerland and has all necessary
power and authority to own its property and carry on its business
as presently owned and conducted. The Company is a Gesellschaft
mit beschraenkter Haftung duly organized and existing under the
laws of Germany and has all necessary power and authority to own
its property and carry on its business as presently owned and
conducted. Each Subsidiary is duly organized and existing under
the laws of its jurisdiction of organization and has all necessary
power and authority to own its property and carry on its business
as presently owned and conducted. BSVG is duly organized and
existing under the laws of Germany and has all necessary power and
authority to own its property and carry on its business as
presently owned and conducted. Each Seller has duly authorized,
executed, and delivered this Agreement and has full power and
authority to execute and deliver, and to perform its obligations
under this Agreement. This Agreement, when executed and delivered
by all parties hereto, constitutes the valid and binding obligation
of each Seller, enforceable in accordance with its terms. No
Seller or any Acquired Company has taken or failed to take any
action, which action or failure would preclude or prevent Purchaser
(or the Company) from conducting the Business in the manner
heretofore conducted.
3.2 Capital. The authorized capital of each Acquired
Company is as set forth in section 1.1 of this agreement and the
number or amount of capital shares or stock in the Company and each
Subsidiary is owned by the entities as set forth in such section
1.1 The shares of each Acquired Company owned directly or
indirectly by the Sellers (the "Owned Shares") are owned legally
and beneficially by the owner thereof as described in such section
1.1, free and clear of any Liens. All of the Owned Shares are duly
authorized, validly issued, and fully paid (other than the First BG
Share and the Second BG Share as set forth in Section 1.1 of this
Agreement) and are not subject to assessment. Other than
Subsidiaries and as set forth in Section 1.1., no Acquired Company
has any subsidiary corporations and nor owns any interest, directly
or indirectly, in any other business, enterprise, firm, or
corporation. For any Acquired Company there are no securities
(issued, reserved for issuance, convertible, or outstanding) of or
other interests or rights in any Acquired Company of any kind and
there are no restrictions with respect to transferability of the
Owned Shares. There are no options, offers, warrants, conversion
rights, preemptive rights, subscriptions or agreements or rights of
any kind to subscribe for or to purchase, or commitments to issue
(either formal or informal, firm or contingent), share or equity
capital or securities of or interests or rights in any (whether
debt, equity, or a combination thereof) or obligating any Acquired
Company to grant,
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extend, or enter into any such agreement or commitment. Upon the
respective sale, assignment, and delivery of the Shares as herein
contemplated, Purchaser will acquire the entire ownership of and
any and all existing rights and interests in, the Acquired
Companies, and will have good and marketable title to the Shares,
free of all Liens, as of and when each such Share is acquired by
Purchaser. Other than the Company, which is in a compromise
proceeding, no Acquired Company is the subject of or should be,
according to applicable Laws, the subject of a compromise or
bankruptcy proceeding.
3.3 Conflicts; Defaults. Neither the execution and
delivery of this Agreement by any Seller, nor the performance of
any of their obligations hereunder, will (i) violate or conflict
with any of the terms of any Articles of Association, By-Laws, or
other organizational documents of any Acquired Company or of any
Seller, or constitute a default or result in the acceleration of
any obligation under any provisions of any contract, or of any
order, judgment, or decree by which any Seller or any Acquired
Company is bound or by which any of their assets are affected, (ii)
result in the creation or imposition of any Liens in favor of any
third Person upon any assets of any Acquired Company or (iii)
violate any Law applicable to any assets of any Acquired Company.
Such execution, delivery, and performance will not give to others
any rights, including rights of termination, cancellation, or
acceleration, in or with respect to any contract.
3.4 Governmental Approvals. Except for the non-
objection of the German Federal Cartel office (Bundeskartellamt),
no approval, consent, decree, or order of any Governmental
Authority is required in connection with the execution and delivery
of this Agreement by any Seller, the performance of their
obligations hereunder, or the consummation by each of them of the
transactions contemplated hereby, or for the prevention of any
termination of any right, privilege, license, or agreement relating
to the Business or the continuation of the Business following the
execution hereof.
3.5 Third Party Consents. No consent, approval, or
authorization of any Person ("Third Party Consent") is required in
connection with the execution, delivery, or performance of this
Agreement by any Seller or the continuation of the Business
following the execution hereof.
3.6 Financial Statements. Attached hereto as Schedule
3.9 entitled "Financial Statements" are the Agreement Financial
Statements. The Agreement Financial Statements (a) were prepared
from the books and records kept by the Acquired Companies in
accordance with statutory German accounting principles consistently
applied with prior periods and (b) fairly and accurately present
the financial condition and the results of operations of the
Acquired Companies as of the dates and for the periods indicated.
To the best knowledge of Shareholder One after due inquiry, there
are no Material Items which will adversely affect the financial
performance or condition of the Company.
3.7 Intellectual Property. The Intellectual Property of
the Acquired Companies comprises all intellectual property
necessary to permit the operation of the Business as now being
conducted. None of the Intellectual Property is subject to any
Liens. To the best knowledge of Shareholder One the conduct of the
Business as now conducted does not conflict with or infringe any
Intellectual Property of any third Person in any way. The Company
has the absolute, unconditional and irrevocable right to use the
name "Becker" in the automotive industry.
