SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): October 3, 1996
BT OFFICE PRODUCTS INTERNATIONAL, INC.
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(Exact name of registrant as specified in its charter)
Delaware 1-13858 13-3245865
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
2150 E. Lake Cook Road, Buffalo Grove, Illinois 60089-1877
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (847) 793-7500
Exhibit Index on Page 5
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Item 2. Acquisition or Disposition of Assets.
On October 3, 1996, BT Office Products Deutschland GmbH + Co.,
KG (the "Purchaser"), a German company and an indirect wholly owned subsidiary
of BT Office Products International, Inc., a Delaware corporation (the
"Registrant"), acquired from KNP BT Beteiligungen Deutschland GmbH (the
"Seller") all of the share capital of bax Burosysteme Vertriebsgesellschaft mbH
("Bax") pursuant to the terms of a Purchase Agreement (the "Purchase Agreement")
dated September 25, 1996 between the Purchaser and the Seller. Bax is a
distributor in Germany of office equipment, including copiers and facsimiles,
and related supplies with total sales of approximately $14 million for the
fiscal year ended December 31, 1995. The Seller is a German company and an
indirect wholly-owned subsidiary of NV Koninklijke KNP BT ("KNP BT"), a
Netherlands company that is also the holder of approximately 70% of the issued
and outstanding shares of the common stock of the Registrant. Frank J. de Wit,
Rob W.J.M. Bonnier and Frans H.J. Koffrie are directors of the Seller and the
Registrant.
The purchase price for such transaction was approximately $10
million in cash. The purchase price was based on an independent valuation of Bax
and a review of other offers from outside third parties.
The assets of Bax that were acquired, including, without
limitation, inventory and equipment, have been used by Bax in the distribution
of office products. The Purchaser intends to continue such use of the acquired
assets.
The source of funds used to finance the acquisition was
borrowings under the Registrant's $200 million Credit Agreement dated as of June
15, 1995 with KNP BT Antilliana, N.V. ("Antilliana"), as modified by an
Assignment and Modification Agreement dated as of June 26, 1996 by and among the
Registrant, Antilliana and KNP BT Finance (USA), Inc., which borrowings the
Registrant expects to convert to loans under the Registrant's $250 million
syndicated Competitive Advance and Revolving Credit Agreement dated as of August
2, 1996 with the lenders named therein, The Chase Manhattan Bank, as
Administrative Agent, and ABN AMRO Bank N.V., as Documentation Agent.
The foregoing summary of the Purchase Agreement is qualified
in its entirety by reference to Exhibit 2 filed herewith and incorporated herein
by reference.
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Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) and (b) Financial Statements of Businesses
Acquired and Pro Forma Financial
Information
It is impracticable at this time to provide financial
statements and pro forma financial information required to be filed pursuant to
Item 7 of Form 8-K. Such financial statements and pro forma financial
information will be filed as soon as practicable but not later than 60 days from
the date hereof.
(c) Exhibits
(1) Purchase Agreement dated September 25, 1996 between KNP BT
Beteiligungen Deutschland GmbH as Seller, and BT Office Products Deutschland
GmbH + Co., KG as Purchaser.
In accordance with Item 601(b)(2) of Regulation S-K, the
schedules and exhibits referenced in the Purchase Agreement have not been filed
as part of the exhibit to this Form 8-K. The Registrant agrees to furnish
supplementally a copy of the omitted schedules and exhibits to the Commission
upon request.
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SIGNATURES
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.
BT OFFICE PRODUCTS INTERNATIONAL,
INC.
By: /s/ John J. McKiernan
___________________________
John J. McKiernan
Vice President-Finance and
Administration, Chief
Financial Officer and
Secretary
DATE: October 17, 1996
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INDEX TO EXHIBITS
Exhibit No. Description
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2 Purchase Agreement
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Exhibit 2
Quota Purchase Agreement
between KNP BT Beteiligungen Deutschland GmbH
Frielingsdorfweg 17
45239 Essen
- hereinafter referred to as the "Seller" -
and Hartmann & Cie. GmbH + Co. KG
(in the future: BT Office Products
Deutschland GmbH & Co. KG)
Weserstrabe 4
60329 Frankfurt am Main
- hereinafter referred to as the "Buyer" -
Preamble
The Seller is the sole quotaholder of
bax Burosysteme Vertriebsgesellschaft m.b.H, Maisach,
county of Furstenfeldbruck (Commercial Register Munich
HRB 56393)
- hereinafter referred to as the "Company" - .
