Document/Exhibit Description Pages Size
1: 8-K Current Report 6 19K
2: EX-10.27 Notarial Deed With Agreement 32 62K
3: EX-10.28 Contract for Purchase and Sale (Us) 21 78K
4: EX-10.29 Contract for Exchange of Stock 22 83K
5: EX-10.30 Contract for Purchase and Sale (Malaysia) 17 66K
6: EX-10.31 Employment Agreement 6 23K
EXHIBIT 10.27
OFFENTLICHE URKUNDE
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NOTARIAL DEED
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Before me, Dr. Thomas Gelzer, notary public in the Canton of Basle-City
(Switzerland), the following persons have appeared today:
Mr Dr. Thomas O.J. Burkert, Attorney-at-law, born 25th March 1958, German
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citizen, domiciled at Reutlinger Strasse 87, D-71732 Tamm, business address
Jahnstrasse 43, D-70597 Stuttgart, identified by his Passport No. 6170100991
and
Mr John Joseh Stinson, Attorney-at-law, born 14th January 1956, American
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citizen, domiciled at Duisburger Strasse 5B, D-70376 Stuttgart, business address
Mittlerer Pfad 15, D-70597 Stuttgart identified by his American Passport No. Z
5965149
Mr Dr. Thomas O.J. Burkert is not acting in his own name but according to the
power of attorney dated 6th May 1996, which is attached to this notarial deed as
annex A, on behalf of
a) Mr Wemer A. Arnold, Dipl.-Ingenieur
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Wildensorger Hauptstrasse 8, D-96049 Bamberg
b) Mrs Petra Albrecht-Arnold
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Wildensorger Hauptstrasse 8, D-96049 Bamberg
c) Mr Willy Paul Albrecht
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Stauffenbergstrasse 43, D-96052 Bamberg
Mr. John Joseph Stinson is not acting in his own name but according to the
Secretary's Certificate and power of attorney, both dated 8th May 1996, which
are attached to this notarial deed as annex B, on behalf of
Mr Frank M. Ward, engineer,
27 Elm Street, Canton (MA), U.S.A.
The persons appearing requested the notarisation of the following notarial deed:
1. Mr Werner A. Arnold, is herein acting on his own behalf and as
a limited partner in BSC Arnold GmbH u. Co.
Softwareentwicklung und -beratung, and
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(ii) as the duly authorized managing director with power of sole
representation of ALBA Light Design GmbH, ALBA Speziallampen
Gesellschaft mit beschrankter Haftung, and Arnold GmbH;
2. Mr. Willy Paul AIbrecht, is herein
acting on his own behalf and as a limited partner in W. Albrecht GmbH u. Co
KG;
3. Mrs.Petra Albrecht-Arnold, is herein
acting on her own behalf and as a limited partner in W. Albrecht GmbH u. Co
KG and as a partner in W. Albrecht Grundstucksgesellschaft GmbH & Co GbR and
as a shareholder in Arnold GmbH, and as a shareholder in Alba Speziallampen
GmbH;
4. Mr. Frank M. Ward, Engineer, address 27 Elm Street, Canton, MA, U.S.A.
not acting on his own behalf but
(i) as a duly authorized member of the board of directors of ALBA
Speziallampen Holding GmbH i.G. with power of sole representation; and
(ii) as the duly authorized President with sole power of representation of
Chicago Miniature Lamp, Inc. (hereinafter "CML"), a corporation validly
existing under the laws of Massachusetts, with its seat in Canton,
Massachusetts.
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Agreement on the Sale and Transfer of Shares and Interests
in the ALBA/Albrecht Group
1. General Provisions
Whereas
(1) W. Albrecht GmbH u. Co KG, with its statutory seat in Bamberg, is a
partnership under German law, with a fully-paid partnership capital of
DM2,400,000.00, registered in the Commercial Registry of the Bamberg
Municipal Court under the number HRA 8480, the partners of which are
- ALBA Speziallampen Gesellschaft mit beschrankter Haftung as general
partner with a capital interest of DM 2,400.00,
- Willy Paul Albrecht as a limited partner
with a capital interest of DM 1,173,600.00,
- Petra Albrecht-Arnold
as a limited partner with a capital interest of DM 1,224,000.00;
and whereas
(2) Alba Speziallampen Gesellschaft mit beschrankter Haftung, with its
statutory seat in Bamberg, is a limited liability company under German law,
with a fully paid share capital of DM 60,000.00, registered in the
Commercial Registry of the Bamberg Municipal Court under the number HRB"
865, the only shareholder of which is
- Petra Albrecht-Arnold with shares in an aggregate amount of DM 60,000.00;
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and whereas
(3) Alba Light Design GmbH, with its statutory seat in Bamberg, is a limited
liability company under German law, with a fully paid share capital of DM
50,000.00, registered in the Commercial Registry of the Bamberg Municipal
Court under the number HRB 2812, the only shareholder of which is
- W. Albrecht GmbH u. Co KG with shares in an aggregate amount of
DM 50,000.00;
and whereas
(4) A & S Electric, spol.s.r.o. (GmbH) (CZ), with its statutory seat in Hranice
(RoBbach), is a limited liability company (spolecnost s rucenim omezenym)
under Czech law, with a fully paid share capital of Kc 100,000.00,
registered in the Commercial Registry at Plzen (Pilsen) under the
identification number 45 35 83 54, the shareholders of which are
- Ladislav Sejrek with a share capital of Kc 40,000.00; and
- W. Albrecht GmbH u. Co KG with a share capital of Kc 60,000.00.
