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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D/A
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(Amendment No. 6)*
- --------------------------------------------------------------------------------
Gull Laboratories, Inc.
(Name of Issuer)
Common Stock, $.001 par value
(Title of Class of Securities)
402901 20 1
(CUSIP Number)
Ulrich Wagner, Esq.
O'Melveny & Myers LLP
The Citicorp Center
153 East 53rd Street, 54th Floor
New York, New York 10022-4611
(212) 326-2000
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
October 23, 1997
(Date of Event which Requires Filing of this Statement)
- --------------------------------------------------------------------------------
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is filing
this schedule because of Rule 13d-1(b)(3) or (4), check the following box [ ]
Note: Six copies of this statement, including all exhibits, should be
filed with the Commission. See Rule 13d-1(a) for other parties to whom
copies are to be sent.
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* The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall
not be deemed to be "filed" for the purpose of Section 18 of the Securities
Exchange Act of 1934 ("ACT") or otherwise subject to the liabilities of that
section of the Act but shall be subject to all other provisions of the Act
(however, see the Notes).
Page 1 of __ Pages
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CUSIP NO. 358031 10 2
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
FRESENIUS AKTIENGESELLSCHAFT
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [ ]
(b) [ ]
3 SEC USE ONLY
4 SOURCE OF FUNDS
OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEM 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
GERMANY
NUMBER OF 7 SOLE VOTING POWER
SHARES 4,930,693
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY -0-
EACH REPORT- 9 SOLE DISPOSITIVE POWER
ING PERSON 4,930,693
WITH 10 SHARED DISPOSITIVE POWER
-0-
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
4,930,693
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [ ]
EXCLUDES CERTAIN SHARES
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
62%
14 TYPE OF REPORTING PERSON
CO
2
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This Schedule 13D/A (Amendment No. 6) amends and supplements the
Statement on Schedule 13D dated May 4, 1994, as amended and supplemented by
Schedule 13D/A (Amendment No. 1) dated June 28, 1994, by Schedule 13D/A
(Amendment No. 2) dated August 15, 1994, by Schedule 13D/A (Amendment No. 3)
dated December 23, 1996, Schedule 13D/A (Amendment No. 4) dated April 21, 1997
and Schedule 13D/A (Amendment No. 5) dated August 14, 1997 (as so amended, the
"Statement"), filed by Fresenius Aktiengesellschaft ("Fresenius AG"), with
respect to the common stock, $0.001 par value ("Common Stock") of Gull
Laboratories, Inc. ("Gull"). Capitalized terms used herein without definition
have the meanings ascribed to them in the Statement.
Item 4. PURPOSE OF TRANSACTION.
Item 4 of the Statement is hereby amended by adding the
following:
On October 23, 1997, Fresenius AG and Gull each issued press
releases in which they announced that Gull's majority stockholder, Fresenius AG,
had been approached by a number of firms expressing a potential interest in
partnering or otherwise acquiring Gull, and that Fresenius AG had retained the
investment banking firm Wasserstein Perella & Co., Inc. ("WP & Co.") to evaluate
the various alternatives and to provide recommendations to Fresenius AG relating
to such matters. Copies of the Fresenius AG press release and the Gull press
release are filed as Exhibits 1 and 2, respectively, to this Schedule 13D/A
(Amendment No. 6).
As described in Fresenius AG's Schedule 13D/A (Amendment No. 5),
in August 1997 Gull acquired from Fresenius AG the diagnostics business of
Fresenius AG's Intensive Care and Diagnostics Division. As a result of the
combination of Fresenius AG's diagnostics business with Gull, and in light of
the interest expressed in Gull, Fresenius AG has determined that it is in the
best interest of the holders of Gull Common Stock, to explore the strategic
alternatives that may be available to Fresenius AG with reference to its
interest in Gull. Fresenius AG has retained WP & Co. to assist Fresenius AG in
doing so. Under the agreement between Fresenius AG and WP & Co., potential
transactions to be explored may include a sale or an exchange of capital stock,
a merger, consolidation or other business combination, an exchange or tender
offer, the formation of a joint venture, partnership or similar entity or any
similar transaction. Fresenius AG's agreement with WP & Co. provides expressly
that any transaction involving Fresenius AG's interest in Gull may be
consummated as part of a series of transactions involving the sale of all or
part of the remaining ownership interests in Gull not held by Fresenius AG to
one or more third parties.
Fresenius AG's investigation of its strategic alternatives and WP
& Co.'s financial advisory services under its agreement with Fresenius AG are in
an early stage. There can be no assurance that any transaction relating to Gull
will ultimately be effected by Fresenius AG and/or by Gull, or what the terms of
any such potential transaction may be.