The Seller desires to sell all its quotas in the Company to the Buyer and the
Buyer desires to purchase such quotas from the Seller.
Therefore, the parties agree as follows:
Section 1
Object of Purchase; Purchase
1. The Seller is the owner of all quotas in the Company as follows:
Quotas in the nominal value of
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- DM 50,000.- since the acquisition of such quota by agreement
of December 13, 1989 (Deed No. 3019 E/1989 of the notary Edwin
Oberacher, Munich)
and
- DM 4,950,000.- since the capital increase of February 5, 1991
(Deed of the notary Steven Perrick, Amsterdam, Niederlande)
- hereinafter collectively referred
to as the "Quotas" -
as in more detail described in Schedule 1.
2. The Seller herewith sells to the Buyer the Quotas including all rights
to profits not distributed as of the Effective Date, with the exception
of the dividend payment to Seller in the amount of DM 815,000.-,
resolved upon on September 3, 1996 and paid to Seller immediately
thereafter, and the Buyer buys the Quotas at the purchase price as
defined in Section 2.
Section 2
Purchase Price
1. The Purchase price for the Quotas amounts to DM 15,000,000.- (in words:
Deutsche Mark fifteen million), less any repayment of capital to Seller
(with the exception of the dividend payment under Section 1.2) which
has taken place after June 30, 1996.
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2. The purchase price shall be payable within two weeks from today's date
to the account of the Seller No. 234000061 at KNP BT Europcenter N.V.,
Wellen, Belgium.
Section 3
Effective Date
The purchase of the Quotas shall take place with economic effect as of July 1,
1996 ("Effective Date").
Section 4
Representations and Warranties
With respect to the Company the Seller guarantees and represents the following:
1. The Seller is the owner of the Quotas and has the unrestricted right to
dispose of the Quotas. There are no claims of third parties relating to
the Quotas. The Quota in the nominal amount of DM 50.000, -- has been
fully paid in.
2. The excerpt from the Commercial Register of May 31, 1996, attached
hereto as Exhibit 1, as well as the Articles of Association of August
27, 1996, attached hereto as Exhibit 2, are, except as disclosed in
Schedule 1, true and complete.
3. With the exception of assets sold in the ordinary course of business,
the Company is the owner of all assets as specified in the annual
statement of accounts as of December 31, 1995 prepared and audited by
Coopers & Lybrand, Munich
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(Exhibit 3; hereinafter "Annual Statement 1995"). The Company has the
exclusive right to dispose of these assets and with the exception of
- legal liens and
- usual retention of title rights by suppliers, for which
appropriate liabilities appear in the balance sheets, no
claims of third parties exist with regard to these assets.
4. The Company is the sole and unrestricted owner of the trade and service
mark "bax Buromaschinen," which is registered under the reference no. B
76868/16 Wz with the German Patent Office. The Company has taken the
trademark into use within the first five years of its entry in the
German Trademark Register, has properly paid all extension fees and is
not restricted in the use of this registered right. To the knowledge of
the Seller, no intellectual property rights of third parties exist,
which the Company would violate in the production or the distribution
of any of its current products. The Company does not own any other
intellectual property rights which are necessary or beneficial for the
Company. During the last five years no claims have been made against
the Company based on the assertion that intellectual property rights of
third parties were violated.
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Buyer is aware that the Company does not own the trademark "bax"
registered under the reference no. B 80011/36 Wz with the German Patent
Office.
5. All inventories in stock on the Effective Date are in good condition
and do not have any defects.