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3.8 Brokers. No Seller or Acquired Company is directly
or indirectly obligated to anyone acting as a broker, finder, or in
any other similar capacity in connection with this Agreement or the
transactions contemplated hereby.
ARTICLE 4
GUARANTIES (GARANTIEN), REPRESENTATIONS AND WARRANTIES
OF PURCHASER
Purchaser, in conjunction with the remedies provided by the
indemnification provisions of Article 6 hereof, absolutely and
unconditionally guaranties, represents, and warrants to Shareholder
One as of the date this Agreement finally comes into effect as
follows:
4.1 Organization; Corporate Power and Authority.
Purchaser is a corporation, duly organized and validly existing
under the laws of Delaware, and has all necessary power and
authority to own its property and carry on its business as
presently owned and conducted. Purchaser has duly authorized,
executed, and delivered this Agreement and has full power and
authority to execute and deliver, and to perform its obligations
under this Agreement. This Agreement, when executed and delivered
by all parties hereto, constitutes the valid and binding obligation
of Purchaser, enforceable in accordance with its terms.
4.2 Conflicts; Defaults. Neither the execution and
delivery of this Agreement by Purchaser, nor the performance of its
obligations hereunder, will (a) violate or conflict with any of the
terms of its certificate of incorporation or by-laws, or other
organizational documents, or constitute a default or result in the
acceleration of any obligation under any provisions of any contract
or agreement by which Purchaser or any of its assets are bound or
(b) violate any Law applicable to Purchaser.
4.3 Brokers. Except for brokers or consultants hired by
Purchaser, whose fees Purchaser shall be responsible for, Purchaser
is not directly or indirectly obligated to anyone acting as a
broker, finder, or in any other similar capacity in connection with
this Agreement or the transactions contemplated hereby.
ARTICLE 5
CERTAIN COVENANTS
5.1 Mutual Covenants and Agreements.
(a) Publicity. Except to the extent as may be required
by applicable Law, no party shall issue any press release or make
any other public statement concerning the transactions contemplated
by this Agreement without obtaining the prior approval of
Purchaser.
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(b) Expenses. Except as otherwise provided in this
Agreement, the Sellers and Purchaser shall each bear their own
costs and expenses incurred in connection with this Agreement and
the transactions contemplated hereby.
(c) Cooperation. Purchaser and the Sellers shall use
all reasonable efforts to execute all documents or certificates as
may be necessary, appropriate, or desirable, on the advice of
counsel, for the consummation of the transactions contemplated by
this Agreement. The parties recognize that a post-acquisition
filing with the German Federal Cartel Office (Bundeskartellamt)
will be required and the parties will cooperate in providing all
necessary information and documentation necessary to make such
filing.
5.2 Assurances Regarding Share Transfer. Each Seller
shall take all actions and execute and deliver all documents
necessary or desirable to effectively convey record and beneficial
ownership, free of all Liens, to the Shares to Purchaser.
5.3 Release and Waiver of Amounts Owed.
(a) Shareholder One, on behalf of himself and
Shareholder Three and
Romalux, hereby irrevocably waives all amounts owed to him by any
Acquired Company, net of any amounts payable by Shareholder One to
any of them, and shall procure the waiver of Romalux of all amounts
owed by any Acquired Company to Romalux, and hereby releases and
shall procure the release by Romalux of every Acquired Company from
any and all claims which he and Romalux may now or in the future
have against any Acquired Company relating to time periods prior to
the date when all conditions subsequent have failed to occur within
the time periods specified. Shareholder One for himself and on
behalf of Shareholder Two, Becker Service und Verwaltungs GmbH,
Shareholder Three and Romalux on the one hand and the appearant
under 3) on behalf of the Company mutually accept the waivers as
declared. Shareholder One shall be liable for all claims that any
such amounts have been assigned to any third Person and undertakes
to himself satisfy the claims of any such third Persons for any
such amounts.
In consideration for the above waivers and releases,
Purchaser shall pay to Shareholder One the following consideration:
DM 6.500.000,-- and the Harman Stock. The Harman Stock and such DM
6.500.000,-- shall be held by Purchaser as security for a period of
two years and may be offset against amounts due an Indemnified
Purchaser by reason of Section 6.2 (a) of this Agreement.
(b) Shareholder One acknowledges that any certificate
representing the Harman Stock will contain a legend substantially
to the following effect:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT, OR ANY STATE SECURITIES LAWS. NEITHER
THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN
MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED, OR OTHERWISE DISPOSED OF IN THE ABSENCE OF
SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT
FROM, OR NOT SUBJECT TO, REGISTRATION.
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TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
REGISTRATION.
(c) Shareholder One, as a purchaser of Harman Stock in
a sale occuring outside the United States within the meaning of
Regulation S under the Securities Act, acknowledges that until the
expiration of the "40-day restricted period" within the meaning of
Regulation S under the Securities Act, any reoffer or resale of the
Harman Stock shall not be made by it to a U.S. person or for the
account or benefit of a U.S. person within the meaning of Rule
902(o) under the Securities Act.
(d) Shareholder One has such knowledge and experience in
financial matters that he is capable of evaluating the merits and
risks of investment in Harman Stock and of making an informed
investment decision and he is capable of bearing the economic risks
of an investment in the Harman Stock.
