SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): December 13, 2002
VISHAY INTERTECHNOLOGY, INC.
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(Exact Name of Registrant as Specified in Charter)
Delaware 1-7416 38-1686453
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(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
63 Lincoln Highway, Malvern, Pennsylvania 19355-2120
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(Address of principal executive offices)
(Zip Code)
Registrant's telephone number, including area code: (610) 644-1300
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N/A
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(Former name or former address, if changed since last report)
Item 2. Acquisition or Disposition of Assets.
On December 13, 2002, Vishay Intertechnology, Inc. completed the acquisition of
BCcomponents Holdings B.V., a leading manufacturer of passive components with
operations in Europe, India and the Far East. The product lines of BCcomponents
include linear and non-linear resistors; ceramic, film and aluminum electrolytic
capacitors; and switches and trimming potentiometers.
Vishay acquired the outstanding shares of BCcomponents in exchange for ten-year
warrants to acquire 7,000,000 shares of Vishay common stock at an exercise price
of $20.00 per share and ten-year warrants to acquire 1,823,529 shares of Vishay
common stock at an exercise price of $30.30 per share.
In the transaction, outstanding obligations of BCcomponents, including
indebtedness and transaction fees and expenses, in the amount of approximately
$224 million were paid or assumed. Also, $105 million in principal amount of
BCcomponents' mezzanine indebtedness and certain other securities of
BCcomponents were exchanged for $105 million principal amount of floating rate
unsecured loan notes of Vishay due 2102. The Vishay notes bear interest at LIBOR
plus 1.5% through December 31, 2006 and at LIBOR thereafter. The interest note
could be further reduced to 50% of LIBOR after December 31, 2010 if the price of
Vishay common stock trades above a specified target price, as provided in the
notes. The notes are subject to a put and call agreement under which the holders
may at any time put the notes to Vishay in exchange for 6,176,471 shares of
Vishay common stock in the aggregate, and Vishay may call the notes in exchange
for cash or for shares of its common stock after 15 years from the date of
issuance. Vishay has granted registration rights for the warrants and the shares
of common stock issuable in respect of the warrants and the notes.
Item 5. Other Events.
On December 13, 2002, Vishay entered into an amendment to its revolving bank
credit facility in which the aggregate commitment under this facility was
reduced from $660 million to $500 million, which amount is subject to increase
under certain circumstances, and certain changes were made to other terms of the
facility. A copy of the amendment is filed as an exhibit to this report.
Item 7. Financial Statements and Exhibits.
(a) Financial Statements of Business Acquired
The financial statements required by this Item 7(a) will be filed by
amendment to this Current Report on Form 8-K.
(b) Pro Forma Financial Information
The pro forma financial information required by this Item 7(b) will be
filed by amendment to this Current Report on Form 8-K.
(c) Exhibits.
Exhibit No. Description
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2.1 Share Sale and Purchase Agreement between Phoenix Acquisition
Company S.ar.l; Other Investors (as defined); Mezzanine
Lenders (as defined); Vishay Intertechnology, Inc.; Vishay
Europe Gmbh; and BCcomponents International B.V., dated as of
November 10, 2002
2.2 Amendment to the Share Sale and Purchase Agreement between
Phoenix
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Acquisition Company S.ar.l; Other Investors (as defined);
Mezzanine Lenders (as defined); Vishay Intertechnology, Inc.;
Vishay Europe Gmbh; and BCcomponents International B.V., dated
as of December 4, 2002
4.1 Warrant Agreement between Vishay Intertechnology, Inc. and
American Stock Transfer & Trust Co., dated December 13, 2002
4.2 Note Purchase Agreement between Vishay Intertechnology, Inc.
and Subscribers (as defined), dated December 13, 2002
4.3. Note Instrument by Vishay Intertechnology, Inc., dated as of
December 13, 2002
4.4 Securities Investment and Registration Rights Agreement by and
among Vishay Intertechnology, Inc. and the Original Holders
defined therein, dated as of December 13, 2002
4.5 Put and Call Agreement between Vishay Intertechnology, Inc.
and the Initial Holders (as defined), dated as of December 13,
2002.
4.6. Second Amendment to Amended and Restated Vishay
Intertechnology, Inc. Long Term Revolving Credit Agreement and
Consent, made as of December 13, 2002, by and among Vishay
Intertechnology, Inc. the Permitted Borrowers (as defined),
Comerica Bank and the Lenders signatory thereto and Comerica
Bank as administrative agent.
99.1 Press Release from Vishay Intertechnology, Inc., dated as of
December 16, 2002
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
VISHAY INTERTECHNOLOGY, INC.
/s/ Avi D. Eden
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By: Avi D. Eden
Executive Vice President and General Counsel
Date: December 23, 2002
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EXHIBIT INDEX
Exhibit No. Description
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2.1 Share Sale and Purchase Agreement between Phoenix Acquisition
Company S.ar.l; Other Investors named therein; Mezzanine
Lenders (as defined); Vishay Intertechnology, Inc.; Vishay
Europe Gmbh; and BCcomponents International B.V., dated as of
November 10, 2002
2.2 Amendment to the Share Sale and Purchase Agreement between
Phoenix Acquisition Company S.ar.l; Other Investors as named
therein; Mezzanine Lenders (as defined); Vishay
Intertechnology, Inc.; Vishay Europe Gmbh; and BCcomponents
International B.V., dated as of December 4, 2002
4.1 Warrant Agreement between Vishay Intertechnology, Inc. and
American Stock Transfer & Trust Co., dated December 13, 2002
4.2 Note Purchase Agreement between Vishay Intertechnology, Inc.
and Subscribers (as defined), dated December 13, 2002
4.3. Note Instrument by Vishay Intertechnology, Inc., dated as of
December 13, 2002
4.4 Securities Investment and Registration Rights Agreement by and
among Vishay Intertechnology, Inc. and the Original Holders
(as defined), dated as of December 13, 2002
4.5 Put and Call Agreement between Vishay Intertechnology, Inc.
and the Initial Holders (as defined), dated as of December 13,
2002.
4.6. Second Amendment to Amended and Restated Vishay
Intertechnology, Inc. Long Term Revolving Credit Agreement and
Consent, made as of December 13, 2002, by and among Vishay
Intertechnology, Inc. the Permitted Borrowers (as defined),
Comerica Bank and the Lenders signatory thereto and Comerica
Bank as administrative agent.
99.1 Press Release from Vishay Intertechnology, Inc., dated as of
December 16, 2002
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Exhibit 2.1
THIS SHARE SALE AND PURCHASE AGREEMENT is made on 10 November 2002
BETWEEN:
(1) PHOENIX ACQUISITION COMPANY S.ar.l (registered at the Luxembourg Trade and
Companies Registry under No. 66455) whose registered office is at 398
route d'Esch, L-1471 Luxembourg (Phoenix);
(2) THE PERSONS other than Phoenix whose names and addresses are set out in
Part A of Schedule 1 (the Other Investors and each an Other Investor and,
together with Phoenix, the Investors);
(3) THE PERSONS whose names and addresses are set out in Part C of Schedule 1
(the Mezzanine Lenders and each a Mezzanine Lender and, together with the
Investors, the BCcH Shareholders);
(4) Stichting Administratiekantoor Phoenix whose registered office is at
Meerenakkerplein 27-30, 5652 BJ Eindhoven, The Netherlands (the
Foundation);
(5) VISHAY INTERTECHNOLOGY, Inc. (the Purchaser);
(6) VISHAY EUROPE GMBH (VEG)
(7) BCCOMPONENTS INTERNATIONAL B.V. (BCc International)
WHEREAS:
(A) BCcomponents Holdings B.V. (the Company) is a private company limited by
shares, whose registered office is at Meerenakkerplein 27-30, 5652 BJ Eindhoven,
The Netherlands (registered in the Dutch Trade Register No.17094574).
(B) The BCcH Shareholders are the legal and beneficial owners of the Sale
Shares and the Foundation is the legal holder of the Foundation Shares. The
Mezzanine Lenders are the holders of the Company Warrants and the DIPs. The Sale
Shares and the Foundation Shares are all of the issued shares of the Company.
(C) The Purchaser has agreed to purchase all of the Sale Shares, the
Foundation Shares, the Company Warrants and the Co-Investor Loan, the BCcH
Shareholders have agreed to sell the Sale Shares, the Mezzanine Lenders have
agreed to sell the Company Warrants and the Co-Investors have agreed to assign
the Co-Investor Loan, in each case on and subject to the terms and subject to
the conditions set out in this Agreement.
(D) The Mezzanine Lenders have agreed to assign the Mezzanine Credit Agreement
and contribute the DIPS subject to the terms and subject to the conditions set
out in this Agreement.
(E) The Foundation has agreed to execute the agreement on and subject to the
terms of Schedule 5.
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(F) Formal advice has been requested in respect of this Agreement (insofar as
it relates to the Netherlands) from the works council representing Group
employees in the Netherlands as required by the Dutch Works Council Act, and
consultations with employee representatives have commenced in each other
jurisdiction where there is a legal requirement to consult prior to the
execution of this Agreement.