6. This contract does not conflict with any obligations of the Seller or
the Company. There are no agreements or legal relations in existence
which are based on the premise that the Seller is the sole quotaholder
of the Company and which could be terminated because of the sale of the
Quotas.
In particular, the Company did not receive or apply for any
governmental subsidies which could be reclaimed or declined as soon as
the Seller ceases to be a quotaholder of the Company.
7. The Annual Statement 1995 has been prepared in accordance with German
generally accepted accounting principles consistently applied.
The financial position of the Company has not changed significantly
since December 31, 1995.
8. As per december 31, 1995 the Company - with the exception of
liabilities originating from contracts for the performance of recurring
obligations - had no liabilities or impending losses from pending
transactions other than those shown or for which provisions have been
made in the Annual Statement
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1995; in particular no direct or indirect pension commitments have been
made. Since December 31, 1995 liabilities have only been created in the
ordinary course of business.
9. The Company has filed all required tax returns and all taxes due have
been paid. For taxes payable for periods prior to January 1, 1996 which
are not yet due, sufficient provisions have been made in the Annual
Statement 1995.
A control and profit transfer agreement has been in existence between
the Company and the Seller as of January 1, 1990 which has been
terminated with effect as of December 31, 1995. The termination has
been registered in the Commercial Register on January 27, 1996. No
rights and obligations result from this agreement anymore.
10. The Company has available a net operating loss carry forward ("NOL") of
at least DM 100 million. In case of breach of this warranty the
resulting damage to the Buyer will be calculated in million DM
according to the following formula:
117 - available NOL
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117
11. The books and records of the Company are complete and have been
conducted orderly.
12. On December 28, 1995 the Company has concluded a lease agreement with
bax Kopiersysteme Vertriebsgesellschaft mbH, Maisach, with respect to
the business premises used by the
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Company which is enclosed as Exhibit 4 hereto; the lease contract has
been amended on August 1, 1996 by means of the Addendum enclosed as
Exhibit 5.
13. All obligations of the Company and the respective other parties under
all agreements due have been properly fulfilled and all payments due
have been made. The general and individual provisions for bad debt as
contained in the balance sheet prepared as of June 30, 1996 (Exhibit 6)
plus an amount of DM 50.000.- are sufficient to cover the risk of
uncollectability of debts in 1996.
14. Exhibit 7 comprises a true and complete list of all agreements and
legal relations as of the Effective Date and as of today between the
Company and the Seller, as well as with companies affiliated with the
Seller in the sense of Sections 15 et seq. German Stock Corporation
Act.
The Company has not issued any guarantees in favor of the Seller, or in
favor of any companies affiliated with the Seller in the sense of
Sections 15 et seq. German Stock Corporation Act.
15. Exhibit 8 comprises a true and complete list of all loans of the
Company as of the Effective Date and as of today, and for each loan the
amount, term, interest rate and the collateral given are listed.
Exhibit 9 comprises on top of this list a list of all collateral for
the benefit of the Company given by the Company, by the Seller or by
companies
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affiliated with the Seller in the sense of Sections 15 et seq. German
Stock Corporation Act. Buyer undertakes to release Seller and its
affiliated companies from such collateral and to indemnify Seller and
its affiliated companies from all claims under and all costs associated
with such collateral.
16. Except for the legal disputes and administrative proceedings mentioned
in Exhibit 10, the Company is not involved in any proceedings with a
value of more than DM 10,000.- and such proceedings are neither
impending nor to be expected. Exhibit 11 contains a list of all
judgments, administrative orders as well as court and out of court
settlements which restrict the Company in its business.
17. The business of the Company is conducted in compliance with all
applicable laws, rules and regulations, in particular those relating to
environmental laws and safety regulations. The Company is in possession
of all permits required for its business.
18. The Seller has neither intentionally nor with gross negligence withheld
from the Buyer any information which is of material influence on the
assessment of the business of the Company.
19. In so far as the guarantees and representations as mentioned above
depend on the knowledge of the Seller, the knowledge of the managing
director of the Company is attributed to the Seller.
