UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934*
MEMC Electronic Materials, Inc.
- -------------------------------------------------------------------------------
(Name of Issuer)
Common Stock, par value $.01 per share
- -------------------------------------------------------------------------------
(Title of Class of Securities)
552715 10 4
- -------------------------------------------------------------------------------
(CUSIP Number)
- -------------------------------------------------------------------------------
Morton E. Grosz, Esq.
Chadbourne & Parke LLP
30 Rockefeller Plaza
New York, NY 10112
(212) 408-5100
- -------------------------------------------------------------------------------
(Name, Address and Telephone Number of Person Authorized to Receive Notices
and Communications)
October 22, 1998
- -------------------------------------------------------------------------------
(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 that is the subject of this Schedule 13D, and is filing this
schedule because of ss.ss. 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the
following box. |_|
Note: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See ss. 240.13d-7 for other
parties to whom copies are to be sent.
* 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>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 2 of 37 Pages
- -------------------------------------------------------------------------------
- -------- ----------------------------------------------------------------------
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
VEBA Aktiengesellschaft
- -------- ----------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |_|
(b) |_|
- -------- ----------------------------------------------------------------------
3 SEC USE ONLY
- -------- ----------------------------------------------------------------------
4 SOURCE OF FUNDS*
WC
- -------- ----------------------------------------------------------------------
5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) |_|
- -------- ----------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Germany
- -------- ----------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES 21,490,942 shares of Common Stock, par value $.01 per
share, of the Issuer ("Common Stock"), see Item 5,
Interest in Securities of the Issuer; does not
include shares of Common Stock which may be acquired
pursuant to the transactions described in Item 4,
Purpose of Transaction
------- ----------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY - 0 -
------- ----------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING 21,490,942 shares of Common Stock, see Item 5,
Interest in Securities of the Issuer; does not
include shares of Common Stock which may be acquired
pursuant to the transactions described in Item 4,
Purpose of Transaction
------- ----------------------------------------------------
10 SHARED DISPOSITIVE POWER
PERSON
- 0 -
WITH
- -------- ----------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
21,490,942 shares of Common Stock, see Item 5, Interest in Securities
of the Issuer; does not include shares of Common Stock which may be
acquired pursuant to the transactions described in Item 4, Purpose of
Transaction
- -------- ----------------------------------------------------------------------
12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
|_|
- -------- ----------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
53.1% See Item 5, Interest in Securities of the Issuer
- -------- ----------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
HC, CO
- -------- ----------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 3 of 37 Pages
- -------------------------------------------------------------------------------
- -------- ----------------------------------------------------------------------
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
VEBA Corporation 74-2183834
- -------- ----------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |_|
(b) |_|
- -------- ----------------------------------------------------------------------
3 SEC USE ONLY
- -------- ----------------------------------------------------------------------
4 SOURCE OF FUNDS*
WC, AF
- -------- ----------------------------------------------------------------------
5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) |_|
- -------- ----------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
- -------- ----------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES 21,490,942 shares of Common Stock, par value $.01 per
share, of the Issuer ("Common Stock"), see Item 5,
Interest in Securities of the Issuer; does not
include shares of Common Stock which may be acquired
pursuant to the transactions described in Item 4,
Purpose of Transaction
------- ----------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY - 0 -
------- ----------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING 21,490,942 shares of Common Stock, see Item 5,
Interest in Securities of the Issuer; does not
include shares of Common Stock which may be acquired
pursuant to the transactions described in Item 4,
Purpose of Transaction
------- ----------------------------------------------------
PERSON 10 SHARED DISPOSITIVE POWER
WITH - 0 -
- -------- ----------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
21,490,942 shares of Common Stock, see Item 5, Interest in Securities
of the Issuer; does not include shares of Common Stock which may be
acquired pursuant to the transactions described in Item 4, Purpose of
Transaction
- -------- ----------------------------------------------------------------------
12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* |_|
- -------- ----------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
53.1% See Item 5, Interest in Securities of the Issuer
- -------- ----------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
HC, CO
- -------- ----------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 4 of 37 Pages
- -------------------------------------------------------------------------------
Item 1. Security and Issuer.
This statement relates to shares of common stock, par value $0.01 per
share (the "Common Stock") of MEMC Electronic Materials, Inc., a Delaware
corporation (the "Company"). The principal executive offices of the Company are
located at 501 Pearl Drive, St. Peters, Missouri 63376.
Item 2. Identity and Background
(a) This statement is filed jointly by VEBA Aktiengesellschaft, a
German corporation ("VEBA AG"), and VEBA Corporation, a Delaware corporation and
a direct and indirect, wholly-owned subsidiary of VEBA AG ("VEBA Corporation",
and together with VEBA AG, the "Reporting Persons"). The Reporting Persons are
filing this statement jointly pursuant to a Joint Filing Agreement attached
hereto as Exhibit 1.
(b) The address of VEBA AG's principal office is Bennigsenplatz 1,
40474 Dusseldorf, Germany. The address of VEBA Corporation's principal office is
605 Third Avenue, New York, New York 10158. The name, business address and
principal occupation of each of the directors and executive officers of each of
VEBA AG and VEBA Corporation are set forth on Schedule I hereto and incorporated
by reference herein.
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 5 of 37 Pages
- -------------------------------------------------------------------------------
(c) The principal business of VEBA AG is to be a management holding
company for one of the largest industrial groups in Germany on the basis of
market capitalization at year-end 1997. VEBA AG is organized into six separate
business divisions: electricity, chemicals, oil, real estate management,
distribution/logistics, and telecommunications. The principal business of VEBA
Corporation is to be a holding company for VEBA AG's interests in the United
States.
(d) During the last five years, none of the Reporting Persons nor, to
the best of their knowledge, any of the executive officers or directors of any
of the Reporting Persons, has been convicted in a criminal proceeding (excluding
traffic violations or similar misdemeanors).
(e) During the last five years, none of the Reporting Persons nor, to
the best of their knowledge, any of the executive officers or directors of any
of the Reporting Persons, has been party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and, as a result of such
proceeding, was or is subject to a judgment, decree or final order enjoining
future violations of, or prohibiting or mandating activities subject to, federal
or state securities laws or finding any violation with respect to such laws.
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 6 of 37 Pages
- -------------------------------------------------------------------------------
(f) Each of the executive officers and directors of each of VEBA AG and
VEBA Corporation is a citizen of the country specified in Schedule I hereto and
incorporated by reference herein.
Item 3. Source and Amount of Funds or Other Consideration.
The source and, as more fully described in Item 4 below, the amount of
funds used by VEBA Corporation in connection with the transactions described
herein will be provided from the working capital of VEBA Corporation and/or from
intercompany loan arrangements between VEBA AG and VEBA Corporation. It is
expected that VEBA AG and VEBA Corporation will enter into a long-term credit
agreement (the "Credit Agreement") prior to the actual purchase by VEBA
Corporation of the shares of Common Stock pursuant to the Purchase Agreement and
the Standby Agreement described in Item 4 below. The Credit Agreement is
expected to be on such terms and subject to such conditions as are customary for
intercompany loan arrangements between VEBA AG and its operating subsidiaries.
The source and, as more fully described in Item 4 below, the amount of
funds used by VEBA AG in connection with the transactions described herein will
be provided from the working capital of VEBA AG.
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 7 of 37 Pages
- -------------------------------------------------------------------------------
Item 4. Purpose of Transaction.
Pursuant to the Purchase Agreement, dated as of October 22, 1998 (the
"Purchase Agreement"), between VEBA Corporation and the Company, VEBA
Corporation agreed, subject to the satisfaction or waiver of various conditions
set forth in the Purchase Agreement, to purchase for a per share purchase price
equal to the volume weighted average trading price of the Common Stock for a
specified five day consecutive trading day period (the "Per Share Purchase
Price") a number of shares of Common Stock approximately equal to 106,100,000
divided by the Per Share Purchase Price. The purpose of entering into the
Purchase Agreement is to assist the Company in meeting certain financial needs
arising before completion of the Rights Offering (described below).
On October 22, 1998, the Company filed with the Securities and Exchange
Commission a Registration Statement on Form S-3 (the "Form S-3") relating to a
distribution on a pro rata basis to all stockholders of the Company (other than
VEBA Corporation) of rights which entitle the holders thereof to purchase one
share of Common Stock for each right as well as additional shares of Common
Stock to the extent that other rights holders do not exercise their rights (the
"Rights Offering"). In the Rights Offering, the Company will issue for the same
Per Share Purchase Price to be paid
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 8 of 37 Pages
- -------------------------------------------------------------------------------
by VEBA Corporation under the Purchase Agreement a number of shares of Common
Stock approximately equal to 93,900,000 divided by the Per Share Purchase Price.
The purpose of the Rights Offering is to allow all stockholders of the Company
(other than VEBA Corporation) to restore their proportionate interest in the
Company at the same price per share previously offered to VEBA Corporation under
the Purchase Agreement.
In connection with the Rights Offering, VEBA Corporation and the
Company entered into the Standby Agreement, dated as of October 22, 1998 (the
"Standby Agreement"), pursuant to which VEBA Corporation has agreed, subject to
the satisfaction or waiver of various conditions set forth in the Standby
Agreement, to purchase all shares of Common Stock not otherwise subscribed for
by other stockholders in the Rights Offering. The purpose of entering into the
Standby Agreement is to assist the Company in raising an aggregate amount of
approximately $93,900,000, to the extent that rights are not exercised in the
Rights Offering.
In connection with the execution of the Purchase Agreement and the
Standby Agreement, VEBA Corporation and the Company intend to enter into an
amendment (the "Amendment") to the Registration Rights Agreement dated as of
July 12, 1995 between Huls Corporation and the Company
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 9 of 37 Pages
- -------------------------------------------------------------------------------
(the "Registration Rights Agreement"). The purpose of entering into the
Amendment is to reflect the change of record ownership of the shares of common
stock of the Company reported herein (the "MEMC Shares") as a result of the
merger described in Item 5(a) below and to include in the definition of
"Registrable Stock" in the Registration Rights Agreement, and extend the
benefits of the Registration Rights Agreement to, (i) all shares of Common Stock
to be acquired by VEBA Corporation as a result of the transactions contemplated
by the Purchase Agreement and the Standby Agreement and (ii) any shares of
Common Stock acquired by VEBA Corporation or VEBA AG and any of its direct or
indirect subsidiaries after the date of the Purchase Agreement and the Standby
Agreement.
Pursuant to the Registration Rights Agreement, VEBA Corporation has the
right to demand registration under the Securities Act of 1933 (as amended, the
"Securities Act") of any or all of the Registrable Stock (as defined in the
Registration Rights Agreement). The demand rights must be exercised for at least
25% of the Registrable Stock. The Company may be required to effect up to three
such demand registrations. VEBA Corporation will bear the expenses of any such
demand registration. The Company is not obligated to take any action to register
the Registrable Stock: (i) during the period starting 30 days prior to the
estimated date of filing of, and ending 90 days after the
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 10 of 37 Pages
- -------------------------------------------------------------------------------
effective date of, any other registration statement filed by the Company under
the Securities Act; (ii) more than once during any six-month period; and (iii)
for up to 90 days after a request from VEBA Corporation if one of the Company's
officers certifies that the Company's Board of Directors has determined that
such registration would interfere with a material transaction then being pursued
by the Company. In addition, except in certain circumstances and subject to
certain limitations, if the Company proposes to register any shares of Common
Stock under the Securities Act, VEBA Corporation will be entitled to require the
Company to include all or a portion of the Registrable Stock in such
registration. The expenses of any such "piggyback" registration, other than
underwriting discounts and commissions relating to the Registrable Stock to be
sold by VEBA Corporation, shall be borne by the Company.
In connection with any registration statement filed pursuant to the
Registration Rights Agreement, the Company has agreed to indemnify VEBA
Corporation and its transferees and assignees and any underwriter against
certain liabilities, including liabilities under the Securities Act.
The preceding summary of certain provisions of the Purchase Agreement,
the Standby Agreement and the Registration Rights Agreement is not intended to
be complete and is qualified in its entirety by reference to the full
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 11 of 37 Pages
- -------------------------------------------------------------------------------
text of such agreements, copies of which are filed as Exhibits 2-4 hereto,
respectively, and which are incorporated herein by reference.
VEBA AG has indirectly owned the MEMC Shares continuously for more than
nine years and has not decreased its equity investment in the Company. VEBA
Corporation currently owns the MEMC Shares and will own additional shares of
Common Stock as a result of the transactions contemplated by the Purchase
Agreement and the Standby Agreement and upon exercise of any rights purchased by
VEBA Corporation on the New York Stock Exchange during the Rights Offering. VEBA
Corporation is owned by VEBA AG (approximately 50.1%), Huls AG (approximately
39.5%), and Stinnes AG (approximately 10.4%). Each of Huls AG and Stinnes AG are
wholly-owned by VEBA AG.
Depending upon the business affairs of the Company, market and general
economic conditions, the availability of Common Stock at favorable prices,
alternative investment opportunities available to the Reporting Persons, the
strategic value to the Reporting Persons of the Common Stock or control of the
Company and other factors deemed relevant by the Reporting Persons, in addition
to the Common Stock acquired as a result of the transactions described above,
the Reporting Persons may acquire, or acquire rights to acquire, additional
shares of Common Stock or other
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 12 of 37 Pages
- -------------------------------------------------------------------------------
securities of the Company by means of open market purchases, brokerage
transactions, privately negotiated transactions, tender offer, or otherwise. The
Reporting Persons may also propose a business combination, merger, tender offer
or other form of transaction involving the Company.
Alternatively, the Reporting Persons may retain their existing shares
of Common Stock or dispose of some or all of their shares of Common Stock in the
open market, in privately negotiated transactions or otherwise, depending upon
market conditions and other factors. In addition, VEBA Corporation may transfer
all or a portion of the Common Stock that it owns to VEBA AG and/or its
subsidiaries.
The foregoing represents a range of possible activities the Reporting
Persons currently may take with respect to the Common Stock. It should be noted,
however, that the possible activities of the Reporting Persons are subject to
change at any time.
Except as described herein, none of the Reporting Persons has any
present plan or proposal which relates to, or could result in, any of the events
referred to in paragraphs (a) through (j), inclusive, of Item 4 of Schedule 13D.
However, the Reporting Persons will continue to review the business of the
Company and, depending upon one or more of the factors referred to above, may in
the
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 13 of 37 Pages
- -------------------------------------------------------------------------------
future propose that the Company take one or more of such actions.
Item 5. Interest in the Securities of the Issuer.
(a) VEBA Corporation is the record owner of 21,490,942 shares of the
Common Stock as a result of the merger of Huls Corporation, the former owner and
wholly-owned subsidiary of VEBA Corporation, with and into VEBA Corporation on
September 30, 1998. Such shares constitute approximately 53.1% of the total
number of outstanding shares of the Common Stock (based on the number of shares
of Common Stock reported as outstanding in the Form S-3) and do not include the
shares of Common Stock to be acquired pursuant to the Purchase Agreement and
possibly the Standby Agreement described in Item 4 above.
Except as set forth below, no executive officer or director of any of
the Reporting Persons is the beneficial owner of any shares of the Common Stock:
Dr. Erhard Meyer-Galow, Member of the Board of Management of VEBA AG,
Chairman of the Board of Stinnes AG and a director of the Company, is the owner
of 12,000 shares of Common Stock and has the right to acquire 700 shares of
Common Stock pursuant to vested options. Mr. Joern Stuehmeier, Vice
President-Finance of VEBA Corporation and President of Fidelia Corporation, is
the owner, jointly with
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 14 of 37 Pages
- -------------------------------------------------------------------------------
his wife, of 2,500 shares of Common Stock. Neither Dr. Meyer-Galow nor Mr.
Stuehmeier beneficially owns one percent or more of the total number of
outstanding shares of the Common Stock (based on the number of shares Common
Stock reported outstanding in the Form S-3).
(b) VEBA AG, acting through its wholly-owned subsidiaries, VEBA
Corporation, Stinnes AG, and Huls AG, indirectly has sole power to vote or
direct the vote, and to dispose or to direct the disposition of the shares of
the Common Stock beneficially owned by VEBA AG. As a result, VEBA AG may be
deemed to beneficially own the shares of the Common Stock owned of record by
VEBA Corporation.
Dr. Meyer-Galow has sole power to vote or direct the vote, and to
dispose or direct the disposition of 12,700 shares of Common Stock of the
Company.
Mr. Stuehmeier has shared power to vote or direct the vote, and to
dispose or direct the disposition of 2,500 shares of Common Stock of the Company
which he owns jointly with his wife.
(c) Except as described in Item 4 above and the merger described in
Item 5(a) above, there have not been any transactions in the Common Stock
effected by or for the account of any of the Reporting Persons or any executive
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 15 of 37 Pages
- -------------------------------------------------------------------------------
officer or director of any of the Reporting Persons during the past 60 days.
(d) Except as stated in this Item 5, to the best knowledge of the
Reporting Persons, no other person has the right to receive or the power to
direct the receipt of dividends from, or the proceeds from the sale of, the
shares of Common Stock owned by the Reporting Persons.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect
to Securities of the Issuer.
See Item 4 above for a description of the Purchase Agreement, the
Standby Agreement and the Registration Rights Agreement, copies of which are
filed as Exhibits 2-4 hereto, respectively, and which are incorporated herein by
reference.
The Company and VEBA AG and its affiliates have amended, effective as
of September 1, 1998, their existing credit agreements (the "Amended Credit
Agreements") to, among other things, extend the maturity dates of outstanding
loans to the Company that mature prior to January 1, 2001 until their respective
maturity date anniversaries in 2001, and increase the interest rates payable by
the Company on all of the Company's existing debt to VEBA AG and its affiliates.
