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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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): September 8, 1997
CHICAGO MINIATURE LAMP, INC.
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(Exact Name of Registrant as Specified in Charter)
OKLAHOMA 0-25848 73-1412000
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(State of Incorporation) (Commission (IRS Employer
File Number) Identification No.)
500 CHAPMAN STREET, CANTON, MASSACHUSETTS 02021
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (617) 828-2948
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ITEM 2. ACQUISITION OF ASSETS
On September 8, 1997, Chicago Miniature Lamp, Inc. (the "Company" or
"CML"), acting through a newly-incorporated subsidiary, Chicago Miniature
Lamp-Sylvania B.V., consummated the purchase of all of the outstanding shares of
capital stock of Sylvania Lighting International, B.V. ("SLI"), a privately held
company headquartered in Geneva, Switzerland for $161.5 million cash, financed
with the Company's internal cash and a $250.0 million credit facility provided
by BankBoston. There was no relationship between the Selling Stockholders of SLI
and the Company or any of its officers, directors, or affiliates. The Company
intends to continue and expand the operations of SLI as presently being
conducted. The acquisition of SLI is being treated as a purchase for accounting
purposes and upon allocation of the purchase price SLI expects to reflect a net
equity of approximately $161.5 million.
SLI is an integrated designer, manufacturer and seller of lighting
systems which are comprised of lamps and fixtures. SLI manufactures and offers a
complete range of lamps (incandescent, fluorescent, compact fluorescent, high
intensity discharge, halogen, and special lamps) and a complete range of
fixtures to meet the lighting needs of its customers, which include architects,
designers, consultants, specifiers, installers, contractors, wholesale
distributors, OEMs, and retailers. SLI's product portfolio is sold under several
brands, most notably the "SYLVANIA" name, for which SLI has rights in all
regions with the exception of North America. For its years ended December 31,
1996 and 1995 SLI reported revenues of approximately $610.0 and $625.0 million
respectively, and EBIT (before extraordinary charges) of $6.1 and $19.2 million
respectively. SLI believes that it has an approximate 11% market share in lamps,
and is the third largest lighting company in Western Europe. SLI manufactures
approximately 90% of all its product requirements in-house through 13 plants in
nine countries; eight plants are in Europe and five are in Latin America and
Australia. SLI does not currently have a miniature lighting line, and its
products do not overlap those of CML. CML and SLI are complementary from both a
product line and geographical standpoint. The Company intends in the future to
capitalize on the combined strengths and attributes of both CML and SLI.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
1) FINANCIAL STATEMENTS OF BUSINESS ACQUIRED. It is impracticable at this
time to provide the required financial statements for the businesses
acquired in the acquisition described in Item 2 above. The Registrant
is in the process of preparing those financial statements. None are
available at this time. It is anticipated that such financial
statements will be available within 60 days from the date of this
report, and in any event will be filed as an amendment to this report
as soon as practicable, but no later than 60 days after this report has
been filed.
2) PRO FORMA FINANCIAL INFORMATION. No pro forma financial information
with respect to the acquisition described in Item 2 above is available
at this time. It is anticipated that the required pro forma financial
information will be available within 60 days from the date of this
report, and in any event will be filed as an amendment to this report
as soon as practicable, but no later than 60 days after this report has
been filed.
3) EXHIBITS.
10.1 Copy of Stock Purchase Agreement dated September 4, 1997
between SLI, its stockholders and the Company.
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SIGNATURE
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.
CHICAGO MINIATURE LAMP, INC.
By: /s/ Ronald S. Goldstein
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Ronald S. Goldstein
Treasurer
Dated: September 22, 1997
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EXHIBIT 10.1
DATED 18 AUGUST 1997
1) CITICORP CAPITAL INVESTORS EUROPE LIMITED
AND OTHERS
(2) CHICAGO MINIATURE LIGHTING INC.
(3) SYLVANIA LIGHTING INTERNATIONAL B.V.
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AGREEMENT FOR THE SALE AND
PURCHASE OF SYLVANIA LIGHTING INTERNATIONAL B.V.
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CONTENTS
CLAUSE
1. INTERPRETATION ................................................... 1
2. SALE AND PURCHASE ................................................ 1
3. CONSIDERATION .................................................... 2
4. POST COMPLETION ADJUSTMENT ....................................... 3
5. COMPLETION BALANCE SHEET ......................................... 3
6. CONDITION ........................................................ 6
7. COMPLETION ....................................................... 6
8. TERMINATION ...................................................... 8
9. WARRANTIES ....................................................... 10
10. ACTION PENDING COMPLETION ........................................ 11
11. BUYER'S OBLIGATIONS .............................................. 11
12. CONFIDENTIAL INFORMATION ......................................... 12
13. ANNOUNCEMENTS .................................................... 13
14. COSTS ............................................................ 14
15. GENERAL .......................................................... 14
16. ENTIRE AGREEMENT ................................................. 14
17. TRANSFER OF RIGHTS AND OBLIGATIONS ............................... 15
18. NOTICES .......................................................... 15
19. GOVERNING LAW AND JURISDICTION ................................... 15
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SCHEDULES
1. The Sellers
2. Option-holders
3. Preference Shareholders
4. Definitions
5. Warranties
6. Completion Balance Sheet
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AGREED FORM DOCUMENTS
Share Transfer Deed
including, where appropriate, each shareholder's waiver of pre-emption
rights
Written Resolution
regarding transfer of Sale Shares
Completion Agenda
Service Agreements
Articles
Osram Pre-Emption Rights
Escrow Letter
Sellers Escrow Instructions
Option holders Escrow Instructions
Seller's Accountants Report
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THIS AGREEMENT is made on 1997
BETWEEN:
(1) the persons whose names and addresses are set out in column 1 of
Schedule 1 being the holders of the entire share capital of the
Company (the "Sellers");
(2) CHICAGO MINIATURE LAMP INC. a corporation validly existing under the
laws of the state of Massachusetts whose principal place of
business is 500 Chapman Street, Canton, MA 02021 (the "Buyer"); and
(3) SYLVANIA LIGHTING INTERNATIONAL B.V. a private company with limited
liability (besloten vennootschap met beperkte aansprakelijkheid)
incorporated under the laws of the Netherlands and having its official
seat in Haarlem (the "Company").