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20. Since December 31, 1995
- the Company has conducted its business in all material fields
in compliance with the ordinary course of business;
- no material, permanent change in the business, the assets or
the prospective business of the Company has occurred;
- no significant changes in the Company's equity capital or the
balance sheet ratio, other than those which result from the
ordinary course of business and planned results, have
occurred.
Section 5
Breach of Guarantees and Representations
1. In case the warranties and representations of the Seller as given in
Section 4 above are untrue or incomplete, the Buyer will inform the
Seller thereof. The Seller will then have the opportunity to establish
the warranted or represented situation within a reasonable period of
time. If this is not possible or not feasible within this time frame,
the Seller is liable to pay damages.
2. Sections 460 and 464 German Civil Code are not applicable.
3. Further rights of the Buyer, in particular the right to cancel or
withdraw from this Contract, are excluded.
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Section 6
Statute of Limitations
With the exception of claims under Section 4.1 which are time- barred only after
30 years, claims resulting from the violation of representations and warranties
are time-barred within twenty four months after the date of this Contract; in so
far as tax liabilities are concerned, the respective claim for damages will be
timed-barred only six months after the tax assessment has become final and
non-appealable.
Section 7
Undertakings by Buyer
1. Buyer will cause the managing director of the Company to immediately
after expiration of the one year waiting period under Section 58 par. 1
no. 3 GmbH Act file the necessary application for the Capital Decrease
with the Commercial Register.
2. Buyer undertakes not to dispose in any way of the Quotas or the Company
before the Capital Decrease has been registered with the Commercial
Register.
3. Buyer will indemnify and hold harmless Seller from all claims by the
Company which might be raised on the basis that the profit for 1996 did
not justify the advance dividend (Section 1.2), provided that the
interim dividend payment referred to in Section 1 par. 2 above was
generated sufficiently by profits of the Company in the first half of
the calendar year 1996.
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Section 8
Prohibition to Compete
1. The Seller agrees that, for a period of five years after the date of
this Agreement, it will neither directly nor indirectly engage in or
carry on any business or activity in the area of business and in the
territory in which the Company is active on the date of this Agreement,
that competes with the Company's business. The Seller will take care
that any companies affiliated with it in the sense of Sections 15 et
seq. Stock Corporation Act will not engage in such competition.
Excepted from this prohibition are BT Office Products International,
Inc. and its subsidiaries. Not regarded as competition for the purpose
of this Article will be: all current activities of Seller and its
affiliates and all activities of companies purchased by the Seller and
its affiliates in the future unless the activities in competition to
the Company constitute the main business of such companies.
2. In case of a violation of this prohibition to compete a contractual
fine in the amount of DM 100,000.- becomes due; claims for further
damages are not excluded hereby.
Section 9
Expenses
1. The notarial fees will be borne by the Buyer.
2. The Seller shall bear all reasonable costs related to the Capital
Decrease as well as the reasonable costs associated
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with a capital increase up to the previous level resolved upon within
one month after registration of the Capital Decrease.
3. All other costs and expenses, in particular for attorneys, tax advisors
and auditors are borne by the party that has commissioned the
respective services.
Section 10
Severability Clause
In case one condition of this Contract is or will become void, the remaining
conditions of this Contract will remain valid. The parties commit themselves to
replace the void condition with one that comes as close as possible to the
intended purpose of the void condition. The same applies to omissions in this
Contract.
Section 11
Applicable Law
This Contract shall be governed by the laws of Germany.
Section 12
Completeness and Written Form
1. This Contract contains the complete agreement between the parties
concerning the subject matter of this Contract; oral side agreements
have not been made or, in so far as they have been made, become void
upon the signing of this Contract.
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2. Any change or amendment of this Contract must be made in writing unless
notarial form is required by statute. This provision can only be waived
by written notice.
Amsterdam, 25 September 1996
/s/ H.G. Vreedenburgh /s/ Janhein H. Pieterse
_______________________________________ ________________________________
KNP BT Beteiligungen Hartmann & Cie. GmbH + Co. KG
Deutschland GmbH
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