IT IS AGREED as follows:
1. INTERPRETATION
1.1 In this Agreement, the following expressions shall have the following
meanings:
Account means the bank account number with the following details:
Correspondent Bank: JP Morgan AG, Frankfurt
SWIFT Code: CHASDEFX
Account Name: JP Morgan Chase Bank, London
SWIFT Code: CHASGB2L
Sort Code: 60-92-42
Account Number: 6231400604
For further credit to: Phoenix Acquisition Company
Account Number: 23135503
Adjusted Financial Debt means the sum which results from the
calculation:
b - a
a = the aggregate, expressed in euros, of the Capital Expenditure and
Restructuring Costs paid by the Group Companies during the period from and
including 30 September 2002 to but excluding the Cut-Off Date that are
related to the activities in any of paragraphs (a) to (g) of Schedule 4,
Part B or otherwise (i) fall within a capital expenditure or restructuring
programme which was approved by Supervisory Board of the Company and/or by
Phoenix on or before 30 September 2002 or (ii) have been consented to by
the Purchaser at any time after 29 September 2002 or (iii) were permitted
under the terms of Clause 4 (or would have been permitted under the terms
of Clause 4 had Clause 4 been in effect at the relevant time), provided
that, for the purpose of calculating the Adjusted Financial Debt, a shall
not exceed the sum of 10 million euros plus (if Completion takes place
after 31 December 2002) 2.8 million euros for each calendar month in the
period from and including 1 January 2003 to but excluding the date of
Completion (or the pro rata proportion of 2.8 million euros for any part
calendar month, according to the number of days elapsed in that calendar
month out of the total number in that month); from
b = the aggregate, expressed in euros and calculated as at 11.59 pm,
applicable local time, on the Business Day immediately before the Cut-Off
Date, of the amount of the borrowings and financial indebtedness
(including, without limitation, by way of acceptance credits, discounting
or similar facilities, finance leases, loan stocks, bonds, debentures,
notes, debt or inventory
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financing or sale and lease back arrangements, overdrafts or any other
arrangements the purpose of which is to raise money) owed by each of the
Group Companies (as reflected in the books of the relevant Group Company
and calculated without double counting) apart from contingent indebtedness
or any indebtedness resulting from operating leases, including without
limitation any amounts payable under the Senior Credit Agreement
(including all accrued interest and all premiums, termination payments,
break costs and other amounts, if any, that would be payable upon
repayment of the Senior Credit Agreement if it was repaid on the Cut-Off
Date) but excluding the Co-Investor Loan and any amounts payable under the
Mezzanine Credit Agreement (including all accrued interest and all
premiums, termination payments, break costs and other amounts, if any,
payable upon repayment of the Mezzanine Credit Agreement) or the DIPs and,
for the avoidance of doubt, excluding any amounts due to trade creditors
in respect of goods or services supplied to a Group Company and any
amounts due to Group Companies.
Any amount in respect of the Shanghai Subsidiary to be included in the
above calculation (other than pursuant to the Senior Credit Agreement) shall be
reduced by 5%;
Adjusted Financial Debt Statement means the statement of the Adjusted
Financial Debt, prepared and agreed or determined in accordance with Schedule 3;
Austrian Shares means the shares in the capital of BCc Austria held by BCc
International;
BCc Austria means BCcomponents Austria GmbH, a Group Company, registered
with the Company Register at the High Court (Landesgericht) of Klagenfurt,
Austria, under no. FN98364d;
BCc Belgium means BCcomponents NV, a Group Company;
BCc Germany means BCcomponents Holding GmbH, a Group Company, registered
with the Commercial Register at the Lower Civil Court (Amtsgericht) of Meldorf,
Germany, under no. HRB 1510;
BCc Luxembourg means BCcomponents LUX S.ar.L.
Business Day means a day (excluding Saturdays and Sundays) on which banks
generally are open in London and New York for the transaction of normal banking
business;
Capital Expenditure means any expenditure (including any obligation in
respect of the capital element of any finance lease or capital lease) for the
acquisition of equipment, fixed assets, real property, intangible assets and
other assets of a capital nature which would be treated as capital expenditure
in accordance with Dutch GAAP;
Claim means any claim for breach of a Warranty or any other claim which is
deemed to be a Claim pursuant to this Agreement;
Co-Investors means Phoenix and Compass Partners European Equity
Investors, L.P.
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Co-Investor Loan means the (euro)10,000,000 subordinated loan together
with all accrued and unpaid interest and other rights thereunder made on or
about 4 February 2002 between the Co-Investors and the Company;
Co-Investor Loan Payment means the greater of (i) (euro)1 and (ii) the
amount (if any) by which the Threshold Amount exceeds the aggregate of the
Adjusted Financial Debt, the amount of the Transaction Fees and the aggregate of
the sums payable in accordance with the Sale Bonus Arrangements;
Company Warrants means the Warrants issued by the Company and held by the
Mezzanine Lenders as set out in Schedule 1, Part C;
Compass means Compass Partners European Equity Fund (Bermuda) L.P.;
Compass Advisory Fee means (euro)2,500,000 plus VAT payable to Compass
Capital Partners Ltd;
Compass Management Fee means (i) (euro)907,560 (plus any value added tax)
in respect of advisory fees payable by the Company to Compass and (ii) all
expenses (not exceeding (euro)100,000 per month) of Compass through and
including the Completion Date reimbursable in accordance with the agreement
between Compass, the Company and CPIL, made on 14 January 1999, and the letter
from the Company to Compass Capital Partners Limited as general partner of
Compass, dated 14 January 1999;
Competition Authority means any relevant government, governmental,
national, supranational, competition or antitrust body or other authority, in
any jurisdiction, which is responsible for applying Competition Law in such
jurisdiction;
Competition Law means any merger control or other competition or antitrust
legislation or regulation in any jurisdiction;
Completion Date means 13 December, 2002;
Completion means completion of the sale and purchase of the Sale Shares
and, if applicable, of the Foundation Shares in accordance with Clause 6;
Confidentiality Agreement means the agreement dated 1 July 2002 between
the Purchaser, Phoenix and the Company;
Consideration Warrants means, subject to Clause 6.13, 8,823,529 warrants
of the Purchaser in the agreed form to be issued pursuant to Clause 6.1(a) and
then transferred pursuant to Clause 6.7 as consideration for the Sale Shares
(other than those to be sold by the Mezzanine Lenders) and for the Foundation
Shares;
Costs means all liabilities, losses, damages, costs (including legal
costs) and expenses (including taxation), in each case, of any nature
whatsoever;
CPIL means Compass Partners International Limited, whose registered office
is at 4 Grosvenor Place, London SW1X 7HJ;
Cut-Off Date means 5 December, 2002;
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Data Room means the contents of the rooms made available to the Purchaser
and its advisers in Frankfurt in relation to the Group Companies;
Depositary Receipts means the A depositary receipts and B depositary
receipts conferring beneficial rights to the Foundation Shares;
DIPs means the issued deferred interest preference shares in the capital
of BCcomponents Lux S.ar.l.;
Dutch GAAP means the principles, policies, procedures, methods and
practices of accounting generally accepted in the Netherlands;
ERISA side letter means the side letter between the Purchaser, Compass and
Phoenix Bermuda Fund LP in agreed form;
Estimated Co-Investor Loan Payment has the meaning provided in
Clause 6.9(b)(i);
Exchange Act means the United States Securities Exchange Act of 1934,
as amended;
Existing Local Facility Limits means the local currency limits on each
respective Local Facility set out in Schedule 8;
Foundation Rules means the terms, conditions, rules and procedures in
respect of the Foundation, constituting the articles of incorporation of the
Foundation, the trust conditions of the Foundation last amended by deed executed
on 10 October 2000 and the terms and conditions of each of the Management Equity
Plans, in each case as amended or supplemented from time to time;
Foundation Shares means all the common D Shares in the capital of the
Company legally owned by the Foundation, details of which are set out in
Schedule 1 Part B;
Foundation Share Consideration means those of the Consideration Warrants
that are to be transferred in consideration for the sale of the Foundation
Shares;
Freshfields means Freshfields Bruckhaus Deringer of 65 Fleet Street,
London EC4Y 1HS;
German Federal Cartel Office means the Federal Cartel Office of the
Republic of Germany;
German Shares means the shares in the capital of BCc Germany held by
BCc International;
Group means the Company and the Subsidiaries;
Group Company means any one of the Company or the Subsidiaries;
HSR Act means the United States Hart-Scott-Rodino Antitrust
Improvements Act of 1976;
Letter of Credit Guarantees means the guarantees which are listed on
Schedule 6;
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LIBOR shall mean the rate at which JP Morgan plc is offering to prime
banks in the London Interbank Market deposits in euros for a period of one (1)
month at or about 11.00 a.m. on the relevant date for such period;
Local Facilities means those local facilities listed on Schedule 8;
Management Equity Plans means the share based management incentive plans,
in each case as set forth in the letters of invitation to participate in such
plans containing the terms of such plans, and the Shareholders' Agreement;
Material Adverse Change means, subject to the provisions of Clause 3.1(f),
any event, act, omission or accident occurring at any time during the period
from the date of this Agreement to but excluding the Cut-Off Date, including
without limitation act of God, war, riot, civil commotion, malicious damage,
breakdown of plant or machinery, fire, flood or storm, but excluding any strike,
lockout or other form of industrial action, as a result of which any of the
Group's facilities at Danshui, Heide, Klagenfurt or Roeselare (the Facilities)
are destroyed, demolished or otherwise put out of scheduled operation;
Merrill Lynch Fee means the fees payable to Merrill Lynch International by
the Company as notified in writing to the Purchaser at any time prior to
Completion;
Mezzanine Credit Agreement means the US$105,000,000 Mezzanine Credit
Agreement, dated 14 January 1999, between Phoenix as parent, the Company as
borrower, certain companies as original guarantors, Chase Equity Associates (now
JP Morgan Partners (BHCA), L.P.), Garmark Partners, L.P., Bain Capital V
Mezzanine Fund, L.P., BCM Capital Partners, L.P., BCIP Associates II, BCIP Trust
Associates II and BCIP Trust Associates II-B as original lenders, and Chase
Manhattan International Limited as security agent, as amended or supplemented
from time to time;
Note Purchase Agreement means the note purchase agreement in the agreed
form;
Notes means the $105,000,000 Floating Rate Unsecured Loan Notes 2102 of
the Purchaser which shall be issued by the Purchaser as directed by the
Mezzanine Lenders pursuant to Clause 6.5;
Philips means Koninklijke Philips Electronics N.V., whose registered
office is at Groenewoudseweg 1 in Eindhoven 5621 BA, together with its
affiliates;
Philips Guarantee means the guarantee entered into by Philips in July 1999
in respect of certain of the debt owed by the Shanghai Subsidiary to Citibank
N.A., Shanghai branch;
Provisional Adjusted Financial Debt means:
(a) if the Draft Adjusted Financial Debt Statement is delivered to the
Purchaser before the Phoenix Pre-Completion Notices (as defined in Clause