The increased interest rates reflect the longer
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 16 of 37 Pages
- -------------------------------------------------------------------------------
maturities and are priced at interest rate spreads applicable to an average
industrial borrower at a specified credit rating. The interest rates payable on
the loans that are extended until 2001 will be adjusted at the time of extension
to reflect the then-current interest rate spreads applicable to an average
industrial borrower at a specified credit rating.
The Amended Credit Agreements provide that if VEBA AG and its
affiliates own less than a majority of the outstanding Common Stock on and after
January 1, 2001, then the interest rates payable by the Company will be the
higher of (a) the interest rate currently set forth in each such loan agreement
or (b) an interest rate determined as of the change of control date for an
average industrial borrower at a specified credit rating based on the remaining
term of each such loan agreement. In addition, in such event the Company will
become subject to certain affirmative covenants set forth in the Amended Credit
Agreements.
The annual commitment fee payable by the Company on the undrawn portion
of loans pursuant to the Amended Credit Agreements is 1/4 of one percent.
Additionally, the Amended Credit Agreements require the Company, subject to
certain exceptions in the ordinary course of the Company's business, to not
allow any encumbrances, such as mortgages and security interests, to be placed
on its assets.
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 17 of 37 Pages
- -------------------------------------------------------------------------------
Pursuant to the Revolving Credit Agreement, dated as of September 23,
1998 (the "Revolving Credit Agreement"), by and between the Company and VEBA AG,
VEBA AG has agreed to provide $100 million of additional debt financing to the
Company on a revolving basis at interest rate spreads applicable to an average
industrial borrower at a specified credit rating. The other terms of the
Revolving Credit Agreement are similar to those of the Amended Credit
Agreements.
The preceding summary of certain provisions of the Amended Credit
Agreements and the Revolving Credit Agreement is not intended to be complete and
is qualified in its entirety by reference to the full text of such agreements,
copies of which are filed as Exhibits 5-25 hereto, respectively, and which are
incorporated herein by reference.
Item 7. Material to be Filed as Exhibits.
Exhibit 1. Joint Filing Agreement, dated as of
October 30, 1998 between VEBA AG
and VEBA Corporation.
Exhibit 2. Purchase Agreement dated as of
October 22, 1998 by and among the
Company and VEBA Corporation.
Exhibit 3. Standby Agreement dated as of
October 22, 1998 by and among the
Company and VEBA Corporation.
Exhibit 4. Registration Rights Agreement, dated
July 12, 1995, between the Company and
Huls Corporation is incorporated herein
by reference to Exhibit 10-l to the
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 18 of 37 Pages
- -------------------------------------------------------------------------------
Company's Report on Form 10-K for the Year ended
December 31, 1995.
Exhibit 5. Second Amendment to Credit Agreement
effective as of September 1, 1998, between
the Company and Huls AG is incorporated
herein by reference to Exhibit 10-gg(2) to
the Company's Current Report on Form 8-K
dated October 22, 1998.
Exhibit 6. First Amendment to Credit Agreement
effective as of September 1, 1998, between
the Company and Huls AG is incorporated
herein by reference to Exhibit 10-qq(1) to
the Company's Current Report on Form 8-K
dated October 22, 1998.
Exhibit 7. First Amendment to Credit Agreement
effective as of September 1, 1998, between
the Company and Huls AG is incorporated
herein by reference to Exhibit 10-rr(1) to
the Company's Current Report on Form 8-K
dated October 22, 1998.
Exhibit 8. First Amendment to Credit Agreement
effective as of September 1, 1998, between
the Company and Huls AG is incorporated
herein by reference to Exhibit 10-ss(1) to
the Company's Current Report on Form 8-K
dated October 22, 1998.
Exhibit 9. First Amendment to Credit Agreement
effective as of September 1, 1998, between
the Company and Huls AG is incorporated
herein by reference to Exhibit 10-tt(1) to
the Company's Current Report on Form 8-K
dated October 22, 1998.
Exhibit 10. First Amendment to Credit Agreement
effective as of September 1, 1998, between
the Company and Huls AG is incorporated
herein by reference to Exhibit 10-ccc(1) to
the Company's Current Report on Form 8-K
dated October 22, 1998.
Exhibit 11. First Amendment to Credit Agreement
effective as of September 1, 1998,
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 19 of 37 Pages
- -------------------------------------------------------------------------------
between the Company and Huls AG is incorporated
herein by reference to Exhibit 10-ddd(1) to
the Company's Current Report on Form 8-K
dated October 22, 1998.
Exhibit 12. First Amendment to Credit Agreement
effective as of September 1, 1998, between
the Company and Huls AG is incorporated
herein by reference to Exhibit 10-eee(1) to
the Company's Current Report on Form 8-K
dated October 22, 1998.
Exhibit 13. Second Amendment to Revolving Credit
Agreement effective as of September 1, 1998,
between the Company and Huls AG is
incorporated herein by reference to Exhibit
10-ii(2) to the Company's Current Report on
Form 8-K dated October 22, 1998.
Exhibit 14. First Amendment to Credit Agreement
effective as of September 1, 1998, between
the Company and Huls Corporation is
incorporated herein by reference to Exhibit
10-cc(1) to the Company's Current Report on
Form 8-K dated October 22, 1998.
Exhibit 15. First Amendment to Credit Agreement
effective as of September 1, 1998, between
the Company and Huls Corporation is
incorporated herein by reference to Exhibit
10-dd(1) to the Company's Current Report on
Form 8-K dated October 22, 1998.
Exhibit 16. First Amendment to Credit Agreement
effective as of September 1, 1998, between
the Company and Huls Corporation is
incorporated herein by reference to Exhibit
10-ee(1) to the Company's Current Report on
Form 8-K dated October 22, 1998.
Exhibit 17. First Amendment to Credit Agreement
effective as of September 1, 1998, between
the Company and Huls Corporation is
incorporated herein by reference to Exhibit
10-ff(1) to the Company's Current Report on
Form 8-K dated October 22, 1998.
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 20 of 37 Pages
- -------------------------------------------------------------------------------
Exhibit 18. First Amendment to Credit Agreement
effective as of September 1, 1998, between
the Company and Huls Corporation is
incorporated herein by reference to Exhibit
10-hh(1) to the Company's Current Report on
Form 8-K dated October 22, 1998.
Exhibit 19. First Amendment to Credit Agreement
effective as of September 1, 1998, between
the Company and Huls Corporation is
incorporated herein by reference to Exhibit
10-xxx(1) to the Company's Current Report on
Form 8-K dated October 22, 1998.
Exhibit 20. First Amendment to Overnight Loan
Agreement effective as of September 1, 1998,
between the Company and Huls Corporation is
incorporated herein by reference to Exhibit
10-fff(1) to the Company's Current Report on
Form 8-K dated October 22, 1998.
Exhibit 21. First Amendment to Credit Agreement
effective as of September 1, 1998, between
the Company and Huls Corporation is
incorporated herein by reference to Exhibit
10-jjj(1) to the Company's Current Report on
Form 8-K dated October 22, 1998.
Exhibit 22. First Amendment to Credit Agreement
effective as of September 1, 1998, between
the Company and Huls Corporation is
incorporated herein by reference to Exhibit
10-kkk(1) to the Company's Current Report on
Form 8-K dated October 22, 1998.
Exhibit 23. First Amendment to Credit Agreement
effective as of September 1, 1998, between
the Company and Huls Corporation is
incorporated herein by reference to Exhibit
10-lll(1) to the Company's Current Report on
Form 8-K dated October 22, 1998.
Exhibit 24. First Amendment to Credit Agreement
effective as of September 1, 1998, between
the Company and Huls Corporation is
incorporated herein by reference to Exhibit
10-mmm(1) to the Company's
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 21 of 37 Pages
- -------------------------------------------------------------------------------
Current Report on Form 8-K dated October
22, 1998.
Exhibit 25. Revolving Credit Agreement dated as of
September 23, 1998 between the Company
Electronic Materials, Inc. and VEBA AG, in
the amount of US$100,000,000 incorporated
herein by reference to Exhibit 10-zzz to the
Company's Current Report on Form 8-K dated
October 22, 1998.
Exhibit 26. Credit Agreement dated as of July 10,
1995, between the Company and Huls
Corporation is incorporated herein by
reference to Exhibit 10-jj to the Company's
Report on Form 10-Q for the Quarter ended
June 30, 1995.
Exhibit 27. Credit Agreement dated as of July 10,
1995, between the Company and Huls
Corporation is incorporated herein by
reference to Exhibit 10-kk to the Company's
Report on Form 10-Q for the Quarter ended
June 30, 1995.
Exhibit 28. Credit Agreement dated as of July 10,
1995, between the Company and Huls
Corporation is incorporated herein by
reference to Exhibit 10-ll to the Company's
Report on Form 10-Q for the Quarter ended
June 30, 1995.
Exhibit 29. Credit Agreement dated as of July 10,
1995, between the Company and Huls
Corporation is incorporated herein by
reference to Exhibit 10-mm to the Company's
Report on Form 10-Q for the Quarter ended
June 30, 1995.
Exhibit 30. Credit Agreement dated as of July 10,
1995, between the Company and Huls AG is
incorporated herein by reference to Exhibit
10-oo to the Company's Report on Form 10-Q
for the Quarter ended June 30, 1995.
Exhibit 31. Credit Agreement dated as of June 26,
1997, between the Company and Huls
Corporation is incorporated herein by
reference to Exhibit qqq to the Company's
Report on Form 10-Q for the Quarter ended
June 30, 1997.
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 22 of 37 Pages
- -------------------------------------------------------------------------------
Exhibit 32. Credit Agreement dated as of June 26,
1997, between the Company and Huls
Corporation is incorporated herein by
reference to Exhibit rrr to the Company's
Report on Form 10-Q for the Quarter ended
June 30, 1997.
Exhibit 33. Credit Agreement dated as of June 26,
1997, between the Company and Huls
Corporation is incorporated herein by
reference to Exhibit sss to the Company's
Report on Form 10-Q for the Quarter ended
June 30, 1997.
Exhibit 34. Credit Agreement dated as of June 26,
1997, between the Company and Huls
Corporation is incorporated herein by
reference to Exhibit ttt to the Company's
Report on Form 10-Q for the Quarter ended
June 30, 1997.
Exhibit 35. Overnight Loan Agreement dated as of
October 31, 1997, between the Company and
Huls Corporation is incorporated herein by
reference to Exhibit 10-fff to the Company's
Report on Form 10-K/A for the Year ended
December 31, 1997.
Exhibit 36. Loan Agreement dated as of June 30,
1998, between the Company and Huls
Corporation is incorporated herein by
reference to Exhibit 10-xxx to the Company's
Report on Form 10-Q for the Quarter ended
June 30, 1998.
Exhibit 37. Credit Agreement dated as of July 10,
1995, between the Company and Huls AG is
incorporated herein by reference to Exhibit
10-nn to the Company's Report on Form 10-Q
for the Quarter ended June 30, 1995.
Exhibit 38. First Amendment to Credit Agreement
dated as of July 1, 1998, between the
Company and Huls AG is incorporated herein
by reference to Exhibit 10-gg(1) to the
Company's Report on Form 10-Q for the
Quarter ended June 30, 1998.
Exhibit 39. Credit Agreement dated as of April 1,
1996, between the Company and Huls AG is
incorporated herein by reference to Exhibit
10-eee to the Company's Report
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 23 of 37 Pages
- -------------------------------------------------------------------------------
on Form 10-K/A for the Year ended
December 31, 1997.
Exhibit 40. Credit Agreement dated as of December 1,
1996, between the Company and Huls AG is
incorporated herein by reference to Exhibit
10-ccc to the Company's Report on Form
10-K/A for the Year ended December 31, 1997.
Exhibit 41. Credit Agreement dated as of December 1,
1996, between the Company and Huls AG is
incorporated herein by reference to Exhibit
10-ddd to the Company's Report on Form
10-K/A for the Year ended December 31, 1997.
Exhibit 42. Credit Agreement dated as of December
22, 1995, between the Company and Huls AG is
incorporated herein by reference to Exhibit
10-aaa to the Company's Report on Form 10-K
for the Year ended December 31, 1995.
Exhibit 43. Credit Agreement dated as of December
22, 1995, between the Company and Huls AG is
incorporated herein by reference to Exhibit
10-bbb to the Company's Report on Form 10-K
for the Year ended December 31, 1995.
Exhibit 44. Credit Agreement dated as of December
22, 1995, between the Company and Huls AG is
incorporated herein by reference to Exhibit
10-ccc to the Company's Report on Form 10-K
for the Year ended December 31, 1995.
Exhibit 45. Credit Agreement dated as of December
22, 1995, between the Company and Huls AG is
incorporated herein by reference to Exhibit
10-ddd to the Company's Report on Form 10-K
for the Year ended December 31, 1995.
Exhibit 46. Revolving Credit Agreement dated as of
July 10, 1995, between the Company and Huls
AG is incorporated herein by reference to
Exhibit 10-pp to the Company's Report on
Form 10-Q for the Quarter ended June 30,
1995.
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 24 of 37 Pages
- -------------------------------------------------------------------------------
Exhibit 47. First Amendment to Loan Agreement dated
as of March 4, 1998, between the Company and
Huls AG is incorporated herein by reference
to Exhibit 10-ii(1) to the Company's Report
on Form 10-Q for the Quarter ended June 30,
1998.
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 25 of 37 Pages
- -------------------------------------------------------------------------------
SIGNATURE
---------
After reasonable inquiry and the best of my knowledge and belief, the
undersigned certify that the information set forth in the statement is true,
complete and correct.
Date: October 30, 1998 VEBA Aktiengesellschaft
By: /s/ Hans Michael Gaul
------------------------------
Name: Dr. Hans Michael Gaul
Title: Chief Financial Officer
By: /s/ Rolf Pohlig
------------------------------
Name: Dr. Rolf Pohlig
Title: Executive Vice President
Date: October 30, 1998 VEBA Corporation
By: /s/ Heinz H. Puetthoff
------------------------------
Name: H. H. Puetthoff
Title: President
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 26 of 37 Pages
- -------------------------------------------------------------------------------
SCHEDULE I
DIRECTORS AND EXECUTIVE OFFICERS OF
VEBA AG
The name, business address, present principal occupation or employment
and citizenship, and the name, principal business and address of any corporation
or other organization in which such employment is conducted, of each of the
directors and executive officers of VEBA AG is set forth below.
Principal Occupation,
if other than as
Name and Business Position with Executive Officer of Citizen-
Address VEBA AG VEBA AG ship
- --------------------- ---------------- -------------------- --------
Hermann Josef Strenger Member of the Chairman of the German
Vorsitzender des Supervisory Board, Supervisory Board,
Aufsichtsrates VEBA AG Chairman Bayer AG, Leverkusen
Kaiser-Wilhelm-Alee,
Gebaude Q 26
51368 Leverkusen
Hubertus Schmoldt Member of the Chairman of the Board German
Vorsitzender der Supervisory Board, of Management,
IG BERGBAU, CHEMIE, Deputy Chairman Industriegewerkschaft
ENERGIE Bergbau, Chemie,
Konigsworther Platz 6 Energie
30167 Hannover
Ralf Blauth Member of the Industrial Clerk German
HULS AG Supervisory Board (Industriekaufmann)
Paul-Baumann-StraBe 1
45764 Marl
Dr. Rolf-E. Breuer Member of the Spokesperson of the German
Sprecher des Vorstandes Supervisory Board Board of Management,
DEUTSCHE BANK AG Deutsche Bank AG
Taunusanlage 12
60325 Frankfurt
Dr. Gerhard Cromme Member of the Chairman of the Board German
Vorsitzender des Supervisory Board of Management, Fried.
Vorstandes Krupp AG Hoesch-Krupp
FRIED, KRUPP AG
HOESCH-KRUPP
Altendorfer StraBe 103
45143 Essen
Rainer Ducker Member of the Power plant worker German
PREUSSENELEKTRA AG Supervisory Board
TresckowstraBe 5
30457 Hannover
und:
PREUSSENELEKTRA AG
Betriebsstelle Lubeck
Bargerbruck 4
23617 Stockelsdorf
Henner Hecht-Wieber Member of the Electrician German
Raab Karcher Supervisory Board
Tankstellentechnik
Niederlassung Dusseldorf
Ronsdorfer StraBe 96
40233 Dusseldorf
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 27 of 37 Pages
- -------------------------------------------------------------------------------
Principal Occupation,
if other than as
Name and Business Position with Executive Officer of Citizen-
Address VEBA AG VEBA AG ship
- --------------------- ---------------- -------------------- --------
Wolf-Rudiger Hinrichsen Member of the M.A. Economics German
VEBA AG Supervisory Board (Diplom-Volkswirt)
Volks-und
Energiewirtschaft
Bennigsenplatz 1
40474 Dusseldorf
Ulrich Hocker Member of the Managing Director, German
Hauptgeschaftsfuhrer Supervisory Board Deutsche
Deutsche Schutzvereinigung Schutzvereinigung fur
fur Wertpapierbesitz e.V. Wertpapierbesitz e. V.
HumboldtstraBe 9
40237 Dusseldorf
Postfach 14 02 43
40072 Dusseldorf
Dr. h.c. Andre Leysen Member of the Chairman of the Belgian
Vorsitzender des Supervisory Board Administrative Board,
Verwaltungsrates Gevaert N.V.
der GEVAERT N.V.