(e) Shareholder One has been provided with, or had
access to, such information which he deems necessary to or useful
in his evaluation of the merits and risks of an investment in the
Harman Stock and of making an informed investment decision,
including an opportunity to ask questions of and request
information from Purchaser.
(f) Shareholder One has chosen, retained and been
advised by, with respect to its investment in the Harman Stock,
independent legal counsel, independent investment advisors and such
other professional advisors as it has deemed necessary and
appropriate.
(g) Shareholder One is acquiring its Harman Stock for
its own account and not with a view to, or for resale in connection
with, any distribution or public offering thereof within the
meaning of the Securities Act or other applicable securities laws
or rules; provided, however, that the disposition of the Harman
Stock shall at all times remain with his control, subject to
specific provisions of this Agreement. Shareholder One is an
individual or institution that, at the time it acquires the Harman
Stock, is outside the United States and is not a U.S. person (and
is not purchasing the Harman Stock for the account or benefit of a
U.S. person) within the meaning of Regulation S under the
Securities Act.
(h) Shareholder One understands that his Harman Stock
may only be disposed of pursuant to an effective registration
statement filed under the Securities Act or pursuant to a
transaction exempt from or not subject to the registration
requirements of the Securities Act, in each case in accordance with
any applicable securities laws of any state of the United States of
America; that Purchaser has neither filed such a registration
statement nor has any obligation to do so, nor agreed to do so, nor
contemplates doing so in the future; and that in the absence of
such a registration statement or such an exemption or its inability
to enter into a transaction not subject to such registration
requirements, it may be required to hold its Harman Stock
indefinitely.
(i) Shareholder One acknowledges that Purchaser will
rely upon the truth and accuracy of the foregoing acknowledgements,
representations and agreements and agrees that, if any of the
acknowledgements, representations or warranties deemed to
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<PAGE>
have been made by him in connection with his aquisition of the
Harman Stock are no longer accurate, it shall promptly notify
Purchaser.
(j) Purchaser guarantees that the Harman Stock will
within two weeks of the end of the 40-day-restrictied period be
listet on the New York Stock Exchange.
5.4 Obligation of Purchaser to Offer Financial Assistance.
Purchaser shall be obligated to offer Hypobank the amount due
Hypobank from the company as of February 16, 1995 on account of the
working capital credit line (Betriebsmittelkredit), the
receivership credit line (Massekredit), less any amounts collected
from customers as of February 16, 1995 and less DM 10 Mio (ten
million Deutsche Mark) up to a maximum of DM 62 Mio (sixtytwo
million Deutsche Mark) as consideration for the waiving of all of
its claims against the Acquired Companies and Shareholder One.
5.5 Consulting Agreement. The Company and Shareholder One
shall enter into a consulting agreement (the "Consulting
Agreement") with a term of 5 years beginning with the date of this
Agreement. The total compensation under the consulting agreement
shall be DM 1,200,000-- per year, payable in arrears. The
Consulting Agreement may not be terminated by Purchaser or the
Company but Purchaser or the Company may relieve Shareholder One
from his duties thereunder; the obligation to pay the compensation
shall be not affected thereby.
5.6 Supervisory Board Chairman. For a period of five years
from the day of this Agreement, Purchaser hereby appoints
Shareholder One as Chairman of the Supervisory Board (Aufsichtsrat)
of the Company.
5.7 Seller Tax Matters. Shareholder One and Shareholder
Three shall each be solely liable for any taxes payable by or
assessable on either of them as a result of the transactions
contemplated by this Agreement.
5.8 Non-Competition. (a) Shareholder One hereby covenants
that for a period of three years from the date of this Agreement,
Shareholder One shall not:
(1) lend money to, be employed by, manage or engage,
participate, assist, invest or have an equity interest, directly
or indirectly, whether as partner, owner, consultant, agent or
otherwise, in any business or enterprise that is in
competition with the Business, other than by holding less than 5%
of the shares, voting or otherwise, in a publicly-traded company
quoted on a recognized stock exchange;
(2) engage, hire, suggest or assist in or influence the
engagement or hiring by any competing business or enterprise of,
any salesman, distributor, supplier, employee or officer of the
Company or any Affiliate thereof, or otherwise cause or
encourage any person having a business relationship with the
Company or any Affiliate thereof to sever such relationship
with, or commit any act inimical to, the Company or any
Affiliate thereof;
(3) use or divulge to others the customer or supplier lists
of the Company or any Affiliate, or, directly or indirectly,
whether as a partner, owner, consultant, agent or otherwise,
solicit or transact business with those customers or suppliers of
17
<PAGE>
the Company or any Affiliate thereof who were customers or
suppliers within the 36 months preceding the date of this
Agreement; or
(4) cause or permit any Person, directly or indirectly under
control of Shareholder One to do any of the foregoing.
(b) This obligation not to compete shall apply to the
territory consisting of Ireland, Great Britain, Norway, Sweden,
Denmark, Iceland, The Netherlands, Belgium, Luxembourg,
Liechtenstein, Finland, France, Spain, Portugal, Andorra, Monaco,
Germany, Switzerland, Italy, Austria, Greece, Turkey, the Czech
Republic, Slovakia, Slovenia, the former republics of the Soviet
Union and the former republics of Yugoslavia, Hungary, Romania,
Albania, the United States, Canada and Mexico.