A & S Electric spol.s.r.o. (GmbH) (CZ) is the owner of certain real estate,
which real estate is unencumbered;
and whereas
(5) W. Albrecht Grundstucksgesellschaft GmbH u. Co GbR, with its statutory seat
in Bamberg, is a partnership under German law, with a fully-paid partnership
capital of DM 1,800,000.00, the partners of which are
- ALBA Speziallampen GmbH as general partner with a capital interest of
DM 1,800.00; and
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- Petra Albrecht-Amold as a limited partner w hose liability is limited to
her partnership assets, with a capital interest of DM 1,798,200.00.
The GbR is the owner of real estate as contained in Volume 568 Page 23357 of
the Real Property Registry at the Municipal Court of Bamberg:
a) entry 6:
lot # 5983/6 Kirschackerstr. 9
Wohn- und Fabrikgebaude, Hofraum 50 ar 70 qm,
b) entry 8:
lot # 5973 Am Furstenwiesenweg
Fabrikgelande I ha 14 ar 62 qm,
a) entry # 9:
lot # 6042/2 Bei der KirschackerstraBe
Hof- und Gebaudeflachen 9 ar 40 qm,
encumbered by three mortgages in the aggregate amount of DM 5,000,000.00;
and whereas
(6) BSC Arnold GmbH & Co Softwareentwicklung und -beratung, with its statutory
seat in Bamberg, is a partnership under German law, with a fully-paid
partnership capital of DM 30,000.00, registered in the Commercial Registry
of the Bamberg Municipal Court under the number HRA 9385, the partners of
which are
- Arnold GmbH as general partner with no capital interest; and
- Wemer Arnold as a limited partner with a capital interest of DM
30,000.00;
and whereas
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(7) Arnold GmbH, with its statutory seat in Bamberg, is a limited liability
company under German law, with a share capital of DM50,000.00, DM 25,250.00
thereof being paid in, and the remaining part of DM 24,750.00 still open,
registered in the Commercial Registry of the Bamberg Municipal Court under
the number HRB 1266, the shareholders of which are
- Wemer Arnold with a share capital of DM 49,500.00; and
- Petra Albrecht-Arnold with a share capital of DM 500.00;
and whereas
(8) the aforementioned corporations and partnerships are hereinafter
collectively referred to as the "Acquired Entities";
and whereas
(9) Alba Speziallampen Holding GmbH i.G., hereinafter referred to alternatively
as "GmbH" or "Buyer," with its statutory seat in Bamberg, is a limited
liability, company in formation under German law, with a fully-paid share
capital of DM 50,000.00, not yet registered, the shareholders of which are
- Chicago Miniature Lamp, Inc., with a share capital of DM 49,500.00; and
- ALBA Speziallampen GmbH with a share capital of DM 500.00;
and whereas
(10) Willy Paul Albrecht, Petra Albrecht-Arnold, and Wemer Arnold, hereinafter
collectively referred to as the Sellers, intend to sell all their shares
and interests in the Acquired Entities, and Alba Speziallampen Holding GmbH
i.G. intends to acquire all these shares and interests;
and whereas
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(II) the Sellers have shareholders' and partners' loans in some of the Acquired
Entities and certain partners' accounts with the Acquired Entities some of
which have a positive balance and others have a negative balance which
shall also be subject to the purchase contemplated in this Agreement;
and whereas
(12) Wemer Arnold intends to offer his services to Alba Speziallampen Holding
GmbH i.G. for at least 3 years;
and whereas
(13) Willy Paul Albrecht is the owner of the patents, patents pending and
trademarks listed in the Schedule to roman numeral I para. (13), and he
intends to contribute and transfer these patents, patents pending and
trademarks to W. Albrecht GmbH u. Co KG for no specific consideration.
Willy Paul Albrecht holds no ownership or other interest in any other
patents, patents pending, trademarks or other intellectual property which
is related to the businesses of the Aquired Entities.
and whereas
(14) Petra Albrecht-Arnold holds no ownership or other interest in any patents,
patents pending, trademarks or other intellectual property which is
related to the businesses of the Aquired Entities.
and whereas
(15) Wemer Arnold holds no ownership or other interest in any patents, patents
pending, trademarks or other intellectual property which is related to the
businesses of the Aquired Entities.
and whereas
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(16) Alba Speziallampen GmbH intends to sell and transfer its interest in W.
Albrecht Grundstucksgesellschaft GmbH u. Co GbR to CML;
now, therefore, this being said, the parties enter into the covenants and mutual
agreements as indicated below:
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II. AGREEMENT ON SALE AND TRANSFER OF SHARES AND INTERESTS
Section I
Sale, TRANSFER, and Consent
(1) The Sellers sell their shares and interests as describ6d under roman numeral
I., above, with all related rights attaching and all of their shareholders'
and partners' loans, as well as all of their accounts (including the one
with the negative balance), to the Buyer. The shareholders' and partners'
loans and the partners' accounts sold under this paragraph (1) are sold on a
consolidated basis, wherein the Sellers warrant and represent that a
positive balance will exist upon sale to the Buyer.
(2) Alba Speziallampen GmbH hereby sells and transfers its interest in W.