Septestraat 27
B-2640 Mortsel
Dr. Klaus Liesen Member of the Chairman of the German
Vorsitzender des Supervisory Board Supervisory Board,
Aufsichtsrates Ruhrgas AG
der RUHRGAS AG
HuttropstraBe 60
45138 Essen
Herbert Mai Member of the Chairman, German
Vorsitzender der Supervisory Board Gewerkschaft
Gewerkschaft OTV Offentliche Dienste,
Theodor-Heuss-StraBe 2 Transport und Verkehr
70174 Stuttgart
Dagobert Millinghaus Member of the Accounting German
BRENNTAG AG Supervisory Board and Administration
Humboldtring 15
45472 Mulheim/Ruhr
Margret Monig-Raane Member of the 1st Chairman, German
Vorsitzender der Supervisory Board Gewerkschaft Handel
Gewerkschaft Banken Versicherungen
Handel, Banken und
Versicherungen
KanzlerstraBe 8
40472 Dusseldorf
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 28 of 37 Pages
- -------------------------------------------------------------------------------
Principal Occupation,
if other than as
Name and Business Position with Executive Officer of Citizen-
Address VEBA AG VEBA AG ship
- --------------------- ---------------- -------------------- --------
Dr. Henning Schulte- Member of the Chairman of the Board German
Noelle Supervisory Board of Management,
Vorsitzender des Allianz AG
Vorstandes
der ALLIANZ AG
KoniginstraBe 28
80802 Munchen
Morris Tabaksblat Member of the Chairman, Unilever Dutch
Chairman & CEO Supervisory Board N.V.
Unilever NV
Weena 455
NL-3013 AL Rotterdam
P.O. Box 760
NL-3000 Rotterdam
Kurt F. Viermetz Member of the Non-Executive German
Non-Executive Director Supervisory Board Director, J.P. Morgan
J.P. MORGAN & CO. & Co., Inc.
INCORPORATED
23 Wall Street (30/15 B)
New York, N.Y. 10260-0023
U.S.A.
uber J.P. MORGAN GmbH,
Frankfurt:
BorsenstraBe 2-4
60313 Frankfurt/Main
Dr. Bernd Voss Member of the Member of the Board German
Mitglied des Vorstandes Supervisory Board of Management,
DRESDNER BANK AG Dresdner Bank AG
Jurgen-Ponto-Platz 1
60329 Frankfurt/Main
Dr. Peter Weber Member of the [Director of the German
HULS AG Supervisory Board Legal Department,
Bau 1047 Huls AG]
Paul-Baumann-StraBe 1
45764 Marl
Kurt Weslowski Member of the Chemical Worker German
VEBA OEL AG Supervisory Board
Werk Scholven
Pawiker StraBe 30
45896 Gelsenkirchen
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 29 of 37 Pages
- -------------------------------------------------------------------------------
Principal Occupation,
if other than as
Name and Business Position with Executive Officer of Citizen-
Address VEBA AG VEBA AG ship
- --------------------- ---------------- -------------------- --------
Ulrich Hartmann* Member of the Board German
of Management,
Chairman and Chief
Executive Officer
Alain D. Bandle* Member of the Board Swiss
of Management,
Telecommunications
Gunther Beuth* Member of the Chairman of the Board German
Board of Management of Management of Raab
Karcher AG-VEBA
Immobilien Management
Wilhelm Bonse-Geuking* Member of the Chairman of the Board German
Board of Management of Management of VEBA
Oel AG
Dr. Hans Michael Gaul* Member of the Board German
of Management;
Chief Financial
Officer
Dr. Hans-Dieter Harig* Member of the Chairman of the Board German
Board of Management of Management of
PreussenElektra AG
Dr. Manfred Kruper* Member of the Board German
of Management;
Group Resource
Management
Helmut Mamsch* Member of the Board German
of Management,
Group Strategic
Development
Dr. Erhard Meyer-Galow* Member of the Chairman of the Board German
Board of Management of Management of
Stinnes AG
* The business address of each of these persons is:
VEBA Aktiengesellschaft, Bennigsenplatz 1, 40474 Dusseldorf, Germany.
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 30 of 37 Pages
- -------------------------------------------------------------------------------
DIRECTORS AND EXECUTIVE OFFICERS OF
VEBA CORPORATION
The name, business address, present principal occupation or employment
and citizenship, and the name, principal business and address of any corporation
or other organization in which such employment is conducted, of each of the
directors and executive officers of VEBA Corporation is set forth below.
Principal Occupation,
if other than as
Name and Business Position with Executive Officer of Citizen-
Address VEBA Corporation VEBA Corporation ship
- --------------------- ---------------- -------------------- --------
Helmut Mamsch** Director Member of Board of German
Management of VEBA AG
Ulrich Hartmann** Director Chairman of Board of German
Management of VEBA AG
Dr. Hans Michael Gaul** Director Member of Board of German
Management of VEBA AG;
Chief Financial
Officer, VEBA AG
Dr. Erhard Meyer-Galow** Director Member of Board of German
Management of VEBA AG;
Chairman of Board
of Management of
Stinnes AG
Dr. Heinz-Helmer Director, President German
Puetthoff**
A. Paul Brandimarte, Director, Vice USA
Jr.** President, General
Counsel and
Secretary
Joseph J. Supp** Vice President-Tax USA
Joern Stuehmeier** Vice President- President, Fidelia German
Finance Corporation,
Wilmington, Delaware
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 31 of 37 Pages
- -------------------------------------------------------------------------------
Principal Occupation,
if other than as
Name and Business Position with Executive Officer of Citizen-
Address VEBA Corporation VEBA Corporation ship
- --------------------- ---------------- -------------------- --------
James N. Balch** Controller USA
** The business address of each of these persons is:
VEBA Corporation, 605 Third Avenue, New York, NY 10158.
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 32 of 37 Pages
- -------------------------------------------------------------------------------
EXHIBIT INDEX
Exhibit 1. Joint Filing Agreement, dated as of October 30, 1998
between VEBA AG and VEBA Corporation.
Exhibit 2. Purchase Agreement dated as of October 22, 1998 by and
among the Company and VEBA Corporation.
Exhibit 3. Standby Agreement dated as of October 22, 1998 by and
among the Company and VEBA Corporation.
Exhibit 4. Registration Rights Agreement, dated July 12, 1995,
between the Company and Huls Corporation is incorporated
herein by reference to Exhibit 10-l to the Company's Report
on Form 10-K for the Year ended December 31, 1995.
Exhibit 5. Second Amendment to Credit Agreement effective as of
September 1, 1998, between the Company and Huls AG is
incorporated herein by reference to Exhibit 10-gg(2) to the
Company's Current Report on Form 8-K dated October 22, 1998.
Exhibit 6. First Amendment to Credit Agreement effective as of
September 1, 1998, between the Company and Huls AG is
incorporated herein by reference to Exhibit 10-qq(1) to the
Company's Current Report on Form 8-K dated October 22, 1998.
Exhibit 7. First Amendment to Credit Agreement effective as of
September 1, 1998, between the Company and Huls AG is
incorporated herein by reference to Exhibit 10-rr(1) to the
Company's Current Report on Form 8-K dated October 22, 1998.
Exhibit 8. First Amendment to Credit Agreement effective as of
September 1, 1998, between the Company and Huls AG is
incorporated herein by reference to Exhibit 10-ss(1) to the
Company's Current Report on Form 8-K dated October 22, 1998.
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 33 of 37 Pages
- -------------------------------------------------------------------------------
Exhibit 9. First Amendment to Credit Agreement effective as of
September 1, 1998, between the Company and Huls AG is
incorporated herein by reference to Exhibit 10-tt(1) to the
Company's Current Report on Form 8-K dated October 22, 1998.
Exhibit 10. First Amendment to Credit Agreement effective as of
September 1, 1998, between the Company and Huls AG is
incorporated herein by reference to Exhibit 10-ccc(1) to the
Company's Current Report on Form 8-K dated October 22, 1998.
Exhibit 11. First Amendment to Credit Agreement effective as of
September 1, 1998, between the Company and Huls AG is
incorporated herein by reference to Exhibit 10-ddd(1) to the
Company's Current Report on Form 8-K dated October 22, 1998.
Exhibit 12. First Amendment to Credit Agreement effective as of
September 1, 1998, between the Company and Huls AG is
incorporated herein by reference to Exhibit 10-eee(1) to the
Company's Current Report on Form 8-K dated October 22, 1998.
Exhibit 13. Second Amendment to Revolving Credit Agreement effective
as of September 1, 1998, between the Company and Huls AG is
incorporated herein by reference to Exhibit 10-ii(2) to the
Company's Current Report on Form 8-K dated October 22, 1998.
Exhibit 14. First Amendment to Credit Agreement effective as of
September 1, 1998, between the Company and Huls Corporation
is incorporated herein by reference to Exhibit 10-cc(1) to
the Company's Current Report on Form 8-K dated October 22,
1998.
Exhibit 15. First Amendment to Credit Agreement effective as of
September 1, 1998, between the Company and Huls Corporation
is incorporated herein by reference to Exhibit 10-dd(1) to
the Company's Current Report on Form 8-K dated October 22,
1998.
Exhibit 16. First Amendment to Credit Agreement effective as of
September 1, 1998, between the Company and Huls Corporation
is incorporated herein by reference to Exhibit 10-ee(1) to
the
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 34 of 37 Pages
- -------------------------------------------------------------------------------
Company's Current Report on Form 8-K dated October 22,
1998.
Exhibit 17. First Amendment to Credit Agreement effective as of
September 1, 1998, between the Company and Huls Corporation
is incorporated herein by reference to Exhibit 10-ff(1) to
the Company's Current Report on Form 8-K dated October 22,
1998.
Exhibit 18. First Amendment to Credit Agreement effective as of
September 1, 1998, between the Company and Huls Corporation
is incorporated herein by reference to Exhibit 10-hh(1) to
the Company's Current Report on Form 8-K dated October 22,
1998.
Exhibit 19. First Amendment to Credit Agreement effective as of
September 1, 1998, between the Company and Huls Corporation
is incorporated herein by reference to Exhibit 10-xxx(1) to
the Company's Current Report on Form 8-K dated October 22,
1998.
Exhibit 20. First Amendment to Overnight Loan Agreement effective as
of September 1, 1998, between the Company and Huls
Corporation is incorporated herein by reference to Exhibit
10-fff(1) to the Company's Current Report on Form 8-K dated
October 22, 1998.
Exhibit 21. First Amendment to Credit Agreement effective as of
September 1, 1998, between the Company and Huls Corporation
is incorporated herein by reference to Exhibit 10-jjj(1) to
the Company's Current Report on Form 8-K dated October 22,
1998.
Exhibit 22. First Amendment to Credit Agreement effective as of
September 1, 1998, between the Company and Huls Corporation
is incorporated herein by reference to Exhibit 10-kkk(1) to
the Company's Current Report on Form 8-K dated October 22,
1998.
Exhibit 23. First Amendment to Credit Agreement effective as of
September 1, 1998, between the Company and Huls Corporation
is incorporated herein by reference to Exhibit 10-lll(1) to
the Company's Current Report on Form 8-K dated October 22,
1998.
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 35 of 37 Pages
- -------------------------------------------------------------------------------
Exhibit 24. First Amendment to Credit Agreement effective as of
September 1, 1998, between the Company and Huls Corporation
is incorporated herein by reference to Exhibit 10-mmm(1) to
the Company's Current Report on Form 8-K dated October 22,
1998.
Exhibit 25. Revolving Credit Agreement dated as of September 23,
1998 between the Company Electronic Materials, Inc. and VEBA
AG, in the amount of US$100,000,000 incorporated herein by
reference to Exhibit 10-zzz to the Company's Current Report
on Form 8-K dated October 22, 1998.
Exhibit 26. Credit Agreement dated as of July 10, 1995, between the
Company and Huls Corporation is incorporated herein by
reference to Exhibit 10-jj to the Company's Report on Form
10-Q for the Quarter ended June 30, 1995.
Exhibit 27. Credit Agreement dated as of July 10, 1995, between the
Company and Huls Corporation is incorporated herein by
reference to Exhibit 10-kk to the Company's Report on Form
10-Q for the Quarter ended June 30, 1995.
Exhibit 28. Credit Agreement dated as of July 10, 1995, between the
Company and Huls Corporation is incorporated herein by
reference to Exhibit 10-ll to the Company's Report on Form
10-Q for the Quarter ended June 30, 1995.
Exhibit 29. Credit Agreement dated as of July 10, 1995, between the
Company and Huls Corporation is incorporated herein by
reference to Exhibit 10-mm to the Company's Report on Form
10-Q for the Quarter ended June 30, 1995.
Exhibit 30. Credit Agreement dated as of July 10, 1995, between the
Company and Huls AG is incorporated herein by reference to
Exhibit 10-oo to the Company's Report on Form 10-Q for the
Quarter ended June 30, 1995.
Exhibit 31. Credit Agreement dated as of June 26, 1997, between the
Company and Huls Corporation is incorporated herein by
reference to Exhibit qqq to the Company's Report on Form
10-Q for the Quarter ended June 30, 1997.
Exhibit 32. Credit Agreement dated as of June 26, 1997, between the
Company and Huls Corporation is
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 36 of 37 Pages
- -------------------------------------------------------------------------------
incorporated herein by reference to Exhibit rrr to the
Company's Report on Form 10-Q for the Quarter ended June
30, 1997.
Exhibit 33. Credit Agreement dated as of June 26, 1997, between the
Company and Huls Corporation is incorporated herein by
reference to Exhibit sss to the Company's Report on Form
10-Q for the Quarter ended June 30, 1997.
Exhibit 34. Credit Agreement dated as of June 26, 1997, between the
Company and Huls Corporation is incorporated herein by
reference to Exhibit ttt to the Company's Report on Form
10-Q for the Quarter ended June 30, 1997.
Exhibit 35. Overnight Loan Agreement dated as of October 31, 1997,
between the Company and Huls Corporation is incorporated
herein by reference to Exhibit 10-fff to the Company's
Report on Form 10-K/A for the Year ended December 31, 1997.
Exhibit 36. Loan Agreement dated as of June 30, 1998, between the
Company and Huls Corporation is incorporated herein by
reference to Exhibit 10-xxx to the Company's Report on Form
10-Q for the Quarter ended June 30, 1998.
Exhibit 37. Credit Agreement dated as of July 10, 1995, between the
Company and Huls AG is incorporated herein by reference to
Exhibit 10-nn to the Company's Report on Form 10-Q for the
Quarter ended June 30, 1995.
Exhibit 38. First Amendment to Credit Agreement dated as of July 1,
1998, between the Company and Huls AG is incorporated herein
by reference to Exhibit 10-gg(1) to the Company's Report on
Form 10-Q for the Quarter ended June 30, 1998.
Exhibit 39. Credit Agreement dated as of April 1, 1996, between the
Company and Huls AG is incorporated herein by reference to
Exhibit 10-eee to the Company's Report on Form 10-K/A for
the Year ended December 31, 1997.
Exhibit 40. Credit Agreement dated as of December 1, 1996, between
the Company and Huls AG is incorporated herein by reference
to Exhibit
<PAGE>
SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 552715 10 4 Page 37 of 37 Pages
- -------------------------------------------------------------------------------
10-ccc to the Company's Report on Form 10-K/A for the Year
ended December 31, 1997.
Exhibit 41. Credit Agreement dated as of December 1, 1996, between
the Company and Huls AG is incorporated herein by reference
to Exhibit 10-ddd to the Company's Report on Form 10-K/A for
the Year ended December 31, 1997.
Exhibit 42. Credit Agreement dated as of December 22, 1995, between
the Company and Huls AG is incorporated herein by reference
to Exhibit 10-aaa to the Company's Report on Form 10-K for
the Year ended December 31, 1995.
Exhibit 43. Credit Agreement dated as of December 22, 1995, between
the Company and Huls AG is incorporated herein by reference
to Exhibit 10-bbb to the Company's Report on Form 10-K for
the Year ended December 31, 1995.
Exhibit 44. Credit Agreement dated as of December 22, 1995, between
the Company and Huls AG is incorporated herein by reference
to Exhibit 10-ccc to the Company's Report on Form 10-K for
the Year ended December 31, 1995.
Exhibit 45. Credit Agreement dated as of December 22, 1995, between
the Company and Huls AG is incorporated herein by reference
to Exhibit 10-ddd to the Company's Report on Form 10-K for
the Year ended December 31, 1995.
Exhibit 46. Revolving Credit Agreement dated as of July 10, 1995,
between the Company and Huls AG is incorporated herein by
reference to Exhibit 10-pp to the Company's Report on Form
10-Q for the Quarter ended June 30, 1995.
Exhibit 47. First Amendment to Loan Agreement dated as of March 4,
1998, between the Company and Huls AG is incorporated herein
by reference to Exhibit 10-ii(1) to the Company's Report on
Form 10-Q for the Quarter ended June 30, 1998.
EXHIBIT 1
JOINT FILING AGREEMENT
The undersigned hereby agree to jointly file a statement on Schedule
13D, together with any amendments thereto, with the Securities and Exchange
Commission pursuant to the requirements of Rule 13d-1(f) under the Securities
Exchange Act of 1934, as amended.
This Joint Filing Agreement may be signed in counterpart copies.
Date: October 30, 1998 VEBA Aktiengesellschaft
By: /s/ Hans Michael Gaul
------------------------------
Name: Dr. Hans Michael Gaul
Title: Chief Financial Officer
By: /s/ Rolf Pohlig
------------------------------
Name: Dr. Rolf Pohlig
Title: Executive Vice President
Date: October 30, 1998 VEBA Corporation
By: /s/ Heinz H. Puetthof
------------------------------
Name: H. H. Puetthof
Title: President
EXHIBIT 2
PURCHASE AGREEMENT
THIS PURCHASE AGREEMENT (the "Agreement") is entered into as of October
22, 1998, by and among VEBA Corporation, a Delaware corporation ("VEBA"), and
MEMC Electronic Materials, Inc., a Delaware corporation (the "Company").