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Except for the matters described in this Item 4, Fresenius AG
does not have any present intention to effect or cause Gull to effect any of the
transactions described in paragraphs (a) through (j) of Item 4 of Schedule 13D.
Item 5. INTEREST IN SECURITIES OF THE ISSUER.
Fresenius AG is presently the record and beneficial owner of a
total of 4,930,693 shares of Gull Common Stock. Based on 6,616,784 shares of
Common Stock outstanding on August 1, 1997 (as set forth in Gull's Form 10-Q
Report for the six months ended June 30, 1997), Fresenius AG is the beneficial
owner of 62% of the Gull Common Stock, as determined in accordance with Rule
13d-3 of the Securities and Exchange Commission. Under a Retransfer of Shares
Agreement among Fresenius AG, Gull and a subsidiary of Gull, Fresenius AG may
become obligated to return up to 33,000 shares to Gull upon the occurrence of
certain events described in Fresenius AG's Schedule 13D/A (Amendment No. 4).
Except as stated in this Item 5, Fresenius AG (and to the best of
its knowledge, the members of the Supervisory Board and the Managing Board of
Fresenius AG) does not own or have any right to acquire, directly or indirectly,
any shares of Gull Common Stock and none of such persons has effected any
transaction in Gull Common Stock in the last sixty days.
Item 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR
RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE
ISSUER.
Fresenius AG has entered into an Agreement with WP & Co. dated
September 24, 1997 (the "WP Agreement") pursuant to which Fresenius AG has
retained WP & Co. as its exclusive financial advisor with respect to a possible
transaction involving Gull. Under the WP Agreement, in performing its Services
thereunder, WP & Co. may utilize the services of one or more of its affiliates
including, without limitation, Wasserstein Perella Co. Deutschland GmbH. The
services to be performed by WP & Co. include study and evaluation of Gull and
Fresenius AG's strategic options with respect to Gull, identification of
potential transaction participants, preparation, with Fresenius AG, of
descriptive materials relating to Gull, analysis and advice in connection with
Fresenius AG's consideration of any offers for Gull, and (if requested by
Fresenius AG) assistance in conducting negotiations and other services relating
to completion of a transaction.
Fresenius AG has paid an advisory fee to WP & Co. of $115,000,
plus applicable VAT. If a transaction is not consummated by April 1, 1998, a
further advisory fee of $115,000, plus applicable VAT, will be due and payable.
If a transaction involving Gull or Fresenius AG's interest in Gull is
consummated, a transaction fee, which increases as the consideration received by
Fresenius AG increases, will be payable. Regardless of the transaction effected,
the transaction fee will be determined as if 100% of Gull had been sold through
a simple pro-forma gross up
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from 62% to 100% of the consideration received by Fresenius AG for its interest
in Gull. The advisory fee paid and any additional advisory fee that may be paid
by Fresenius AG will be credited against any transaction fee ultimately payable
by Fresenius AG. Fresenius AG has also agreed to reimburse WP & Co. for
out-of-pocket expenses and for any sales, use, VAT or similar taxes arising in
connection with matters covered by the WP Agreement. Pursuant to a separate
letter agreement with WP & Co., Fresenius AG has agreed to indemnify WP & Co.
and its affiliates, directors, officers, agents, employees and controlling
persons for certain liabilities arising out of WP & Co.'s activities under the
WP Agreement.
The WP Agreement may be terminated by either party upon 30 days
written notice, but Fresenius AG will remain liable for any financial advisory
fees and, if a transaction is consummated prior to the expiration of 12 months
after such termination, for the full transaction fee.
The description of the WP Agreement and the related letter
agreement set forth in this Schedule 13D/A (Amendment No. 6) is qualified in its
entirety by reference to such documents, copies of which have been filed as
Exhibit No. 3 to this Schedule 13D/A (Amendment No.6).
Item 7. MATERIALS TO BE FILED IN EXHIBITS.
EXHIBIT Exhibit No.
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Fresenius AG Press Release Issued October 23, 1997 1
Gull Press Release Issued October 23, 1997 2
Financial Advisory Agreement dated September 24, 1997
between Fresenius AG and Wasserstein Perella & Co.,
Inc. and related letter agreement relating
to indemnity 3
5
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SIGNATURES
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this statement is true,
complete and correct.
Dated: November 3, 1997 FRESENIUS AKTIENGESELLSCHAFT
By: /s/ Dr. Matthias Schmidt
----------------------------------------
Name: Dr. Matthias Schmidt
Title: Member of the Managing Board
By: /s/ Rainer Baule
----------------------------------------
Name: Rainer Baule
Title: Member of the Managing Board
S-1
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EXHIBIT INDEX
Description Exhibit No.