Albrecht Grundstucksgesellschaft GmbH u. Co GbR to CML, which accepts such
sale and transfer.
(3) Petra Albrecht-Arnold and Werner Arnold hereby transfer their shares, loans
and accounts in Arnold GmbH to Buyer, who accepts such transfer.
(4) Willy Paul Albrecht and Petra Albrecht-Arnold hereby transfer their
interests in W. Albrecht GmbH u. Co KG and all of their partners' loans and
accounts with W. Albrecht GmbH u. Co. KG to Buyer by way of special
succession (Sonderrechtsnachfolge), who accepts such transfer. Internally,
such transfer shall become effective as of the Takeover Date, externally,
the transfer shall become effective only upon entry of the Buyer as a
limited partner by way of special succession (im Wege der
Sonderrechtsnachfolge) in the Commercial Register. Sellers shall fully
cooperate with Buyer in any filing with the Commercial Register to be
effected only after Closing.
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(5) Petra Albrecht-Arnold hereby transfers her interest in W. Albrecht
Grundstucksgesellschaft GmbH & Co GbR and all of her partners' loans and
accounts with W. Albrecht Grundstucksgesellschaft GmbH & Co. GbR to the
Buyer, who accepts such transfer.
(6) Petra Albrecht-Arnold hereby transfers her share, loans and accounts in Alba
Speziallampen Gesellschaft mit beschrankter Haftung to Buyer, who accepts
the transfer.
(7) Wemer Arnold hereby transfers his interest in BSC Arnold GmbH u. Co
Softwareentwicklung und -beratung and all of his partners' loans and
accounts with BSC Arnold GmbH u. Co. Softwareentwicklung und -beratung to
Buyer by way of special succession (Sonderrechtsnachfolge), who accepts the
transfer. Internally, such transfer shall become effective as of the
Takeover Date, externally, the transfer shall become effective only upon
entry of the Buyer as a limited partner by way of special succession (im
Wege der Sonderrechtsnachfolge) in the Commercial Register. Sellers shall
fully cooperate with Buyer in any filing with the Commercial Register.
(8) Any consents to the transfer of shares and interests necessary under the
pertinent Articles of Association have been given and are confirmed hereby.
(9) Willy Paul Albrecht hereby contributes and transfers the patents, patents
pending and trademarks, together with any licences granted to the Aquired
Entities indicated under roman numeral 1, para. (13) above to W. Albrecht
GmbH u. Co KG, and W. Albrecht GmbH u. Co KG accepts such contribution and
transfer.
Willy Paul Albrecht shall deliver to the Buyer on the Closing Date proper
forms of transfer and assignment, duly executed, for all the above mentioned
rights. Willy Paul Albrecht further agrees to provide such other
assigrunents, notices, and forms after the Closing as shall be necessary or
appropriate to effectuate and record such transfers to Buyer.
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(10) Buyer and Sellers agree that the shareholders'and partners' loans as well
as any partners' accounts with the Acquired Entities are sold on a
consolidated basis and that
(i) all positive balances as of the Takeover Date due to Sellers shall be
transferred to the benefit of Buyer and the Sellers shall not be entitled
to claim any amounts under such positive accounts after the execution of
this Agreement and
(ii) save Section 1 para. (1) Sentence 2, all negative balances as of the
Takeover Date due to any of the Acquired Entities shall be claimed by the
Acquired Entities against the Buyer after the execution of this Agreement
and the Acquired Entities and the Buyer hereby release the Sellers from any
claims that might arise of, or in connection with, such negative balances,
and the Sellers hereby accept this release.
Section 2
PURCHASE PRICE, PAYMENT OF PURCHASE PRICE
(1) The overall purchase price for the shares and interests, shareholders' and
partners' loans and partners' accounts and the intellectual property sold
shall be DM 9,700,000.00 (nine million seven hundred thousand German Marks)
payable in the following manner:
a) 90 percent by the transfer of funds into a bank account, to be specified
by the Sellers, at Closing;
b) 10 percent by the transfer of funds into a bank account, to be specified
by the Sellers, within 30 days after Closing (the "Post Closing
Payment").
(2) The overall purchase price shall be allocated as follows:
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a) an amount of DM 49,500.00 to Werner Arnold's share of par value DM 49,500.00
in Arnold GmbH,
b) an amount of DM 500.00 to Petra Albrecht-Arnold's share of par value DM
500.00 in Arnold GmbH,
c) an amount of DM 250,000.00 to Werner Arnold's interest of par value DM
30,000.00 in BSC Arnold GmbH u. Co Softwareentwicklung und -beratung,
d) an amount of DM 6,000,000.00 to Petra Albrecht-Arnold's interest of par
value DM 1,798,200.-- in W. Albrecht Grundstucksgesellschaft GmbH & Co GbR,
e) an amount of DM 60,000.00 to Petra Albrecht-Arnold's share of par value DM
60,000.00 in Alba Speziallampen Gesellschaft mit beschranker Haftung,
f) an amount of DM 1,631,600.00 to Petra Albrecht-Arnold's interest of par
value DM 1,224,000.-- in W. Albrecht GmbH u. Co KG,
g) an amount of DM 1,708,400.00 to Willy Paul Albrechfs interest of par value
DM 1,736,000.-- in W. Albrecht GmbH u. Co KG.
No additional consideration shall be allocated to shareholders' and partners'
loans and partners' accounts and intellectual property rights.