(c) In the event of any breach of the restrictions in (a) of
this Section 5.8, in addition to any damages or injunctive or other
equitable relief which may be claimed by Purchaser, Shareholder One
shall pay to Purchaser a penalty of DM 100,000.-- in respect of
each and every breach. Should a breach continue despite written
warning from Purchaser, a further penalty of DM 100,000.-- shall be
payable by Shareholder One to Purchaser for each month during which
such breach is continuing.
5.9 No Shop. During the period during which the Shares may
revert pursuant to Section 1.3 of this Agreement, Shareholder One
shall not sell or negotiate for the sale of any of the Shares or
the Business, or otherwise deal, directly or indirectly, with any
Person regarding the sale of the Shares or the Business.
5.10 Becker Name. Shareholder One hereby irrevocably, subject
to reversion upon the occurrence of a condition subsequent in
accordance with Section 1.3 of this Agreement, (a) transfers to the
Company for the benefit of Purchaser the exclusive use of the name
"Becker" in the automotive industry throughout the world and (b)
covenants that Shareholder One shall not use, directly or
indirectly, or transfer, directly or indirectly, to any Person any
rights in the name "Becker" in the automotive industry anywhere in
the world.
5.11 Confidentiality. Neither Shareholder One nor Purchaser
shall disclose the details of this Agreement to any other Person
without the prior consent of the other (exceptions: Hypo-Bank, SEC
and the receiver). The parties have provided one another with
confidential information concerning their respective companies.
Each party shall hold all such information confidential and shall
not disclose such confidential information to third parties unless
required to do so pursuant to law or court order. This obligation
shall survive the termination of this Agreement. The information
shall be considered confidential until such time as it is public
knowledge in the industry of which the Company and Purchaser are a
part.
5.12 Managing Director and Supervisory Board. Shareholder One
agrees to appoint a managing director for the Company with sole
signing authority for the Company as and replace the non-workers
council Supervisory Board members with members nominated by
Purchaser during the period where a condition subsequent may occur
but has not yet occurred.
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ARTICLE 6
SURVIVAL AND INDEMNIFICATION
6.1 Survival of Guaranties, Representations, and
Warranties. The period during which claims under the respective
guaranties, representations, and warranties of Shareholder One
contained in Article 3 and of Purchaser contained in Article 4
shall be pursuable shall be until June 30, 1997, except that such
period for claims under Sections 3.1 and 3.2 shall be 30 years.
6.2 Indemnification by Shareholder One. (a) Shareholder
One shall defend, indemnify, and hold harmless any Indemnified
Purchaser, from and against any Losses, including interest thereon,
caused by or arising out of (1) any failure by a Seller to perform
its covenants or obligations as set forth in this Agreement or in
any instrument or agreement delivered by a Seller pursuant to this
Agreement, (2) any claims against any Indemnified Purchaser
relating to or arising out of the Shares, this Agreement or the
transactions contemplated hereby by any spouse of Shareholder One
or any Person in which Shareholder One holds, legally or
beneficially, an interest of 25% or more, and (3) the amount of any
Net Worth Difference (which shall be deemed to be a finally
determined Loss), and (4) subject to the limitations contained in
Sections 6.1, any breach by Shareholder One of any guaranty,
representation, and warranty to Purchaser contained in Article 3 of
this Agreement.
(b) Shareholder One shall not be liable under Section
6.2(a)(3) and (4) of this Agreement until the amount of the claims
thereunder exceeds DM 2,000,000.-- and such liability thereafter
shall be limited to an amount equal to DM 6,5 Mio. plus the value
of the Harman Stock. This limitation shall not apply to liability
for breaches of the representations, warranties and guarantees
contained in Sections 3.1 through 3.5 of this Agreement. Any
liability of Shareholder One under Section 6.2(a) may be offset
against the DM 6,500,000.-- or against the Harman Stock.
6.3 Indemnification by Purchaser. Purchaser hereby
agrees to defend, indemnify, and hold harmless any Indemnified
Seller from and against any Losses, including interest thereon,
caused by or arising out of (a) any failure by Purchaser to perform
its covenants or obligations to such Indemnified Seller as set
forth in this Agreement or in any instrument or agreement delivered
by Purchaser pursuant to this Agreement, and (b) subject to the
limitations contained in Sections 6.1, any breach by Purchaser of
any guaranty, representation, and warranty to Shareholder One
contained in Article 4 of this Agreement.
6.4 Indemnification Procedure. (a) Each Indemnified
Party agrees to give the Indemnifying Party prompt written notice
of any event, or any written claim by a third party, of which it
obtains knowledge, which could give rise to any Losses as to which
it may require indemnification under this Agreement. Such written
notice shall set forth the basis on which a claim for indemnity
hereunder is requested and, in the case of claims by third parties,
shall advise the Indemnifying Party whether the Indemnified Party
intends to contest same. The Indemnified Party shall have the
right to contest such claim, in which case the Indemnifying Party
shall have the right to be represented, at its own expense, by its
own counsel, its participation to be subject to the reasonable
direction of the Indemnified Party.