THE PARTIES AGREE as follows:
1. INTERPRETATION
1.1 The schedules form part of this Agreement and any reference to this
Agreement includes the schedules. In this Agreement, reference
to a Clause or Schedule is a reference to a clause of, or schedule to,
this Agreement.
1.2 Certain words and expressions used in this Agreement are defined in
Schedule 4.
2. SALE AND PURCHASE
2.1 Subject to the condition set out in Clause 6, each of the Sellers will
sell and the Buyer will buy those of the Sale Shares set
opposite the relevant Seller's name in column (2) of Schedule 1 and
column (2) of Schedule 3.
2.2 The Sale Shares will be sold with all rights attaching or accruing to
the Sale Shares now or after the date of this Agreement (other
than, for the avoidance of doubt, any distributions on the Preference
Sale Shares in respect of the period from 1 January 1997 to 31 October
1997 up to a maximum of L.140,000 per month and which are intended to be
paid by the Company to the Preference Shareholders at or before
Completion) and free of all Third-party Rights.
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3. CONSIDERATION
3.1 3.1.1 In the event that the Relevant Exchange Rate is within the
range of US$1.62 to US$1.67 to L1. then the Aggregate
Consideration will be US$165 million.
3.1.2 In the event that, under the Relevant Exchange Rate, there is
more than US$1.67 to L.1, then the Aggregate Consideration
shall be the Dollar amount calculated by converting
L.98,802,395 into Dollars at the Relevant Exchange Rate.
3.1.3 In the event that, under the Relevant Exchange Rate, there is
less than US$1.62 to the pound, then the Aggregate
Consideration shall be the Dollar amount calculated by
converting L.101,851,850 into Dollars at the Relevant Exchange
Rate.
3.2 The Average Ordinary Consideration is calculated as follows:
A - (B+C)
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101,688
where:
A = Aggregate Consideration;
B = Preference Consideration multiplied by 179,311;
C = Preference Cash Equivalent multiplied by 1,672.
3.3 The price for each Ordinary Sale Share is the Ordinary Consideration
calculated as follows:
Average Ordinary Consideration = 1,519,200
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100,000
3.4 The price for each Preference Share is the Dollar amount calculated by
converting L.74.2299 into Dollars at the Relevant Exchange Rate.
3.5 The Buyer shall pay the Aggregate Consideration to the Sellers Lawyers
Client Account on the Completion Date by CHAPS transfer in Dollars
to be received for value on the Completion Date.
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4. POST COMPLETION ADJUSTMENT
4.1 The following provisions of Clause 4 and the provisions of Clauses 5,
7.2.2 and 7.3.2 will only take effect if the Buyer serves notice on the
CEO on behalf of the Sellers not later than 21 October 1997, stating
that it wishes Clauses 4,5, 7.2.2 and 7.3.2. to apply.
4.2 If there is a Deficiency (as described in Clause 4.4), then each
Ordinary Shareholder shall, within fourteen days of the Determination
Date (as defined in Clause 5.2), by way of reduction of the Ordinary
Consideration or Ordinary Cash Equivalent, as appropriate, pay to the
Buyer an amount equal to its Due Proportion of the Deficiency Provided
that in the case of the Option Holders and (to the extent of the
Sellers Escrow Account) the Sellers payment will be pursuant to the
Escrow Letter.
4.3 The liability of the Ordinary Shareholders for any payment due under
this Clause 4 shall be several and no Ordinary Shareholder shall be
required to pay a sum greater than its Due Proportion of the
Deficiency.
4.4 To the extent that Total Group Shareholder Funds as determined in
accordance with Clause 5 are less than 99 million, the amount of that
shortfall, converted into Dollars at the Relevant Exchange Rate, shall
be the Deficiency.
4.5 In Clause 4 and 5, all references to Ordinary Shareholders shall be
deemed to include a reference to Option Holders (in relation to their
Ordinary Option Shares).
5. COMPLETION BALANCE SHEET
5.1 The provisions of this Clause 5 will only take effect in the
circumstances described in Clause 4.1.
5.2 For the purposes of this Agreement:
(a) "Total Group Shareholder Funds" means Total Equity as at
Completion as shown in the Completion Accounts;
(b) "Completion Accounts" means the Completion Accounts as
identified in this Clause 5;
(c) "Determination Date" means the date on which Total Group
Shareholder Funds shall have been determined.
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5.3 The Company (acting on the instructions of the holders of 75% of the
Ordinary Sale Shares) will prepare management accounts comprising a
consolidated balance sheet of the Group as at Completion set out in the
form shown in Schedule 6. The management accounts will be prepared by
the Company on bases consistent with those currently employed in
preparing the Management Accounts except that the exchange rates used
in the balance sheet will be those applied in preparing the December
1996 audited accounts.
5.4 The Sellers shall use all reasonable endeavours to procure that the
Sellers Accountants will review the management accounts and issue a
report in the agreed form confirming that the management accounts have
been prepared in accordance with this Agreement ("the Sellers
Accountants Report").
5.5 The Sellers shall use all reasonable endeavours to procure the
delivery to the Buyer of a copy of the management accounts as soon as
reasonably practicable after they are prepared and in any event not
later than 30 days after Completion accompanied by the Sellers'
Accountants Report duly signed on behalf of the Sellers' Accountants.
5.6 Within 15 days of receipt of the management accounts, the Buyer's
Accountants shall notify the Sellers' Accountants in writing of any
item or items they wish to dispute together with the detailed reasons
why they dispute the items. If the Buyer's Accountants do not notify
the Sellers Accountants of such items within that period, the
management accounts shall constitute the Completion Accounts and the
Buyer and the Sellers shall be deemed to accept and shall be bound by
the contents of the Completion Accounts.