As an additional part of the purchase price Buyer agrees and commits that it
will bear and pay the attorneys' fees up to DM 300,000.00 plus V.A.T. of
Sellers' attorneys Hennerkes, Jeschke, Kirchdorfer & Partner, Stuttgart,
Germany. Immediately after Closing, the attorneys will send a bill of their
fees showing the net amount, the V.A.T. attributable into the net amount, and
the gross amount to the Buyer, and the Buyer will promptly pay the gross amount
to the attorneys as shown in their bill. After full payment of the billed
amount
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the Buyer shall have fully performed, and be released from, its duty to pay
under this paragraph.
(3) Should the consolidated equity of the Acquired Entities as determined in the
Takeover Balance Sheets according to Section 4 of this agreement fall short
of the consolidated equity of these entities as determined in the 1995
Balance Sheets the shortfall, to the extent that it exceeds DM 2,000,000.00
shall be deducted from the purchase price.
(4) The purchase price for the interest of Alba Speziallampen GmbH in W.
Albrecht Grundstucksgesellschaft GmbH u. Co GbR sold to CML shall be DM
9,000.00 and such amount shall be transferred to a bank account specified by
Alba Speziallampen GmbH.
Section 3
TAKEOVER DATE, EXECUTION DATE, CLOSING
(1) The Takeover Date shall be May 1, 1996. Economic ownership in the shares
and interests shall change as of the Takeover Date. Dividends distributed
after Takeover Date by the acquired corporate entities shall inure to the
benefit of Buyer. Profits of the Acquired Entities made betwen December 31,
1995 and the Takeover Date shall belong to the Buyer, and taxes attributable
to these profits shall be borne by the Buyer. For the purposes of this
paragraph, the profits will be calculated by Schitag Ernst & Young on the
basis of the 1995 Balance Sheets and the Takeover Balance Sheets, and an
agreed tax rate of 50% shall be applied irrespective of the ultimate tax
liability of the Sellers.
(2) Execution Date shall be the date of the notarization of this Agreement.
(3) Closing shall be within 15 days of the execution of this Agreement, or
sooner, if the parties agree, but in no event before the execution of a
service agreement
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between Werner Arnold and the Buyer. Closing shall be contingent on the
simultaneous closing on the acquisition of all shares of Alba Lamps, Inc.
and Alba Technology (M) Sdn. Bhd., Malaysia ("Related Agreements").
(4) Once this Agreement and the Related Agreements have been closed on, the
parties shall give each other written confirm to this effect.
Section 4
Takeover Balance Sheets
(1) The parties charge Schitag Ernst & Young (and/or affiliated auditing firms,
collectively referred to as "Schitag Ernst & Young"), to present the parties
on or before May 31, 1996, with the audited consolidated Balance Sheets and
inventory counts of the Acquired Entities upon December 31, 1995, ("1995
Balance Sheets") and upon Takeover Date ("Takeover Balance Sheets"). The
costs for the preparation and the confirmation of the 1995 Balance Sheets
and the Takeover Balance Sheets are to be borne by the Buyer.
(2) The 1995 Balance Sheets and the Takeover Balance Sheets are to be presented
and confirmed on the basis of GAAP applicable in the country of the audited
Acquired Entity, under the preservation of balance continuity, on a
consolidated basis, on a "going concern" basis and without a view to the
transaction contemplated by this Agreement.
(3) Before finalizing the preparation and confirmation of the 1995 Balance
Sheets and the Takeover Balance Sheets Schitag Ernst & Young will present
drafts to the Buyer and the Sellers and explain how they have found their
results and particularly how they have exercised any discretion available
under the applicable GAAP. The Sellers may raise reasonable objections to
the drafts, and Sellers and Buyer shall agree on such objections.
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(4) If the Sellers and the Buyer cannot agree on Sellers' objections according
to para. 3 above, Schitag Ernst & Young shall finalize their balance sheets
and Sellers shall appoint another auditing firm to present the Sellers'
version of the same balance sheets under the same rules as outlined
hereabove in this Section 4 and at their own cost. If the two auditors
cannot agree on the outcome of these examinations, the dispute shall
finally be settled by an Arbitrator who must be an auditor certified under
the laws of Germany (the "Arbitrator") and shall be appointed by both
parties. In case that the parties cannot agree on the Arbitrator, the
Chamber of Commerce of Bamberg shall appoint the Arbitrator. The Arbitrator
shall also determine who of the parties shall bear the fees and costs of the
arbitration (including the reasonable attorneys' fees) taking into account
who of the parties has won or lost, or partially won or lost, the
arbitration.
(5) For purposes of determining the shortfall of consolidated equity to be paid
by the Sellers according to Section 2 para. (3) of this Agreement, the
parties agree that Buyer shall be entitled to any amount he would be
entitled to under Section 2 para. (3) of this Agreement if the balance
sheets of the Sellers' auditor were to be applied. The parties further
agree that after Schitag Ernst & Young and the Sellers' auditor have agreed
on a matter or after the Arbitrator has ruled on the dispute, according to
Section 4 para. (4) of this Agreement the Buyer shall be entitled to the
amount he is entitled to under Section 2 para. (3) of this Agreement after
taking into account the agreement of the auditors or the ruling of the
Arbitrator. If the amount is more than already paid by the Sellers to the
Buyer according to this paragraph, the Sellers shall pay the balance due to
the Buyer. If the amount is less than already paid by the Sellers to the
Buyer according to this paragraph, the Buyer shall pay the balance due to
the Sellers.