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<PAGE>
(b) If the Indemnified Party determines not to contest
such claim, the Indemnifying Party shall have the right, at its own
expense, to contest and defend against such claim by giving written
notice to the Indemnified Party within fifteen days after the
receipt of the Indemnified Party's notice that it intends not to
contest. If the Indemnifying Party determines to contest such
claim, the Indemnified Party shall have the right to be
represented, at its own expense, by its own counsel, its
participation to be subject to the reasonable direction of the
Indemnifying Party. If the Indemnifying Party determines to
contest such claim, it shall be deemed to have agreed that such
claim is absolutely subject to indemnification hereunder, and, if
the Indemnifying Party subsequently determines to settle such
claim, such settlement shall be subject to Section 6.4(d) hereof.
If the Indemnifying Party fails to undertake the defense of or
settle or pay any such third-party claim within 15 days after the
Indemnified Party has given written notice to the Indemnifying
Party advising that the Indemnified Party does not intend to
contest such claim, or if the Indemnifying Party, after having
given notice to the Indemnified Party that it intends to contest
such claim, fails promptly to defend, settle, or pay such claim,
then the Indemnified Party may take any and all necessary action to
dispose of such claim, including, without limitation, the
settlement or full payment thereof upon such terms as it shall deem
appropriate, in its sole discretion, and the Indemnifying Party
shall be liable to indemnify, upon demand, the Indemnified Party
for the full amount of the indemnity claim therefor.
(c) In any case, each party shall make available to the
other and its attorneys at all reasonable times during normal
business hours, all books, records, and other documents in its
possession relating to such claim and the party contesting any such
claim shall be furnished all reasonable assistance in connection
therewith by the other party or parties.
(d) In the event that a Settling Party desires to settle
any such third-party claim, the Settling Party shall advise the
other party in writing of the terms of the Proposed Settlement. If
such Proposed Settlement is unsatisfactory to such other party,
such other party shall have the right, at its expense, to contest
such claim, by giving written notice of such election to the
Settling Party within 15 days of such other party's receipt of the
advice of the Proposed Settlement. If such other party delivers no
such written notice within such 15 days, the Settling Party may
offer the Proposed Settlement to the third party making such claim.
If the Proposed Settlement is not accepted by the third party
making such claim, any new Proposed Settlement which the Settling
Party may wish to present to the third party making such claim
shall again be subject to the provisions of this subparagraph. Any
settlement proposed by Shareholder One shall contain an
unconditional release of Purchaser from such claim and shall not
involve any non-monetary relief affecting the Business as then
conducted or proposed to be conducted by Purchaser.
(e) At the time the amount of any liability on the part
of an Indemnifying Party under this section is determined which in
case of payments to a third party shall be the earlier of (i) the
date of such payment or (ii) the date that a court of competent
jurisdiction shall enter a judgment, order, or decree establishing
such liability shall be the date such liability is agreed with the
relevant taxing authority), the Indemnifying Party shall forthwith,
upon notice to the Indemnified Party, pay to the Indemnified Party
the amount of the indemnity claim.
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(g) No Indemnified Purchaser or Indemnified Seller shall
be entitled to be indemnified under this Article 6 unless such
Indemnified Purchaser or Indemnified Seller agrees to submit
disputes, except for Disputed Items, regarding such indemnification
to arbitration in accordance with a separate arbitration agreement.
ARTICLE 7
MISCELLANEOUS
7.1 Notices. Except as otherwise provided herein, any
notice required hereunder shall be in writing, and shall be deemed
to have been validly served, given or delivered upon delivery
thereof to the party to be notified (in the case of a fax, by
delivery with confirmation of receipt), in each case to the address
of the party to be notified, as follows:
(a) If to Purchaser:
Harman International Industries, Incorporated
8500 Balboa Boulevard
Northridge, California 91329
Attention: Bernard A. Girod
USA
Telephone: 1-818-893-8411
Fax: 1-818-891-7345]
With copies to:
Jones, Day, Reavis & Pogue
Triton Haus
Bockenheimer Landstrasse 42
60323 Frankfurt am Main
Germany
Attention: Partner-in-Charge
Telephone: (49)(69) 9726-3939
Fax: (49)(69) 9726-3993
(b) If to Shareholder One:
[Roland Becker]
[Passage des sapins 98]
[2905 Courtedoux/Jura]
[Switzerland]
[]
Attention: []
Telephone: [(066) 66 26 44]
Fax: [(07229) 305230]
With copies to:
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RA Dr. K.W. Pohl
Bayenthalguertel 31
50968 Koeln
(c) If to Shareholder Three:
Becker Holding S.A.
Passage des Sapins 98
2905 Courtedoux/Jura
Switzerland
Telephone: [066) 66 26 41]
Fax: [066) 66 26 44]
With copies to:
or to such other address or addresses as Purchaser, Shareholder
One, Shareholder Two or Shareholder Three may from time to time
designate by notice as provided herein.
7.2 Assignment. No Seller shall assign or delegate this
Agreement or any rights or obligations hereunder to any Person.
Purchaser may assign or delegate this Agreement and any rights or
obligations hereunder. The Notary Public informed the Sellers
expressily about the consequences according to sections 414, 415
German Civil Code; therefore Purchaser remains liable for any
fullfilment of its obligations under this agreement despite any
assignement.