5.7 If the Buyer's Accountants notify the Sellers' Accountants in
accordance with sub-clause 5.6 of any item they wish to dispute, and
the Buyer and the Seller agree the item or items in dispute within 15
days of such notification, the management accounts as amended following
agreement of the disputed item shall constitute the Completion
Accounts and the Buyer and the Sellers shall be bound by the contents
of the Completion Accounts.
5.8 If the Buyer's Accountants notify the Sellers' Accountants in
accordance with sub-clause 5.6 of any item they wish to dispute and
the Buyer and the Sellers cannot agree the item or items in dispute
within 15 days of such notification, the item or items in dispute shall
be determined by:
(a) such firm of charted accountants as the Buyer and the Sellers
may agree in writing; or
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(b) failing agreement or the identity of the firm of chartered
accountants within a further 10 days from the expiry of the
period of 15 days referred to above, such firm of chartered
accountants as may be appointed for this purpose on the
application of any party to this agreement by the President
for the time being of the Institute of Chartered Accountants
of England and Wales,
and the management accounts as amended in accordance with such
accountants' determination shall constitute the Completion Accounts and
the Buyer and the Sellers shall be deemed to accept and be bound by the
contents of the Completion Accounts.
5.9 The accountants appointed under sub-clause 5.8 (the "Accountants")
shall act on the following basis:
(a) the Accountants will act as experts and not as arbitrators:
(b) their terms of reference shall be to determine an amount which
in their opinion represent the item or items in dispute as
specified in Clause 5.6, as notified to them in writing by
either the Sellers or the Buyer within 7 days of their
appointment, and to determine the Total Group Shareholders
Funds;
(c) the Sellers, the Company and the Buyer shall each use their
best endeavours to provide the Accountant with all information
which they reasonably require and the Accountants shall be
entitled (to the extent they consider it appropriate) to base
their opinion on such information;
(d) the determination of the Accountants shall (in the absence of
manifest error) be conclusive; and
(e) their costs shall be borne in proportion to the allocation of
any correction to the management accounts as between the
Sellers on the one hand and the Buyer on the other hand. (By
way of example, if the Sellers state to the Accountants that
the Total Group Shareholders Funds are L.88 million, the Buyer
states that the figure is L.80 million and the Accountants
state that the figure is L.86 million, the fees will be borne
as to 25% by the Sellers and 75% by the Buyer). The Sellers'
liability shall be apportioned between them in accordance
with their respective Due Proportions.
5.10 Sellers holding 75% of the Ordinary Sale Shares shall be entitled to
agree all matters on behalf of the Sellers for the purposes of this
Clause 5.
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6. CONDITION
6.1 The sale and purchase of the Sale Shares is conditional on the following
condition being satisfied (or waived in writing by the Buyer and the
holders of 75% of the Ordinary Sale Shares) on or before the Condition
Date:
(i) the Office of Fair Trading having indicated in terms reasonably
satisfactory to the Buyer and to the holders of 75% of the
Ordinary Sale Shares that the Secretary of State does not intend
to refer the acquisition of the Sale Shares pursuant to this
Agreement or another matter arising from the acquisition of the
Sale Shares to the Monopolies and Mergers Commission; or
(ii) the Secretary of State not having announced by the Condition Date
his decision to make any such references
6.2 The parties will each co-operate to seek satisfaction of the Condition as
soon as possible.
6.3 If the Condition set out in Clause 6.1 have not been satisfied (or waived
in writing by the Buyer and the holders of 75% of the Ordinary Sale
Shares) on or before 9:00 am on the Condition Date the further rights and
obligations of the parties cease immediately on termination, except that
termination does not affect Clause 8 or 13 or the accrued rights and
obligations of the parties at the date of termination.
7. COMPLETION
7.1 Completion will take place at the office of the Sellers' Lawyers on the
Completion Date.
7.2 At Completion each of the Sellers must:
7.2.1 give the Buyer those items set out in the Completion Agenda in
respect of the Sale Shares to be sold by him hereunder and, in the
case of John Botts and Rene Swaanen his duly executed resignation
as a director of the Company in the agreed form and in the case of
Citicorp Capital Investors Europe Limited, the duly executed
resignations of each of Michael Smith and James Joy as directors
of the Company in the agreed form and each of the Sellers will use
all reasonable endeavors to procure (so far as lies within his
power to procure) that Dr. J Semler delivers his duly executed
resignation as director of the Company in the agreed form.
7.2.2 only in the circumstances described in Clause 4.1, give the Buyer
a copy of the Escrow Letter and the Sellers Escrow Instruction
signed by him and (insofar as it
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is within his power to procure) a copy of the Optionholders Escrow
Instructions instruction signed by all the Optionholders and
(insofar as it lies within his power to procure) a copy of the
Escrow Letter and of the Sellers Escrow Instruction and the
Optionholders Escrow Instruction signed on behalf of the Sellers
Lawyers and (insofar as lies within his power to procure) a copy
of the Escrow Letter signed on behalf of the Company.
7.3 At Completion the Buyer must:
7.3.1 pay the Aggregate Consideration to the Sellers Lawyers Client
Account in accordance with Clause 3.5; and
7.3.2 only in the circumstances described in Clause 4.1, deliver to the
Sellers lawyers a copy of the Escrow Letter and the Sellers Escrow
Instructions and the Optionholders Escrow Instructions signed on
behalf of the Buyer
7.4 At Completion each of the Sellers (in respect of the Sale Shares being
sold by it hereunder) and the Buyer shall execute, and the Company shall
execute, in the presence of a Dutch notary (notaris), Share Transfer
Deeds in relation to all the Sale Shares. (For the avoidance of doubt,
the Deeds in respect of the shares being sold by W. Platt, J Baillie, C.
Pietri and D. Orr will be executed by Mourant & Co Trustees Limited, the
registered holder of those shares and the Deeds in respect of the shares
being sold by Botts & Company Limited will be executed by Goulditar
Nominees Limited, the registered holder of those shares.)