5.1), the amount of the Adjusted Financial Debt as stated in that
Statement; or
(b) if the Draft Adjusted Financial Debt Statement has not been delivered to
the Purchaser before the Pre-Completion Notices are served in accordance
with
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Clause 5.1, the good faith estimate in euros of the Adjusted Financial
Debt delivered to the Purchaser pursuant to Clause 5.1(b);
Purchaser's Group means the Purchaser and any of the Purchaser's
subsidiaries;
Purchaser Warranties means the warranties given by the Purchaser and by
VEG in Clause 10;
Put and Call Agreement means the put and call agreement between the
Purchaser and those persons nominated by the Mezzanine Lenders in the agreed
form to be entered into pursuant to Clause 6.5(d);
PwC means PricewaterhouseCoopers;
Registration Rights Agreement means the registration rights agreement
in the agreed form;
Releases means the forms of release in agreed form;
Restructuring Costs means costs related to a transaction or event that is
unusual in nature or occurs infrequently including those resulting from the exit
of an activity, the consolidation, cessation and/or relocation of an operation,
the abandonment of operations or productive assets, provision for the
termination and/or relocation of operations and employees and the settlement of
obligations outside the ordinary course of business including any
disentanglement costs;
Sale Bonus Arrangements means the discretionary bonus arrangements between
Compass and the executives of the Group Companies upon the disposal of the Group
amounting to not more than (euro)1,000,000 in addition to the directly related
employer social security cost with respect to such arrangements, details of
which are contained in Exhibit 1;
Sale Shares means the Shares held by the BCcH Shareholders and set out in
Schedule 1, Part A and Part C;
Sale Share Consideration means those of the Consideration Warrants that
are to be transferred in consideration for the sale of the Sale Shares (other
than the Sale Shares held by the Mezzanine Lenders);
Schedules means the schedules to this Agreement and Schedule shall be
construed accordingly;
Senior Credit Agreement means the (euro)214,184,262 credit agreement,
dated 14 January 1999, between Phoenix as parent, BCcomponents Holdings
(Netherlands) B.V. and BCc International as original borrowers, the Company and
certain other companies as original guarantors, Chase Manhattan PLC and CIBC
Wood Gundy PLC as arrangers, Chase Manhattan International Limited (the Agent)
as agent and security agent and certain other parties thereto, as amended or
supplemented from time to time;
Senior Management means the chief executive officer of the Company and all
executives of the Company that are listed on Schedule 7, each of whom earn over
$100,000 per annum;
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Shanghai Subsidiary means BCcomponents (Shanghai) Company Limited;
Shares means issued shares of any class in the capital of the Company;
Shareholder means a legal holder of shares in the Company;
Shareholders' Agreement means the agreement or agreements between the BCcH
Shareholders and the Foundation relating to the ownership and control of the
Sale Shares and Foundation Shares and the rights and obligations of the BCcH
Shareholders and the Foundation inter se;
Subsidiaries means the companies that are direct and indirect subsidiaries
of the Company, a complete list of which is set out in Schedule 2 and ownership
of which is shown in Exhibit 2;
Third Party Shares means such share or shares in, as the case may be,
BCcomponents Taiwan Ltd., BCcomponents Hong Kong Ltd., BCcomponents China
Ltd., Valen Ltd., or BCcomponents India Pvt. Ltd. as are not held by the
Company or one of its Subsidiaries but are instead held by third parties,
whether or not on the basis of trust or nominee agreements;
Threshold Amount means(euro)217.8 million;
Termination Date means the later of:
(i) 31 May 2003; or
(ii) the date which is four (4) weeks after the service of any
notice in writing by the Purchaser on Phoenix that it
considers there to have been a Material Adverse Change; or
(iii) if applicable, the date on which it is agreed, deemed to be
agreed or determined in accordance with Clause 3.1(f)(ii)
that the Insurance Cover covers substantially all of the
losses;
Transaction Fees means the amount of the legal, accounting and
professional fees, costs and expenses incurred by or on behalf of (i) the
Company, (ii) the lenders under the Senior Credit Agreement, (iii) the Mezzanine
Lenders, (iv) Phoenix, (v) Phoenix Bermuda L.P. (vi) Compass or (vii) any of the
other BCcH Shareholders and payable or reimbursable by the Company or any other
Group Company in connection with the transactions contemplated by this Agreement
(together in each case with the amount of any value added tax payable thereon by
the Company or any other Group Company), including without limitation the
Compass Management Fee, the Compass Advisory Fee, the Winchester Fee and the
Merrill Lynch Fee, provided that the aggregate amount of such fees and value
added tax (if any) payable thereon by the Company or any other Group Company
shall not exceed (euro)17 million and provided also that, for purposes of the
calculation of the Aggregate Estimates in Clause 5.1, for purposes of Clause 6.9
and for purposes of the definition of Co-Investor Loan Payment, any fees or
costs and expenses incurred in connection with the implementation of the steps
provided for in Clauses 6.3 and 6.4 and any value added tax payable by the
Company thereon shall not be treated as Transaction Fees;
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US Newco means the corporation to be incorporated in the United States as
a direct, wholly-owned subsidiary of the Purchaser as contemplated by Clause 4 ;
Vendor Warranties means the warranties given by any or all of the BCcH
Shareholders in Clause 9;
Warrant Agreement means the agreement in respect of the Consideration
Warrants in the agreed form;
Warranty means a Vendor Warranty or a Purchaser Warranty, as the case
may be; and
Winchester Fee means (euro)2,500,000 payable to Winchester Capital
Technology Partners L.L.C.
1.2 In this Agreement, unless the context otherwise requires:
(a) references to persons shall include individuals, bodies corporate
(wherever incorporated), unincorporated associations and partnerships;
(b) the headings are inserted for convenience only and shall not affect the
construction of this Agreement;
(c) any reference to an enactment is a reference to it as from time to time
amended, consolidated or re-enacted (with or without modification) on or
prior to the date hereof and includes all instruments or orders made under
such enactment on or prior to the date hereof;
(d) any reference to a document in the agreed form is to the form of the
relevant document agreed between the Purchaser and the BCcH Shareholders
and for the purpose of identification initialled by the Purchaser and
Phoenix or on their behalf (in each case with such amendments as may be
agreed by or on behalf of the parties);
(e) the terms subsidiary and holding company shall each be construed in
accordance with sections 736 and 736A of the Companies Act 1985 (as
amended);
(f) the term group undertaking shall be construed in accordance with the
Companies Act 1985; and
(g) references to any English legal term for any action, remedy, method of
judicial proceeding, legal document, legal status, court, official or any
other legal concept shall, in respect of any jurisdiction other than
England, be deemed to include the legal concept which most nearly
approximates in that jurisdiction to the English legal term.
1.3 The Schedules form part of and shall be construed as one with this
Agreement.
1.4 The Exhibits do not form part of this Agreement.
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2. SALE AND PURCHASE
Sale of the Sale Shares held by the Investors
2.1 In each case upon the terms and subject to the conditions set forth in
this Agreement:
(a) each of the Investors hereby agrees to sell or procure the sale of the
Sale Shares shown against its name in Schedule 1 to US Newco in
consideration of the transfer by US Newco of the Sale Share
Consideration; and
(b) the Co-Investors agree to assign all of their right, title and interest
in the Co-Investor Loan to US Newco in consideration of the Co-Investor
Loan Payment.
2.2(a) Each of the Investors shall sell the Sale Shares respectively held by it
and each of the Co-Investors shall assign all its right, title and
interest in the Co-Investor Loan, in each case free from any option,
warrant, right of conversion, charge, lien, equity, encumbrance, rights
of pre-emption or any other third party rights and together with all
rights attached to them at Completion or subsequently becoming attached
to them.
(b) Each of the Investors hereby waives and undertakes not to exercise any
rights which that Investor may have to restrict the transfer of Sale
Shares in accordance with the terms of this Agreement (whether under the
Shareholders' Agreement or otherwise, including waiving and undertaking
not to exercise any rights which that BCcH Shareholder may have pursuant
to any pledge over any Sale Shares or Depositary Receipts and
undertaking to execute such documents as are necessary to give effect to
such waiver/undertaking) and hereby confirms that it has procured the
waiver of any pre-emption rights or restrictions on transfer which that
BCcH Shareholder has granted to any other party.
Sale of the Foundation Shares
2.3 Upon the terms and subject to the conditions set forth in this Agreement
and subject to Clause 2.4 and Schedule 5, the Foundation hereby agrees with the
Purchaser to sell or procure the sale of the Foundation Shares to US Newco in
consideration of the transfer by US Newco of the Foundation Share Consideration.
2.4 The provisions of Schedule 5 shall apply in relation to the following:
(a) the conditions upon which the Foundation's obligations become effective
under the terms of the Agreement;
(b) the implementation of the procedures necessary to authorise the Foundation
to sell and transfer the Foundation Shares;
(c) the undertakings among the parties to this Agreement regarding the
Foundation; and
(d) the escrow arrangements if the Foundation Shares are not delivered to the
Purchaser at Completion.
10
2.5 Subject to Schedule 5, the Foundation Shares shall be sold free from any
option, warrant, right of conversion, charge, lien, equity, encumbrance, rights
of pre-emption or any other third party rights and together with all rights
attached to them at Completion or on such other date as the sale of the
Foundation Shares is completed or subsequently becoming attached to them.
2.6 Subject to Schedule 5, the Foundation hereby waives and undertakes not to
exercise any rights which it may have to restrict the transfer of the Sale
Shares or the Foundation Shares in accordance with the terms of the Agreement
(whether under the Shareholders Agreement or otherwise, including waiving and
undertaking not to exercise any rights which the Foundation may have pursuant to
any pledge over any Foundation Shares or Depository Receipts and undertaking to
execute such documents as are necessary to give effect to such
waiver/undertaking).
Assignment of Mezzanine Credit Agreement, transfer of the DIPS and sale of the
Company Warrants and those of the Sale Shares held by the Mezzanine Lenders
2.7 In each case upon the terms and subject to the conditions set forth in
this Agreement:
(a) each of the Mezzanine Lenders hereby agrees to sell or procure the sale
of the Sale Shares shown against its name in Schedule 1 and the Company
Warrants shown against its name in Schedule 1 to US Newco and assign all
of its respective right, title and interest in the Mezzanine Credit
Agreement to US Newco in consideration for the issue by the Purchaser of
the Notes and the execution and delivery by the Purchaser of the Note
Purchase Agreement and the Put and Call Agreement; and
(b) Each of the Mezzanine Lenders agrees to transfer the DIPs shown against
its name in Schedule 1 to the Company by way of capital contribution.