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Fresenius AG Press Release Issued October 23, 1997 1
Gull Press Release Issued October 23, 1997 2
Financial Advisory Agreement dated September 24, 1997
between Fresenius AG and Wasserstein Perella & Co.,
Inc. and related letter agreement relating
to indemnity 3
<PAGE> 1
EXHIBIT 1
[LOGO] Fresenius
PRESS RELEASE
October 23, 1997
Oliver Helack, Public Relations
Tel: +49-6171-602101
Fax: +49-6171-602284
e-mail: [email protected]
Fresenius seeks partner
for Gull Laboratories
Fresenius AG, Bad Homburg, today reported that it has been approached by a
number of firms expressing a potential interest in partnering or otherwise
acquiring Gull Laboratories, Inc., Salt Lake City. Fresenius has engaged the
investment banking firm Wasserstein Perella & Co., New York/Frankfurt, to
evaluate the various alternatives and provide a range of recommendations.
Fresenius AG holds a 62% majority in Gull shares.
Gull Laboratories, Inc., which is listed on the American Stock Exchange, is a
broad based immunodiagnostic company with reagents and automated systems for the
detection and diagnosis of infectious diseases and is active in autoimmune
disease, the bloodgrouping and HLA tissue typing for transplantation.
Especially noteworthy is the revolutionary, patented molecular DNA based
technology called GeneSTAR, for the rapid detection and diagnosis of infectious
agents with significant sales potential in the clinical laboratory and food
industry market. Gull also recently launched a unique and highly sensitive
Herpes Type Specific test which is essential for detecting the increasingly
recognized problem of genital herpes virus in women, men and children.
Gull Laboratories, Inc. reported revenues of $11.2 million and
net income of $0.176 million for the first six months of 1997. The company has a
global marketing and sales organization with significant capabilities in both
the US and Europe and a distribution of products in 42 countries. Gull has
manufacturing facilities in Salt Lake City/Utah, Kennebunk/Maine and Bad
Homburg/Germany.
Fresenius AG is one of the world's leading Health Care
companies. For the first six months of 1997, the company reported revenues of DM
3.5 billion and has 34,000 employees worldwide.
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EXHIBIT 2
GULL LABS -
FRESENIUS EVALUATING
PARTNERSHIP STRATEGY
For immediate Release: October 23, 1997
CONTACT: Peter Gladkin
Independent Board Member
Gull Laboratories, Inc.
(801) 263-3524 Ext. 5020
Gull Laboratories, Inc. (AMEX: GUL), a Salt Lake City-based medical products
manufacturer, confirms today that its major shareholder Fresenius AG, Bad
Homburg, Germany, has been approached by a number of firms expressing a
potential interest in partnering or otherwise acquiring Gull Laboratories.
Fresenius has engaged the New York based investment banking firm Wasserstein
Perella & Co. to evaluate the various alternatives and provide recommendations.
Fresenius AG holds a 62% majority in Gull shares.
Gull Laboratories, Inc., which is listed on the American Stock
Exchange, is a broad based immunodiagnostic company with reagent and automated
systems for the detection and diagnosis of infectious diseases and is active in
autoimmune disease, the bloodgrouping serology and HLA tissue typing for
transplantation.
Especially noteworthy is the revolutionary, patented molecular
DNA based development by Gull called GeneSTAR, for the rapid detection and
diagnosis of infectious agents with significant sales potential in the clinical
laboratory and food industry markets. Gull also recently launched in Europe a
unique and highly sensitive Herpes Type Specific test which is essential for
detecting the increasingly recognized problem of genital herpes virus in women,
men and children.
Gull Laboratories, Inc. reported revenues of $11.2
million and net income of $0.176 million for the first six months
of 1997. The company has a global marketing and sales
organization with significant capabilities in both the US and
Europe and a distribution of products in 42 countries. Gull has
manufacturing facilities in Salt Lake City, Utah, Kennebunk, Maine
and Bad Homburg, Germany.
Fresenius AG is one of the world's leading Health Care
companies. For the first six months of 1997, the company reported revenues of DM
3.5 billion and has 34,000 employees worldwide.
Except for historical information contained herein,
the matters discussed in this press release may contain forward looking
statements which are based on management's expectations and beliefs concerning
future events affecting Gull Laboratories. Such statements involve risks and
uncertainties, including market acceptance of new products by Gull's customers,
regulatory clearance, and other matters, that are described by Gull's filings
with the SEC.
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EXHIBIT 3
[LOGO] Wasserstein Perella & Co., Inc.
31 West 52nd Street
New York, New York 10019-6118
Telephone 212-969-2700
Fax 212-969-7836
24 September, 1997
Fresenius AG
Borkenberg 14
D-61440 Bad Homburg
Germany
Dear Sirs:
This letter confirms our understanding that Fresenius
Aktiengesellschaft (the "Company") has engaged Wasserstein Perella & Co., Inc.