7.5 The Buyer may elect by notice in writing to the CEO on behalf of the
Sellers to request a Completion Date earlier than 31 October 1997 and the
Sellers will agree to such request provided that:
(a) on Completion the distribution referred to in Clause 2.2 will be
calculated and paid as if Completion was taking place on 31
October 1997;
(b) notwithstanding any provision to the contrary in this Agreement,
the provisions of Clauses 4, 5, 7.2.2 and 7.3.2 will not apply,
(c) the Buyer gives not less than five Business Days' notice of the
proposed new Completion Date (or such shorter period as the
holders of not less than 75% of the Ordinary Sale Shares agree in
writing); and
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(d) the new Completion Date proposed by the Buyer is a date by which
the Condition has been satisfied or duly waived.
7.6 for the avoidance of doubt, with effect from Completion, the Buyer will
obtain full control of the Company.
8. TERMINATION
8.1 The Buyer is not obliged to complete this Agreement unless:
8.1.1 the Sellers comply with all their obligations under Clause 7 or
are ready, able and willing to comply with such obligations; and
8.1.2 the purchase of 100% of the Sale Shares of each class is completed
simultaneously (but if the Buyer exercises its option pursuant to
Clause 8.2.1, completion of the purchase of some of the Sale
Shares does not affect the Buyer's rights in connection with the
others).
8.2 If Completion does not take place on the Completion Date because the
Sellers fail to comply or are not ready, able and willing to comply with
any of their obligations under Clause 7, the Buyer may by notice to the
Sellers:
8.2.1 proceed to Completion to the extent reasonably practicable;
8.2.2 postpone Completion to a date not more than ten Business Days
after the Completion Date; or
8.2.3 in the event that:
(a) the Condition has been satisfied or duly waived (or if the
Condition has not been satisfied due to the default of the
Sellers);
(b) compliance by the Sellers with their obligation under
Clause 7 will not involve the breach of or non-compliance
with any Law (other than any consents required under the
constitutional documents of the Sellers); and
(c) the Buyer is ready, able and willing to comply with its
obligations under Clause 7
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terminate this Agreement whereupon the defaulting Seller or
Sellers will promptly pay the Buyer $16.5 million in aggregate by
way of liquidated damages and the Company will co-operate with the
Buyer insofar as lies within its power in enforcing the Buyers
right to such sum.
8.3 If the Buyer postpones Completion to another date in accordance with
Clause 8.2.2, the provisions of this Agreement apply as if that other
date is the Completion Date;
8.4 If the Buyer terminates the Agreement pursuant to clause 8.2.3, each
party's further rights and obligations cease immediately on termination
and the sale and purchase of the Sale Shares envisaged by this Agreement
shall not take place and any documents previously delivered under Clause
7 shall be returned and the parties shall take such steps as are within
their power to ensure that any actions taken pursuant to Clause 7 are
reversed but termination does not affect a party's accrued rights and
obligations at the date of termination or the obligation of the
defaulting Seller to pay $16.5 million to the Buyer under Clause 8.2.3 or
the provisions of the Confidentiality Letter.
8.5 The Sellers are not obliged to complete this Agreement unless:
8.5.1 the Buyer complies with all with its obligations under Clause 7 or
is ready, able and willing to comply with such obligations; and
8.5.2 the purchase of all the Sale Shares is completed simultaneously
(but if the Sellers exercise their option pursuant to Clause
8.6.1, completion of the purchase of some of the Sale Shares does
not affect the Seller's rights in connection with the others).
8.6 If Completion does not take place on the Completion Date because the
Buyer fails to comply or is not ready, able and willing to comply with
all of its obligations under Clause 7 for any reason including, without
limitation, lack of financing, the Sellers may by notice to the Buyer
given by the holders of 75% of the Sale Shares:
8.6.1 proceed to Completion to the extent reasonably practicable; or
8.6.2 postpone Completion to a date not more than ten Business Days
after the Completion Date; or
8.6.3 (a) in the event that the Condition has been satisfied or duly
waived (or if the Condition has not been satisfied due to
the default of the Buyer); and
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(b) the Sellers are ready, able and willing to comply with
their obligations under Clause 7 (or would have been were
it not for a default by the buyer under Clauses 11.2 and
11.4).
terminate this Agreement whereupon the Buyer will promptly pay the
company $16.5 million by way of liquidated damages.
8.7 If the Sellers postpone Completion to another date in accordance with
Clause 8.6.2. the provisions of this Agreement apply as if that other
date is the Completion Date:
8.8 If the Seller terminates the Agreement pursuant to Clause 8.6.3 each
party's further rights and obligations cease immediately on termination
and the sale and purchase of the Sale Shares envisaged by this Agreement
shall not take place and any documents previously delivered under Clause
7 shall be returned and the parties shall take such steps as are within
their power to ensure that any actions taken pursuant to Clause 7 are
reversed, but termination does not affect a party's accrued rights and
obligations at the date of termination or the obligation of the Buyer
to pay $16.5 million to the company under Clause 8.6.3 or the provisions
of the Confidentiality Letter.
9. WARRANTIES
9.1 Each of the Sellers separately warrants to the Buyers that each of the
Warranties is true and accurate as regards himself and the Sales Shares
to be sold by him hereunder only (and not as regards any of the other
Sellers or any other Sale Shares).
9.2 Any payment made by the Sellers in respect of a breach of the Warranties
shall be deemed to be a reduction in the Consideration.
9.3 Each of the Sellers undertakes that he will not before Completion:
(i) dispose of any interest in his Sale Shares or any of them or
grant any option or right of pre-emption over, or mortgage, charge
or otherwise encumber his Sale Shares or any of them;
(ii) do or cause to be done any act or thing which would result (or be
likely to result) in a breach of any of the Warranties given by
him under Clause 9.1 if such Warranties were repeated at
Completion; or
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(iii) exercise any rights in respect of his Sale Shares so as to
prevent or hinder the sale of the Sale Shares as provided for in
this Agreement except to the extent that the Buyer has previously
consented to such exercise of rights in writing.