2.8 (a) Each of the Mezzanine Lenders shall sell such Sale Shares and Company
Warrants and transfer such DIPs and shall assign such right, title and
interest in the Mezzanine Credit Agreement free from any option,
warrant, right of conversion, charge, lien, equity, encumbrance, rights
of pre-emption or any other third party rights and together with all
rights attached to them at Completion or subsequently becoming attached
to them.
(b) Each of the Mezzanine Lenders hereby waives and undertakes not to
exercise any rights which that Mezzanine Lender may have to restrict the
transfer of Sale Shares, the Company Warrants or the DIPs in accordance
with the terms of this Agreement (whether under the Shareholders'
Agreement or otherwise, including waiving and undertaking not to
exercise any rights which that Mezzanine Lender may have pursuant to any
pledge over any Sale Shares, Company Warrants, DIPs or Depositary
Receipts and undertaking to execute such documents as are necessary to
give effect to such waiver/undertaking). Each of the Mezzanine Lenders
hereby confirms that it has procured the waiver of any such pre-emption
rights or restrictions on transfer which that Mezzanine Lender has
granted to any other party.
Issue of the Consideration Warrants and the Notes
11
2.9 In each case upon the terms and subject to the conditions set forth in
this Agreement:
(a) the Purchaser hereby agrees to procure the purchase of the Sale Shares and
the Foundation Shares by US Newco and the acceptance by US Newco of the
assignment of the Co-Investor Loan and to purchase the Company Warrants;
(b) the Purchaser shall issue the Notes to or as directed by Phoenix or by the
Mezzanine Lenders pursuant to Clause 6.5(b) free from any option, warrant,
right of conversion, charge, lien, equity, encumbrance, rights of
pre-emption or any other third party rights and together with all rights
attached to them at Completion or subsequently becoming attached to them;
(c) the Purchaser hereby agrees to execute and deliver the Put and Call
Agreement;
(d) the Purchaser hereby agrees to deliver or cause the delivery of the
Consideration Warrants to those of the parties to this Agreement as are
nominated by Phoenix in such proportions as Phoenix may direct, in each
case free from any option, warrant, right of conversion, charge, lien,
equity, encumbrance, rights of pre-emption or any other third party rights
and together with all rights attached to them at Completion or
subsequently becoming attached to them.
Sale of the German Shares and the Austrian Shares held by BCc International
2.10 Upon the terms and subject to the conditions set forth in this Agreement,
BCc International hereby agrees to sell the German Shares to VEG and VEG agrees
to purchase the German Shares. The transfer of the shares to VEG shall be
effected in accordance with Clause 6.4. BCc International shall not be entitled
to the whole or any part of a dividend or distribution made or declared by BCc
Germany after Completion.
2.11 Upon the terms and subject to the conditions set forth in this Agreement,
BCc International hereby agrees to sell the Austrian Shares to VEG and VEG
agrees to purchase the Austrian Shares. The transfer of the Austrian Shares to
VEG shall be effected in accordance with Clause 6.4. BCc International shall not
be entitled to the whole or any part of a dividend or distribution made or
declared by BCc Austria after Completion.
2.12 In consideration for the sale of the German Shares and the Austrian Shares
VEG shall pay US$75,000,000 (converted into euros using the Spot Rate (as
defined in Schedule 3) on the close of business on 11 December 2002) in cash to
BCc International (the Purchase Price Germany/ Austria) in accordance with
Clause 6.4(c).
Sale and Transfer of Third Party Shares
2.13 Phoenix shall use its reasonable endeavours to procure that each of the
Third Party Shares held by:
(a) Nazario Proietto;
12
(b) Allan Choy;
(c) Frank Chan;
(d) D. F. Lin;
(e) C. S. Yang;
(f) Peter Lin;
(g) Ramchandra Gajanan Deshpande,
are transferred at Completion to the Purchaser or such person as is nominated
in writing by the Purchaser.
3. CONDITIONS TO COMPLETION
3.1 The obligation of each of the Purchaser and VEG on the one hand and the
BCcH Shareholders and the Foundation on the other hand to proceed with
Completion shall be conditional upon the following conditions having been
fulfilled or waived:
(a) confirmation in writing, in terms satisfactory to Phoenix and (subject to
Clause 3.7) the Purchaser, from each of:
(i) the German Federal Cartel Office, in so far as the proposed
transaction must be notified in accordance with section 39 of the
Act against Restraints on Competition, that the conditions for a
prohibition in Section 36 paragraph 1 of the Act against Restraints
on Competition are not fulfilled, or that the concentration has been
cleared pursuant to Section 40 paragraph 2, first sentence and
Section 40 paragraph 3, if applicable or, if no such confirmation is
received, either:
(A) the one month time limit from submission of a complete
notification as laid down in Section 40 paragraph 1 of the Act
against Restraints on Competition having expired without the
parties having been notified by the Federal Cartel Office that
it has entered into the examination of the proposed
concentration; or
(B) the four months time limit, or an extended time limit, from
submission of a complete notification as laid down in Section
40 paragraph 2 of the Act against Restraints on Competition,
having expired without the Federal Cartel Office having issued
an order prohibiting the transaction;
(ii) the French Minister of Economy, Finance and Industry, insofar as the
proposed transaction must be notified pursuant to articles L. 430-1
to L. 430-3 of the French Commercial Code, as modified by the Act
known as NRE of 15 May 2001 (the NRE Act), that he does not oppose
the transaction or, if no such confirmation is received, either:
(A) the time limits laid down in Article L. 430-5 I. or II., as
applicable, of the French Commercial Code, as modified by the
13
NRE Act, having expired without the parties having been
notified by the Minister of the Economy, Finance and Industry
of its decision to request the Competition Council's opinion;
or
(B) the time limits laid down in Article L. 430-7 I. or II., as
applicable, of the French Commercial Code, as modified by the
NRE Act, having expired without the parties having been
notified by the Minister of the Economy, Finance and Industry
of its decision to prohibit the transaction;
(iii) the Appellate Court of Vienna as Cartel Court, insofar as the
proposed transaction must be notified in accordance with Section 42a
of the Austrian Cartel Act (KartG), that:
(A) pursuant to section 42b paragraph 1 KartG, no review
proceedings have been initiated or an initiated proceeding has
been terminated and the Cartel Court issues a confirmation
thereof; or
(B) pursuant to section 42b paragraph 2 no. 3 or section 42b
paragraph 3 KartG, the merger is not prohibited and this
decision has become final and binding; or
(C) pursuant to section 42b paragraph 5 KartG, the review period
has expired;
(iv) all waiting periods, if any, including any extensions under the HSR
Act and regulations made under the HSR Act, having expired or been
terminated; and
(v) in the event that one or more EU Member State makes a request (a
Relevant Request) to the European Commission pursuant to Article
22(3) of Council Regulation (EEC) number 4064/89 as amended (the
Regulation): (i) the European Commission having issued a decision
pursuant to Article 6(1)(b) of the Regulation in respect of all
parts of the proposed transaction which were the subject of a
Relevant Request; (ii) all parts of the proposed transaction which
were the subject of a Relevant Request having been deemed compatible
with the common market pursuant to Articles 10(6) of the Regulation;
or (iii) the European Commission having issued a decision pursuant
to Article 6(1)(c) of the Regulation to initiate proceedings in
respect of all parts of the proposed transaction which were the
subject of a Relevant Request and subsequently having issued a
decision, under Article 8(2) of the Regulation declaring all parts
of the proposed transaction which were the subject of a Relevant
Request compatible with the common market;
(b) no order or judgment of any court or governmental, statutory
or regulatory body having been issued or made prior to
Completion which has the effect of making unlawful or
otherwise prohibiting the completion of the transactions
contemplated hereunder and which continues to be outstanding;
14
(c) the Purchaser and VEG, on the one hand and the BCcH
Shareholders and the Foundation, on the other hand, having
complied in all material respects with their obligations under
this Agreement prior to Completion (provided that, if any
party to this Agreement fails to comply with its obligations
under this Agreement prior to Completion in any material
respect but the breach concerned is capable of remedy, then it
shall be deemed to have complied in all material respects with
its obligations under this Agreement for the purpose of this
paragraph (c) if it has remedied the breach within 15 days of
its occurrence);
(d) no Group Company having taken any action or refrained from
taking any action, in each case at any time during the period
from and including 30 September 2002 to but excluding the
Cut-Off Date, which, had the provisions of Clause 4.1 and
Schedule 4 comprised obligations of each Group Company during
that period, would have constituted a breach by that Group
Company of those provisions resulting in a loss of US$20
million or more for the Group and of which the Purchaser has
served written notice on Phoenix in accordance with this
Agreement before the Cut-Off Date;
(e) as of the Cut-Off Date, the Company not having been dissolved
(ontbonden) granted a (preliminary) suspension of payments
((voorlopige) surseance van betaling verleend) or declared
bankrupt (failliet verklaard), and no proceeding having been
commenced for its dissolution (ontbinding), liquidation
(vereffening), suspension of payments (surseance van betaling)
or bankruptcy (faillissement) which in any case is continuing;
and
(f) no Material Adverse Change shall have occurred and be
continuing immediately before the Cut-Off Date of which the
Purchaser has served written notice on Phoenix in accordance
with this Agreement before the Cut-Off Date. However, such
Material Adverse Change shall be deemed not to have occurred
in case of the following:
(i) the relevant Facility has returned to scheduled
operation;
(ii) substantially the whole of (A) the cost of the assets
relating to the Facilities and (B) the loss of earnings
resulting from the business disruption resulting from
such Material Adverse Change (together the Losses) are
covered by insurance of which any one or more Group
Companies have the benefit (the Insurance Cover). In
determining whether the Insurance Cover covers such
Losses, the parties hereby agree to the following:
(A) Phoenix shall deliver to the Purchaser as soon as
practicable after the occurrence of a Material
Adverse Change and in any event not later than ten
(10) days after such event, copies of all
policies, claims and other related insurance
documentation relating to Insurance Cover and the
relevant Facilities (the Insurance Information).