("WP") on an exclusive basis as its financial advisor with respect to the
possible sale or other disposition by the Company of its 62% interest in Gull
Laboratories, Inc., Salt Lake City ("Gull"), to one or more third parties
(individually or collectively, as applicable, a "Sale"). For purposes of this
agreement, the term "Sale" shall include, without limitation, any transaction or
series or combination of transactions, other than in the ordinary course of
business, which takes the form of, amongst other things, a sale or exchange of
capital stock, a merger, consolidation or other business combination, an
exchange or tender offer, the formation of a joint venture, partnership or
similar entity, or any similar transaction. It is our mutual understanding that
the Sale may be consummated as part of a series of transactions involving the
sale of all or part of the remaining ownership interests in Gull not held by the
Company to one or more third parties. If appropriate in connection with
performing its services for the Company hereunder, WP may utilize the service of
one or more of its affiliates, including, without limitation, Wasserstein
Perella & Co. Deutschland GmbH in which case references herein to WP shall
include such affiliates.
1. WP, in its capacity as exclusive financial advisor to
the Company, will perform the following services:
- Study and evaluate Gull, its business
prospects and the Company's possible
strategic options relating to Gull;
- Identify potential purchasers for Gull and a
strategy for approaching them;
- Compile, in conjunction with the Company, a
Memorandum describing Gull and the
opportunities that Gull provides to
prospective investors or acquirers with
particular emphasis on Gull's proprietary
technologies and their projected future
market value;
- If necessary, advise with respect to
strategies for negotiating with minority
shareholders of Gull;
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- Provide analysis and advice in connection
with the consideration of offers received
for Gull;
- As directed by the Company, assist in the
negotiation of a definitive purchase
agreement with a prospective purchaser; and
- Provide such other financial advisory and
investment banking services as may be
required in completing a Sale, as
specifically agreed upon by WP and the
Company.
The Company shall, to the extent legally permissible, make
available to WP all information received by, or accessible to,
the Company in its capacity as a shareholder of Gull
concerning the business, assets, operations and financial
condition of Gull that WP reasonably requests in connection
with the services to be performed for the Company hereunder,
shall provide WP with reasonable access to the Company's
officers, directors, employees, independent accountants and
other advisors and agents as WP shall deem appropriate, and
shall use its best efforts to cause Gull to provide WP
reasonable access to Gull's officers, directors, employees,
accountants and other advisors and agents. All contacts and
access as described in the preceding sentence shall be
coordinated with and be subject to the prior written approval
of the Company, which approval shall not be unreasonably
withheld. In performing its services for the Company
hereunder, WP is not assuming any responsibility for the
Company's underlying business decision to effect a Sale. All
information provided by the Company or Gull to WP pursuant to
this agreement shall be kept confidential by WP and its
affiliates and shall not be used or disclosed by any of them
other than in connection with the financial advisory services
to be provided by WP and its affiliates hereunder, except to
the extent that any of such information: (a) was known by the
recipient when received (other than as the result of a
violation of this paragraph by WP); (b) is in the public
domain or is or hereafter otherwise becomes lawfully
obtainable from other sources; (c) is necessary or appropriate
to disclose to a court, governmental or regulatory entity or
securities exchange having jurisdiction over WP or as may
otherwise be required by law or (d) was independently
developed by WP or its affiliates; and except to the extent
such duty as to confidentiality is waived in writing by the
person or entity to whom such duty is owed. If this Agreement
is terminated in accordance with its terms, WP shall use all
reasonable efforts to return upon written request from the
Company or Gull all documents (and reproductions thereof)
received by it or its representatives from the Company or Gull
(and, in the case of reproductions, all such reproductions
made by WP or its representatives) that include information
not within the exceptions contained in the previous sentence,
unless WP provides assurances reasonably satisfactory to the
Company or Gull that such documents have been destroyed.
2. WP's compensation for services rendered under this
engagement will consist of the following cash fees:
(A) A financial advisory fee of $115,000, plus
applicable VAT, which is due and shall be
paid by the Company upon the execution of
this agreement. This amount is
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non-refundable, but will be credited against
any transaction fee payable to WP pursuant
to subparagraph 2(B) below. In the event
that no Sale is consummated prior to April
01, 1998, a further financial advisory fee
of $115,000, plus applicable VAT, shall
become due and shall be paid to WP on such
date; it is being understood that this
latter amount is also non-refundable, but
will be credited against any transaction fee
payable to WP pursuant to subparagraph 2(B)
below.
(B) In connection with any Sale, a transaction
fee, plus applicable VAT, is due and shall
be paid by the Company to WP upon a Sale.