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Section 5
WARRANTIES AND REPRESENTATIONS (ZUSICHERUNGEN)
(1) The Sellers warrant and represent, that upon the Execution Date of this
Agreement and at the Closing, the assertions made under roman numeral 1. of
this Agreement are correct, the shares and interests are fully-paid unless
otherwise indicated in roman numeral 1. of this Agreement, non-assessable,
not encumbered with third parties' rights or options, at the Sellers' free
disposal, and that no repayments on such shares and interests have been
made.
(2) The Sellers warrant and represent, that upon the Execution Date of this
Agreement and at Closing
a) the balance sheets and profit & loss statements of the Acquired
Entities for the fiscal years 1994 and 1995 (hereinafter "Financial
Statements") have been determined under principles of the pertinent
national GAAP (German GAAP for all Acquired Entities except for A & S
Electric, spol.s.r.o. (GmbH), whose financial statements have been
determined under principles of Czech GAAP), and that such financial
statements are a reflection of the actual relations in the asset and
financial situation of the Acquired Entities;
b) the fixed and current assets shown in the Financial Statements were/are
the property of the Acquired Entities, were/are not encumbered
with the rights of third parties (except for customary retained rights
(,,Eigentumsvorbe-halte") given in the normal course of business) and
included all economic goods that were necessary for the operation of
the Acquired Entities;
c) the fixed assets are in a proper and workable condition and the
necessary replacements and repair have been carried out;
d) the Financial Statements show all pension and fringe benefit
obligations and all liabilities in accordance with the pertinent
national GAAP;
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e) the Financial Statements include sufficient provision for all tax
liabilities accruing to the Acquired Entities for the periods through
December 31, 1995;
f) that the Schedule to roman numeral I. para. (13) and the
representations made in roman numeral I. pares. (1 3), (14) and (1 5)
are correct;
g) the execution and implementation of this Agreement does not entail the
revocability of government grants, subsidies or loans.
3) The Sellers further warrant and represent that in the time period from
December 31, 1995 through the Closing:
a) the Acquired Entities have conducted business in a reasonable and
ordinary course, and will continue to do so, and have engaged in no
extraordinary transactions (in particular additional borrowings or
liabilities of any kind), nor will they do so;
b) the scope and content of the business activities of the Acquired
Entities have not substantially varied from those of the preceding
fiscal year, nor will they do so;
c) the fixed and current assets of the Acquired Entities have been and/or
will be maintained and supplemented under the principles of reasonable
and ordinary business behavior, and the amount of the claims, which
needs to be reserved (Forderungswertberichtigungen), has not risen and
is not rising and new pension obligations have been or are being
undertaken only in the usual scope;
d) no extraordinary events have occurred or are threatened to occur which
could deleteriously affect the current or future business activities or
the economic outcome of the Acquired Entities, such as a price
reduction of more than 10 percent;
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e) no repayments on shareholders' or partners' loans have been made except
of the payment of the first installment in the amount of DM 30,000.00 on
a loan given by Willy Paul Albrecht to A & S Electric, Spol.s.r.o.
(GmbH) (CZ) and due on December 31, 1995.
(4) The Sellers finally warrant and represent (sichern zu), that upon the
Closing, as far as not disclosed in the Schedule to Section 5 para. 4 and
in this Agreement,
a) the Acquired Entities are not bound to agreements with the Sellers or
any persons or entities related to the Sellers;
b) the Acquired Entities are not bound by contracts with managing
directors, employees, counsel or other persons which contemplate a
yearly remuneration of more than DM 100,000.00 gross except of fringe
benefits and car use, or any turnover or profit participation;
c) the Acquired Entities are not bound on any lease agreements, rental
agreements or other agreements which have a term of more than one year
or would lead respectively to a yearly expense of more than DM
100,000.00 gross (except of inter-company agreements);
d) the Acquired Entities are not bound as licensors or as licensees on
agreements regarding intellectual property or other unprotected
knowledge or inventions (know-how), and are, or will be at closing, the
rightful owners of all patents, patents pending, trademarks and other
intellectual property used in their business operations.
e) the Acquired Entities are not bound by any sales agents or distribution
contracts;
f) the Acquired Entities are not bound by agreements which can be
cancelled, changed or supplemented by third parties as a result of the
sale of the shares and/or interests;
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g) the Acquired Entities are in possession of all government/administrative
permits and allowances, that are necessary to the continuation of the
operation of the businesses of the Acquired Entities; these permits and
allowances have not been cancelled or rescinded and no situation is
present which gives reason to believe that such rescission or
cancellation of these would happen and the operation of the businesses
of the Acquired Entities is being conducted in accordance with these
permits and allowances; the Acquired Entities do not infringe, to the
actual or constructive knowledge of the Seller, any third parties'
rights under the law or under any agreement;
h) the Acquired Entities are not engaged in any processes before a court or
administrative agency nor in any arbitration proceedings with an amount
in controversy of over DM 10,000.00; nor is any such process or
proceeding threatened or impending;
i) the Acquired Entities are not bound by any agreements which could
reasonably be of interest for the Buyer as far as the businesses of the
Acquired Entities are concerned;
j) the Acquired Entities have fulfilled all their contractual and public
obligations including tax filings and payments;
k) all products manufactured or sold before the Takeover Date by the
Acquired Entities are in accordance with the applicable technical
regulations and with the latest product standards, and no facts,
circumstances, or conditions exist which are reasonably probable to give
rise to product recall and the Acquired Entities are not anticipating
such product recalls within the next three years;
l) the Acquired Entities' insurance coverage extends to damages relating to
products sold on or before the Closing Date, if such damages are raised
within three years after Closing;
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m) there are no silent partnership agreements between the Acquired Entities
and the Sellers or third parties and that the thus existing silent
partnerships have been converted to equity at no cost for the respective
Acquired Entities;
n) all members of Supervisory Boards of the Acquired Entities shall have
resigned, evidenced by resigning letters, unless requested otherwise
within ten days after the execution of this Agreement;
o) the quantities contained in the inventory counts of the Acquired
Entities as of the Takeover Date are correct;
p) the employees currently with the Acquired Entities, the periods of the
contracts concluded with such employees and their major remuneration
entitlements and pension rights are correctly reflected in Schedule to
Sectioti 5 para. (4) and no claims under the Law on Employee Inventions
(Arbeitnehmererfindergesetz) have been raised.