(B) The Purchaser shall have a period of five (5) days
after the date of delivery to it of such Insurance
Information, to review such Insurance Information
and to present to Phoenix in writing any
15
objections that Insurance Cover will not cover the
Insured Losses.
(C) If no such written objections as are referred to
in Clause (B) above are properly presented to
Phoenix by the end of the period stated above,
then the Purchaser shall be deemed to have agreed
that Insurance Cover documented in the Insurance
Information will cover the Losses and that there
is no Material Adverse Change.
(D) If any such written objections as are referred to
above are properly presented to Phoenix by the end
of the proposed period the specific matters in
dispute shall be referred for determination to
Marsh Claims Consultancy Services, part of Marsh
UK Ltd (the Insurance Loss Adjustor) not later
than ten (10) days after the end of such period.
If such Insurance Loss Adjustor shall for any
reason be unable or unwilling to act then another
independent firm shall be appointed to act in its
place by the agreement of Phoenix and the
Purchaser and, in default of such agreement, at
the request of Phoenix and the Purchaser by the
President of the Corporation of Professional Loss
Assessors for the time being. The Insurance Loss
Adjustor shall be instructed to notify the
Purchaser and Phoenix of its determination
regarding the Insurance Cover and the Losses
within fifteen (15) days of such referral.
(E) In making its determination, the Insurance Loss
Adjustor shall act as expert and not as arbitrator
and the determination by the Insurance Loss
Adjustor shall, in the absence of manifest error,
be final and binding on the parties and shall be
deemed to have been accepted and approved by the
parties. The fees and the costs of the Insurance
Loss Adjustor shall be shared as to fifty per
cent. (50%) by Phoenix and as to fifty per cent.
(50%) by the Purchaser.
3.2 Without prejudice to Clause 3.3, the conditions set out in Clause 3.1(a)
and (b) may only be waived jointly in writing by the Purchaser and Phoenix (on
behalf of the BCcH Shareholders and the Foundation). The condition set out in
Clause 3.1(c) may be waived only with respect to the Purchaser's and VEG's
obligations by Phoenix (on behalf of the BCcH Shareholders and the Foundation),
and with respect to the BCcH Shareholders' and the Foundation's obligations by
the Purchaser (on behalf of the Purchaser and VEG) at any time by notice in
writing to the other parties to this Agreement. The conditions in Clauses
3.1(d), (e) and (f) may only be waived in writing by the Purchaser.
3.3 Both the Purchaser and VEG, on the one hand, and the BCcH Shareholders on
the other hand, shall use their reasonable endeavours to procure the fulfilment
of the conditions set out in Clauses 3.1(b), (c), (d), (e) and (f), apart from
those conditions the fulfilment of which is entirely outside its respective
control, as soon as practicable after the date of this Agreement.
16
3.4 In order to ensure that the conditions set out in Clause 3.1(a) are
fulfilled, the BCcH Shareholders shall at all times cooperate with the Purchaser
in providing to the Competition Authority or other persons concerned such
information as may reasonably be necessary to ensure that any request for
information from the relevant Competition Authority or other persons is
fulfilled promptly and in any event in accordance with any relevant time limit,
and that, where practicable, it shall provide copies of any proposed
communication with the Competition Authority or other persons in relation to the
transactions contemplated by this Agreement to the Purchaser and take due
consideration of any comments that the Purchaser may have in relation to such
proposed communication, prior to making the proposed communication, provided
that the BCcH Shareholders shall not be required to provide the Purchaser with
any confidential information or business secrets relating to the Group.
3.5 The Purchaser shall use its commercially reasonable endeavours to procure
the fulfilment of the conditions set out in Clause 3.1(a) as soon as practicable
after the date of this Agreement. In particular, the Purchaser shall take all
steps necessary or desirable (including making filings and notifications), as
soon as reasonably practicable, to procure the fulfilment of the condition set
out in Clause 3.1(a). In particular, the Purchaser and VEG shall, where
practicable, promptly notify Phoenix, sufficiently in advance (for the purposes
referred to below in this sub-clause 3.5) of any notification, submission,
response or other communication (in each case whether in writing or otherwise)
(excluding communications of an administrative nature) which they propose to
make or submit to any Competition Authority or other persons and at the same
time provide Phoenix with copies thereof and any supporting documentation or
information reasonably requested by Phoenix, provided that the Purchaser shall
not be required to provide Phoenix with any confidential information or business
secrets. The Purchaser undertakes to take due consideration of any comments
which Phoenix may have in relation to any such notification, submission,
communication or response to a request for further information prior to making
the relevant notification, submission, communication or response (as the case
may be). The Purchaser further agrees to keep Phoenix fully informed as to the
progress of any notification made to any of the Competition Authorities or other
persons referred to in Clause 3.1(a) and, where reasonably requested by Phoenix,
the Purchaser shall permit Phoenix or its advisers to attend all meetings with
the Competition Authority or other persons concerned (unless prohibited by the
other person or authority concerned) and, where appropriate, to make oral
submissions at such meetings.
3.6 The Purchaser undertakes to each of the BCcH Shareholders and the
Foundation that it will not (and that it will procure that no member of the
Purchaser's Group will) make any filings with any Competition Authority or other
persons other than those filings to which Phoenix, on behalf of the BCcH
Shareholders and the Foundation, agrees in writing or failing such agreement
which the Purchaser has been advised in writing by Hasche Sigle is necessary to
make in order to procure the fulfilment of the conditions set out in Clause 3.1.
Before making such filing, the Purchaser agrees to notify Phoenix in writing of
its intention to do so and to give Phoenix, on behalf of the BCcH Shareholders
and the Foundation, a reasonable opportunity to challenge such opinion.
3.7 Without prejudice to the generality of the Purchaser's obligations under
the other provisions of this Clause 3, the Purchaser shall (or shall procure
that the relevant member(s) of the Purchaser's Group shall), where required to
do so in order to
17
procure the satisfaction of any of the conditions listed in Clause 3.1(a) comply
with, and agrees to provide suitable undertakings to meet, all requirements of
any Competition Authority or other persons from which any consent, approval or
action is required or desirable in order to complete the sale and purchase of
the Sale Shares and the Foundation Shares and the other transactions
contemplated by this Agreement, including without limitation agreeing to hold
separate or dispose of any part of the business of the Group, provided that this
sub-clause 3.7 shall not require the Purchaser to take any action or give any
undertaking in order to procure the satisfaction of the condition listed in
Clause 3.1(a) which the Purchaser, in its reasonable discretion, determines
would not be commercially reasonable for it to be required to take or give.
3.8 Without prejudice to the generality of the BCcH Shareholders' obligations
under the other provisions of this Clause 3, the BCcH Shareholders shall:
(a) co-operate in good faith in order to achieve compliance with the
requirements of any Competition Authority or other persons;
(b) not object to any undertakings given by the Purchaser with respect to the
Company in connection with obtaining consent, approval or action of any
relevant Competition Authority or other persons; and
(c) co-operate with and assist the Purchaser in any notification or filing
procedure(s) by providing in good faith any necessary information and
documents.
3.9 If any of the conditions set out in Clause 3.1 has not been fulfilled or
waived pursuant to Clause 3.2 by 5:00pm (London time) on the Termination Date,
then:
(a) none of the BCcH Shareholders, the Foundation, the Purchaser or VEG shall
be bound to proceed with Completion; and
(b) this Agreement shall automatically terminate.
and in all other respects, no party shall have any Claim hereunder of any nature
whatsoever against the other party save in respect of their accrued rights
and/or liabilities arising from any prior breach of this Agreement.
3.10 If any fact which makes any of the conditions set out Clause 3.1 incapable
of being satisfied in accordance with the provisions of this Clause 3 (taking
account of the Purchaser's, VEG's and the BCcH Shareholders' obligations under
Clause 3.3) comes to the knowledge of the Purchaser or of Phoenix at any time
prior to Completion then each such party shall notify the other of that fact and
(unless the party is responsible for making such condition incapable of being
satisfied) each party shall be entitled to terminate this Agreement by written
notice to the other party (in the case of Phoenix, such termination being
effected for itself and on behalf of the other BCcH Shareholders and the
Foundation) and the provisions set forth in Clause 3.9 shall apply to such
termination.
3.11 The Purchaser and VEG acknowledges that the BCcH Shareholders and the
Foundation may be irreparably injured by a breach by the Purchaser or VEG of
their obligations under the terms of Clause 3 and that the BCcH Shareholders and
the
18
Foundation shall be entitled to claim equitable relief, including injunctive
relief and specific performance, in the event of any threatened or actual breach
of such terms. Such remedies shall not be deemed to be the exclusive remedies
for a breach of such terms by the Purchaser or VEG, but shall be in addition to
all other remedies available at law or equity.
4. PRE-COMPLETION UNDERTAKINGS
4.1 Save with the prior written consent of the Purchaser, such consent (save
with respect to paragraphs (a), (c), (d), (k) and (j) of Part A of Schedule 4,
in respect of which the Purchaser may withhold its consent in its absolute
discretion) not to be unreasonably withheld and which consent shall be deemed to
be given if not refused within five (5) Business Days from the date of request
therefore, and save with respect to the exceptions listed in Part B of Schedule
4, Phoenix shall procure (so far as it is within its power to do so) that
between the date of this Agreement and Completion, each Group Company shall take
such actions or refrain from taking such actions as are required pursuant to
Part A of Schedule 4 of this Agreement unless expressly permitted or required to
take them under the terms of this Agreement.
4.2 For the purposes of Clause 4.1, the Purchaser shall at the date of this
Agreement nominate an individual who shall be responsible for giving or refusing
consent if requested by Phoenix. Consent received from such person shall be
sufficient consent for the purposes of Clause 4.1.
4.3 Neither the Purchaser nor VEG shall liquidate, dissolve, wind up its
affairs or merge with any corporation or sell or convey all or substantially all
of its assets, nor shall the Purchaser enter into any similar transaction in
which the Purchaser is not a continuing public company with reporting
obligations under the Exchange Act.