The transaction fee will not be based on the
aggregate consideration received by the
Company for its 62% interest in Gull, but
will rather be based on Aggregate
Consideration (as defined below) as if 100%
of Gull had been sold. The transaction fee
payable to WP for selling the Company's 62%
interest in Gull will be calculated as a
simple pro forma gross up of the aggregate
consideration received for the Company's 62%
interest in Gull, to approximate 100% of
Gull's firm value. A sample calculation of
the transaction fee payable to WP pursuant
to this subparagraph 2(B) is set forth in
Exhibit 1 hereto. The implied value of 100%
of Gull will be calculated solely on the
basis of the proceeds received by the
Company for the 62% interest in Gull which
WP is retained to sell. Should the remaining
minority interest in Gull be sold for a
greater or lesser amount than that received
for the Company' 62% interest in Gull, this
will have no bearing on the transaction fee
payable to WP hereunder as defined below and
as illustrated in Exhibit 1. The transaction
fee will be calculated as follows:
<TABLE>
<CAPTION>
Aggregate
Consideration (based
on implied valuation of Transaction Fee for Sale of Company's
100% of Gull) 62% Interest in Gull
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<S> <C>
up to US$ 60million $715,000
US$ 60 - 70million $857,000
US$ 70 - 75million $1,000,000
US$ 75 - 90million $1,000,000, plus 10% of the amount of
Aggregate Consideration (if any) (based on
valuation of 100% of Gull) between US$
75million and US$ 90million
</TABLE>
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over US$ 90million $2,500,000 plus 20% of the amount of
Aggregate Consideration (if any) (based on
valuation of 100% of Gull) in excess of US$
90million
Under no circumstances will the transaction
fee payable to WP pursuant to the terms of
this subparagraph 2(B) be less than
$715,000.
For purposes of this subparagraph 2(B), the
term Aggregate Consideration shall mean the
total amount of cash and the fair market
value (on the date of payment) of all
securities and other property paid or
payable, directly or indirectly, by the
acquiring party (the "Acquiror") to the
acquired party or the seller of the acquired
business (in either case, the "Acquired"),
or to the Acquired's security holders or its
employees, or by the Acquired to the
Acquired's security holders, in connection
with a Sale or a transaction related
thereto. Aggregate Consideration shall also
include the value of any long-term
liabilities (including the short-term
portion thereof) of the Acquired (including
the principal amount of any indebtedness for
borrowed money) indirectly or directly
assumed or acquired by the Acquiror, or
otherwise repaid or retired, in connection
with or in anticipation of a Sale. Aggregate
Consideration shall exclude intercompany
trade-related liabilities to Fresenius or
the Fresenius Group entered into after the
signing of this agreement. In the event of a
sale that takes the form of a
recapitalization or restructuring of Gull
(including, without limitation, through
negotiated repurchases of Gull's securities,
an issuer tender offer, an extraordinary
dividend, a spin-off, split-off or similar
transaction), Aggregate Consideration shall
also include the fair market value of (i)
the equity securities of Gull retained by
the Company or its security holders
following such transaction and (ii) any
cash, securities (including securities of
subsidiaries) or other consideration
received by the Company in exchange for or
in respect of securities of Gull in
connection with such transaction (all such
cash, securities or other consideration
received by such security holders being
deemed to have been paid to such security
holders in such transaction). In the event
that any part of the consideration in
connection with a sale will be payable
(whether in one payment or a series of two
or more payments) at any time following the
consummation thereof, the term Aggregate
Consideration shall include the present
value of such future payment or payments, as
agreed upon in good faith among Gull, the
Company and WP&Co. As used in this
agreement, the terms "payment", "paid" or
"payable" shall be deemed to include, as
applicable, the issuance or delivery of
securities or other property other than
cash.
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(C) In the event that WP agrees to provide
additional services to the Company other
than the services specifically referred to
above (including, without limitation,
advising the other shareholders of Gull as
part of the negotiation of a sale of 100% of
Gull), then the Company shall pay additional
fees to WP in such amounts as shall be
customary given the nature of the specific
services agreed to be provided, and at such
times as the Company and WP shall mutually
agreed in writing.
(D) In addition to any fees payable by the
Company to WP hereunder, the Company shall,
whether or not any Sale shall be proposed or
consummated, reimburse WP on a quarterly
basis for its travel and other reasonable
out-of-pocket expenses (including all
reasonable fees, disbursements and other
charges of counsel to be retained by WP, and
of other consultants and advisors retained
by WP with the Company's prior written
consent) incurred in connection with, or
arising out of WP's activities under or
contemplated by, this engagement. The
Company and WP shall agree in advance to a
quarterly budget in writing covering all out
of pocket expenses pursuant to this
paragraph. The Company shall not be
obligated to reimburse any expenses incurred
in any quarter in excess of the budget
relating to such quarter, unless WP has
obtained prior written approval of the
Company to exceed such budget. The Company
shall also reimburse WP, at such times as WP
shall request, for any sales, use, VAT or
similar taxes (including additions to such
taxes, if any) arising in connection with
any matter referred to or contemplated by
this engagement. Such reimbursements shall
be made promptly upon submission by WP of
statements therefor. Nothing contained in
this subparagraph 2(D) shall be deemed to
limit in any manner the obligations of WP
under the separate letter agreement referred
to in paragraph 4 hereof.