RECITALS
A. The Company proposes to issue (the "Rights Offering") to holders of
its Common stock, par value $0.01 per share (the "Common Stock"), other than
VEBA, upon the terms and subject to the conditions set forth in the prospectus
(the "Prospectus") contained in the Registration Statement (as herein defined),
rights (the "Rights") to purchase shares of its Common Stock, exercisable at a
price per share equal to the Purchase Price (as hereinafter defined). The Rights
and the Common Stock issuable upon exercise thereof are hereinafter sometimes
collectively referred to as the "Rights Securities;" and
B. The Company proposes to issue and sell to VEBA, and VEBA proposes to
buy from the Company, upon the terms and subject to the conditions set forth
herein, the Common Shares (as herein defined) at a price per share equal to the
Purchase Price, which will be identical to the subscription price in the Rights
Offering.
NOW, THEREFORE, in consideration of the recitals and the mutual
covenants, representations, warranties, conditions and agreements hereinafter
expressed, the parties agree as follows:
Section 1
Sale and Purchase of the Common Shares
Subject to the terms and conditions of this Agreement, the Company will
issue and sell to VEBA and VEBA will purchase from the Company, at the Closing
provided for in Section 2, the Common Shares, at a price per share equal to the
Purchase Price.
Section 2
Closing
The sale of the Common Shares to be purchased by VEBA shall take place
at the offices of Bryan Cave LLP, 211 N. Broadway, Suite 3600, St. Louis,
Missouri 63102-2750 at 10:00 A.M., Central Standard Time, at a closing (the
"Closing") to be held on the date that is the Business Day immediately following
the Calculation Date; provided that in no event shall the date of Closing be
later than December 30, 1998. At the Closing, the Company will deliver to the
Escrow Agent certificates for the Common Shares registered in VEBA's name (or in
the name of VEBA's nominee or assignee in accordance with Section 7.4), against
delivery by VEBA to the Escrow Agent of immediately available funds by federal
wire transfer in the amount of the aggregate Purchase Price therefor. After the
Closing the certificates for the Common Shares and such funds shall be held by
the Escrow Agent pursuant to and in accordance with the terms of the Escrow
Agreement. If at the Closing the Company shall fail to tender certificates for
the Common Shares as provided above in this Section 2, or any of the conditions
specified in Section 3(a) shall not have been fulfilled, VEBA shall, at its
election, be relieved of all further obligations under this Agreement, without
thereby waiving any other rights VEBA may have by reason of such failure or such
nonfulfillment.
Section 3
Conditions to Closing
(a) VEBA's obligations to purchase and pay for the Common Shares are
subject to the fulfillment, prior to or at the Closing, of the following
conditions:
3.1 Representations and Warranties. The representations and warranties
of the Company contained in this Agreement shall be true and correct when made
and at the time of the Closing.
3.2 Performance. The Company shall have performed and complied in all
material respects with all agreements and conditions contained herein required
to be performed or complied with prior to or at the Closing.
3.3 Compliance Certificate. VEBA shall have received an Officer's
Certificate of the Company, dated the date of the Closing and satisfactory in
form and substance to VEBA, in the name and on behalf of the Company, certifying
that the conditions specified in Section 3.1 and 3.2 have been fulfilled.
3.4 Opinions of Counsel. VEBA shall have received at the time of
Closing the opinion of Bryan Cave LLP, counsel for the Company, addressed to
VEBA, dated the date of the Closing and substantially to the following effect:
(i) The Company is a corporation validly existing and is in good
standing under the laws of the State of Delaware and has all requisite
corporate power and authority to carry on its business as described in the
Registration Statement;
(ii) The Common Shares have been duly authorized and, when issued and
delivered to VEBA against payment therefor in accordance with the terms of
this Agreement, will be (A) validly issued, fully paid and nonassessable and
(B) free of any preemptive or similar rights under the certificate of
incorporation or bylaws of the Company, or to the knowledge of such counsel,
pursuant to any other agreement;
(iii) None of the issuance and sale of the Common Shares, the
execution, delivery or performance of this Agreement by the Company or the
consummation by the Company of the transactions contemplated hereby
constitutes or will constitute a violation or breach of, or a default under,
the certificate of incorporation or bylaws of the Company or any Material
Agreement or will result in the creation or imposition of any lien, charge
or encumbrance pursuant to any Material Agreement, upon any property or
assets of the Company or any of its subsidiaries, nor will any such action
result in any violation of the Delaware General Corporation Law (the "DGCL")
or any existing Federal or Missouri law, regulation, ruling (assuming
compliance with all applicable state securities and Blue Sky laws),
recognized by such counsel to be applicable to, or any judgment, injunction,
order of decree known to such counsel, of any Federal or Missouri court to
be applicable to, the Company, its subsidiaries or any of their respective
properties (provided, the term "Material Agreement" shall mean any
agreement, indenture, lease or other instrument or agreement that is both
(i) an exhibit to the Registration Statement and (ii) an agreement,
indenture, lease or other instrument or agreement to which the Company or
any of its subsidiaries is a party or by which any of their properties or
assets are bound);
(iv) (A) The Company has the corporate power and authority to enter
into this Agreement and to issue, sell and deliver the Common Shares
pursuant to this Agreement, and (B) this Agreement has been duly authorized,
executed and delivered by the Company and is a legally valid and binding
agreement of the Company;
(v) No consent, approval, authorization or other order of, or
registration or filing with, any Federal or Missouri court, regulatory body,
administrative agency or other governmental body, agency or official is
required to be obtained by the Company (except as may be required under
state securities or Blue Sky laws governing the sale and distribution of the
Shares) for the valid issuance and sale of the Common Shares; and
(vi) Each of the Incorporated Documents, as amended or supplemented by
the Registration Statement or otherwise, as of the date hereof (and except
for the financial statements and the notes thereto and the schedules and
other financial and statistical data or schedules included therein or
omitted therefrom, as to which such counsel need not express any opinion),
comply as to form in all material respects with the requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act").
In addition to the matters set forth above, such opinion shall also
contain a statement to the effect that, although counsel has not undertaken,
except as otherwise indicated in their opinion, to determine independently, and
does not assume any responsibility for, the accuracy or completeness of the
statements in the Registration Statement, such counsel has participated in the
preparation of the Registration Statement and the Prospectus, including review
and discussion of the contents thereof (including a review and discussion of the
contents of all Incorporated Documents), and nothing has come to the attention
of such counsel that has caused it to believe (i) that the Registration
Statement (including the Incorporated Documents but excluding any VEBA
Information (as defined below)) contains any untrue statement of a material fact
or omits to state a material fact required to be stated therein or necessary to
make the statements therein not misleading or (ii) that the Prospectus
(including the Incorporated Documents but excluding any VEBA Information (as
defined below)) contains any untrue statement of a material fact or omits to
state a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading (it being
understood that such counsel need express no opinion with respect to the
financial statements and the notes thereto and the schedules and other financial
and statistical data included or incorporated by reference in the Registration
Statement or the Prospectus or omitted therefrom). With respect to specific
matters with respect to which Bryan Cave does not represent the Company, the
foregoing statement may be delivered by other counsel that represents the
Company with respect to such matters, such counsel to be reasonably acceptable
to VEBA.
In rendering the foregoing opinion, such counsel may rely, as to
matters involving laws of any jurisdiction other than Missouri or the United
States or the DGCL, upon opinions addressed to VEBA of other counsel reasonably
acceptable to VEBA; provided that insofar as any such opinion relates to the
DGCL, such opinion may be delivered by Richards Layton & Finger, P.A. In
rendering the opinion specified in clause (iv) above such counsel shall assume
that, insofar is it relates to enforceability, that the laws of the State of New
York are the same as the laws of the State of Missouri. In addition, the
foregoing opinion may contain customary assumptions and qualifications.
3.5 Secretary's Certificate. VEBA shall have received a Certificate,
dated the date of the Closing, of the Secretary or an Assistant Secretary of the
Company, certifying as to the resolutions adopted by the Board of Directors of
the Company or its Special Committee approving the documents and/or transactions
contemplated hereby, copies of which resolutions shall be attached to such
Certificate.
3.6 Absence of Certain Changes. (i) There shall not have been any
material adverse change in the capital stock of the Company nor any material
increase in the short-term or long-term debt of the Company and its subsidiaries
on a consolidated basis (other than in the ordinary course of business or
pursuant to agreements with VEBA AG or its affiliates) from the date of this
Agreement; (ii) there shall not have been, since the date of this Agreement any
material adverse change in the condition (financial or other), business,
prospects, properties, net worth or result of operations of the Company and its
subsidiaries taken as a whole and (iii) the Company and its subsidiaries shall
not have any liabilities or obligations, direct or contingent (whether or not in
the ordinary course of business), that are material to the Company and its
subsidiaries, taken as a whole, other than those in existence on the date hereof
or those pursuant to any agreement with VEBA AG or its affiliates.
3.7 Registration Rights Agreement. The Registration Rights Agreement
shall have been amended to include all Common Shares and any other shares of
Common Stock acquired by VEBA or VEBA AG and any of its direct or indirect
subsidiaries after the date hereof as Registrable Stock thereunder.
3.8 Fairness Opinion. The Company shall have received a fairness
opinion from a financial advisor substantially to the effect that (i) the
Purchase Price to be paid by VEBA to the Company pursuant to this Agreement is
fair to the Company and its stockholders (excepting VEBA) from a financial point
of view as of the date thereof, (ii) the financial terms and conditions of the
Rights Offering are consistent with those of rights offerings by public
companies reviewed and deemed comparable to the Rights Offering by such
financial advisor and (iii) the subscription price in the Rights Offering is
fair to the Company and its stockholders (excepting VEBA) from a financial point
of view as of the date thereof.
3.9 Comfort Letter. VEBA shall have received, to the extent not
precluded by KPMG Peat Marwick LLP's accounting policy, a letter addressed to it
and dated the date of the Closing from KPMG Peat Marwick LLP independent
certified public accountants to the Company, in form and substance reasonably
acceptable to VEBA and set forth in SAS 72 and customary for a firm commitment
underwriting.
(b) The Company's obligations to issue and sell the Common Shares are
subject to the fulfillment, prior to or at the Closing, of the condition that
the Company shall have received a fairness opinion from a financial advisor
substantially to the effect that (i) the Purchase Price is fair to the Company
and its stockholders (excepting VEBA) from a financial point of view as of the
date thereof, (ii) the financial terms and conditions of the Rights Offering are
consistent with those of rights offerings by public companies reviewed and
deemed comparable to the Rights Offering by such financial advisor and (iii) the
subscription price in the Rights Offering is fair to the Company and its
stockholders (excepting VEBA) from a financial point of view as of the date
thereof.
Section 4
Representations and Warranties of the Company
The Company represents and warrants on and as of the date hereof, and
as of the date of the Closing, as follows:
4.1 Organization, Standing, Qualification, Etc. The Company and each
of its subsidiaries is a corporation duly incorporated, validly existing and in
good standing under the laws of its jurisdiction of organization, has all the
requisite corporate power and authority to carry on its business as described in
the Registration Statement and Prospectus and is qualified to do business in
every jurisdiction where such qualification or registration is required, except
where the failure to qualify or register would not have, individually or in the
aggregate, a material adverse effect on the condition (financial or other),
business, properties, prospects, net worth or results of operations of the
Company and its subsidiaries taken as a whole (a "Material Adverse Effect").
4.2 Authorization. (a) The Company has taken all actions necessary to
authorize it (i) to execute, deliver and perform all of its obligations under
this Agreement and (ii) to consummate the transactions contemplated hereby. This
Agreement is a legally valid and binding obligation of the Company, enforceable
against it in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium and
other laws relating to or affecting the rights of creditors generally and by
general principles of equity (regardless of whether such enforceability is
sought in equity or at law).
(b) The Common Shares have been duly authorized and, when issued and
delivered to VEBA against payment therefor in accordance with the terms of this
Agreement, will be validly issued, fully paid and nonassessable and free of any
preemptive or other similar rights.
4.3 Capital Stock. All of the outstanding shares of Common Stock have
been duly authorized and validly issued, are fully paid and nonassessable, and
are free of any preemptive or similar rights.
4.4 No Violation or Conflict; No Default. (a) Provided that the
aggregate number of shares of Common Stock to be issued in connection with the
Rights Offering and issued and sold to VEBA pursuant hereto and the Standby
Agreement (as defined below) does not exceed 150,000,000 and the aggregate
proceeds therefrom does not exceed $200 million, none of the issuance and sale
of the Common Shares, the execution, delivery or performance of this Agreement
by the Company, the consummation by the Company of the transactions contemplated
hereby nor the compliance with the terms of this Agreement (A) requires any
consent, approval, authorization or other order of or registration or filing
with, any court, regulatory body, administrative agency or other governmental
body, agency or official or conflicts or will conflict with or constitutes or
will constitute a breach of, or a default under, the certificate or articles of
incorporation or bylaws, or other organizational documents, of the Company or
any of its subsidiaries or (B) conflicts or will conflict with or constitutes or
will constitute a breach of, or a default under, any agreement, indenture, lease
or other instrument to which the Company or any of its subsidiaries is a party
or by which any of them or any of their respective properties may be bound, or
violates or will violate any statute, law, regulation or filing or judgment,
injunction, order or decree applicable to the Company or any of its subsidiaries
or any of their respective properties, or will result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets of the
Company or any of its subsidiaries pursuant to the terms of any agreement or
instrument to which any of them is a party or by which any of them may be bound
or to which any of the property or assets of any of them is subject except for,
in the case of the foregoing clause (B), such violations which would not, either
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
(b) Neither the Company nor any of its subsidiaries is in violation (A)
of its certificate or articles of incorporation or by-laws, or other
organizational documents, or (B) of any law, ordinance, administrative or
governmental rule or regulation applicable to the Company or any of its
subsidiaries, including, without limitation, (i) any foreign, Federal, state or
local law or regulation relating to the protection of human health and safety,
the environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("Environmental Laws"), (ii) any Federal or state law relating to
discrimination in the hiring, promotion or pay of employees or any applicable
federal or state wages and hours laws, or (iii) any provisions of the Employee
Retirement Income Security Act or the rules and regulations promulgated
thereunder (collectively, "ERISA"), or of any decree of any court or
governmental agency or body having jurisdiction over the Company or any of its
subsidiaries except for, in the case of the foregoing clause (B), such
violations which would not, either individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect.
(c) Neither the Company nor any of its subsidiaries is in default in
the performance of any obligation, agreement or condition contained in any bond,
debenture, note or any other evidence of indebtedness or in any other agreement,
indenture, lease or other instrument to which the Company or any of its
subsidiaries is a party or by which any of them or any of their respective
properties may be bound, except for such defaults which would not, either
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
4.5 Registration Statement and Prospectus. (a) The Registration
Statement does not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading, and the Prospectus does not contain an untrue
statement of material fact or omit to state a material fact necessary in order
to make the statements, in light of the circumstances in which they are made,
not misleading, except that this representation and warranty does not apply to
statements in or omissions from the Registration Statement or the Prospectus
relating to the VEBA Information.
(b) The historical financial statements, together with related
schedules and notes, included in the Registration Statement and the Prospectus,
comply as to form in all material respects with the requirements of the
Securities Act of 1933, as amended (the "Securities Act"); such historical
financial statements, together with related schedules and notes, present fairly
the consolidated financial position, results of operations, cash flows and
changes in the financial position of the entities to which they relate on the
basis stated in the Registration Statement at the respective dates or for the
respective periods to which they apply; such statements and related schedules
and notes have been prepared in accordance with generally accepted accounting
principles consistently applied through the periods involved, except as
disclosed therein; and the other financial and statistical information and data
included in the Registration Statement and the Prospectus, are accurately
presented in all material respects and, to the extent applicable, prepared on a
basis consistent in all material respects with such financial statements and the
books and records of the entities to which they relate.
4.6 Permits. The Company and each of its subsidiaries has such permits,
licenses, franchises and authorizations including, without limitation, under any
applicable Environmental Laws, of governmental or regulatory authorities
("permits") as are necessary to own its respective properties and to conduct its
business subject to such qualifications and exceptions as may be set forth in
the Registration Statement and Prospectus and as would not, individually or in
the aggregate, reasonably be expected to have a Material Adverse Effect; the
Company and each of its subsidiaries has fulfilled and performed all its
material obligations with respect to such permits subject in each case to such
qualifications as may be set forth in the Registration Statement and Prospectus
and no event has occurred which allows, or after notice or lapse of time or both
would allow, revocation or termination thereof or results in any other material
impairment of the rights of the holder of any such permit subject in each case
to such qualifications as may be set forth in the Registration Statement and
Prospectus.
4.7 Incorporated Documents. The Incorporated Documents heretofore filed
with the Commission, when they were filed (or, if any amendment with respect to
any such document was filed, when such amendment was filed), conformed in all
material respects with the requirements of the Exchange Act and the rules and
regulations thereunder, and any further Incorporated Documents so filed will,
when they are filed, conform in all material respects with the requirements of
the Exchange Act and the rules and regulations thereunder; no such document when
it was filed (or, if an amendment with respect to any such document was filed,
when such amendment was filed), contained any untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary in order to make the statements therein, in light of the circumstances
under which they were made, not misleading; and any further Incorporated
Documents so filed will, when they are filed, not contain any untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary in order to make the statements therein, in light of the
circumstances under which they are made, not misleading, except that this
representation and warranty will not apply to any VEBA Information.
4.8 No Material Adverse Change. (a) No Material Adverse Change. Since
December 31, 1997 except as set forth in the Registration Statement, there has
not been a material adverse change in the condition (financial or other),
business, prospects, properties, net worth or results of operations of the
Company and its subsidiaries on a consolidated basis (a "Material Adverse
Change").