7.3 Waiver. Any party may, by written notice to the
other party, (a) extend the time for the performance of any of the
obligations or other actions of such other under this Agreement;
(b) waive compliance with any of the conditions or covenants of
such other contained in this Agreement; or (c) waive or modify
performance of any of the obligations of such other under this
Agreement. Except as provided in the preceding sentence, no action
taken pursuant to this Agreement, including, without limitation,
any investigation by or on behalf of any party, shall be deemed to
constitute a waiver by the party taking such action of compliance
with any of the covenants, conditions, agreements, or indemnities
contained in this Agreement. The waiver by any party hereto of a
breach of any provision of this Agreement shall not operate or be
construed as a waiver of any subsequent breach.
7.4 Entire Agreement. This Agreement, together with the
Exhibits and Schedules hereto which are incorporated into this
Agreement by reference, supersedes any other agreement, whether
written or oral, that may have been made or entered into by any of
the parties relating to the matters contemplated hereby.
7.5 Amendments, Supplements. This Agreement may be
amended or supplemented only by an instrument in writing executed
and delivered by a duly authorized director or officer of each of
the parties hereto.
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<PAGE>
7.6 Captions. The captions in this Agreement are for
convenience only and shall not be considered a part of or affect
the construction or interpretation of any provision of this
Agreement.
7.7 Successors and Assigns. This Agreement shall be
binding upon, inure to the benefit of, and may be enforced by,
Purchaser, any Seller, and their respective successors and
permitted assigns.
7.8 Governing Law. This Agreement shall be governed by
the laws of Germany.
7.9 Severability. Each section and sub-section of this
Agreement constitutes a separate and distinct undertaking, covenant
and/or provision hereof. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective
and valid under applicable Laws. In the event that any provision
of this Agreement shall finally be determined by a competent court
or tribunal to be unlawful or unenforceable, such provision shall
be deemed severed from this Agreement, but every other provision of
this Agreement shall remain in full force and effect, and in
substitution for any such provision held unlawful or unenforceable,
there shall be substituted a provision of similar import reflecting
the original intent of the parties to the extent permissible under
applicable Laws. In particular, but without limiting the
generality of this Section 7.9, each covenant contained in Section
5.8 hereof shall be read and construed independently of the other
covenants and while the covenants contained therein are considered
by the parties to be reasonable in all the circumstances as of the
date hereof it is acknowledged that covenants of such a nature may
be invalid because of changing circumstances or other unforeseen
reasons and accordingly it is hereby agreed and declared that if
any one or more such covenants shall be judged to be void as going
beyond what is reasonable in all the circumstances for the
protection of the interests of the Company or the party in
question, the validity of any other covenants and provisions
contained therein shall not be affected, provided that if such
covenants would be valid if part of the wording thereof was deleted
or the period thereof reduced or the range of activities or area
covered thereby reduced in scope then said covenants shall be
deemed to apply with such modifications as may be necessary to make
them valid and effective and any such modification shall not
thereby affect the validity of any other covenants contained
herein.
7.10 Gender and Number. The masculine, feminine, or
neuter gender and the singular or plural shall each be deemed to
include the others whenever the context so indicates.
7.11
Hiermit bevollmaechtigen wir We hereby grant power of
attorney to
Frau Renate Wolf, geb. Woeber
Frau Renate Knauer, geb. Mueller
Frau Ilona Zeiss, geb. Doersam
Frau Ursula Matschkewitsch, geb. Pusch,
alle geschaeftsansaessig: Feuerbachstr. 8
60325 Frankfurt am Main
23
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alle Erklaerungen fuer uns abzugeben, die erforderlich werden
sollten, damit die in dieser Urkunde gefassten Beschluesse und
Vereinbarungen wirksam sind. Die Bevollmaechtigten sind auch
befugt, insoweit Gesellschafterversammlungen durchzufuehren und
ergaenzende Gesllschafterbeschluesse zu fassen. Die
Bevollmaechtigten sind ferner befugt, alle nach dieser Urkunde
erforderlichen Antraege zum Handelsregister zu stellen, zu aendern
und zurueckzunehmen.
to declare any statements whatsoever, which might become necessary
to safeguard that all resolutions and arrangements of this notarial
deed take effect. In so far the attorneys-in-fact are authorized to
convene company's meetings and pass additional corporate
resolutions. Furthermore the attorneys-in-fact are authorized to
forward, amend or withdraw all applications to the commercial
register in accordance with this notarial deed.
7.12 The parties present were informed by the Notary of the
following:
- that he did not inspect the Commercial Registers
with reference to the representation rights of the
appearing persons for the various companies and the power
of Mr. Sidney Harman given to Mr. Palin, and the Land
Register, and the parties, therefore, bear a substantial
risk if the registrations in the commercial Registers
and/or the Land Register do not comply with the
conditions set forth in this Agreement; the parties were
especially informed that the whole agreement might be
invalid if the persons acting do not have the
representation rights necessary. Despite this warning the
parties insisted on immediate notarization of this
agreement.