3. The Company recognizes and confirms that, in
advising the Company and in completing its
engagement hereunder, WP will be using and
relying on publicly available information
and on data, material, and other information
furnished to WP by the Company, Gull and
other parties. It is understood that in
performing under this engagement WP may
assume and rely upon the accuracy and
completeness of, and is not assuming any
responsibility for independent verification
of, such publicly available information and
the other information so furnished.
4. The Company and WP have entered into a
separate letter agreement, dated the date
hereof and attached hereto, providing for
indemnification by the Company of WP and
certain related persons. Such
indemnification agreement is an integral
part of this agreement and the terms thereof
are
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incorporated by reference herein. As
stated therein, such indemnification
agreement shall survive any termination or
completion of WP's engagement hereunder.
5. WP has been retained under this agreement as
an independent contractor with no fiduciary
or agency relationship to the Company or any
other party. The advice (oral or written)
rendered by WP pursuant to this agreement is
intended solely for the benefit and use of
the senior management of the Company in
considering the matters to which this
agreement relates, and the Company agrees
that such advice may not be relied upon by
any other person, used for any other purpose
or reproduced, disseminated, quoted or
referred to at any time, in any manner or
for any purpose, nor shall any public
references to WP be made by the Company,
without the prior written consent of WP.
6. This agreement and WP's engagement hereunder
may be terminated by either the Company or
WP at any time upon thirty days' prior
written notice thereof to the other party;
provided, however, that (a) termination of
WP's engagement hereunder shall not affect
the Company's continuing obligation to
indemnify WP and certain related persons as
provided in the separate letter agreement
referred to above, and its continuing
obligations and agreements under paragraph 5
hereof, (b) notwithstanding any such
termination, WP shall be entitled to (i) the
full financial advisory fee(s) provided for
in paragraph 2(A) hereof in the amount(s)
and at the time(s) specified therein, and
(ii) unless the Company has terminated WP's
engagement hereunder by reason of WP's gross
negligence or willful misconduct as finally
judicially determined by a court of
competent jurisdiction the full transaction
fee provided for in paragraph 2(B) hereof in
the event that a Sale is consummated at any
time prior to the expiration of twelve
months following such termination, and; and
(c) termination of WP's engagement hereunder
shall not affect the Company's obligation to
reimburse the expenses accruing prior to
such termination to the extent provided for
herein.
7. The Company agrees that WP shall have the
right after successful completion of the
transaction to place advertisements in
financial and other newspapers and journals
at its own expense describing its services
to the Company hereunder, provided that WP
will submit a copy of any such advertisement
to the Company for its approval in writing,
which approval shall not be unreasonably
withheld or delayed.
8. This agreement shall be deemed made in New
York. This agreement and all controversies
arising from or relating to performance
under this agreement
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<PAGE> 7
shall be governed by and construed in
accordance with the laws of the Sate of New
York, without giving effect to such state's
rules concerning conflicts of laws. The
Company hereby irrevocably consents to
personal jurisdiction in any court of the
State of New York or any Federal court
sitting in the Southern District of New York
for the purposes of any suit, action or
other proceeding arising out of this
agreement or any of the agreements or
transactions contemplated hereby, which is
brought by or against the Company, hereby
waives any objection to venue with respect
thereto, and hereby agrees that all claims
in respect of any such suit, action or
proceeding shall be heard and determined in
any such court. ANY RIGHT TO TRIAL BY JURY
WITH RESPECT TO ANY CLAIM OR ACTION ARISING
OUT OF THIS AGREEMENT OR CONDUCT IN
CONNECTION WITH THIS ENGAGEMENT IS HEREBY
WAIVED.
9. This agreement may be executed in
counterparts, each of which together shall
be considered a single document. This
agreement shall be binding upon WP and the
Company and their respective successors and
assigns. This agreement is not intended to
confer any rights upon any shareholder,
owner, partner of the Company, or any other
person not a party hereto other than the
indemnified persons referenced in the
indemnification agreement referred to above.