10. ACTION PENDING COMPLETION
10.1 Each of the Sellers shall (insofar as he is able by virtue of holding
shares in the Company and/or as an officer of any Group Company) ensure
that each Group Company will:
10.1.1 operate its business in the usual way so as to maintain that
business as a going concern;
10.1.2 in the case only of the Company (and not in respect of any other
Group Company) and declare, pay or make a dividend or distribution
other than in accordance with the terms of the Preference Shares
(as envisaged by Clause 2.2).
10.2 The CEO on behalf of the Sellers shall consult with the Buyer before the
Group acquires or disposes of, or agrees to acquire or dispose of, a
significant asset (i.e. having a consideration of at least Pound 5
million).
10.3 For the avoidance of doubt, the Sellers shall be entitled to modify the
Articles of Association of the Company so as to permit the payments of
the dividend referred to in Clause 2.2.
11. BUYERS OBLIGATIONS
11.1 The Buyer will not, and will procure that the members of the Buyer's
Group and its and their advisers and representatives will not, directly
or indirectly without the express written consent of the CEO on behalf of
the Sellers contact in connection with the transaction envisaged by this
Agreement (other than in the presence of the CEO):
(a) any present or former directors, officers, employees, advisers or
representatives of the Company or any Group Company other than the
CEO, Clifford Chance, London, Coopers & Lybrand, Watson Wyatt or
Arthur D. Little;
(b) any customers, competitors or suppliers of any Group Company;
(c) any member of the Siemens - Osram Group.
Any breach of this clause will entitle Sellers holding 75% of the
Ordinary Sale Shares to terminate this Agreement before Completion by
notice in writing to the Buyer.
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11.2 for the avoidance of doubt, the Buyer agrees with the Sellers (as trustee
for the Company) that the Confidentiality Agreement remains in full force
and effect. Any breach of the Confidentiality Agreement shall entitle
Sellers holding 75% of the Ordinary Sale Shares, without prejudice to any
rights and remedies they may have, to terminate this Agreement before
Completion by notice in writing to the Buyer.
11.3 The Buyer undertakes with the CEO, the CFO and the other Executive
Shareholders that following Completion it will procure that the Company
and its relevant subsidiaries comply with the Service Agreements and do
not seek to vary their terms or behave unreasonably.
11.4 The Buyer will be responsible for procuring all consents, notifications,
consultations and similar matters required by any Law (including without
limitation any anti-trust or foreign exchange law) required by the
transactions envisaged by this Agreement (other than any consents
required under the constitutional documents of the Sellers).
11.5 The Buyer will indemnify the Sellers and the Option Holders against each
loss, liability and cost which any of them incur arising out of breach of
the Buyer's obligations under Clause 11.4 including, without limitation,
each loss, liability and cost incurred as a result of defending or
settling a claim (alleging such a liability).
12. CONFIDENTIAL INFORMATION
12.1 Each of the Sellers must after Completion not use or disclose to any
person any Confidential Information it has or acquires.
12.2 Clause 12.1 does not apply to:
12.2.1 disclosure of Confidential Information to directors, managers or
employees of the Buyer or its subsidiaries whose functions require
them to know the Confidential Information:
12.2.2 use or disclosure of those of the Sellers who remain officers or
employees of the Company or any of its subsidiaries in the course
of and for the purposes of such office or employment;
12.2.3 use or disclosure of Confidential Information required to be
disclosed or used by law or any regulatory authority to which a
Seller is subject;
-12-
<PAGE> 17
12.2.4 disclosure of Confidential Information to an adviser for the
purpose of advising the Seller but only on terms that Clause 12.1
and 12.2 apply to any use or disclosure by the adviser; or
12.2.5 Confidential Information which becomes publicly known or generally
available within the lighting industry otherwise than by breach of
Clause 12.1 or 12.2 by the Sellers.
13. ANNOUNCEMENTS
13.1 Unless Clause 13.3 or 13.4 applies, no public announcement,
communication or circular concerning the transactions referred to in
this Agreement may be made or dispatched at any time (before or after
Completion) by either party without having first obtained the written
consent of the Buyer and the CEO on behalf of the Sellers, each of whom
must not unreasonably withhold or delay the giving of consent.
13.2 Unless Clause 13.3 or 13.4 applies, each of the parties shall keep the
price and terms of this transaction confidential unless the written
consent of the Buyer or the CEO or behalf of the Sellers is obtained,
such consent not to be unreasonably withheld or delayed.
13.3 Where the announcement, communication, circular or disclosure is required
by law or a regulation of a stock exchange or other regulatory authority
governing such parties, the party required to make it must use best
endeavors to keep such disclosures to the minimal level and to first
consult, and take into account the reasonable requirements of, the other
party. In particular, without limitation, the price of the transaction
will not be disclosed (except in a tax return) unless the lawyers acting
for the party wishing to make the disclosure state that in their opinion,
such disclosure is required by law or regulation as aforesaid. Any
Seller which is an institutional investor (or a nominee for an
institutional investor) may disclose the price and terms of this
transaction to the extent required by its regulations.
13.4 The Sellers may give Osram and Siemens notice of this Agreement and a
copy of this Agreement.
14. COSTS
Except where this Agreement provides otherwise, each party must pay its
own costs relating to the negotiation, preparation, execution and
implementation by it of this Agreement and of all other documents
referred to in it.
-13-
<PAGE> 18
15. GENERAL
15.1 No variation of this Agreement (including the clause) is valid unless it
it is in writing and signed by or on behalf of each party.
15.2 Except where this Agreement expressly provides otherwise, the parties
exclude the right to rescind this Agreement and specifically the right
referred to in Article 6:265 of the Dutch Civil code.
15.3 All obligations in this Agreement are several and not joint
15.4 in converting any non Dollar amount into Dollars under this Agreement,
the resulting sum will be rounded up or down to four decimal places
provided that, in calculating the amount payable to any person hereunder,
the payment may be rounded up or down to the nearest Dollar.
15.5 It is noted that Osram has agreed that the Osram Pre-emption Rights will
not apply to the sale of the Sale Shares to the Buyer.