q) the Acquired Entities own neither land nor buildings other than that
described under roman numeral I. paras. (4) and (5) and that such land
and buildings are not environmentally contaminated, and that the
assessed value (Einheitswert) according to the most recent Taxation
Notice of Assessment (Einheitswertbescheid) of January 1, 1987,
(Wertfortschreibung auf 1.1.87), and unchanged since then is DM
1,426,800.00 in the aggregate.
r) the indebtedness secured by the mortgages described under roman numeral
I. para. 5 (in the aggregate amount of DM 5,000,000.00) are included in
the bank indebtedness of approximately DM 7,587,000.00 reflected on the
December 31, 1995 financial statements.
- 22 -
SECTION 6
LIABILITY
(1) Should one of the warranties and/or representations made in Section 5 of
this Agreement remain fully or partially unfulfilled, the Buyer can reduce
the purchase price in the amount of the value of the breach, as long as the
Buyer has demanded in written form from the Sellers, that within ten
calendar days of receipt of the demand the Sellers put the Buyer in such a
position as if the warranty were completely fulfilled and this deadline, for
whatever reason, expires having borne no fruit. Should the purchase price be
reduced as set forth above, the Post Closing Payment shall be reduced by the
amount of such reduction in the purchase price, and should such reduction
exceed the unpaid amount of the Post Closing Payment or should the Post
Closing Payment have been previously made, then the Sellers shall remain
liable to the Buyer for the amounts not satisfied and the Sellers shall make
prompt payment of said amounts.
(2) Should any of the warranties and/or representations in Section 5 paras 2
through 4 of this Agreement remain partially or fully unfulfilled, the Buyer
can renounce its right to a reduction of the purchase price and instead
demand that the Acquired Entities be put in such a position as it would be
if the warranty had been fulfilled.
(3) The claims of the Buyer under paras. 1 and 2 of this Section can only be
raised if they exceed a value of DM 100,000.00 in the aggregate.
- 23 -
SECTION 7
DEFENSE OF CLAIMS
(1) The Buyer is obligated to immediately notify the Sellers, if a third party
makes or threatens to make any claim that could lead to the liability of the
Sellers under Section 6 of this Agreement. The Buyer must give the Sellers
access to all relevant documentation and all relevant information and must
allow the Sellers to view the books and written documents of the Acquired
Entities insofar as this is necessary to make a judgement on the
righteousness of any claim that has been made or threatened.
(2) The parties will inform one another regarding the defense of claims under
para. 1. The Sellers must be given the reasonable opportunity to participate
in the defense of these claims. The Buyer must permit the Sellers to defend
the claims in their own names and at their own cost, if the Buyer,
regardless of reason, is not prepared to take up the defense of claims
himself, and the defense of claims does not conflict with the Buyer's
commercial interests.
(3) Should the Buyer not notify the Seller as provided for in paras. (1) and (2)
of this Section, the Sellers shall be released from their liability under
Section 6 of this Agreement with respect to such claims, unless the Buyer
can prove that his omission was immaterial for the defense of such claims.
SECTION 8
LIMITATION PERIODS
(1) The claims of the Buyer which are based on one of the warranties and/or
representations made in Section 5 of this Agreement expire (erloschen),
unless otherwise specified in para. 2 of this Section, six months from the
point in
- 24 -
time, at which the Buyer has come into the knowledge of the unfulfillment of
a warranty or representation, and at the latest June 30, 1997.
(2) The claims of the Buyer which are based on the unfulfillment of a warranty
or representation in Section 5 para. 1 of this Agreement or on other
grounds not covered by this Section 8 and referred to in Section 9 of this
Agreement expire five years after the Closing.
(3) The expiration of claims shall be prevented by a first written notification
of claim (setting forth in reasonable detail the facts and circumstances of
the cause of the claim) made to the Sellers. In this case, claims lapse
(verjdhren) one year after the written notice of claim.
SECTION 9
LIMITATION OF LIABILITY
The Buyer can, insofar as not otherwise explicitly provided for in this
Agreement, bring no claim against the Sellers, regardless of reason, for the
breach of contractual or pre-contractual obligations or obligations under law
unless the Sellers, the Sellers' management or employees breached any such
obligation intentionally or the Sellers or the Sellers' management breached any
such obligation with gross negligence.