10. It is understood and agreed that WP and its
affiliates may from time to time make a
market in, have a long or short position in,
buy and sell or otherwise effect
transactions for customer accounts and for
their own accounts in the securities of, or
perform investment banking or other services
for, the Company and other entities which
are or may be the subject of the engagement
contemplated by this agreement. WP
acknowledges that WP is aware, and will
advise its representatives who are informed
as to the matters which are subject of this
agreement, that United States federal and
many United States state securities laws
prohibit any person who has received from an
issuer or a controlling person of the issuer
material, non-public information concerning
the matters which are the subject of this
letter from purchasing or selling securities
of such issuer or from communicating such
information to any person under
circumstances in which it is reasonably
foreseeable that such person is likely to
purchase or sell such securities. WP further
acknowledges its and its affiliates'
obligations to establish, maintain and
enforce written policies and procedures
reasonably designed to prevent the misuse of
material non-public information in violation
of United States federal securities laws.
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<PAGE> 8
11. Any payments to be made to WP hereunder and
under the related indemnification agreement
referred to above shall be in US dollars and
shall be free of all withholding, stamp and
other taxes and of all other governmental
charges of any nature whatsoever; provided
that, at the request of WP, payments (if
any), to be made to WP under the related
indemnification agreement, shall be made in
DM.
We are pleased to accept this engagement and look
forward to working with the Company. Please confirm that the foregoing is in
accordance with your understanding by signing and returning to us the enclosed
duplicate of this letter, which shall thereupon constitute a binding agreement
between WP and the Company.
Very truly yours,
WASSERSTEIN PERELLA & CO., INC.
By: /s/ Alan J. Biloski
-----------------------------
Name: A.J. Biloski
Title: Managing Director
ACCEPTED AND AGREED TO:
FRESENIUS AKTIENGESELLSCHAFT
By: /s/ Rainer Baule
-----------------------------------------
Name: Rainer Baule
Title: COO, President Intensive Care &
Diagnostics
By: /s/ Franz-Josef Acher
-----------------------------------------
Name: Dr. Franz-Josef Acher
Title: General Counsel, Sr. VP
8
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<TABLE>
<CAPTION>
EXHIBIT 1: SAMPLE CALCULATION OF TRANSACTION FEE:
<S> <C>
Consideration for the Company's 62% interest in Gull: US$
45 million
Aggregate Consideration (based on implied valuation of 100% of Gull): US$
72.6 million
(1)
Transaction fee payable to WP for sale of Company's interest in Gull US$
1,000,000
(1) Aggregate Consideration calculated as follows:
($ 45 million/62%) 100% = $72.6 million
</TABLE>
9
<PAGE> 10
24 September, 1997
Wasserstein Perella & Co., Inc. ("WP")
31 West 52nd Street
New York, New York 10019
Gentlemen:
In connection with your engagement as our financial advisor pursuant to a
separate agreement between you and us, we hereby agree to indemnify and hold
harmless Wasserstein Perella & Co., Inc. ("WP") and their respective affiliates,
their respective directors, officers, agents, employees and controlling persons,
and each of their respective successors and assigns (collectively, the
"indemnified persons"), to the full extent lawful, from and against all losses,
claims, damages, liabilities and expenses incurred by them which (A) are related
to or arise out of (i) actions or alleged actions taken or omitted to be taken
(including any untrue statements made or any statements omitted to be made) by
us or (ii) actions or alleged actions taken or omitted to be taken by an
indemnified person with our consent or in conformity with our actions or
omissions or (B) are otherwise related to or arise out of WP's activities under
WP's engagement. We will not be responsible, however, for any losses, claims,
damages, liabilities or expenses pursuant to clause (B) of the preceding
sentence which arc finally judicially determined to have resulted primarily from
the gross negligence or willful misconduct of the person seeking indemnification
hereunder. We also agree that no indemnified person shall have any liability to
us for or in connection with such engagement or any transactions or conduct in
connection therewith except for losses, claims, damages, liabilities or expenses
incurred by us which are finally judicially determined to have resulted
primarily from the gross negligence or willful misconduct of such indemnified
person; provided, however, that in no event shall the indemnified persons'
aggregate liability to us exceed the fees WP actually receives from us pursuant
to its engagement referred to above, unless there is a final judicial
determination of willful misconduct specified in this sentence.