4.9 Litigation. Except to the extent set forth in the Registration
Statement, there are no actions, claims, suits, citations or proceedings
(including, without limitation, an investigation or partial proceeding, such as
a deposition) pending, or to the knowledge of the Company, threatened
("Proceedings") against or affecting the Company or any of its subsidiaries or
any of their respective properties or assets, that either individually or in the
aggregate are reasonably likely to have a Material Adverse Effect. There is no
Proceeding seeking to restrain, enjoin, prevent the consummation of or otherwise
challenge this Agreement, the Rights Offering, the issuance of the Common Shares
or the transactions contemplated hereby. Neither the Company nor any of its
subsidiaries is subject to any judgment, order, decree, rule or regulation of
any court, governmental authority or arbitration board or tribunal that has had
a Material Adverse Effect or, except to the extent set forth in the Registration
Statement, that could reasonably be expected to have a Material Adverse Effect.
4.10 Private Offering. Assuming the truth and correctness of the
representations and warranties set forth in Section 6 hereof, the sale of the
Common Shares hereunder is exempt from the registration and prospectus delivery
requirements of the Securities Act.
4.11 No Stabilization or Manipulation. The Company has not taken,
directly or indirectly, any action designed to cause or to result in, or that
has constituted or which might reasonably be expected to constitute, the
stabilization or manipulation of the price of any security of the Company.
Section 5
Expenses; Indemnification
5.1 Expenses. If the transactions contemplated by this Agreement are
not consummated (other than because of VEBA's breach of its obligations
hereunder), the Company agrees to reimburse VEBA and its affiliates (as defined
in the Securities Act), other than the Company and its subsidiaries, for all
reasonable out-of-pocket expenses (including reasonable fees and expenses of
counsel) incurred by VEBA and such affiliates in connection with this Agreement
and the transactions contemplated hereby. Notwithstanding anything in this
Agreement to the contrary, the provisions of this Section 5.1 shall survive the
termination of this Agreement.
5.2 Indemnification. (a) In addition to all other sums due hereunder or
provided for in this Agreement, the Company hereby agrees, without limitation as
to time, to indemnify VEBA and its affiliates, directors, officers, employees,
counsel, agents or representatives (collectively, the "VEBA Indemnified
Parties") against, and hold each of them harmless from, to the fullest extent
lawful, all losses, claims, damages, liabilities, costs (including, without
limitation, costs of preparation and reasonable attorneys' fees and
disbursements) and expenses, including expenses of investigation (collectively,
"Losses"), incurred by each of them and arising out of or in connection with (i)
this Agreement, (ii) a breach of any representation, warranty, covenant or
agreement of the Company hereunder or (iii) the transactions contemplated hereby
(or any other document or instrument executed herewith or pursuant hereto or
thereto) whether or not the transactions contemplated by this Agreement are
consummated and whether or not any VEBA Indemnified Party is a formal party to
any proceeding. The Company agrees to reimburse any VEBA Indemnified Party
promptly for all such Losses as they are incurred by such VEBA Indemnified Party
(regardless of whether it is or may be ultimately determined that a VEBA
Indemnified Party is not entitled to indemnification hereunder). The obligations
of the Company to each VEBA Indemnified Party hereunder shall be separate
obligations, and the Company's liability to any such VEBA Indemnified Party
hereunder shall not be extinguished solely because any other VEBA Indemnified
Party is not entitled to indemnity hereunder. The obligations of the Company
under this Section 5.2 shall survive any transfer of the Common Shares by VEBA
and the termination of this Agreement. Notwithstanding the foregoing, (x) to the
extent (A) the compliance certificate delivered pursuant to Section 3.3 contains
any exceptions and (B) VEBA nevertheless elects to consummate the transactions
contemplated under this Agreement, the Company shall not be obligated to
indemnify, hold harmless or contribute to the Losses of any VEBA Indemnified
Party (or reimburse its related expenses) with respect to such exceptions under
this Section 5.2 and VEBA shall not have any claim or remedy under this
Agreement with respect to such excepted matters (except, in both such instances,
to the extent such Losses result from an inaccuracy contained in such compliance
certificate), and (y) the Company shall not be obligated to indemnify, hold
harmless or contribute to the Losses of any VEBA Indemnified Party (or reimburse
its related expenses) to the extent any Loss arises out of or is in connection
with a claim made pursuant to clause (i) and/or (iii) of this Section 5.2(a) and
results from the wrongful act or omission of such VEBA Indemnified Party or
results from an act or omission with respect to which a court of competent
jurisdiction would find such VEBA Indemnified Party liable or culpable. In
addition, the Company shall not be obligated to indemnify, hold harmless or
contribute to the Losses of any VEBA Indemnified Party (or reimburse its related
expenses) to the extent any Loss arises out of or is in connection with a claim
(x) made pursuant to clause (i) and/or (iii) of this Section 5.2(a) and (y)
originally brought, commenced or asserted by a VEBA Indemnified Party.
(b) In addition to all other consideration provided for in this
Agreement, VEBA hereby agrees, without limitation as to time, to indemnify the
Company and its subsidiaries, directors, officers, employees, counsel, agents or
representatives (collectively, the "Company Indemnified Parties") against, and
hold each of them harmless from, to the fullest extent lawful, all Losses
incurred by each of them and arising out of or in connection with a breach of
any representation, warranty, covenant or agreement of VEBA hereunder whether or
not the transactions contemplated by this Agreement are consummated and whether
or not any Company Indemnified Party is a formal party to any proceeding. VEBA
agrees to reimburse any Company Indemnified Party promptly for all such Losses
as they are incurred by such Company Indemnified Party (regardless of whether it
is or may be ultimately determined that a Company Indemnified Party is not
entitled to indemnification hereunder). The obligations of VEBA to each Company
Indemnified Party hereunder shall be separate obligations, and VEBA's liability
to any such Company Indemnified Party hereunder shall not be extinguished solely
because any other Company Indemnified Party is not entitled to indemnity
hereunder. The obligations of VEBA under this Section 5.2 shall survive any
transfer of the Common Shares by VEBA and the termination of this Agreement.
(c) The procedures set forth in Section 8(c) of the Registration Rights
Agreement dated July 12, 1995 between the Company and Huls Corporation (a
predecessor to VEBA) shall govern any indemnification pursuant to this Section
5.2.
(d) If the indemnification provided for in this Section 5.2 is
unavailable to, or insufficient to hold harmless, any indemnified party in
respect of any Losses referred to herein, then an indemnifying party shall have
an obligation to contribute to the amount paid or payable by such indemnified
party as a result of such Losses in such proportion as is appropriate to reflect
its relative fault, on the one hand, and such indemnified party, on the other
hand, in connection with the actions which resulted in such Losses as well as
any other relevant equitable considerations. The amount paid or payable by any
such person as a result of the Losses referred to above shall be deemed to
include, subject to the limitations set forth in Section 5.2, any legal or other
fees or expenses reasonably incurred by such Person in connection with any
investigation, lawsuit or legal or administrative action or proceeding.
(e) The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 5.2 were determined by pro rata allocation
or by any other method of allocation that does not take account of the equitable
considerations referred to in subsection (c) of this Section 5.2.
5.2 Arbitration. (a) Resolution of any and all disputes arising from or
in connection with the determination of to what extent, if any, a claim is made
pursuant to clause (i) and/or (iii) of Section 5.2(a) as compared to clause (ii)
of Section 5.2(a) or to what extent, if any, a VEBA Indemnified Party is
entitled to indemnification pursuant to clause (y) in the penultimate sentence
of Section 5.2(a) ("Disputes"), shall be exclusively governed by and settled in
accordance with the provisions of this Section; provided, that the foregoing
shall not preclude equitable or other judicial relief to enforce the provisions
hereof or to preserve the status quo pending resolution of Disputes hereunder.
Each party to this Agreement (each a "Party" and together the "Parties") may
commence proceedings hereunder by delivery of written notice providing a
reasonable description of the Dispute to the other Party, including a reference
to this Section (the "Dispute Notice").
(b) The Parties shall first attempt in good faith to resolve promptly
any Dispute by negotiations between executives who have authority to settle it
(as to each Party, an "Executive"). Not later than 35 days after delivery of the
Dispute Notice, each Party shall designate an Executive and meet with the other
Party's Executive at a reasonably acceptable time and place, and thereafter as
such Executives deem reasonably necessary. The Executives shall exchange
relevant information and endeavor to resolve the Dispute. Prior to any such
meeting, each Party's Executive shall advise the other as to any other
individuals who will attend such meeting. All negotiations pursuant to this
Section shall be confidential and shall be treated as compromise negotiations
for purposes of Rule 408 of the Federal Rules of Evidence and similarly under
other federal and state rules of evidence.
(c) Except to the extent the Parties agree to continue proceedings
pursuant to paragraph (b) hereof, the Parties shall, commencing not later than
35 days after the date of delivery of the Dispute Notice, endeavor to settle the
Dispute by Mediation pursuant to the Center for Public Resources ("CPR") Model
Procedure for Mediation of Business Disputes, as amended from time to time,
and/or according to such other or additional rules or procedures as the Parties
may agree. The neutral third party in such Mediation shall be as agreed by the
Parties or, failing such agreement, selected with the assistance of the CPR.
(d) (1) The Parties hereby agree to submit all Disputes to arbitration
under the following provisions, which arbitration shall be final and binding
upon the Parties, their successors and assigns, and that the following
provisions constitute a binding arbitration clause under applicable law.
(2) Either Party may initiate arbitration of a Dispute by delivery of a
demand therefor (the "Arbitration Demand") to the other Party not sooner than 60
days after the date of delivery of the Dispute Notice but at any time
thereafter; provided, that if a Party (the "Non-Cooperative Party") does not
cooperate in the procedures provided under paragraph (b) or paragraph (c), the
other Party may initiate arbitration at such earlier time as such
non-cooperation shall become reasonably apparent, and the arbitrators may assess
against the Non-Cooperative Party damages and expenses arising from such
non-cooperation, including attorney's fees and expenses and Arbitration Costs
(as defined below) in connection with arbitration hereunder.
(3) The arbitration shall be conducted in New York by one arbitrator
selected by agreement of the Parties not later than 10 days after delivery of
the Arbitration Demand or, failing such agreement, appointed pursuant to the
Commercial Arbitration Rules of the American Arbitration Association, as amended
from time to time (the "AAA Rules"). If an arbitrator becomes unable to serve,
his or her successor(s) shall be similarly selected or appointed.
(4) The arbitration shall be conducted pursuant to the Federal
Arbitration Act and the Missouri Uniform Arbitration Act and such procedures as
the Parties may agree or, in the absence of or failing such agreement, pursuant
to the AAA Rules. Notwithstanding the foregoing: (A) each party shall be allowed
to conduct discovery through written requests for information, document
requests, requests for stipulations of fact, and depositions; (B) the nature and
extent of such discovery shall be determined by the Panel, taking into account
the needs of the Parties and the desirability of making discovery expeditious
and cost-effective; (C) the Panel may issue orders to protect the
confidentiality of information to be disclosed in discovery; and (D) the Panel's
discovery rulings may be enforced in any court of competent jurisdiction.
(5) All hearings shall be conducted on an expedited schedule, and all
proceedings shall be confidential. Either Party may at its expense make a
stenographic record thereof.
(6) The Panel shall complete all hearings not later than 90 days after
selection or appointment. The Panel's decision shall be in writing and shall
specify the factual and legal bases for the decision. The Panel shall apportion
all costs and expenses of the arbitration, including the Panel's fees and
expenses and fees and expenses of experts ("Arbitration Costs") between the
prevailing and non-prevailing Party as the Panel deems fair and reasonable and
consistent with the principles and provisions of Section 5.2. In circumstances
where (A) a Dispute has been asserted or defended against on grounds that the
Panel deems manifestly unreasonable, or (B) the non-prevailing Party has
rejected participation in procedures under paragraph (b) or (c), the Panel may
assess all Arbitration Costs against the non-prevailing Party and may include in
the award the prevailing Party's attorney's fees and expenses in connection with
any and all proceedings under this Section. Any assessment or apportionment of
Arbitration Costs in accordance with the foregoing sentences shall not affect
the amount, if any, an indemnified party is entitled to receive on account of
any Losses pursuant to the provisions of Section 5.2. Notwithstanding the
foregoing, in no event may the Panel award multiple, punitive or exemplary
damages.
(7) Either Party may assert appropriate statutes of limitation as a
defense in arbitration; provided, that upon delivery of a Dispute Notice any
such statute shall be tolled pending resolution hereunder.
(e) Confidentiality - Notice. Each Party shall notify the other
promptly, and in any event prior to disclosure to any third person, if it
receives any request for access to confidential information or proceedings
hereunder.
Section 6
Purchase for Investment;
Other Representations and Warranties
VEBA represents and warrants on and as of the date hereof and as of the
date of issuance of the Common Shares and, to the extent specified below, VEBA
agrees, as follows:
6.1 Purchase for Investment. Subject to VEBA's right of assignment set
forth in Section 7.4, VEBA is purchasing the Common Shares for its own account
or for one or more separate accounts maintained by VEBA, in each case for
investment and not with a view to the distribution or sale thereof in violation
of the securities laws.
6.2 Authorization. The execution, delivery and performance by VEBA of
this Agreement are within VEBA's powers (corporate or otherwise), have been duly
authorized by all necessary action (corporate or otherwise) on the part of VEBA,
and do not contravene or constitute a default under (a) any provision of
applicable law, rule or regulation applicable to VEBA, (b) VEBA's certificate of
incorporation, bylaws, partnership agreement or other governing instruments or
(c) any agreement, judgment, injunction, order, decree or other instrument
binding upon VEBA, except for any such contravention or default as would not,
individually or in the aggregate, be reasonably likely to prevent VEBA from
performing its obligations hereunder.
6.3 Enforceability. This Agreement constitutes VEBA's legally valid and
binding obligation, enforceable against VEBA in accordance with its terms,
except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other laws relating to or affecting
the rights of creditors generally and by general principles of equity
(regardless of whether such enforceability is sought in equity or at law).
6.4 No Public Market. VEBA understands that the offering and the sale
of the Common Shares are intended to be exempt from registration under the
Securities Act pursuant to Section 4(2) of the Securities Act. VEBA is an
accredited investor within the meaning of Regulation D under the Securities Act.
6.5 Organization. VEBA is a corporation duly organized and validly
existing, is in good standing under the laws of the State of Delaware.
6.6 Brokers. Neither VEBA nor its affiliates (other than the Company
or its subsidiaries) has employed any investment banker, broker or finder
or incurred any liability for any brokerage fees, commissions or finder's
fees in connection with the transactions contemplated by this Agreement.
6.7 Financial Status. VEBA has as of the date of this Agreement, the
financial wherewithal to honor its commitments hereunder.
6.8 Reliance. VEBA acknowledges that the Company is relying upon the
representations and warranties contained herein in determining to make the sale
of the Common Shares, and VEBA consents to such reliance.
6.9 Representations and Warranties; Registration Statement. Except to
the extent set forth in any officer's certificate delivered pursuant to Section
3.3, neither VEBA AG nor VEBA has any reason to believe that a breach of any
representation or warranty contained herein has occurred or that the
Registration Statement or Prospectus (if amended or supplemented, as amended or
supplemented) contains any untrue statement of a material fact or omits to state
any material fact required to be stated therein or necessary to make the
statements therein not misleading.
Section 7
Miscellaneous
7.1 Amendments, Etc. Any term of this Agreement may be amended and the
observance of any term of this Agreement may be waived (either generally or in a
particular instance and either retroactively or prospectively) only with the
written consent of the Company and VEBA.
7.2 Definitions.
"Business Day" means any day except a Saturday, Sunday or other day on
which commercial banks in the City of New York are authorized or required by law
to close.
"Calculation Date" means (x) the date on which the Company has
substantially complied with and responded to all of the Commission's comments
regarding the Registration Statement and Rights Offering and the Commission has
indicated its willingness, other than insofar as the disclosure therein relates
to the fairness opinion to be delivered to the Special Committee of the Board of
Directors of the Company, to accelerate the effectiveness of the Registration
Statement, or (y) such other date mutually agreed to by the parties.
"Commission" means the Securities and Exchange Commission.
"Common Shares" means a number of shares of Common Stock equal to
106,100,000 divided by the Purchase Price rounded up to the nearest whole
number.
"Escrow Agent" means an escrow agent mutually agreed to between the
Company and VEBA.
"Escrow Agreement" means an escrow agreement among the Escrow Agent,
VEBA and the Company in form and substance reasonably acceptable to the Company
and VEBA, it being understood that the parties intend that the only condition
necessary to release the escrowed funds to the Company and the certificates
representing the Common Shares to VEBA or its permitted assignee shall be that
the Commission declares the Registration Statement effective.
"Purchase Price" per Common Share shall mean the volume weighted
average trading price of the Common Stock for the five consecutive trading days
ending on the day prior to the Calculation Date.
"Registration Statement" means the Registration Statement relating to
the Rights Securities on Form S-3 or another appropriate form under the
Securities Act.
"VEBA Information" means the following information: (i) the identity,
business, management and activities of VEBA AG and its affiliates (other than
the Company and its subsidiaries); (ii) the plans of VEBA AG or its affiliates
(other than the Company and its subsidiaries) relating to the Company or shares
of Common Stock; (iii) the number of shares of Common Stock beneficially owned
by VEBA or which VEBA has the right to acquire; (iv) information regarding the
ownership or control of VEBA common stock by VEBA AG and its affiliates; (v)
statements regarding the commitment or intentions of VEBA AG and affiliates
(other than the Company and its subsidiaries) with respect to the Company; and
(vi) the plans of VEBA AG or its affiliates with respect to the inclusion of the
Company in the VEBA consolidated federal income tax return filed by VEBA and
related matters in the event that VEBA's ownership of Common Stock entitles VEBA
to include the Company in VEBA's consolidated federal income tax return.