4.4 The Purchaser shall procure that, prior to Completion, US Newco is
incorporated as a direct subsidiary of the Purchaser and that US Newco shall not
carry on any business or have any assets or liabilities of any nature whatsoever
before Completion, except for those transferred to or assumed by it pursuant to
any transaction contemplated by this Agreement.
4.5 To the extent not previously obtained prior to the date of this Agreement,
as soon as reasonably practicable after the date of this Agreement, the
Purchaser shall take all such steps and deliver all such documentation to the
Dutch Authority for the Financial Markets or otherwise as are in each case
necessary in order for dispensation to be granted pursuant to Section 4 of the
Act on the Supervision of Securities Trade 1995 in respect of the Consideration
Warrants.
4.6 The Purchaser undertakes and acknowledges that from the date of entry into
the Confidentiality Letter until Completion, it has not and shall not (and shall
procure that its group undertakings do not):
(a) save to the extent permitted by Clause 4.9, directly or indirectly make or
have any contact whatsoever with any Group Company or any officer or
employee of any Group Company; or
(b) use Information provided by Phoenix, the Company or any Connected Person
(as such terms are defined in the Confidentiality Agreement), persuade or
seek
19
to persuade any customer, supplier or independent contractor of any of the
Group Companies to cease to do business or reduce the amount of business
which such customer, supplier or independent contractor has customarily
done with such Group Company.
4.7 To the extent that it has not supplied copies by the date of this
Agreement, Phoenix shall forthwith provide the Purchaser with a copy of the
Shareholders Agreement, the Senior Credit Agreement, the Intercreditor Deed
dated January 14 1999, the agreement regulating the Co-Investor Loan and the
Mezzanine Credit Agreement, copies of its monthly reports to lenders under the
Senior Credit Agreement for the periods from June 2002 onwards (excluding all
forward-looking information) together with copies of all supplementary or
amending agreements entered into pursuant to such agreements, in particular all
accession memoranda, if any, and copies of all agreements relating to the
obligation of the Company or any Group Company to pay or reimburse the Compass
Management Fee and the Transaction Fees. Phoenix shall also, without undue delay
after the date of this Agreement, deliver to the Purchaser, copies of the
documentation relating to all outstanding pledges, charges, liens and
encumbrances granted pursuant to the Senior Credit Agreement or the Mezzanine
Credit Agreement, as well as copies of each of the Letter of Credit Guarantees.
Phoenix will, in addition, provide copies of any agreements entered into by any
Group Company on or after today's date relating to the Shareholders Agreement,
the Senior Credit Agreement, the Co-Investor Loan, the Mezzanine Credit
Agreement or the payment of the Compass Management Fee or any of the Transaction
Fees, as soon as practicable after execution thereof by the relevant Group
Company.
4.8 Phoenix undertakes to procure that the Company provides the Purchaser with
copies of:
(a) its monthly reports to the lenders under the Senior Credit Agreement as
soon as practicable after delivery of such reports as required pursuant to
the Senior Credit Agreement;
(b) from October 1, 2002, copies of all requests made for consents or
approvals as required under the terms and conditions of the Senior Credit
Agreement;
(c) as soon as practicable after the date of this Agreement, reasonable
details of the actions that have been taken by any Group Company during
the period from and including 30 September 2002 to but excluding the date
of this Agreement which, had the provisions of Clause 4 of this Agreement
been in effect during that period, would have required the Purchaser's
consent; and
(d) as soon as practicable after the date of this Agreement, reasonable
details of any items of Capital Expenditure of more than 500,000 euros
paid by any Group Company during the period from and including 30
September 2002 to but excluding the date of this Agreement.
4.9 From the date of this Agreement the Purchaser, with reasonable notice to
Phoenix (such notice to specify the reason for the visit) and with the prior
written consent of Phoenix (such consent not to be unreasonably withheld or
delayed) and subject always to the terms of the Confidentiality Agreement, shall
be allowed such access as it may reasonably require to the premises (provided
that the Purchaser shall
20
comply with any reasonable restrictions required by Phoenix while visiting such
premises) and to Senior Management, provided that no notice to or consent from
Phoenix will be required in order for the Purchaser to communicate with the
chief executive officer, the chief financial officer and the corporate
development director of the Company. For the purposes of this Clause 4.9,
Phoenix nominates Ken Hanna as the individual who shall be responsible for
giving or refusing consent if requested under the terms of this Clause 4.9.
Consent received from Mr Hanna shall be sufficient consent for the purposes of
this Clause 4.9.
4.10 If Phoenix acquires actual knowledge at any time between the Cut-Off Date
and Completion that any Group Company has taken any action or refrained from
taking any action, in each case at any time during the period between the
Cut-Off Date and Completion, which, had the provisions of Clause 4.1 and
Schedule 4 comprised obligations of each Group Company during that period, would
have constituted a breach by that Group Company of those provisions resulting in
a loss of US$20 million or more for the Group, it shall notify the Purchaser
forthwith;
4.11 If Phoenix acquires actual knowledge at any time prior to Completion that
proceedings of the kind referred to in Clause 3.1(e) or any one of the events
set out in Clause 3.1(e) has occurred or is about to occur, it shall notify the
Purchaser forthwith and, subject to such consents as are required under the
terms of the Senior Credit Agreement and the Mezzanine Credit Agreement first
having been obtained in writing, shall use its reasonable endeavours to procure
that the Company enters into such loan agreements with the Purchaser (or other
persons as arranged by the Purchaser) as the Purchaser may reasonably require
with a view to providing the Company with the funds required to prevent the
dissolution or insolvency events referred to in Clause 3.1(e) from proceeding.
5. PREPARATION FOR COMPLETION
5.1 Phoenix shall not less than three (3) Business Days prior to Completion:
(a) notify the Purchaser of the sums which will be required to be paid
under Clauses 6.8, 6.12(c) and 8.2, together with details of the
persons to whom those payments are to be made and the relevant payment,
currency and bank account details, reasonable detail of the calculation
of all the applicable sums and a written confirmation from the Agent
referred to in Clause 6.12(d) of the sums outstanding under the Senior
Credit Agreement. Phoenix shall also provide the Purchaser with such
other additional documentary evidence as the Purchaser may reasonably
require in relation to the sums that the Purchaser is being required to
fund;
(b) if Phoenix has not already delivered the Draft Adjusted Financial Debt
Statement to the Purchaser pursuant to Schedule 3, deliver to the
Purchaser Phoenix's good faith estimate in euros of the Adjusted Financial
Debt. Phoenix shall also provide such other information and/or other
evidence in relation to such amount as the Purchaser may reasonably
request; and
(c) notify the Purchaser of the proportion of Consideration Warrants and Notes
to be delivered to any party to this Agreement
(all such notices together, the Phoenix Pre-Completion Notices).
21
If the Provisional Adjusted Financial Debt exceeds the Threshold Amount, then
the Purchaser shall be entitled to terminate this Agreement by notice in writing
to Phoenix, unless Phoenix delivers to the Purchaser, within two Business Days
of deliveries being made pursuant to paragraphs (a), (b) and (c) above, evidence
in a form reasonably satisfactory to the Purchaser that the amounts payable
under the Clauses 6.12(c) will be reduced by an amount at least equal to the
amount by which the Provisional Adjusted Financial Debt exceeded the Threshold
Amount (the original Provisional Adjusted Financial Debt as so reduced shall
then become the Provisional Adjusted Financial Debt for all purposes). On
delivery of notice by the Purchaser in accordance with this Clause 5, this
Agreement shall terminate and neither party shall have any Claim hereunder of
any nature whatsoever against the other party save in respect of their accrued
rights and/or liabilities arising from any prior breach of this Agreement.
5.2 The Purchaser shall, as soon as reasonably practicable after the date of
this Agreement, provide drafts of all transfer deeds, assignments, agreements,
wire transfer instructions and other documentation that are not in agreed form
and are reasonably necessary in order to effect the Completion in accordance
with Clause 6.
5.3 The parties to this Agreement shall:
(a) execute an escrow agreement in customary form (the Escrow Agreement) to
provide for the steps and document deliveries required for the steps
provided for in Clause 6 to take effect in the correct order,
automatically, one after the other, after the identified escrow condition
has been satisfied; and
(b) execute or procure the execution before Completion of all transfer deeds,
assignments, wire transfer instructions and other documentation as may be
reasonably necessary (including, without limitation, all documentation
listed in Clause 6) in order to effect Completion, in each case on the
basis that such documentation is held on and subject to the terms of the
Escrow Agreement.
(c) open and maintain all bank accounts as required under the terms of the
Escrow Agreement.
5.4 Each Party shall, as soon as practicable after the date of this Agreement,
grant a power of attorney in favour of CMS Hasche Sigle and/or such other
counsel or notary as are agreed upon by Phoenix and the Purchaser and take such
other steps as are reasonably necessary in each case in order for this Agreement
to be duly notarised before a notary public in Austria and Switzerland.
5.5 Phoenix shall provide all reasonable assistance to the Purchaser and VEG
for the purpose of arranging the release at Completion of all outstanding
pledges, charges, liens and encumbrances granted pursuant to the Senior Credit
Agreement or the Mezzanine Credit Agreement over any of the Shares.
6. COMPLETION
The following steps (together, the Completion Steps) shall be completed at the
offices of Nauta Dutilh, Weena 750, 3014, DA, Rotterdam, The Netherlands or at
such other venue as may be agreed in writing between the Purchaser and Phoenix
and the
22
Completion Steps shall occur on the Completion Date, each immediately after the
previous one:
6.1 Issue of the Consideration Warrants by the Purchaser to US Newco. The
Purchaser shall issue the Consideration Warrants to US Newco as a capital
contribution to US Newco, in connection with which:
(a) the Purchaser shall cause the Consideration Warrants in the agreed form to
be issued to US Newco;
(b) the Purchaser shall procure that such documentation as is required in
respect of the contribution under applicable law is entered into; and
(c) the Purchaser and the agent for the holders of the Warrants shall execute
and deliver the Warrant Agreement.
6.2 Transfer of the DIPs by the Mezzanine Lenders to the Company. The
Mezzanine Lenders shall transfer the DIPS to the Company as a capital
contribution.