16. ENTIRE AGREEMENT
16.1 This Agreement constitutes the entire agreement, and supersedes any
previous agreement between the parties relating to the subject matter of
this Agreement.
16.2 Each party acknowledges that it is not relied on or been induced to enter
into this Agreement by a warranty or representation other than those
expressly set out in this Agreement.
16.3 A party is not liable to the other party for a representation that is not
set out in this Agreement.
17. TRANSFER OF RIGHTS AND OBLIGATIONS
Neither party may assign or transfer, or purport to assign or transfer,
any of its rights or obligations under this Agreement.
-14-
<PAGE> 19
18. NOTICES
18.1 Any notice or other communication in connection with this Agreement
must be in writing in the English language and must be:
18.1.1 delivered personally;
18.1.2 sent by pre-paid ordinary mail, or, if appropriate, by pre-paid
air mail; or
18.1.3 sent by telefax
to the party due to receive the notice or communication at its address
set out in this Agreement or such other address as a party may specify
by notice in writing to the others.
18.2 In the absence of evidence of earlier receipt, a notice or other
communication is deemed given;
18.2.1 if delivered personally, when left at the address referred to
in clause 18.1;
18.2.2 if sent by ordinary mail (inland), three days after posting it;
18.2.3 if sent by ordinary mail (overseas), ten days after posting it;
18.2.4 if sent by air mail, six days after posting it; and
18.2.5 if sent by telefax, on completion of its transmission
19. GOVERNING LAW AND JURISDICTION
19.1 This Agreement is governed by the laws of The Netherlands.
19.2 The parties hereto hereby submit to the exclusive jurisdiction of the
Courts of Amsterdam subject to right of appeal including appeal to the
Supreme Court in the Hague ("cassatie").
IN WITNESS WHEREOF this Agreement has been signed by the parties hereto.
- 15 -
<PAGE> 20
SCHEDULE 1
THE SELLERS
<TABLE>
<CAPTION>
(1) (2) (3)
THE SELLERS ORDINARY SALE SHARES DUE PROPORTION
<S> <C> <C>
Citicorp Capital Investors 17,000 "B" Ordinary 16.72%
Europe Limited Shares
Capital Partnership 14,375 "A" Ordinary 20.04%
Nominees Limited Shares
6,000 "B" Ordinary Shares
E.P. Bartlett ("the CFO") 1,500 "A" Ordinary Shares 1.48%
N. Scoular ("the CEO") 6,000 "A" Ordinary Shares 5.90%
J.C. Botts 5,000 "A" Ordinary Shares 4.92%
N.D. Davies 750 "A" Ordinary Shares 0.74%
Botts & Company 20,000 "A" Ordinary 19.67%
Limited Shares
W Platt 75 "A" Ordinary Shares 0.08%
J Baillie 75 "A" Ordinary Shares 0.08%
C Pietri 40 "A" Ordinary Shares 0.04%
D Orr 60 "A" Ordinary Shares 0.06%
R. Swaanen 500 "A" Ordinary Shares 0.49%
M.J.L. Goodwin 250 "A" Ordinary Shares 0.25%
R. McSweeney 750 "A" Ordinary Shares 0.74%
EuropEnterprise '92 10,625 "A" Ordinary 27.17%
Curacao N.V. Shares
17,000 "B" Ordinary
Shares
Totals 40,000 "B" Ordinary 98.38%
Shares
60,000 "A" Ordinary
Shares
</TABLE>
- 16 -
<PAGE> 21
SCHEDULE 2
OPTION-HOLDERS
<TABLE>
<CAPTION>
(1) (2) (3) (4) (5)
OPTION-HOLDERS "A" ORDINARY SHARES "B" ORDINARY SHARES PREFERENCE SHARES DUE PROPORTION
UNDER OPTION UNDER OPTION UNDER OPTION
<S> <C> <C> <C> <C>
J. Virte 75 50 125 0.12%
H. Kurzendorfer 53 35 87 0.09%
C. Pietri 60 40 99 0.10%
A. Smith 60 40 99 0.10%
G. Schauer 68 45 111 0.11%
K. Segets (personal 45 30 74 0.07%
representatives)
J. Germis 45 30 75 0.07%
L. v.Dingenen 15 10 25 0.02%
E. De Herdt 60 40 99 0.10%
P. Mazalon 45 30 74 0.07%
M. Crompton 45 30 74 0.07%
</TABLE>
- 17 -
<PAGE> 22
<TABLE>
<S> <C> <C> <C> <C>
R. Williams 45 30 74 0.07%
P. de Orive 45 30 74 0.07%
A. Natali 30 20 50 0.05%
N. Hansen 30 20 50 0.05%
J. Phillips 45 30 74 0.07%
D. Orr 45 30 74 0.07%
M. Sloan 37 25 62 0.06%
N. Farraway 45 30 74 0.07%
W. Platt 45 30 74 0.07%
J. Baillie 45 30 74 0.07%
M. Krechting 30 20 50 0.05%
------ ------ ------ -----
1013 675 1672 1.62%
====== ====== ====== =====
====== ====== ====== =====
</TABLE>
- 18 -
<PAGE> 23
SCHEDULE 3
PREFERENCE SHAREHOLDERS
<TABLE>
<CAPTION>
(1) (2) (3)
NAME OF PREFERENCE NUMBER OF PREFERENCE AMOUNTS PAYABLE PURSUANT
SHAREHOLDER SHARES TO CLAUSE 3.4
POUND
<S> <C> <C>
Citicorp Capital Investors 59,806 4,439,389.86
Europe Limited
E.P. Bartlett 1,485 110,231.31
N. Scoular 5,940 440,925.25
N.D. Davies 743 55,152.77
Botts & Company 49,800 3,696,646.07
Limited
W Platt 74 5,493.01
J Braillie 74 5,493.01
C Pietri 40 2,969.20
D Orr 59 4,379.57
M. Swaanen 495 36,743.77
M.J.L. Goodwin 248 18,409.00
R. McSweeney 742 55,078.54
EuropEnterprise '92 59,805 4,439,315.63
Curaco N.V.