In any event, the liability of the Sellers under this Agreement, especially
Sections 6 and 9, shall be limited to the purchase price.
- 25 -
SECTION 10
NON-COMPETE AGREEMENT
(1) The Sellers are obligated not to compete with the Acquired Entities,
directly or indirectly, on any substantive or geographical market in Europe,
on which the Acquired Entities are doing business upon the execution of this
Agreement, for a period of five years after the disassociation of Werner
Arnold with the Buyer, the Acquired Entities, or CML. This obligation not
to compete does not, however, prevent the Sellers from acquiring and/or
holding passive minority investments in publicly traded shares (including
those of the Buyer and/or CML).
(2) The Sellers warrant, that at the time of Closing, they have no other
businesses or participations in other corporations or partnerships (except
for participations in Alba Lamps, Inc. and Alba Technology (M) Sdn. Bhd.,
Malaysia, which shall be sold to the Buyer in a separate deed), other than
those contemplated by this Agreement, shares in CML or the Buyer, and a 60%
share in Witte GmbH, Katzhutte (Thuringen), which is a manufacturer of
metal bases for lamps and does other assembly work.
(3) The Sellers will pay liquidated damages in the amount of DM 1,000,000.00 for
every breach of the non-compete agreement. By continuing breach of the
noncompete agreement, every successive calendar month shall be deemed a
separate violation. The proof of an actual damage greater than the
liquidated damages shall not be barred.
(4) Any claims arising out of or in connection with any violation of the
Sellers' duties and obligations under this Section 10 shall be fmally barred
if the Buyer does not notify the Seller of any such claim within a period of
three months of the time that the Buyer first learns of such a violation of
this non-compete agreement.
- 26 -
SECTION 11
NAME OF THE ACQUIRED ENTITIES AND BUYER
The Acquired Entities and Buyer have the right to use any reference to
the names Albrecht, Arnold, and Alba, in their corporate or partnership
names and logos at their full discretion, provided, however, that such
use shall not violate public policy.
SECTION 12
CONFIDENTIALITY, PRESS RELEASES, INFORMATIONAL RIGHTS
(1) The parties are obligated to keep the substance of this Agreement,
especially the purchase price, strictly confidential and inaccessible to
third parties, other than their respective advisors (lawyers, tax advisors,
auditors) and unless required by law or necessary under the applicable tax
laws.
(2) The parties shall agree on the full scope of any declarations which they
intend to make public regarding the execution of this Agreement.
(3) The Sellers shall assure that the Acquired Entities, upon execution of this
Agreement, will give the Buyer and the Buyer's employees access (together
with representatives of Sellers if requested so by Sellers) to the Acquired
Entities' property, access to books and documents of the Acquired Entities
as well as access to Acquired Entities workers, during normal working hours,
in order that the Buyer may inform itself of the Acquired Entities' legal,
technical and financial/economic factors. The Sellers shall also assure
that the Acquired Entities continually inform the Buyer of all essential
business matters of the Acquired Entities.
- 27 -
SECTION 13
ACCESS TO BUSINESS DOCUMENTS
The Buyer shall assure that the Sellers and the Sellers' counsel obligated to
professional confidentiality will be given on demand within a reasonable scope
and reasonable time the opportunity to examine the books and records of the
Acquired Entities relating to the time period up through the Closing, and that
the Buyer will prepare the necessary copies of these records insofar as such is
necessary to enable the Sellers the ordinary, timely fulfillment of the Sellers'
tax or other legal/administrative obligations.
SECTION 14
EFFECTIVENESS OF THIS AGREEMENT
This Agreement - with the exception of the provisions of roman numeral II
Section 1 para. (9), Section 4, and Section 12 - which become effective
immediately - becomes effective at Closing, if the Closing conditions are
fulfilled.
SECTION 15
NOTARIAL AND OTHER STATUTORY FEES, COSTS
The notarial and other statutory fees which are or become applicable as a result
of the execution and implementation of this Agreement shall be borne by the
Buyer. Each party shall bear the costs of its own counsel, except as provided
for under Section 2 para. (2).
- 28 -
SECTION 16
FEDERAL CARTEL OFFICE ANNOUNCEMENT
The parties agree that the prospective acquisition is not subject to examination
by the Bundeskartellamt due under Sections 23 et seq Anti-Trust Code (Gesetz
gegen Wettbewerbsbeschrankungen).
SECTION 17
NOTICES, KNOWLEDGE, JOINT AND SEVERAL LIABILITY
(1) Notices required to be given to or by the Sellers or any one of the Sellers
shall be effective when made to or by Werner Arnold, Wildensorgerstr. 8,
96049 Bamberg, Germany.
(2) Notices required to be given to or by the Buyer shall be effective when made
to or by the President of Chicago Miniature Lamp, Inc., 500 Chapman Street,
Canton, MA 02021, USA.
(3) Constructive knowledge shall be defined as that knowledge that a reasonable
person would be deemed to have under similar circumstances.
(4) Actual or constructive knowledge of any relevant circumstance of any one
Seller shall be attributed to any and all other Sellers.
(5) Actual or constuctive knowledge of Werner Arnold shall not be attributable
to the Buyer on the ground of his being managing director of Buyer.