(a) The Mezzanine Lenders shall deliver to the Company a deed of transfer and
contribution agreement in order to effect the transfer of the DIPs in the
register of BCc Luxembourg; and
(b) The Mezzanine Lenders shall and Phoenix shall procure that the Company
shall enter into any documentation in relation to the capital contribution
as is required under the law of The Netherlands, including an auditor's
statement regarding the value of the DIPs and a description of the capital
contribution by the board of the Company.
6.3 Transfer of BCc Belgium. Phoenix shall procure that BCc Germany shall
transfer the entire issued share capital of BCc Belgium less one share (which is
held already by BCc International) to BCc International in satisfaction of the
(euro)50,000,000 principal amount of debt plus accrued but unpaid interest owed
by BCc Germany to BCc International, in connection with which Phoenix shall
procure that BCc Germany and BCc International shall execute and deliver a power
of attorney and such agreement as is necessary to register the transfer of the
shares in the register of BCc Belgium and discharge the (euro)50,000,000 loan
plus interest.
6.4 Transfer of BCc Germany and BCc Austria. BCc International shall transfer
the German Shares and the Austrian Shares to VEG, in consideration for which VEG
shall pay the Purchase Price Germany/Austria.
(a) BCc International shall duly execute and deliver powers of attorney and
closing memoranda in order to (A) enable the transfer of the German Shares
and the Austrian Shares to VEG by way of notarial deeds of transfer which
will be passed before a civil law notary in Austria and Switzerland on or
before the Completion Date (the Relevant Jurisdictions) as indicated by
Phoenix and VEG and (B) enable this Agreement to be passed before a civil
law notary in the Relevant Jurisdictions on or before the Completion Date
as indicated by Phoenix and VEG.
(b) Each Investor, each Mezzanine Lender and the Purchaser shall duly execute
and deliver powers of attorney in order to enable this Agreement to be
passed
23
before a civil law notary in the Relevant Jurisdictions on or before the
Completion Date;
(c) VEG shall (and the Purchaser shall procure that VEG shall):
(i) pay the Purchase Price Germany/ Austria to BCc International; and
(ii) duly execute and deliver powers of attorney in order to (a) enable
the transfer the German Shares and the Austrian Shares to VEG by way
of notarial deeds of transfer which will be passed before a civil
law notary in the Relevant Jurisdictions on or before the Completion
Date and (b) enable this Agreement to be passed before a civil law
notary in the Relevant Jurisdictions on or before the Completion
Date;
6.5 Transfers by the Mezzanine Lenders, issue of the Notes and execution of
the Note Purchase Agreement and the Put and Call Agreement. The Mezzanine
Lenders shall assign all of their right, title and interest in the Mezzanine
Credit Agreement to US Newco and transfer the Sale Shares and the Company
Warrants held by them and set out in Schedule 1 beside their respective names to
US Newco and shall execute and deliver the Note Purchase Agreement and the Put
and Call Agreement, in consideration for which the Purchaser shall execute and
deliver the Note Purchase Agreement and the Put and Call Agreement and issue the
Notes to such parties to this Agreement and in such proportions as Phoenix or
the Mezzanine Lenders may direct.
(a) Each Mezzanine Lender shall:
(i) deliver a duly executed assignment in a form reasonably acceptable
to the Purchaser of their respective right, title and interest in
the Mezzanine Credit Agreement;
(ii) deliver a duly executed acknowledgement in a form reasonably
acceptable to the Purchaser, that no amounts are outstanding to them
under the Mezzanine Credit Agreement and an instruction to the
security trustee for the Mezzanine Credit Agreement to release all
pledges, charges, liens or encumbrances over the securities and
assets of any Group Company held by such security trustee for the
benefit of the Mezzanine Lenders;
(iii) in respect of the Sale Shares set out in Schedule 1 beside that
Mezzanine Lender's name, duly execute and deliver powers of attorney
in order to enable the transfer of the Sale Shares by way of a
notarial deed of transfer in agreed form, which will be passed
before a civil law notary in the Netherlands on the Completion Date
as indicated by Phoenix and the Purchaser; and
(iv) in respect of the Company Warrants set out in Schedule 1 beside that
Mezzanine Lender's name, duly execute and deliver an assignment
agreement transferring such Company Warrants to US Newco and deliver
(or cause to be delivered) to US Newco all of the certificates
representing such Company Warrants;
24
(b) The Purchaser shall issue the Notes to such parties to this Agreement and
in such proportions as Phoenix or the Mezzanine Lenders may direct.
(c) The Purchaser shall procure that US Newco shall duly execute and deliver
powers of attorney in order to enable the transfer of the Sale Shares
referred to in paragraph (a) above by way of a notarial deed of transfer
in agreed form, which will be passed before a civil law notary in the
Netherlands on the Completion Date as indicated by Phoenix
(d) Each of the Purchaser and the parties to which the Notes are to be issued
shall execute and deliver the Note Purchase Agreement and each of the
Purchaser and each of the parties to which the Notes are to be issued (and
Phoenix Bermuda) shall execute and deliver the Put and Call Agreement.
6.6 Payment of cash to the Company. The Purchaser shall procure that US Newco
transfers cash to the Company to the extent necessary to enable the obligations
under Clauses 6.8 and 6.12 to be fulfilled as a loan, in connection with which
the Purchaser and Phoenix shall procure that US Newco and the Company
respectively shall enter into such documentation as is required in respect of
the loan under applicable law.
6.7 Transfer of the Sale Shares and transfer of the Consideration Warrants.
Each Investor shall transfer the Sale Shares held by them to US Newco, in
consideration for which the Purchaser shall procure that US Newco transfers the
Consideration Warrants to such BCcH Shareholders and in such proportions as
Phoenix may direct, in connection with which:
(a) Phoenix shall procure the delivery to the Purchaser of the original
shareholders register of the Company, duly written up to the Business Day
immediately preceding the Completion Date;
(b) Each Investor shall:
(i) in respect of the Sale Shares set out in Schedule 1 beside that
Investor's name, duly execute and deliver powers of attorney in
order to enable the transfer of such Sale Shares by way of a
notarial deed of transfer in agreed form, which will be passed
before a civil law notary in the Netherlands on the Completion Date
as indicated by Phoenix;
(ii) deliver a duly executed release in a form reasonably satisfactory to
the Purchaser confirming that no amounts are outstanding to it from
any Group Company and it has no claims outstanding against any Group
Company;
(c) The Purchaser shall:
(i) procure that US Newco duly executes and delivers powers of attorney
in order to enable the transfer of the Sale Shares by way of a
notarial deed of transfer in agreed form, which will be passed
before a civil law notary in the Netherlands on the Completion Date
as indicated by Phoenix; and
(ii) cause the Consideration Warrants and the applicable Warrant
assignment forms to be transferred by US Newco to Phoenix or such
25
BCcH Shareholders as Phoenix may direct in the proportions directed
by Phoenix and applicable Warrant assignment forms to be duly
executed and delivered, provided that if the Foundation does not
have the authority to transfer any or all of the Foundation Shares
to the Purchaser at Completion, then the provisions of Schedule 5
shall apply in respect of the delivery of the Foundation Share
Consideration or the relevant portion thereof.
If such Consideration Warrants are transferred to Phoenix and subsequently
transferred by Phoenix to Phoenix Bermuda L.P. or to another BCcH
Shareholder, such subsequent transfer shall be made without the
application of the transfer restrictions provided for in the terms of the
Consideration Warrants.
6.8 Payment of the Transaction Fees. The Purchaser shall procure that the
Company pays the Transaction Fees to Phoenix as paying agent for the Company and
Phoenix shall:
(a) deliver to the Purchaser a written confirmation that Phoenix will receive
such payment as the Company's paying agent and apply that sum so received
without delay in paying the Transaction Fees to the persons to whom they
are payable in accordance with the notice delivered pursuant to Clause
5.1(b) (save that (a) if any person entitled to such payment makes a
request for payment pursuant to a banker's draft as opposed to wire
transfer of funds, then payment shall be made as soon as reasonably
practicable and (b) if the Company is not required to make a payment on
the Completion Date, then such payment shall be made on or before the date
on which such payment is due); and
(b) procure the delivery to the Purchaser of a duly executed release from CPIL
in a form reasonably satisfactory to the Purchaser confirming that no
amounts are outstanding to it from any Group Company and it has no claims
outstanding against any Group Company.
6.9 Provisional Adjustment Payments and Co-Investor loan assignment.
(a) The Purchaser shall procure that US Newco enters, and Phoenix shall enter
into, and shall procure that Compass Partners European Equity Investors LP
enters into, assignments in the agreed form in relation to the benefit of
the Co-Investor Loan.
(b) The Purchaser and Phoenix agree that, to the extent that the sum of (i)
the Provisional Adjusted Financial Debt, (ii) the amount payable in
respect of the Sale Bonus Arrangements and (iii) the Transaction Fees:
(i) is less than the Threshold Amount, the Purchaser shall procure that
the difference (the Estimated Co-Investor Loan Payment) shall be
paid by US Newco to Phoenix to the Account as provisional
consideration for the assignment of the Co-Investor Loan;
(ii) is greater than the Threshold Amount, Phoenix shall pay to US Newco
the amount of the difference (unless the amount of the difference
26
exceeds the sum which is the aggregate of the Transaction Fees and
the amounts payable in respect of the Sale Bonus Arrangements, in
which event Phoenix shall only pay that aggregate sum) and US Newco
shall pay the sum of one euro to Phoenix to the Account as
provisional consideration for the assignment of the Co-Investor
Loan.
If an Estimated Co-Investor Loan Payment is made pursuant to paragraph (i)
above, then Phoenix shall retain the funds so received and shall not
distribute them until such time as the payments provided for under Clause
7 have been made.