7.3 Survival of Agreements, Representations and Warranties. The rights
and remedies in respect of the representations, warranties, covenants and
agreements herein or in any certificate or other instrument delivered in
connection with this Agreement shall survive the sale and purchase of the Common
Shares herein contemplated regardless of any investigation made by any party
hereto. No representation or warranty made or deemed made as of any date
pursuant to any Section of this Agreement shall be deemed by reason of this
Section 7.3 to have been made or deemed made as of any other date. All
statements in any such certificate or other instrument shall constitute
representations and warranties as of the date of such certificates.
7.4 Assignment; Binding Agreement. This Agreement and the various
rights and obligations arising hereunder shall inure to the benefit of and be
binding upon VEBA, its successors, and permitted assigns and the Company, its
successors, and permitted assigns. Neither this Agreement nor any of the rights,
interests, or obligations hereunder shall be transferred, delegated, or assigned
(by operation of law or otherwise) by either of the parties hereto without the
prior written consent of the other party, except that VEBA shall have the right
to transfer and assign its rights hereunder to purchase the Common Shares and
any other rights or benefits afforded to it by this Agreement to (x) VEBA AG or
VEBA Zweite Verwaltungsgesellschaft mbH and (y) any other direct or indirect
wholly owned subsidiary of VEBA AG, provided that, only in the case of the
foregoing subclause (y), to the extent required by law, such right to transfer
and assign shall be subject to the prior approval of the Company's Board of
Directors, which approval shall not be unreasonably withheld and, in the case of
both of the foregoing sub-clauses (x) and (y), any such transferee makes the
representations and warranties contained in Sections 6.1 and 6.4 and
acknowledges and agrees to the provisions of Section 7.19. Any such transfer
shall not discharge VEBA from its obligations hereunder.
7.5 Entire Agreement. This Agreement embodies the entire agreement and
understanding between the Company and VEBA and supersedes all prior agreements
and understandings, written or oral, relating to the subject matter hereof.
7.6 Notices, Etc. All notices, requests, demands, and other
communications required or permitted under this Agreement shall be in writing
and shall be deemed to have been duly given and made upon being delivered either
by courier or fax delivery to the party for whom it is intended, provided that a
copy thereof is deposited, postage prepaid, certified or registered mail, return
receipt requested, in the United States mail, bearing the address shown in this
Section 7.5 for, or such other address as may be designated in writing hereafter
by, such party:
If to VEBA:
VEBA Corporation
605 Third Avenue
New York, NY 10158
Attention: Dr. Heinz Helmer Putthoff
President
Fax: (212) 922-2798
If to the Company:
MEMC Electronic Materials Inc.
501 Pearl Drive (City of O'Fallon)
St. Peters, Missouri 63376
Attention: Helene F. Hennelly
Corporate Vice President,
General Counsel and Secretary
Fax: (314) 279-5158
7.7 Severability. Any provision of this Agreement which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction. There shall be
substituted for any such provision so rendered ineffective a provision which, as
far as legally possible, most nearly reflects the intent of the parties hereto.
7.8 Use of Proceeds. The Company hereby agrees to use the proceeds from
the sale of the Common Shares in the manner and for the purposes specified in
the Registration Statement.
7.9 Termination. Either party may terminate this Agreement if more than
an aggregate of 150 million shares of Common Stock would be required to be
issued, or more than $200 million would be received by the Company, in
connection with the consummation of the purchase and sale of Common Shares
contemplated hereby and the consummation of the Rights Offering and the
transactions contemplated by the Standby Agreement dated the date hereof between
VEBA and the Company (the "Standby Agreement"). The Company shall have the right
to terminate this Agreement if the Special Committee of the Board of Directors
of the Company determines in good faith, after receiving the advice of outside
counsel, that proceeding with the Rights Offering would result in a breach of
its fiduciary duties to the Company's stockholders under applicable law.
7.10 Taxes. In the event that VEBA and its affiliates' ownership of
Common Stock, entitles VEBA to include the Company in the VEBA consolidated
federal income tax return, VEBA and the applicable VEBA affiliates shall enter
into a tax sharing or affiliation agreement with the Company. Such agreement
shall provide that the inclusion of the Company in the VEBA consolidated federal
income tax return will not be detrimental to the Company for federal income tax
purposes as compared with the federal income tax treatment of the Company had it
not been includible in the VEBA consolidated federal income tax return and such
agreement shall be in form and substance reasonably acceptable to the Company
and VEBA.
7.11 Comfort Letter. The Company agrees to endeavor in good faith to
obtain the receipt of the Comfort Letter described in Section 3.9.
7.12 Counterparts. This Agreement may be executed in any number of
counterparts, and by each party hereto in separate counterparts, each of which
counterpart shall be an original, but all of which together shall constitute one
and the same Agreement. Delivery of an executed counterpart of a signature page
of this Agreement by telecopier shall be effective as delivery of a manually
executed counterpart of this Agreement.
7.13 Headings. The section headings in this Agreement are for purposes
of reference only and shall not limit or define the meaning hereof.
7.14 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO IRREVOCABLY AND
UNCONDITIONALLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL OR EQUITABLE
ACTION, SUIT, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR
OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE SECURTIES OR ANY
TRANSACTION CONTEMPLATED HEREBY OR THEREBY, THE SUBJECT MATTER OF ANY OF THE
FOREGOING OR THE ACTIONS OF ANY PARTY HERETO OR THERETO IN THE NEGOTIATION,
ADMINISTRATION, PERFORMANCE OR ENFORCEMENT HEREOF OR THEREOF.
7.15 GOVERNING LAW. THIS AGREEMENT AND (UNLESS OTHERWISE EXPRESSLY
PROVIDED) ALL AMENDMENTS AND SUPPLEMENTS TO, AND ALL CONSENTS AND WAIVERS
PURSUANT TO, THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK.
7.16 Registration Statement. Any reference in this Agreement to the
Registration Statement shall be to the most recent Registration Statement, as
filed with the Commission (notwithstanding that such Registration Statement is
subject to completion and has not yet been declared effective by the Commission)
or to the extent no Registration Statement has been filed with the Commission,
the Company's draft Registration Statement attached hereto as Schedule A. In
addition, any reference in this Agreement to the Registration Statement shall be
deemed to include any documents filed under the Exchange Act which have been (or
would have been had such Registration Statement then been filed with and
declared effective by the Commission) incorporated by reference therein. As used
herein, the term "Incorporated Documents" means the documents which at the time
are (or would have been had such Registration Statement then been filed with and
declared effective by the Commission) incorporated by reference in the
Registration Statement.
7.17 Covenants of VEBA. In further consideration of the agreements of
the Company herein contained, VEBA covenants as follows:
VEBA has not taken and during the period of the calculation of the
Purchase Price, will not take, directly or indirectly, any action designed to or
which might be reasonably expected to cause or result in stabilization or
manipulation of the price of the Company's Common Stock, and VEBA has no reason
to believe that any such action has been taken by its controlled affiliates
other than the Company and its subsidiaries, and during the period of the
calculation of the Purchase Price, will not permit any such controlled affiliate
to take such action.
7.18 Waiver of Rights. Assuming consummation of the issuance and
purchase of the Common Shares in accordance with this Agreement, VEBA
acknowledges and agrees that neither VEBA nor any assignee of its Shares or
assignee of its rights under this Agreement will be entitled to any distribution
of Rights from the Company in the Rights Offering. If VEBA transfers any shares
of Common Stock prior to the Record Date of the Rights Offering, VEBA will cause
any such transferee to agree that it will not be entitled to any distribution of
Rights from the Company in the Rights Offering with respect to such shares.
7.19 Restricted Nature of Shares. VEBA acknowledges that the Common
Shares, in its hands, will be restricted securities under the Securities Act
which may not be sold or offered for sale in the absence of an effective
registration statement as to such Common Shares under the Securities Act or an
opinion of counsel satisfactory to the Company that such registration is not
required. VEBA agrees it will not transfer, by way of gift or otherwise, or sell
the Common Shares or any part thereof, unless such Common Shares have been
registered under the Securities Act and any applicable state securities laws or
it first obtains, at its own expense, if requested by the Company, an opinion of
counsel reasonably satisfactory to the Company that the transfer of such Common
Shares may be effected without registration under the Securities Act and any
applicable state securities laws. VEBA acknowledges that the certificates
evidencing the Common Shares will contain a legend to such effect.
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed as of the date first above written.
VEBA CORPORATION
By /s/ A. Paul Brandimarte, Jr.
--------------------------------
Name: A. Paul Brandimarte, Jr.
Title: Vice President
MEMC ELECTRONIC MATERIALS INC.
By /s/ James M. Stolze
--------------------------------
Name: James M. Stolze
Title: Executive Vice President/
Chief Financial Officer
EXHIBIT 3
STANDBY AGREEMENT
THIS STANDBY AGREEMENT (the "Agreement") is entered into as of October
22, 1998, by and among VEBA Corporation, a Delaware corporation ("VEBA"), and
MEMC Electronic Materials, Inc., a Delaware corporation (the "Company").
RECITALS
A. Pursuant to a stock purchase agreement, dated the date hereof (the
"Stock Purchase Agreement"), the Company proposes to issue to VEBA approximately
$106 million of its Common Stock, par value $0.01 per share (the "Common
Stock"), at a purchase price per share determined in accordance with the Stock
Purchase Agreement (the "VEBA Purchase Price") (the transactions contemplated by
the Stock Purchase Agreement being hereinafter referred to as the "Private
Placement"); and
B. The Company also proposes to issue (the "Rights Offering"), upon the
terms and subject to the conditions set forth in the Prospectus (as hereinafter
defined), rights (the "Rights") to purchase shares of its Common Stock. Each
Right will be exercisable at a price per share to be set forth in the Prospectus
(the "Subscription Price") and evidenced by transferable certificates (the
"Rights Certificates"). The Subscription Price and the VEBA Purchase Price will
be identical. The date on which the Rights Offering expires is referred to as
the "Expiration Date" and the time which the Rights Offering expires on the
Expiration Date is referred to as the "Expiration Time." The Rights and the
Common Stock issuable and issued upon exercise thereof are hereinafter sometimes
collectively referred to as the "Securities."
NOW, THEREFORE, in consideration of the recitals and the mutual
covenants, representations, warranties, conditions and agreements hereinafter
expressed, the parties agree as follows:
ARTICLE I
STANDBY COMMITMENT FOR PURCHASE AND SALE OF SHARES
1.1. Registration Statement and Prospectus; Public Offering. The
Company will file with the Securities and Exchange Commission (the
"Commission"), pursuant to the Securities Act of 1933, as amended (the
"Securities Act"), and the published rules and regulations adopted by the
Commission under it (the "Rules"), a registration statement on Form S-3 or
another appropriate form under the Securities Act, including a preliminary
prospectus, relating to the Securities, and will use its reasonable efforts to
permit such registration statement to become effective. The registration
statement as amended at the time it becomes effective (the "Effective Date"),
including all financial statements and all exhibits set forth therein, is called
the "Registration Statement," and the prospectus relating to the Rights Offering
included in the Registration Statement (including information deemed a part of
such Registration Statement pursuant to Rule 430A under the Securities Act), is
called the "Prospectus." Any reference in this Agreement to the Registration
Statement or Prospectus shall be deemed to refer to and include the documents
incorporated by reference therein as of the date of any such Registration
Statement or Prospectus, as the case may be, and any reference to any amendment
or supplement to the Registration Statement or Prospectus shall be deemed to
refer to and include any documents filed after such date under the Securities
Exchange Act of 1934, as amended (the "Exchange Act") which, upon filing, are
incorporated by reference therein. As used herein, the term "Incorporated
Documents" means the documents which at the time are incorporated by reference
in the Registration Statement or the Prospectus or any amendment or supplement
thereto.
1.2. Purchase and Sale of Shares. On the basis of the representations,
warranties and other agreements herein contained, VEBA agrees to purchase and
the Company agrees to sell at the Subscription Price any shares of Common Stock
offered in the Rights Offering and not otherwise subscribed for by the other
stockholders of the Company prior to the Expiration Time ("Shares"), but only
after satisfaction in full of the Oversubscription Privileges of all other
stockholders of the Company. Notwithstanding the foregoing, but subject to the
provisions of Section 3.1, VEBA agrees that, to the extent the rounding up of
Rights distributed to stockholders or any other reason causes the aggregate
proceeds from the Stock Purchase Agreement, the Rights Offering and pursuant to
this Agreement to exceed $200 million (or the aggregate number of shares of
Common Stock issued pursuant to both transactions to exceed 150 million shares),
the number of shares of Common Stock sold by the Company and purchased by VEBA
pursuant to this Agreement shall be reduced, in order that the aggregate
proceeds from the Private Placement, the Rights Offering and pursuant to this
Agreement shall not exceed $200 million and the aggregate number of shares of
Common Stock issued in such transactions shall not exceed 150 million. If VEBA
or its affiliates purchase any Rights, on the New York Stock Exchange or
otherwise, during the Rights Offering, VEBA agrees that neither it nor its
affiliates (other than the Company and its subsidiaries) will exercise its
Oversubscription Privilege with respect to such Rights.
1.3. Payment and Delivery. VEBA shall pay for the Shares by wire
transfer of immediately available funds to a bank account designated by the
Company and the Company shall deliver the Shares at the office of Chadbourne &
Parke LLP, 30 Rockefeller Plaza, New York, New York 10112, at 10:00 A.M., New
York City time, on the same business day as the shares of Common Stock are
issued to the holders of Rights in the Rights Offering, which date shall be the
first business day following the Expiration Date, or at such other date or place
as shall be determined by agreement between VEBA and the Company. This date and
time are sometimes referred to as the "Closing Date." On the Closing Date, the
Company shall deliver or cause to be delivered certificates representing the
Shares to VEBA against payment as aforesaid. Upon delivery, the certificates for
the Shares shall be registered in the name of VEBA (or its permitted assignee in
accordance with Section 6.4) and in such denominations as VEBA shall request in
writing not less than two full business days prior to the Closing Date.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
2.1. Representations and Warranties of the Company. The Company
represents and warrants to and agrees with VEBA that:
(a) The Company is a corporation duly organized and validly
existing, is in good standing under the laws of the State of Delaware, and has
all requisite corporate power and authority to carry on its business as
described in the Registration Statement and the Prospectus. The Company is duly
qualified as a foreign corporation and is in good standing in all other
jurisdictions in which such qualification is required, provided however, that
the Company need not be qualified in a jurisdiction in which its failure to
qualify would not, individually or in the aggregate, have a material adverse
effect on the condition (financial or other), business, properties, prospects,
net worth or results of operations of the Company and its subsidiaries taken as
a whole (a "Material Adverse Effect").
(b) No person is entitled to any preemptive or similar rights to
subscribe for the Shares.
(c) All the outstanding shares of Common Stock of the Company have
been duly authorized and validly issued, are fully paid and nonassessable and
are free of any preemptive or similar rights. The Rights, the Common Stock
issuable upon exercise of the Rights and the Shares to be issued and sold to
VEBA pursuant to this Agreement have been duly authorized and such Common Stock
and Shares, when issued and paid for, will be validly issued, fully paid and
non-assessable; such securities are not subject to any preemptive or similar
rights. The capital stock of the Company conforms in all material respects to
the description thereof in the Registration Statement and the Prospectus.
(d) Neither the issuance and sale of the Securities, the
execution, delivery or performance of this Agreement by the Company, the
consummation by the Company of the transactions contemplated hereby by the
Company (including the issuance and sale of the Shares to VEBA) nor the
compliance with the terms of the Rights and this Agreement (A) requires any
consent, approval, authorization or other order of or registration or filing
with, any court, regulatory body, administrative agency or other governmental
body, agency or official (except such as may be required for the registration of
the Securities under the Securities Act, compliance with the rules of the
National Association of Securities Dealers, Inc., compliance with the securities
or Blue Sky laws of various jurisdictions and compliance with the rules of the
New York Stock Exchange, all of which have been or will be effected in
accordance with this Agreement) conflicts or will conflict with or constitutes
or will constitute a breach of, or a default under, the certificate or articles
of incorporation or bylaws, or other organizational documents, of the Company or
any of its subsidiaries or (B) conflicts or will conflict with or constitutes or
will constitute a breach of, or a default under, any agreement, indenture, lease
or other instrument to which the Company or any of its subsidiaries is a party
or by which any of them or any of their respective properties may be bound, or
violates or will violate any statute, law, regulation or filing or judgment,
injunction, order or decree applicable to the Company or any of its subsidiaries
or any of their respective properties, or will result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets of the
Company or any of its subsidiaries pursuant to the terms of any agreement or
instrument to which any of them is a party or by which any of them may be bound
or to which any of the property or assets of any of them is subject except for,
in the case of the foregoing clause (B), such violations which would not, either
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
(e) The Registration Statement in the form in which it becomes
effective and also in such form as it may be when any post-effective amendment
thereto shall become effective, will comply in all material respects with the
provisions of the Securities Act and will not at any such times contain an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading,
and the Prospectus and any supplement or amendment thereto when filed with the
Commission under Rule 424(b) under the Securities Act will comply in all
material respects with the provisions of the Securities Act and will not at any
such time contain an untrue statement of material fact or omit to state a
material fact necessary in order to make the statements, in light of the
circumstances in which they are made, not misleading, except that this
representation and warranty does not apply to the VEBA Information (as defined
below).
(f) There are no legal or governmental proceedings pending or, to
the knowledge of the Company, threatened against the Company or any of its
subsidiaries, or to which the Company or any of its subsidiaries, or to which
any of their respective properties is subject, that are required to be described
in the Registration Statement or the Prospectus but are not so described as
required.