After receipt by an indemnified person of notice of any complaint or the
commencement of any action or proceeding with respect to which indemnification
is being sought hereunder, such person will notify us in writing of such
complaint or of the commencement of such action or proceeding, but failure so to
notify us will relieve us from any liability which we may have hereunder only
if, and to the extent that such failure results in the forfeiture by us of
substantial rights and defenses, and will not in any event relieve us from any
other obligation or liability that we may have to any indemnified person
otherwise than under this letter agreement. If we so elect or are requested by
such indemnified person, we will assume the defense of such action or
proceeding, including the employment of counsel reasonably satisfactory to WP
and the payment of the fees and disbursements of such counsel. In the event,
however, such indemnified person reasonably determines in its judgment that
having common counsel would present such counsel with a conflict of interest or
if the defendants in, or targets of, any such action or proceeding include both
an indemnified person and us, and such indemnified person reasonably concludes
that there may be legal defenses available to it or other indemnified persons
that are different from or in addition to those available to us, or if we fail
to assume the defense of the action or proceeding or to employ counsel
reasonably satisfactory to such indemnified person, in either case in a timely
manner, then such indemnified person may employ separate
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<PAGE> 11
counsel reasonably satisfactory to us to represent or defend it in any such
action or proceeding and we will pay the fees and disbursements of such counsel;
provided, however, that we will not be required to pay the fees and
disbursements of more than one separate counsel (in addition to local counsel)
for all indemnified persons in any jurisdiction in any single action or
proceeding. In any action or proceeding the defense of which we assume, the
indemnified person will have the right to participate in such litigation and to
retain its own counsel at such indemnified person's own expense. We further
agree that we will not, without the prior written consent of WP, settle or
compromise or consent to the entry of any judgement in any pending or threatened
claim, action, suit or proceeding in respect of which indemnification or
contribution may be sought hereunder (whether or not WP or any other indemnified
person is an actual or potential party to such claim, action, suit or
proceeding) unless such settlement, compromise or consent includes an
unconditional release of WP and each other indemnified person hereunder from all
liability arising out of such claim, action, suit or proceeding.
We agree that if any indemnification sought by an indemnified person
pursuant to this letter agreement is held by a court to be unavailable for any
reason other than as specified in the second sentence of the first paragraph of
this letter agreement, then (whether or not WP is the indemnified person), we
and WP will contribute to the losses, claims, damages, liabilities and expense
for which such indemnification is held unavailable (i) in such proportion as is
appropriate to reflect the relative benefits to us, on the one hand, and WP, on
the other hand, in connection with WP's engagement referred to above, or (ii) if
the allocation provided by clause (i) above is not permitted by applicable law,
in such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i), but also the relative fault of us, on the one hand,
and WP, on the other hand, as well as any other relevant equitable
considerations; provided however, that in any event the aggregate contribution
of all indemnified persons, including WP, to all losses, claims, damages,
liabilities and expenses with respect to which contribution is available
hereunder will not exceed the amount of fees actually received by WP from us
pursuant to WP's engagement referred to above. It is hereby agreed that for
purposes of this paragraph, the relative benefits to us, on the one hand, and
WP, on the other hand, with respect to WP's engagement shall be deemed to be in
the same proportion as (i) the total value paid or proposed to be paid or
received by us or our stockholders, as the case may be, pursuant to the
transaction, whether or not consummated, for which WP is engaged to render
financial advisory services, bears to (ii) the fee paid or proposed to be paid
to WP in connection with such engagement. It is agreed that it would not be just
and equitable if contribution pursuant to this paragraph were determined by pro
rata allocation or by any other method which does not take into account the
considerations referred to in this paragraph.
We further agree that we will promptly reimburse WP and any other
indemnified person hereunder for all expenses (including fees and disbursements
of counsel) as they are incurred by WP or such other indemnified person in
connection with investigating, preparing for or defending, or providing evidence
in, any pending or threatened action, claim, suit or proceeding in respect of
which indemnification or contribution may be sought hereunder (whether or not WP
or any other indemnified person is a party) and in enforcing this agreement.
Our indemnity, contribution, reimbursement and other obligations under
this letter agreement shall be in addition to any liability that we may
otherwise have, at common law or otherwise, and shall be binding on our
successors and assigns.
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<PAGE> 12
Solely for the purpose of enforcing this letter agreement, we hereby
consent to personal jurisdiction, service and venue in any court in which any
claim or proceeding which is subject to, or which may give rise to a claim for
indemnification or contribution under, this letter agreement is brought against
WP or any other indemnified person.
This letter agreement shall be deemed made in New York. This letter
agreement and all controversies arising from or relating to performance under
this letter shall be governed by and construed in accordance with the laws of
the State of New York, without giving effect to such state's rules concerning
conflicts of law. ANY RIGHT TO TRIAL BY JURY WITH RESPECT TO ANY CLAIM OR ACTION
ARISING OUT OF THIS LETTER AGREEMENT OR ANY ENGAGEMENT OF WP IS HEREBY WAIVED.
12
<PAGE> 13
The provisions of this letter agreement shall apply to the above-mentioned
engagement, activities relating to the engagement occurring prior to the date
hereof, and any subsequent modification of or amendment to such engagement, and
shall remain in full force and effect following the completion or termination of
WP's engagement.
Very truly yours,
FRESENIUS AG
By: /s/ Rainer Baule
-------------------------------
Name: Rainer Baule
Title: COO, President-Intensive
Care & Diagnostics
Accepted:
WASSERSTEIN PERELLA & CO., INC
By: /s/ Alan J. Biloski
----------------------------
A.J. Biloski
Managing Director
13