- That all agreements must be correctly and fully
notarized, that any agreements not notarized shall be
deemed void and shall thereby jeopardize the validity of
the entire agreement;
- that both parties - irrespective of the provisions
agreed between them in this Share Purchase Agreement -
may be held jointly and severally liable for taxes, court
costs, and notarial fees;
- that the notary has not verified the fiscal
consequences arising in connection with this Share
Purchase Agreement, nor was authorized or asked to do so;
- that according to section 613 a German Civil Code
(BGB) the Purchaser is not entitled to terminate any
employment contract because of the purchase of the
shares;
- that Purchaser is liable for all outstanding share
capital of the companies involved in this Share Purchase
Agreement;
- that the fulfillmat of this agreement is subject to
the approval of the Bayerische Hypotheken- und
Wechselbank AG
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- that the validity of this agreement might be subject
to the approval of the German Federal Cartel Office
- he is not familiar with US-Law and therefore cannot
judge about whether this agreement meets the requirements
of US-Law with reference to the transfer of shares of
Stock of Harman International Industries Incorporated or
any other provision of this agreement. Despite this and
the serious warning of the Notary Public about the
substantial risk, the parties declared to have retained
the services of experts of US-Law and therefore insist on
immediate notarization of this agreement.
- he had no opportunity to inspect the partnership
agreement, by-laws, articles of association or other
organization documents of all companies involved and that
therefore he cannot judge whether this agreement is in
line with these partnership agreements etc.; despite the
risks which the Notary Public prominently explained, the
parties insisted on immediate notarization of this
agreement.
- that the competition clause under 5.8 might be
invalid because of a lack of a waiting allowance in favor
of the Shareholder One.
7.13 With reference to all mutual financial commitments the
parties hereby submit to the execution of this notarial
deed in their entire property. A special execution of
this notarial deed may be issued without any proof of the
arisal or maturity of the enforceable debt. This waiver
shall not mean any alteration of the burden of proof.
Therefore the creditor has so substantiate the arisal and
maturity of his claim in case of a foreclosure suit
according to section 767 German General Practice Act
(Zivilprozessordnung).
7.14 The person appearing under 3) hereby gives his approval
to this Share Purchase Agreement on behalf of Becker
GmbH. Furtheron he is waiving on behalf of Becker GmbH
any right of preemption as possibly being foreseen in the
articles of association.
The person appearing under 2) gives his approval to this
Share Purchase Agreement on behalf of Becker Holding
GmbH, Becker Holding S.A. and Becker Service- und
Verwaltungs GmbH. Furtheron he is waiving on his own
behalf and on behalf of Becker Holding GmbH, Becker
Holding S.A. and Becker Service- und Verwaltungs GmbH any
preemption rights possibly being foreseen in the articles
of association of these companies.
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This agreement including all Exhibits and Schedules was
read aloud to the parties all of whom were simultaneously
present, by the Notary and subsequently confirmed and
personally signed:
signed: /s/ William S. Palin
/s/ Roland Becker
/s/ Anton Dittner
/s/ Werner Leipnitz
Notary Public
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EXHIBIT A
Definitions
27
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1. "Acquired Company" means any and "Acquired Companies"
means all of the Company, Shareholder Two, the Subsidiaries and
BSVG.
2. "Affiliate" means, with respect to any Person, any other
Person controlled by or under common control with, under the
control of, or controlling such party.
3. "Agreement" means this Share Purchase Agreement.
4. "Agreement Financial Statements" means the unaudited
balance sheet and statement of income for the Company for the 12-
month period ending December 31, 1994 attached to this Agreement as
Schedule 3.9.
5. "Arbitrator" means "Arbitrator as defined in the separate
Arbitration Agreement.
6. "Audited Financial Statements" means the audited balance
sheet and statement of income for the Company for the 12-month
period ending December 31, 1994 as audited by KPMG Mannheim.
7. "BHG Share" means "BHG Share" as defined in Section 1.1
of this Agreement.
8. "BSVG" means BSVG as defined in the first recital to this
Agreement.
9. "Business" means the business of the Company which is to
manufacture, market, sell and develop audio, video, airbag,
navigation, computer, security and communications systems for the
automative industry.
10. "Company" means Company as defined in the first recital
of this Agreement.
11. "Consulting Agreement" means "Consulting Agreement" as
defined in Section 5.5 of this Agreement.
12. "Disputed Item" means "Disputed Item" as defined in
Section 2.2(b)(ii) of this Agreement.
13. "First BG Share" means "First BG Share" as defined in
Section 1.1 of this Agreement.
14. "First BSVG Share" means "First BSVG Share" as defined in
Section 1.1 of this Agreement.
15. "Governmental Authority" means any court, governmental
authority, governmental body, or other regulatory or administrative
agency or commission of any government of any country or any
private or governmental arbitration or conciliation authority or
other similar body.
16. "Harman Stock" means 400,000,--(fourhundredthousand)
shares of Purchaser's common stock, par value US$0.01 per shares.
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17. "Hypobank" means Bayerische Hypotheken und Wechselbank
AG.
18. "Indemnified Party" means a party to this Agreement
seeking indemnification from another party to this Agreement
pursuant to the terms and conditions of Article 6 of this
Agreement.
19. "Indemnified Purchaser" means the Acquired Companies,
Purchaser, the Affiliates of Purchaser, and their respective
successors and assigns.
20. "Indemnified Seller" means Shareholder One Shareholder
Three, their successors and permitted assigns.
21. "Indemnifying Party" means a party hereto from whom
another party hereto is seeking indemnification pursuant to the
terms and conditions of Article 6 of this Agreement.