-------------- --------------------
179,311 POUND 13,310,226.99
</TABLE>
- 19 -
<PAGE> 24
SCHEDULE 4
DEFINITIONS
1. In this Agreement:
""A" Ordinary Shares" means "A" Ordinary Shares of one Dutch Guilder
each of the Company;
"Aggregate Consideration" means the amount calculated in accordance
with Clause 3.1;
"Articles" means the current Articles of Association of the Company in
the agreed form;
""B" Ordinary Shares" means "B" Ordinary Shares of thirty five Dutch
Guilder Cents each of the Company;
"Business Day" means a day other than a Saturday or Sunday on which
banks are generally open for business in London and Amsterdam;
"Buyer's Group" means the Buyer and all corporations directly or
indirectly controlled by the Buyer;
"Completion" means completion of the sale and purchase of the Sale
Shares in accordance with this Agreement;
"Completion Agenda" means the agenda listing the matters to be dealt
with at Completion in the agreed form;
"Completion Date" means 31 October 1997 or such other date as may be
agreed in writing by the Buyer and the holders of 75% of the Ordinary
Sale Shares:
"Condition" means the condition described in Clause 6.1;
"Condition Date" means 31 October 1997 or such other date as may be
agreed in writing by the Buyer and the holders of 75% of the Ordinary
Sale Shares;
"Confidential Information" means all information not publicly known,
used in or otherwise relating to the business, customers or financial
or other affairs of any Group Company;
- 20 -
<PAGE> 25
"CONFIDENTIALITY AGREEMENT" means the confidentiality agreement between
the Buyer and the Company dated May 1997;
"DOLLAR" and the signs "$" and "US$" means lawful money of the United
States of America;
"DUE PROPORTION" means, in relation to a Seller, that proportion set
opposite its name in column (3) of Schedule 1 and in relation to an
Option Holder, that proportion set opposite its name in column (5) of
Schedule 2;
"ESCROW LETTER" means the escrow letter in the agreed form;
"EXECUTIVE SHAREHOLDERS" means N. Scoular, E.P. Barlett, R. McSweeney and
N.D. Davies;
"GROUP" means the Company and the Subsidiaries;
"GROUP COMPANY" means the Company or any Subsidiary;
"LAW" means civil and common law, statute, subordinate legislation,
treaty, regulation, directive, decision, by-law, ordinance, circular,
code, order, notice, demand, decree, injunction, resolution, judgment or
recommendation of any government, quasi-government, statutory,
administrative or regulatory body, court, agency or association in any
jurisdiction;
"MANAGEMENT ACCOUNTS" means the management accounts of the Group for the
period 1 January 1997 to 30 June 1997;
"OPTION SHARES" means the Ordinary Option Shares and the Preference
Option Shares;
"OPTIONHOLDER ESCROW INSTRUCTION" means the Optionholders instructions in
the agreed form;
"ORDINARY CASH EQUIVALENT" means the Average Ordinary Consideration less
$900;
"ORDINARY OPTION SHARES" means the unissued "A" Ordinary Shares and/or
"B" Ordinary Shares over which the Company has granted the Option-holders
options exercisable on Completion, further details of which are shown in
Schedule 2;
"ORDINARY SALE SHARES" means 60,000 "A" Ordinary Shares and 40,000 "B"
Ordinary Shares;
-21-
<PAGE> 26
"ORDINARY CONSIDERATION" is as defined in Clause 3.3;
"ORDINARY SHAREHOLDERS" means the persons listed in Schedule 1;
"OSRAM" means Osram GmbH, a company organized in Germany;
"OSRAM PRE-EMPTION RIGHTS" means the provisions of clauses 10.3 to 10.6
of the Master Agreement as shown on the extract in the agreed form;
"POUND" and the sign "f" means lawful money of the United Kingdom;
"PREFERENCE CONSIDERATION" means the amount payable for each Preference
Share under Clause 3.4;
"PREFERENCE CASH EQUIVALENT" means (the Preference Consideration x
110.518%) less $100;
"PREFERENCE OPTION SHARES" means the unissued Preference Shares over
which the Company has granted the Option-holders options exercisable on
Completion, further details of which are set out in Schedule 2;
"PREFERENCE SALE SHARES" means 179,311 Preference Shares;
"PREFERENCE SHAREHOLDERS" means the Cumulative Preference Shares of
one Dutch Guilder Cent each of the Company;
"RELEVANT EXCHANGE RATE" means the spot rate of exchange for the purchase
of Pounds with Dollars quoted by Midland Bank plc at or about 11.00 a.m.
London time on the business day immediately preceding the Completion
Date;
"SALE SHARES" means the Ordinary Sale Shares and the Preference Sale
Shares;
"SELLERS' ACCOUNTANTS" means Coopers & Lybrand of 1 Embankment Place,
London;
"SELLERS ESCROW INSTRUCTIONS" means the Sellers instructions in the
agreed form;
"SELLERS' LAWYERS" means Clifford Chance. Apollolaan 171, 1077 AS
Amsterdam. The Netherlands;
-22-
<PAGE> 27
"SELLERS LAWYERS CLIENT ACCOUNT" means a client bank account of the
Sellers Lawyers:
"SERVICE AGREEMENTS" means the service agreements between the CEO, the
CFO, the other Executive Shareholders and members of the Group in the
agreed form;
"SIEMENS" means Siemens Aktiengesellschaft, a company organised in
Germany;
"SIEMENS - OSRAM GROUP" means Osram, the holding companies of Osram and
their respective subsidiary companies (as defined by section 736 of the
Companies Act 1985 of England) and shall include in addition such
affiliate of Siemens as Osram may designate;
"SHARE TRANSFER DEED" means a notarial deed for the transfer of the Sale
Shares or the Preference Shares in the agreed form;
"SUBSIDIARY" means a subsidiary of the Company;
"THIRD-PARTY RIGHT" means a mortgage, charge, pledge, lien, right or
usufruct, depository receipt, option, restriction, right of first
refusal, right of pre-emption, easement, lease, third-party right or
interest, other encumbrance or security interest of any kind, or any
other type or preferential arrangement (including, without limitation,
any title transfer and retention arrangement) having similar effect;
"WARRANTIES" means the warranties contained in Schedule 5.