(g) Neither the Company nor any of its subsidiaries is in
violation (A) of its certificate or articles of incorporation or by-laws, or
other organizational documents, or (B) of any law, ordinance, administrative or
governmental rule or regulation applicable to the Company or any of its
subsidiaries, including, without limitation, (i) any foreign, Federal, state or
local law or regulation relating to the protection of human health and safety,
the environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("Environmental Laws"), (ii) any Federal or state law relating to
discrimination in the hiring, promotion or pay of employees or any applicable
federal or state wages and hours laws, or (iii) any provisions of the Employee
Retirement Income Security Act or the rules and regulations promulgated
thereunder (collectively, "ERISA"), or of any decree of any court or
governmental agency or body having jurisdiction over the Company or any of its
subsidiaries except for, in the case of the foregoing clause (B), such
violations which would not, either individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect.
(h) Neither the Company nor any of its subsidiaries is in default
in the performance of any obligation, agreement or condition contained in any
bond, debenture, note or any other evidence of indebtedness or in any other
agreement, indenture, lease or other instrument to which the Company or any of
its subsidiaries is a party or by which any of them or any of their respective
properties may be bound, except for such defaults which would not, either
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
(i) The historical financial statements, together with related
schedules and notes, included in the Registration Statement and the Prospectus
(and any amendment or supplement thereto), comply as to form in all material
respects with the requirements of the Securities Act; such historical financial
statements, together with related schedules and notes, present fairly the
consolidated financial position, results of operations, cash flows and changes
in financial position of the entities to which they relate on the basis stated
in the Registration Statement at the respective dates or for the respective
periods to which they apply; such statements and related schedules and notes
have been prepared in accordance with generally accepted accounting principles
consistently applied throughout the periods involved, except as disclosed
therein; and the other financial and statistical information and data included
in the Registration Statement and the Prospectus (and any amendment or
supplement thereto), are accurately presented in all material respects and, to
the extent applicable, prepared on a basis consistent in all material respects
with such financial statements and the books and records of the entities to
which they relate.
(j) The execution and delivery of, and the performance by the
Company of its obligations under, this Agreement have been duly and validly
authorized by the Company, and this Agreement has been duly executed and
delivered by the Company and constitutes the valid and legally binding agreement
of the Company, enforceable against the Company in accordance with its terms,
except as rights to indemnity and contribution hereunder may be limited by
federal or state securities laws and subject to limitations on enforcement under
applicable bankruptcy, insolvency, liquidation, fraudulent conveyance,
reorganization, moratorium and other similar laws affecting creditors' rights
generally and to general equitable principles (whether considered in a
proceeding in equity or at law).
(k) Except as disclosed in the Registration Statement and the
Prospectus, subsequent to the respective dates as of which such information is
given in the Registration Statement and the Prospectus: neither the Company nor
any of its subsidiaries has incurred any material liability or obligation,
direct or contingent, or entered into any transaction, not in the ordinary
course of business, that is material to the Company and its subsidiaries taken
as a whole, and there has not been any material change in the capital stock, or
material increase in the short-term debt or long-term debt, of the Company or
any of its subsidiaries (except pursuant to agreements with VEBA and its
affiliates), or any material adverse change, or any development involving, or
which may reasonably be expected to involve, a prospective material adverse
change in the condition (financial or other), business, properties, prospects,
net worth or results of operations of the Company and its subsidiaries, taken as
a whole.
(l) The Company and each of its subsidiaries has such permits,
licenses, franchises and authorizations including, without limitation, under any
applicable Environmental Laws, of governmental or regulatory authorities
("permits") as are necessary to own its respective properties and to conduct its
business in the manner described in the Registration Statement and Prospectus,
subject to such qualifications as may be set forth in the Registration Statement
and Prospectus and with such exceptions as would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect; the Company
and each of its subsidiaries has fulfilled and performed all its material
obligations with respect to such permits and no event has occurred which allows,
or after notice or lapse of time or both would allow, revocation or termination
thereof or results in any other material impairment of the rights of the holder
of any such permit, subject in each case to such qualification as may be set
forth in the Registration Statement and Prospectus.
(m) The Incorporated Documents heretofore filed, when they were
filed (or, if any amendment with respect to any such document was filed, when
such amendment was filed), conformed in all material respects with the
requirements of the Exchange Act and the rules and regulations thereunder, and
any further Incorporated Documents so filed will, when they are filed, conform
in all material respects with the requirements of the Exchange Act and the rules
and regulations thereunder; no such document when it was filed (or, if an
amendment with respect to any such document was filed, when such amendment was
filed), contained any untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading; and no such further document, when it is filed, will contain an
untrue statement of a material fact or will omit to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading, except that this representation and warranty does not apply to VEBA
Information.
(n) The Company has not taken, directly or indirectly, any action
designed to cause or to result in, or that has constituted or which might
reasonably be expected to constitute, the stabilization or manipulation of the
price of any security of the Company to facilitate the issuance of the Rights or
the sale or resale of the Common Stock issuable upon exercise of the Rights or
Shares.
2.2. Representations and Warranties of VEBA. VEBA represents and
warrants to the Company that, as of the date of this Agreement, and covenants
and agrees that as of the Closing Date, it will be deemed to have represented
and warranted as of such date, that:
(a) VEBA is a corporation duly organized and validly existing, is
in good standing under the laws of the State of Delaware.
(b) The execution and delivery of, and the performance by VEBA of
its obligations under, this Agreement have been duly and validly authorized by
VEBA, and this Agreement has been duly executed and delivered by VEBA and
constitutes the valid and legally binding agreement of VEBA, enforceable against
VEBA in accordance with its terms, except as rights to indemnity and
contribution hereunder may be limited by federal or state securities laws and
subject to limitations on enforcement under applicable bankruptcy, insolvency,
liquidation, fraudulent conveyance, reorganization, moratorium and other similar
laws affecting creditors' rights generally and to general equitable principles
(whether considered in a proceeding in equity or at law).
(c) The execution, delivery and performance of this Agreement, the
consummation of the transactions herein contemplated and the compliance with the
terms this Agreement will not conflict with or result in a breach of any of the
terms or provisions of, or constitute a default under, or give rise to rights of
termination under, any deed of trust, lease, sublease, the certificate or
articles of incorporation or by-laws of VEBA, or any indenture, mortgage, or
other agreement or instrument to which VEBA is a party or by which VEBA or its
property is bound, or any applicable law, rule, regulation, judgment, order or
decree of any government, governmental instrumentality or court, domestic or
foreign, having jurisdiction over VEBA or any of its subsidiaries, or the
properties or operations of any of them, except for any such conflict, breach,
default, or right of termination, as would not, individually or in the
aggregate, be reasonably likely to prevent VEBA from performing its obligations
hereunder.
(d) The VEBA Information as reflected in or omitted from the
Registration Statement and the Prospectus does not and will not include any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading. "VEBA Information" means
the following information: (i) the identity, business, management and activities
of VEBA AG and its affiliates (other than the Company and its subsidiaries),
(ii) the plans of VEBA AG or its affiliates (other than the Company and its
subsidiaries) relating to the Company or shares of Common Stock, (iii) the
number of shares of Common Stock beneficially owned by VEBA or which VEBA has a
right to acquire, (iv) information regarding the ownership or control of VEBA
common stock by VEBA AG and its affiliates (other than the Company and its
subsidiaries), (v) statements regarding the commitment or intentions of VEBA AG
and affiliates (other than the Company and its subsidiaries) with respect to the
Company, and (vi) the plans of VEBA AG or its affiliates with respect to the
inclusion of the Company in the consolidated federal income tax return filed by
VEBA ("VEBA Consolidated Federal Income Tax Return") and related matters in the
event that the ownership of Common Stock by VEBA AG or its affiliates entitles
any such entity to include the Company in the VEBA Consolidated Federal Income
Tax Return.
(e) Neither VEBA AG nor VEBA has any reason to believe that a
breach of any representation or warranty contained herein has occurred or that
the Registration Statement or Prospectus (if amended or supplemented, as amended
or supplemented) contains any untrue statement of a material fact or omits to
state any material fact required to be stated therein or necessary to make the
statements therein not misleading.
(f) Neither VEBA nor its affiliates (other than the Company or its
subsidiaries) has employed any investment banker, broker or finder or incurred
any liability for any brokerage fees, commissions or finder's fees in connection
with the transactions contemplated by this Agreement.
(g) VEBA has as of the date of this Agreement, and will have upon
exercise of its Rights, the financial wherewithal to honor its commitments
hereunder.
(h) VEBA understands that the offering and sale of the Shares is
intended to be exempt from registration under the Securities Act of 1933, as
amended (the "Securities Act"), pursuant to Section 4(2) of the Securities Act.
VEBA is not acquiring the Shares as a result of (i) any advertisement, article,
notice or other communication published in any newspaper, magazine, or similar
media or broadcast over television or radio or (ii) any seminar meeting whose
attendees had been invited as a result of, subsequent to, or pursuant to any of
the foregoing.
(i) VEBA (or any permitted assignee under Section 6.4) is
acquiring the Shares solely by and for its own account as principal, for
investment purposes only, and not for the account of any other person and not
with a view to, or for, distribution, assignment, fractionalization or resale or
distribution to others in whole or in part in violation of the Securities Act.
(j) VEBA is an accredited investor under the Securities Act.
(k) VEBA hereby waives its right under the Registration Rights
Agreement between VEBA (as successor to Huls Corporation) and the Company, dated
July 12, 1995, (the "Registration Rights Agreement") to have its existing shares
of Common Stock included in the Registration Statement and thereby registered
under the Securities Act in connection therewith.
(l) VEBA acknowledges that the Company is relying upon the
representations and warranties contained herein in determining to make the sale
of the Shares, and VEBA consents to such reliance.
ARTICLE III
RIGHTS OFFERING
3.1. Subscription Offer. The Company will use its reasonable efforts to
distribute at no charge to holders of its Common Stock of record as of the close
of business on a date (the "Record Date") established by the special committee
of the Board of Directors designated to take all board action in connection
with, and to consider and/or approve, the Rights Offering (the "Special
Committee"), a specified number or fraction of transferable subscription rights
(each, a "Right") for every share of Common Stock held on the Record Date, with
each such Right entitling the holder thereof to subscribe for (the "Basic
Subscription Privilege") and to purchase one share of Common Stock, for the
Subscription Price. The number of Rights distributed to each holder of Common
Stock will be rounded up to the nearest whole number. Notwithstanding the
foregoing, VEBA agrees that the Company will not distribute any Rights to VEBA
or to any permitted transferee of its shares of Common Stock. If VEBA transfers
any shares of Common Stock prior to the Record Date, VEBA will cause any such
transferee to agree that it will not be entitled to any distribution of Rights
from the Company in the Rights Offering with respect to such shares. The Rights
will expire as provided in the Prospectus, unless extended as described therein.
Each Right also carries with it the right to subscribe (the "Oversubscription
Privilege") at the Subscription Price for an unlimited number of shares of
Common Stock that are not otherwise purchased through the exercise of the Basic
Subscription Privilege, subject to reduction by the Company in certain
circumstances. If an insufficient number of shares of Common Stock are available
to satisfy fully all subscriptions pursuant to the Oversubscription Privilege,
then the available shares of Common Stock will be prorated among those persons
who subscribe pursuant to the Oversubscription Privilege (other than VEBA or its
permitted transferee), based on the respective numbers of Rights exercised by
such persons pursuant to the Basic Subscription Privilege. The Company shall
allocate Shares to VEBA as provided in Section 1.2. The Rights will be evidenced
by the Rights Certificates. Notwithstanding anything contained in this
Agreement, in no event shall the Rights Offering result in VEBA and its
affiliates (within the meaning of the Securities Act) in the aggregate owning
less than 52% of the issued and outstanding shares of Common Stock of the
Company (excluding shares issuable pursuant to the Company's employee benefit
plans), immediately after consummation of the Rights Offering.
3.2. Restricted Nature of Shares. VEBA acknowledges that the Shares, in
its hands, will be restricted securities under the Securities Act which may not
be sold or offered for sale in the absence of an effective registration
statement as to such Shares under the Securities Act or an opinion of counsel
satisfactory to the Company that such registration is not required. VEBA agrees
it will not transfer, by way of gift or otherwise, or sell the Shares or any
part thereof, unless such Shares have been registered under the Securities Act
and any applicable state securities laws or it first obtains, at its own
expense, if requested by the Company, an opinion of counsel reasonably
satisfactory to the Company that the transfer of such Shares may be effected
without registration under the Securities Act and any applicable state
securities laws. VEBA acknowledges that the certificates evidencing the Shares
will contain a legend to such effect.
ARTICLE IV
COVENANTS OF THE PARTIES
4.1 Covenants of the Company. In further consideration of the
agreements of VEBA herein contained, the Company covenants as follows:
(a) Effectiveness of Registration Statement. The Company will use
its reasonable efforts to cause the Registration Statement to become effective
and will advise VEBA promptly and, if requested by VEBA, will confirm such
advice in writing (i) when the Registration Statement, or any post-effective
amendment to the Registration Statement, shall have become effective, or any
supplement to the Prospectus or any amended Prospectus shall have been filed,
(ii) of the necessity of amending or supplementing the Prospectus or any amended
Prospectus in order to then meet the requirements of the Securities Act and the
reasons why such amendment or supplement is necessary, (iii) of any request of
the Commission for amendment or supplementing of the Registration Statement or
Prospectus or for additional information, and (iv) of the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or of any order preventing or suspending the use of any preliminary or
amended preliminary prospectus or the Prospectus, or of the suspension of the
qualification of the Securities for offering or sale in any jurisdiction, or of
the institution of any proceedings for any of such purposes. The Company will
use its reasonable efforts to prevent the issuance of any such stop order or of
any order preventing or suspending such use and to obtain as soon as possible
the lifting thereof, if issued.
(b) Amendment of Registration Statement and Prospectus. The
Company will not file any amendment to the Registration Statement or make any
amendment or supplement to the Prospectus (including the filing of any document
which, upon filing, becomes an Incorporated Document) of which VEBA shall not
previously have been advised or to which VEBA shall reasonably object after
being so advised.
(c) Copies. The Company will deliver to VEBA, without charge, as
soon as the Registration Statement shall have become effective, 10 copies of the
Prospectus (as supplemented or amended, if the Company shall have made any
supplements or amendments to the Prospectus).
(d) Authorized Shares. The Company will maintain at all times
sufficient reserved, authorized but unissued shares of Common Stock for issuance
upon exercise of the Rights.
(e) Amendment or Termination of Rights Offering. The Company
reserves the right to amend the terms and conditions of the Rights Offering;
provided, however, the Company may not change the Subscription Price or the
number of shares of Common Stock issuable in the Rights Offering or take any
other action which would materially adversely affect VEBA's rights hereunder
without the written consent of VEBA. The Company may terminate the Rights
Offering at any time only if (i) it does not receive the Fairness Opinion (as
defined in Section 5.1(f)) or (ii) the special committee of the board of
directors of the Company delegated authority to take action in connection with
the Rights Offering determines in good faith, after receiving the advice of
outside counsel, that proceeding with the Rights Offering would result in a
breach of its fiduciary duties to the Company's stockholders under applicable
law.
(f) Rule 158. The Company will make generally available to its
security holders an earnings statement, which need not be audited, covering a
twelve-month period commencing after the effective date of the Registration
Statement (as defined in Rule 158 under the Securities Act) and ending not later
than 15 months thereafter, as soon as practicable after the end of such period,
which earnings statement shall satisfy the provisions of Section 11(a) of the
Securities Act.
(g) Expenses. In the event of a termination of this Agreement or
if the Rights Offering is not otherwise consummated (other than solely (i)
because of a breach by VEBA of its representations, warranties, covenants or
agreements hereunder or (ii) pursuant to Section 6.8(c) of this Agreement), the
Company agrees to reimburse VEBA and its affiliates (as defined in the
Securities Act), other than the Company and its subsidiaries, for all reasonable
out-of-pocket expenses (including reasonable fees and expenses of counsel)
incurred by VEBA and such affiliates in connection with the Rights Offering (but
excluding expenses attributable to the Private Placement), provided the Company
receives reasonable supporting documentation of such expenses.
(h) No Price Stabilization or Manipulation. The Company (a) will not,
except as disclosed in the Registration Statement, sell, bid for or purchase, or
pay anyone any compensation for soliciting purchases of, the Company's Common
Stock or the Rights and (b) will not, until the later of the Expiration Date or
the completion of the distribution (within the meaning of Regulation M under the
Exchange Act) of the shares of Common Stock, sell, bid for or purchase, apply or
agree to pay to any person any compensation for soliciting another to purchase
any other securities of the Company (except for the solicitation of the
exercises of Rights pursuant to this Agreement). The foregoing shall not apply
to the offer, sale, agreement to sell or delivery with respect to (1) shares of
Common Stock offered and sold upon exercise of the Rights, as described in the
Prospectus, or (2) any shares of Common Stock sold pursuant to any employee
benefit plan.
4.2 Covenants of VEBA. In further consideration of the agreements of
the Company herein contained, VEBA covenants as follows:
(a) VEBA has not taken and will not take, directly or indirectly,
any action designed to or which might be reasonably expected to cause or result
in stabilization or manipulation of the price of the Company's Common Stock, and
VEBA has no reason to believe that any such action has been taken by its
affiliates other than the Company and its subsidiaries, and will not permit any
such affiliate to take such action.
(b) When the Registration Statement becomes effective, the VEBA
Information (as defined in Section 2.2(d)) will not contain any untrue statement
of a material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein in light of the
circumstances in which they were made not misleading.
(c) VEBA will not take any action to prevent the Registration
Statement or any post-effective amendment thereto from becoming effective.
(d) VEBA will use its reasonable efforts to do or perform all
things required to be done or performed by VEBA or its affiliates (other than
the Company and its subsidiaries) prior to the Closing Date to satisfy all
conditions precedent to the consummation of the transactions contemplated
hereby.