(6) Sellers shall be jointly and severally liable for all obligations deriving
from this Agreement, except that Werner Arnold shall not be liable for any
obligation incumbent upon Willy Paul Albrecht and/or Petra Albrecht-Amold,
and Willy
- 29 -
Paul Albrecht and/or Petra Albrecht-Arnold shall not be liable for any
obligation incumbent on Werner Arnold.
SECTION 18
TAXES, TAX AUDIT
(1) The Acquired Entities have filed all tax returns in a due and proper manner.
All taxes due up to the Takeover Date and other commercial duties ("sonstige
betriebliche Abgaben") including tax payments in advance and social security
payments have been duly and properly paid or provisions therefor have been
made in the respective Takeover Balance Sheets.
(2) In the event that additional payments are required in respect of the period
up until the Takeover Date as the result of a tax audit, the Sellers shall
indemnify the Acquired Entities in respect of any sum paid by the Acquired
Entities in respect of such additional payments together with all costs,
claims, loss and damage arising therefrom.
(3) In the event that the tax authorities attribute to the Sellers or the
Acquired Entities, regardless of the actual or legal reasons therefor, any
hidden dividends or do not recognize expenses in respect of transactions up
until the Takeover Date, the Sellers shall indemnify the Acquired Entities
in respect of any sum paid by the Acquired Entities in respect of such
additional payments together with all costs, claim, loss and damage arising
therefrom.
(4) The Sellers shall be entitled to take part in any external tax audit
("steuerliche AuBenprufung") which relates to the periods before the
Takeover Date. In case of a dispute with the tax authorities on matters that
might lead to tax claims against the Sellers or claims by the Buyer against
the Sellers under this Section 18 of this Agreement, the Sellers may, at
their discretion, risk, and
- 30 -
cost, oppose to such matters and file the appropriate appeals with the
competent tax authorities and/or tax courts unless the Buyer opposes to such
matters and/or files the appropriate appeals with the competent tax
authorities and/or tax courts. In the case that the Buyer makes an
opposition or filing as mentioned above, the Sellers have to be informed by
the Buyer on the current status of the proceedings and are entitled to
participate as far as legally possible in such proceedings and/or make
proposals as to the facts, arguments, and objections that might be raised as
a defense against tax claims. Should the Buyer not accept the Sellers'
proposals the Buyer shall save harmless the Sellers for any loss, damage, or
claims they suffer as a result of the final settlement, order or judgment in
such proceedings unless the Buyer can prove that Sellers' proposal would not
have avoided such loss, damage or claims. Should the Buyer accept the
Sellers' proposals the Sellers shall save harmless the Buyer for any loss,
damage, or claims it suffers as a result of the final settlement, order or
judgment in such proceedings.
(5) Personal income taxes of the Sellers shall be borne by the individual Seller
or Sellers.
(6) External tax audits shall leave the 1995 Balance Sheets and the Takeover
Balance Sheets under this Agreement unaffected.
SECTION 19
SURETYSHIP OF CML
CML shall serve as a surety on first demand for the purchase-price obligations
of the Buyer under this Agreement. In case that the Sellers have and/or will
incur any liability as shareholder and/or managing director and/or person acting
(including refraining from acting) on behalf or in the interest of the Buyer for
any activities of, and/or attributable to, the Buyer, particularly arising out
of or in connection with the
- 31 -
establishment of the Buyer (the "Liability"), CML shall release the Sellers from
any such Liability and save the Sellers harmless from and against any claims,
demands, actions, causes of action, damage, loss, deficiency, cost (including
reasonable attorneys' fees), liability and expense which may be made or brought
against the Sellers or which the Sellers may suffer or incur as a result of, in
respect of or arising out of such Liability.
SCETION 20
PARTIAL INVALIDITY, FORM OF WRITINGS, VENUE,
APPLICABLE LAW, LETTER OF INTENT
(1) Should any provision of this Agreement become ineffective or unenforceable,
the validity of this Agreement shall not otherwise be affected. The
ineffective or unenforceable provision shall be substituted with an
effective and enforceable provision, which approaches the economic result of
the ineffective or unenforceable provision as far as possible.
(2) Changes and supplementations of this Agreement require notarized form.
(3) This Agreement shall, by the extent permitted by law, be subject to the
exclusive jurisdiction (ausschlie,B1iche Gerichtsbarkeit) of the court for
commercial matters (KAMMERFUR Handelssachen) of Bamberg.
(4) The law applicable to this Agreement is the law of the Federal Republic of
Germany.
(5) The Letter of Intent between the parties of April 4, 1996, shall be deemed
consummated by the execution of this Agreement.
The Notary has instructed the parties as to the legal implications of this
document.
IN WITNESS THEREOF, this notarial deed as well as the annexes were read aloud to
the persons appearing, approved by them and signed by each of them before me,
the notary public, who also signed and fixed the official seal.
BASLE, this 15. (fifteenth) May 1996 (nineteen hundred and ninety-six)
[NOTARY SEAL APPEARS HERE] /s/
/s/
/s/
Allg.Prot.Nr.44/1996
--------------------
Dates Referenced Herein and Documents Incorporated by Reference
| Referenced-On Page |
|---|
| This ‘8-K’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| | 6/30/97 | | 24 |
| Filed on: | | 6/14/96 |
| | 5/31/96 | | 15 |
| For Period End: | | 5/30/96 | | | | | | | 8-K/A |
| | 5/1/96 | | 14 |
| | 4/4/96 | | 31 |
| | 12/31/95 | | 14 | | 21 |
| List all Filings |
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