2. In this Agreement, a reference to:
2.1 a "subsidiary" has the meaning ascribed to the word
"dochtermaatschappij" in section 2:24a of the Dutch Civil Code
save where expressly provided to the contrary;
2.2 a document in the "agreed form" is a reference to a document in a
form approved and for the purposes of identification signed by or
on behalf of the parties;
2.3 a person includes a reference to any body corporate, association
or partnership;
2.4 the masculine gender includes the feminine and neuter and vice
versa;
2.5 a person includes a reference to that person's legal personal
representatives and successors.
-23-
<PAGE> 28
SCHEDULE 5
WARRANTIES
1. The Seller has the legal right and full power and authority, and has
taken all action required, to sign and perform his obligations under this
Agreement and all the documents which are to be signed by him at
Completion.
2. The Seller will at Completion be entitled to sell or procure the transfer
of the full legal and beneficial ownership in his Sale Shares to the
buyer on the terms set out in this Agreement.
3. There is not Third-party Right and there is no agreement, arrangement or
obligation to create a Third-party Right in relation to any of his Sale
Shares. No person has claimed to be entitled to any Third-party right in
relation to any of his Sale Shares.
4. So far as the Seller is aware, the Sale Shares comprise the whole of the
issued share capital of the company, have been properly and validly
issued and are each fully paid.
5. So far as the Seller is aware, there is no agreement (other than this
Agreement), arrangement or obligation which requires the allotment or
issue of, or the grant to any person of the right (conditional or not) to
require the issue of, shares of the Company, other than the agreements
requiring the Company to allot the Option Shares to the Option-holders.
-24-
<PAGE> 29
SCHEDULE 6
FORM OF COMPLETION BALANCE SHEET
Cash
Temporary Security
Receivables - Trade
- Interco
Allowance for Doubtful Account
TOTAL NET RECEIVABLES
Finished Goods
Raw Materials & WIP
Inventories Reserves
TOTAL NET INVENTORIES
Reorganization Expenses
Prepaids & Other Current Assets
TOTAL CURRENT ASSETS
Property, Plant & Equipment
Depreciation
NET P P E
Loan Receivables
Other Long Term Asset
TOTAL ASSETS
Payables - Trade
- Interco
TOTAL PAYABLES
Accrued Income Tax
Accrued Liabilities
CURRENT LIABILITIES
Deferred Income Tax
Reserves & Deferred Credits
TOTAL NON DEBT LIABILITIES
- 25 -
<PAGE> 30
Overdraft & Short Term Debt
Long Term Debt
Loan Payables
TOTAL DEBT LIABILITIES
Minority
Capital Stock
Capital Surplus
Retained Earning - Restricted
- Unrestricted
Profit and Loss
Translation Adjustment
TOTAL EQUITY
- 26 -
<PAGE> 31
Signed by James F Joy ) /s/ J F Joy
for and on behalf of Citicorp )
Capital Investors Europe )
Limited )
Signed by
for and on behalf of Capital ) /s/ J C Botts
Partnership Nominees )
Limited )
Signed by J C Botts ) /s/ J C Botts
Signed by N Scoular ) /s/ N Scoular
Signed by E P Bartlett ) /s/ E P Bartlett
Signed by N D Davies by his ) /s/ E P Bartlett
attorney E P Bartlett )
Signed by ) /s/ J C Botts
for and on behalf of )
Botts & Company )
Limited )
Signed by W Plant by his ) /s/ John Chapman
attorney Mourant & Co ) Authorized Signature
Trustees Limited )
- 27 -
<PAGE> 32
Signed by J. Baillie by his ) /s/ John Chapman
Attorney Mourant & Co ) Authorized signature
Trustees Limited )
Signed by C. Pietri by his ) /s/ John Chapman
attorney Mourant & Co ) Authorized signature
Trustees Limited )
Signed by D Orr by his ) /s/ John Chapman
attorney Mourant & Co ) Authorized signature
Trustees Limited )
Signed by M Swansen ) E Bartlett
by his attorney E. Bartlett
Signed by M J L Goodwin by ) (signature illegible)
his attorney N Scoular )
Signed by R. McSweeney ) E Bartlett
by his attorney E Bartlett )
Signed by James P Joy ) (signature illegible)
for and on behalf of )
EuropEnterprise '92 )
Curacao NV )
- 28 -
<PAGE> 33
Signed by ) /s/ Frank M. Ward
for and on behalf of Chicago ) Chairman
Miniature Lamp Inc. )
Signed by N Scoular ) /s/ N Scoular
for and on behalf of )
Sylvania Lighting )
International B.V. )
- 29 -
<PAGE> 34
[BOTTS & CO LTD - LETTERHEAD]
To: Chicago Miniature Lighting Inc.
Dated August 1997
From: Botts & Company Limited, Capital Partnership Nominees Limited and J C
Botts
We refer to the sale and purchase agreement to be entered into between
Citicorp Capital Investors Europe Limited and Others (1) Chicago Miniature
Lighting Inc (2) and Sylvania Lighting International BV (3) (the "Agreement").
Terms defined in this letter will have the same meaning as in the Agreement.
We each hold Sale Shares on behalf of beneficiaries under trust or nominee
arrangements; however these Third Party Rights will terminate and be
overreached by a transfer of the Sale Shares to the Buyer pursuant to the
Agreement and will in no way affect the acquisition by the Buyer of the Sale
Shares to be sold by us free of all Third party Rights.
Please would you sign and return to us a copy of this letter to confirm your
agreement that this letter qualifies the warranty in paragraph 3 of schedule 5
notwithstanding clause 16.1 of the Agreement.
Yours sincerely,
/S/ /s/ /s/
For and on behalf of For and on behalf of John Botts
Botts & Company Limited Capital Partnership
Nominees Limited
Agreed for and on behalf of
Chicago Miniature Lamp Inc.