(e) Until the Expiration Date, VEBA will advise the Company
promptly, and if requested by the Company, will promptly confirm such advice in
writing, of (A) any change in (i) the VEBA Information, or (ii) VEBA's
intentions with respect to transactions and relationships among VEBA AG or its
affiliates (other than the Company and its subsidiaries), on the one hand, and
the Company or its affiliates, on the other hand, or (B) any new information
relating to (i) VEBA Information or (ii) VEBA's intentions with respect to
transactions and relationships among VEBA AG or its affiliates, on the one hand,
and the Company or its affiliates, on the other hand, that causes the
Registration Statement or the Prospectus (as then amended or supplemented, if
amended or supplemented) to contain an untrue statement of material fact or omit
to state a material fact necessary in order to make the statements therein, in
light of the circumstances in which they are made, not misleading.
ARTICLE V
CONDITIONS TO OBLIGATIONS OF VEBA
5.1. Conditions to VEBA's Obligations. The obligation of VEBA to
purchase the Shares hereunder is subject to the satisfaction of the following
conditions on or prior to the Expiration Date:
(a) VEBA shall have received on the Expiration Date, the opinion
of Bryan Cave LLP, counsel for the Company, addressed to VEBA, dated the
Expiration Date and substantially to the effect that:
(i) The Company is a corporation validly existing and is in
good standing under the laws of the State of Delaware and has all requisite
corporate power and authority to carry on its business as described in the
Registration Statement and the Prospectus;
(ii) The shares of Common Stock issuable upon exercise of the
Rights and issuable to VEBA pursuant to this Agreement have been duly
authorized and, when issued and delivered against payment therefor in
accordance with the terms of the Rights Offering or this Agreement as the
case may be, will be (A) validly issued, fully paid and nonassessable and
(B) free of any preemptive or similar rights that entitle or will entitle
any person to acquire any shares of Common Stock upon the issuance thereof
by the Company by operation of the certificate of incorporation or bylaws of
the Company, or to the knowledge of such counsel, pursuant to any agreement;
(iii) None of the issuance and sale of the shares of Common
Stock upon exercise of the Rights, the execution, delivery or performance of
this Agreement by the Company, the consummation by the Company of the
transactions contemplated hereby (including the issuance and sale to VEBA of
the Shares) nor the compliance by the Company with the terms of the Rights
and this Agreement constitutes or will constitute a violation or breach of,
or a default under, the certificate of incorporation or bylaws of the
Company or any Material Agreement, or will result in the creation or
imposition of any lien, charge or encumbrance pursuant to any Material
Agreement upon any property or assets of the Company or any of its
subsidiaries, nor will any such action result in any violation of the
Delaware General Corporation Law (the "DGCL"), any existing Federal or
Missouri law, regulation, ruling (assuming compliance with all applicable
state securities and Blue Sky laws) recognized by such counsel to be
applicable to, or any judgment, injunction, order or decree known to such
counsel of any Federal or Missouri court to be applicable to the Company,
its subsidiaries or any of their respective properties (provided, the term
"Material Agreement" shall mean any agreement, indenture, lease or other
instrument that is both (i) an exhibit to the Registration Statement and
(ii) an agreement, indenture, lease or other instrument to which the Company
or any of its subsidiaries is a party or by which any of their properties or
assets are bound);
(iv) Such counsel has been advised by the Staff of the
Commission that the Registration Statement has become effective under the
Securities Act and, to the knowledge of such counsel, no stop order
suspending the effectiveness of the Registration Statement has been issued
and no proceedings for that purpose are pending before or threatened by the
Commission; and any required filing of the Prospectus pursuant to Rule
424(b) has been made in accordance with Rule 424(b);
(v) (A) The Company has the corporate power and authority to
enter into this Agreement and to issue, sell and deliver the shares of
Common Stock issuable upon exercise of the Rights and to VEBA pursuant to
this Agreement, (B) the Rights Offering has been duly authorized by
corporate action, and (C) this Agreement has been duly authorized, executed
and delivered by the Company;
(vi) No consent, approval, authorization or other order of,
or registration or filing with, any Federal or Missouri court, regulatory
body, administrative agency or other governmental body, agency, or official
is required to be obtained by the Company (except as have been obtained
under the Securities Act and the Exchange Act or such as may be required
under state securities or Blue Sky laws governing the sale and distribution
of the shares of Common Stock) for the valid issuance and sale of the shares
of Common Stock issuable upon exercise of the Rights or to VEBA in
accordance with this Agreement; and
(vii) Each of the Registration Statement, as of its effective
date, and the Prospectus, as of its date (including Incorporated Documents
and except for the financial statements and the notes thereto and the
schedules and other financial and statistical data or schedules included
therein or omitted therefrom, as to which such counsel need not express any
opinion), comply as to form in all material respects with the requirements
of the Securities Act.
In addition to the matters set forth above, such opinion shall also contain a
statement to the effect that, although counsel has not undertaken, except as
otherwise indicated in their opinion, to determine independently, and does not
assume any responsibility for, the accuracy or completeness of the statements in
the Registration Statement, such counsel has participated in the preparation of
the Registration Statement and the Prospectus, including review and discussion
of the contents thereof (including a review and discussion of the contents of
all Incorporated Documents), and nothing has come to the attention of such
counsel that has caused it to believe (i) that the Registration Statement
(including the Incorporated Documents), and any amendment thereto, at the time
it became effective (excluding any VEBA Information), contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading or
(ii) that the Prospectus (including the Incorporated Documents), or any
amendment or supplement to the Prospectus, as of its respective date, and as of
the Closing Date (excluding any VEBA Information) contained any untrue statement
of a material fact or omitted to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading (it being understood that such counsel need not
express any opinion with respect to the financial statements and the notes
thereto and the schedules and other financial and statistical data or schedules
included or incorporated by reference in the Registration Statement or the
Prospectus or omitted therefrom).
With respect to specific matters with respect to which Bryan Cave LLP
does not represent the Company, the foregoing statement may be delivered by
other counsel that represents the Company with respect to such matters, such
counsel to be reasonably acceptable to VEBA.
In rendering the foregoing opinion, such counsel may rely, as to
matters involving laws of any jurisdiction other than Missouri or the United
States or the DGCL, upon opinions addressed to VEBA of other counsel reasonably
acceptable to VEBA, provided that insofar as any such opinion relates to the
DGCL, such opinion may be delivered by Richards, Layton & Finger, P.A. In
addition, the foregoing opinion may contain customary assumptions and
qualifications.
(b) VEBA shall have received a letter addressed to it and dated
the Expiration Date from KPMG Peat Marwick LLP independent certified public
accountants to the Company, in form and substance reasonably acceptable to VEBA
and set forth in SAS 72 and customary for a firm commitment underwriting.
(c) (i) No stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for that
purpose shall have been taken; (ii) there shall not have been any material
change in the capital stock of the Company nor any material increase in the
short-term or long-term debt of the Company and its subsidiaries on a
consolidated basis (other than in the ordinary course of business or pursuant to
existing agreements with VEBA AG or its affiliates) from the date of this
Agreement; (iii) there shall not have been, since the date of this Agreement any
material adverse change in the condition (financial or other), business,
prospects, properties, net worth or results of operations of the Company and its
subsidiaries taken as a whole; (iv) the Company and its subsidiaries shall not
have any liabilities or obligations, direct or contingent (whether or not in the
ordinary course of business, except for any liabilities or obligations, direct
or contingent, with VEBA and its affiliates), that are material to the Company
and its subsidiaries, taken as a whole, other than those in existence on the
date hereof; and (v) all the representations and warranties of the Company
contained in this Agreement shall be true and correct in all material respects
on and as of the Expiration Date as if made on and as of the Expiration Date;
and (vi) VEBA shall have received a certificate, dated the Expiration Date and
signed by the chief executive officer and the chief financial officer (or other
reasonably acceptable officers) in the name and on behalf of the Company to the
effect set forth in this Section 5.1(c).
(d) The Shares and Rights shall have been approved for listing on
the New York Stock Exchange, subject to official notice of issuance, prior to
the Expiration Date.
(e) The Registration Rights Agreement shall have been amended to
include all Shares purchased by VEBA, VEBA AG or any subsidiaries of VEBA AG and
any other shares of Common Stock acquired or purchased by VEBA, VEBA AG or any
subsidiaries of VEBA AG after the date hereof as Registrable Stock thereunder,
such amendment to be effective as of the Closing Date.
(f) VEBA shall have received confirmation that the Company
received prior to commencement of the Rights Offering a fairness opinion from a
financial advisor substantially to the effect that (i) the VEBA Purchase Price
to be paid to the Company by VEBA is fair to the Company and its stockholders
(other than VEBA) from a financial point of view as of the date thereof, (ii)
the financial terms and conditions of the Rights Offering are consistent with
those of rights offerings by public companies reviewed and deemed comparable to
the Rights Offering by such financial advisor and (iii) the Subscription Price
is fair to the Company and its stockholders (other than VEBA) from a financial
point of view as of the date thereof (the "Fairness Opinion").
ARTICLE VI
MISCELLANEOUS PROVISIONS
6.1. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless VEBA, its officers, directors, employees and agents
and each person, if any, who controls VEBA (collectively, the "VEBA Indemnified
Persons") within the meaning of Section 15 of the Securities Act or Section
20(a) of the Exchange Act from and against any and all losses, claims, damages,
liabilities and reasonable expenses (including reasonable legal fees and costs
of investigation) (collectively "Losses") arising out of or based upon any
untrue statement or alleged untrue statement of a material fact contained in the
Registration Statement or the Prospectus or in any amendment or supplement
thereto, or arising out of or based upon any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, but only with respect to information
other than VEBA Information, except that the Company shall have no obligations
under this Section 6.1 for any untrue statement or omission to state a material
fact contained in a preliminary prospectus that was corrected in the Prospectus
(as amended or supplemented). The foregoing indemnity agreement shall be in
addition to any liability which the Company may otherwise have. Notwithstanding
the foregoing, to the extent (A) the compliance certificate delivered pursuant
to Section 5.1(c)(vi) contains any exceptions and (B) VEBA nevertheless elects
to consummate the transaction contemplated under this Agreement, the Company
shall not be obligated to indemnify, hold harmless or contribute to the Losses
of any VEBA Indemnified Party (or reimburse its related expenses) with respect
to such exceptions under this Section 6.1 and VEBA shall not have any claim or
remedy under this Agreement with respect to such excepted matters, except (x) to
the extent such Losses result from an inaccuracy contained in such compliance
certificate and (y) to the extent such Losses result from an action, suit or
proceeding commenced by a person other than a VEBA Indemnified Person arising
out of or based upon any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or the Prospectus or in
any amendment or supplement thereto, or arising out of or based upon any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, but
only with respect to information other than VEBA Information; except that the
Company shall have no obligations under this Section 6.1 for any untrue
statement or omission to state a material fact contained in a preliminary
prospectus that was corrected in the Prospectus (as amended or supplemented).
(b) VEBA agrees to indemnify and hold harmless the Company, its
officers, directors, employees and agents, and any person who controls the
Company within the meaning of Section 15 of the Securities Act or Section 20(a)
of the Exchange Act, to the same extent as the foregoing indemnity from the
Company to VEBA, but only with respect to the VEBA Information except that VEBA
shall have no obligations under this Section 6.2 for any untrue statement or
omission to state a material fact with regard to the VEBA Information contained
in a preliminary prospectus that was corrected in the Prospectus (as amended or
supplemented). The foregoing indemnity agreement shall be in addition to any
liability which VEBA may otherwise have.
(c) If the indemnification provided for in this Section 6.1 is
unavailable to an indemnified party under paragraphs (a) or (b) hereof in
respect of any Losses referred to therein, then an indemnifying party, in lieu
of indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such Losses (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and VEBA on the other hand from the Rights Offering and
the Private Placement taken as a whole, 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)
above but also the relative fault of the Company on the one hand and VEBA on the
other hand in connection with the statements or omissions that resulted in such
Losses, as well as any other relevant equitable considerations.
(d) The procedures set forth in Section 8(c) of the Registration
Rights Agreement dated July 12, 1995 between the Company and Huls Corporation (a
predecessor to VEBA) shall govern any indemnification pursuant to this Section
6.1.
6.2. Notice. All notices, requests, demands, and other communications
required or permitted under this Agreement shall be in writing and shall be
deemed to have been duly given and made upon being delivered either by courier
or fax delivery to the party for whom it is intended, provided that a copy
thereof is deposited, postage prepaid, certified or registered mail, return
receipt requested, in the United States mail, bearing the address shown in this
Section 6.1 for, or such other address as may be designated in writing hereafter
by, such party:
If to VEBA:
VEBA Corporation
605 Third Avenue
New York, NY 10158
Attention: Dr. Heinz Helmer Putthoff
President
Fax: (212) 922-2798
If to the Company:
MEMC Electronic Materials Inc.
501 Pearl Drive (City of O'Fallon)
St. Peters, Missouri 63376
Attention: Helene F. Hennelly
Corporate Vice President,
General Counsel and Secretary
Fax: (314) 279-5158
6.3. Entire Agreement. This Agreement, together with the Stock Purchase
Agreement, embodies the entire agreement and understanding of the parties hereto
with respect to the subject matter hereof, and supersedes all prior and
contemporaneous agreements and understandings relative to such subject matter.
6.4. Assignment; Binding Agreement. This Agreement and the various
rights and obligations arising hereunder shall inure to the benefit of and be
binding upon VEBA, its successors, and permitted assigns and the Company, its
successors, and permitted assigns. Neither this Agreement nor any of the rights,
interests, or obligations hereunder shall be transferred, delegated, or assigned
(by operation of law or otherwise) by either of the parties hereto without the
prior written consent of the other party, except that VEBA shall have the right
to transfer and assign its rights hereunder to purchase Common Stock and any
other rights or benefits afforded to it by this Agreement to (x) VEBA AG or VEBA
Zweite Verwaltungsgesellschaft mbH and (y) any other direct or indirect wholly
owned subsidiary of VEBA AG, provided that, only in the case of the foregoing
subclause (y), to the extent required by law, such right to transfer and assign
shall be subject to the prior approval of the Company's Board of Directors,
which approval shall not be unreasonably withheld and, in the case of both of
the foregoing sub clauses (x) and (y), any such transferee makes the
representations and warranties contained in Sections 2.2(h), 2.2(i) and 2.2(j)
and acknowledges and agrees to the provisions of Section 3.2. Any such transfer
shall not discharge VEBA from its obligations hereunder.
6.5. Counterparts; Expenses. This Agreement may be executed
simultaneously in multiple counterparts, each of which shall be deemed an
original, but all of which taken together shall constitute one and the same
instrument. Except to the extent set forth in Section 4.1(g), each party shall
bear the fees and expenses incurred by such party incidental to the preparation
of, and the consummation of the transactions contemplated by, this Agreement.
6.6. Headings; Interpretation. The article and section headings
contained in this Agreement are inserted for convenience only and shall not
affect in any way the meaning or interpretation of the Agreement. Each reference
in this Agreement to an Article or Section, unless otherwise indicated, shall
mean an Article or a Section of this Agreement. References herein to "days,"
unless otherwise indicated, are to consecutive calendar days. Both parties have
participated substantially in the negotiation and drafting of this Agreement and
agree that no ambiguity herein should be construed against the draftsman.
6.7 Taxes. In the event that VEBA and its affiliates' ownership of
Common Stock entitles VEBA to include the Company in the VEBA Consolidated
Federal Income Tax Return, VEBA and the applicable VEBA affiliates shall enter
into a tax sharing or affiliation agreement with the Company. Such tax sharing
or affiliation agreement shall provide that the inclusion of the Company in the
VEBA Consolidated Federal Income Tax Return will not be detrimental to the
Company for federal income tax purposes as compared with the federal income tax
treatment of the Company had it not been includible in the VEBA Consolidated
Federal Income Tax Return and such tax sharing or affiliation agreement shall be
in form and substance reasonably acceptable to the Company and VEBA.
6.8. Termination of the Agreement.
(a) Prior to consummation of the transactions contemplated hereby,
this Agreement may be terminated: (i) at any time prior to the Closing Date,
upon termination of the Rights Offering by the Company, in accordance with
Section 4.1(e), without further liability or obligation, or (ii) after March 31,
1999, by either party hereto, without further liability or obligation, if (x)
such party is not in breach or violation hereof and (y) the conditions to such
party's obligations have not then been satisfied.
(b) Either party may terminate this Agreement if more than an
aggregate of 150 million shares of Common Stock would be required to be issued
in connection with, or the Company would receive more than $200 million from,
the consummation of the purchase and sale of Common Stock pursuant to this
Agreement, the Stock Purchase Agreement and the Rights Offering.
(c) This Agreement shall be subject to termination in VEBA's
discretion after consultation with the Company, without liability on the part of
VEBA to the Company, by notice to the Company, if on or 20 days prior to the
Expiration Date, (i) trading in securities generally on the New York Stock
Exchange, American Stock Exchange or the Nasdaq National Market is suspended or
materially limited, (ii) a general moratorium on commercial banking activities
in New York shall have been declared by either federal or New York State
authorities, or (iii) there shall have occurred any outbreak or escalation of
hostilities or other international or domestic calamity, crisis or material
adverse change in political, financial or economic conditions, which has a
materially adverse impact on the ability of the Company to distribute the shares
of Common Stock in the Rights Offering.
(d) The provisions of Section 4.1(g) and Article VI shall survive
any termination of this Agreement.
6.9. Governing Law. This Agreement shall in all respects be construed
in accordance with and governed by the substantive laws of the State of New
York, without reference to its choice of law rules, except that matters subject
to the General Corporation Law of Delaware shall be governed by such laws.
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed as of the date first above written.
VEBA CORPORATION
By /s/ A. Paul Brandimarte, Jr.
--------------------------------
Name: A. Paul Brandimarte, Jr.
Title: Vice President
MEMC ELECTRONIC MATERIALS INC.
By /s/ James M. Stolze
--------------------------------
Name: James M. Stolze
Title: Executive Vice President/
Chief Financial Officer