22. "Intellectual Property" means copyrights, patents, design
patents, utility patents and applications, know-how and licenses
therefor of the Company.
23. "Interim Financial Statements" means the balance sheets
and statements of income for each Acquired Company for the period
from January 1, 1995 ending February 16, 1995 as prepared by
Purchaser's Accountants but excluding the effect of the waivers
contained in section 5.3 (a) of this Agreement.
24. "Law" means any law, statute, judgment, decree, order,
rule, regulation, ordinance, zoning regulation, legal requirement,
enactment, or Permit of any Governmental Authority.
25. "Lien" means any lien, encroachment, easement,
encumbrance, mortgage, hypothecation, charge, restriction, or other
conflicting ownership, equity, or security interest.
26. "Litigation" means any litigation, arbitration, action,
suit, investigation, claim, or proceeding.
27. "Losses" means claims asserted, actions, deficiencies,
damages, losses, costs, taxes, penalties, expenses, and liabilities
(including reasonable attorneys' fees, court costs, investment
expenses and any other costs incident to or interest chargeable on
any of the foregoing).
28. "Material Item" means any single occurrence or item or
series of occurrences or items having in the aggregate an adverse
effect on the Purchaser or its Affiliates or any Acquired Company,
in an amount estimated by the Purchaser to be or liquidated at more
than DM 2,000,000.--.
29. "Net Worth" means the net value of shareholder equity
including paid in capital (Eingezahlte Stammkapital), legal
reserves (Kapitalruecklagen) and retained profits (Gewinnruecklage)
before any positive adjustment for equity shortfall debited to
capital (nicht durch buchmaessiges Eigenkapital gedeckten
Fehlbetrag), as shown in a balance sheet prepared in accordance
with German statutory accounting principles consistently applied
29
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with prior periods not materially different from generally accepted
accounting principles in the United States.
30. "Net Worth Difference" means "Net Worth Difference" as
defined in Section 2.2(a) of this Agreement.
31. "Owned Shares" means "Owned Shares as defined in Section
3.2 of this Agreement.
32. "Permit" means any license, notification, permit,
approval, consent, qualification, or the like.
33. "Person" means an individual, a corporation, a
partnership, a joint stock company, a joint venture, an estate, a
trust, an unincorporated organization, a Governmental Authority, or
any other entity.
34. "Proposed Settlement" means the amount and terms and
conditions of any Settling Party's proposed settlement of a third
party claim.
35. "Purchase Price" means "Purchase Price" as defined in
Section 2.1 of this Agreement.
36. "Purchaser's Accountant" means "Purchaser's Accountant"
as defined in the Arbitration Agreement.
37. "Romalux" means Romalux S.A., Switzerland.
38. "Second BSVG Share" means "Second BSVG Share" as defined
in Section 1.1 of this Agreement.
39. "Securities Act" means the United States Securities Act
of 1933, as amended, and the regulations promulgated thereunder.
40. "Sellers" means "Sellers" as defined in the first
paragraph of this Agreement.
41. "Settling Party" means any Indemnified Party or
Indemnifying Party who desires to settle a third-party claim for
which indemnification is being sought pursuant to the terms of
Article 6 of this Agreement.
42. "Shares" means "Shares" as defined in Section 1.1 of this
Agreement.
43. "Shareholder One" means "Shareholder One" as defined in
the first paragraph of this Agreement.
44. "Shareholder One's Accountant" means "Shareholder One's
Accountant" as defined in the Arbitration Agreement.
45. "Shareholder Three" means "Shareholder Three" as defined
in the first paragraph of this Agreement.
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46. "Shareholder Two" means "Shareholder Two" as defined in
the first recital to this Agreement.
47. "Subsidiary" means any of Becker of North America, Inc.
and Becker Automotive (Pty) Ltd.
48. "Third Party Consent" means "Third Party Consent" as
defined in Section 3.5 of this Agreement.
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EXHIBIT 2.2
32
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March 1, 1995 FOR IMMEDIATE RELEASE
HARMAN INTERNATIONAL ANNOUNCES THE COMPLETION OF THE
ACQUISITION OF BECKER GmbH
Washington, D.C. -- Harman International Industries, Inc.
announced today completion of its acquisition of Becker GmbH of
Karlsbad, Germany with satisfaction of all conditions remaining
after the execution of its agreement of February 16, 1995.
Under the terms of the purchase agreement, Harman acquired Becker
in exchange for 400,000 shares of Harman International Common
Stock and payments or assumptions of Becker bank indebtedness
totaling approximately $60 million. For the year ended December
31, 1994, Becker's net sales were approximately $200 million.
Dr. Sidney Harman, Chairman and Chief Executive Officer, stated:
We are very pleased to add Becker to the Harman
International Group of companies. Its principal markets and
technologies complement those of the other Harman companies.
Becker will add greatly to our growing strength in digital
signal processing applications for broadcasting and for
professional and consumer audio. Becker is widely renowned
for its automotive OEM and consumer aftermarket high-end
radios and its principal client is Mercedes Benz.
Harman International Industries, Incorporated is a leader in the
design, manufacture and marketing of high-quality, high-fidelity
audio products targeted primarily at the professional, consumer
and automotive markets. The Company's stock is traded on the New
York Stock Exchange under the symbol: HAR.
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