6.10 [Intentionally left blank]
6.11 In addition, each of the parties to this Agreement shall procure that the
following occurs at Completion:
(a) The BCcH Shareholders shall procure that a general meeting of the
Shareholders of the Company is held at which the following business is
transacted:
(i) L. John Clark, Franklin J. Rudd and Ken Hanna (and any other
director nominated by Phoenix) shall each resign as members of the
Company's supervisory board and shall deliver letters of resignation
in agreed form and the Company shall discharge each of L. John
Clark, Franklin J. Rudd and Ken Hanna from any liability in respect
of their capacity as members of the Company's supervisory board;
(ii) such persons as the Purchaser may notify to the BCcH Shareholders at
least three (3) Business Days prior to the anticipated date for
Completion shall be appointed as directors of the Company;
(iii) the articles of association of the Company shall be amended to
increase the authorised share capital of the Company to such amount
as the Purchaser shall indicate to Phoenix at least three (3)
Business Days prior to the Completion Date, such amendment to come
into effect immediately after Completion has taken place in its
entirety.
(b) The Investors shall deliver to the Purchaser:
(i) executed letters of resignation in the agreed form from membership
of the management boards of the Group Companies of such of the
managing directors of the Group Companies as the Purchaser may
request in writing no later than five (5) Business Days before the
Completion Date; and
(ii) legal opinion in agreed form as to Phoenix;
(c) The Purchaser shall deliver to Phoenix and the Mezzanine Lenders legal
opinions in agreed form or otherwise in a form reasonably satisfactory to
Phoenix as to the Purchaser, VEG and US Newco.
(d) Each of the Purchaser, the BCcH Shareholders and the Foundation shall
enter into the Registration Rights Agreement, the ERISA Side Letter and
such other
27
agreements as are in the agreed form, in each case to the extent they are
designated as parties to them.
6.12 Payment of the Senior Debt and the Release of Pledges relating to the
Senior Credit Agreement.
(a) The Purchaser shall procure that the Company lends to BCc International
(or such other members of the Group as have the obligations to make the
relevant payments) such sum or sums (after taking account of the payments
made to BCc International pursuant to Clauses 6.4 and 6.6) as will provide
such Group Companies with the aggregate cash resources to make the
payments required by paragraph (c) below.
(b) The Purchaser shall be entitled to procure that BCc International pays BCc
Netherlands a portion of such sums in satisfaction of all or part of the
principal amount of an intercompany loan and accrued but unpaid interest
owed by BCc International to BCc Netherlands.
(c) The Purchaser shall procure that BCc International and BCc Netherlands (or
such other Group Companies as have the obligations to make the relevant
payments) shall repay all amounts outstanding under the Senior Credit
Agreement, including all accrued interest up to and including the
Completion Date and all premiums, termination payments, break costs and
other amounts, if any, payable upon such repayment, in each case, in
accordance with the terms of the Senior Credit Agreement and as set out in
the notice delivered pursuant to Clause 5.1(a) and confirmed in writing by
the Agent.
(d) The Investors shall deliver:
(i) a duly executed acknowledgement in a form reasonably acceptable to
the Purchaser from the Agent for the Senior Credit Agreement that no
amounts are outstanding under the Senior Credit Agreement and
irrevocable instructions from the lenders under the Senior Credit
Agreement to release all pledges, charges, liens or encumbrances
over the securities and assets of any Group Company held by such
security trustee for the benefit of such lenders;
(ii) a duly executed letter from the Agent for the Senior Credit
Agreement to the Purchaser agreeing to release all pledges, charges,
liens or encumbrances over the securities and assets of any Group
Company held by the security trustee upon payment of all amounts
outstanding under the Senior Credit Agreement;
The Purchaser shall either: (a) deliver all guarantees or other security
interests executed by the Purchaser in favour of third parties as are necessary
to procure the release of the Philips Guarantee or Letter of Credit Guarantees;
or, only if the Fronting Bank (as defined in the Senior Credit Agreement) so
agrees, (b) put in place letters of credit or other guarantees acceptable to
that Fronting Bank as collateral for its prospective liability under the Letter
of Credit Guarantees and shall deliver all guarantees or other security
interests executed by the Purchaser in favour of third parties as are necessary
to procure the release of the Philips Guarantee. The Purchaser shall, if (a)
above applies, provide Phoenix and (in the case of the Letter of
28
Credit Guarantees) the Agent for the Senior Credit Agreement with all necessary
documentary evidence of the release of the Philips Guarantee and each Letter of
Credit Guarantee immediately following such release and, if (b) above applies,
the Purchaser shall provide written confirmation from the Fronting Bank of its
agreement to (b) above applying and its satisfaction with such collateral and
shall provide Phoenix and the agent under the Senior Credit Agreement with all
necessary documentary evidence of the release of the Philips Guarantee
immediately following such release;
6.13 If any event shall have occurred from and including 23 October 2002 until
the date of Completion which would be an adjustment event under the terms of
Section 4 of the Put and Call Agreement and Section 11 of the Warrant Agreement,
then the agreed forms of those documents that are entered into at Completion
shall be amended by replacing any references to a number of shares, or as
applicable, a price per share, in order to take into account those adjustments
required under the terms of the Warrant Agreement and the Put and Call
Agreement, as the case may be, as if such Warrants or interests in relation to
the Put and Call had been outstanding immediately prior to such adjustment
event.
6.14 If in any respect material to the Purchaser or Phoenix, as the case may
be, the provisions of this Clause 6 are not complied with on the Completion
Date, the Purchaser (in the case of any actions required under Clause 6 to be
performed by any of the BCcH Shareholders, the Foundation or Phoenix) or Phoenix
(in the case of any actions required under this Clause 6 to be performed by the
Purchaser, VEG or US Newco) may defer Completion until a date not later than ten
(10) days following the Completion Date. If all the provisions of this Clause 6
have not been complied with on such deferred date, Phoenix (if such
non-compliance is due to the default of any one or more of the Purchaser, VEG or
US Newco) or the Purchaser (if such non-compliance is due to the default of any
one or more of the BCcH Shareholders, the Foundation or Phoenix) shall be
entitled to terminate this Agreement without prejudice to any rights and
liabilities arising from any prior breach of this Agreement.
7. DETERMINATION OF CO-INVESTOR LOAN PAYMENT AND OTHER MATTERS
7.1 The parties shall comply with their obligations under Schedule 3 in
relation to the preparation and finalisation of the Adjusted Financial Debt
Statement.
7.2 Not later than two (2) Business Days following the date on which the
Adjusted Financial Debt Statement prepared in accordance with Schedule 3 has
been finalised:
(a) if the Adjusted Financial Debt is less than the Provisional Adjusted
Financial Debt, then the Purchaser shall pay to Phoenix the amount of the
difference;
(b) if the Adjusted Financial Debt is greater than the Provisional Adjusted
Financial Debt, then Phoenix shall pay to the Purchaser the amount of the
difference, provided that the maximum sum which Phoenix shall be obliged
to pay under this paragraph (b) shall be the amount resulting from the
following calculation:
(a + b) - c
where:
29
a = the amount of the Estimated Co-Investor Loan Payment (if any) made to the
Account pursuant to Clause 6.9(b)(i);
b = the amount of the Transaction Fees plus the aggregate of the sums payable in
respect of Sale Bonus Arrangements pursuant to Clause 8.2; and
c = the amount of the payment (if any) made by Phoenix pursuant to Clause
6.9(b)(ii).
8. POST COMPLETION UNDERTAKINGS
8.1 The Purchaser undertakes to each of the BCcH Shareholders that from and
after Completion it shall procure that each Group Company shall comply with the
terms and conditions of employment of each employee of the Group, including
those relating to salary, benefits, incentive schemes (other than share based
incentive schemes) and severance benefits, including, without limitation, all
salary and benefits to be paid to each of the Senior Managers, in each case to
the extent disclosed in the Data Room or otherwise disclosed in writing to the
Purchaser's German counsel subject to any subsequent amendments to such salary,
benefits, incentive schemes or severance benefits which may be negotiated and
agreed in accordance with applicable laws between the Purchaser and such
employee or Senior Manager, as the case may be, or such other representative
body (including, without limitation, any works council) and subject further to
any amendments as may be provided under applicable law. Clause 8.1 shall not
inhibit the ability of any Group Company to vary the terms of employment of any
of their employees in accordance with all applicable contractual and legal
requirements.
8.2 The Purchaser undertakes within ten (10) Business Days of Completion to
procure that the Company pays to the relevant employees of the Group Companies
any amount payable to them in accordance with the Sale Bonus Arrangements.
8.3 From and after Completion, the Purchaser agrees to provide all reasonable
assistance to Phoenix, including granting reasonable access to employees of the
Group and information held by the Group relating to periods prior to Completion
to enable Phoenix to resolve any outstanding issues in connection with its
original acquisition of shares in the Company.
8.4 The Purchaser hereby acknowledge that, after Completion, the Purchaser may
take any or all of the following steps: (i) contribution by US Newco of all its
assets and liabilities to the Company; (ii) filing of elections to change the
classification for US tax purposes of each of the Company and its Subsidiaries
to be treated as either partnerships or as entities to be disregarded as a
separate entity from their owners; (iii) filing of elections under US Internal
Revenue Code section 338(g) in respect of the acquisition of the Company and its
Subsidiaries; and (iv) liquidation of BCc Luxembourg (together, the Post
Completion Steps). Subject to the provisions of Clause 8.5, the Purchaser agrees
to indemnify, defend and hold harmless the BCcH Shareholders, the Foundation and
the Mezzanine Lenders and (if Phoenix so requires) each Group Company, and any
of their respective directors, officers, employees, affiliates, controlling
persons, agents and representatives and their successors and assigns
(collectively, the Indemnitees) from and against, and shall compensate and
reimburse each of the Indemnitees for, all liabilities, demands, claims, actions
or causes of action, assessment, losses, damages, fines, penalties, costs and
expenses (including, for the avoidance of doubt and without limitation, any
liability to make or
30
suffer an actual payment of Tax (or an amount in respect of Tax) or the loss,
use or set-off of any relief from Tax), reasonable attorneys fees and expenses)
(collectively, the Damages) incurred by any Indemnitees as a result of, in
respect of, by reference to or in consequence of or arising out of any actions
taken pursuant to Clauses 6.3 or 6.4 or any of the Post Completion Steps (all
such actions and the Post Completion Steps together being referred to as the
Relevant Actions) PROVIDED THAT the Purchaser's liability under this Clause 8.4
for any Damages shall be reduced or extinguished to the extent that such Damages
would have arisen regardless of whether the Relevant Action had taken place).
Tax includes, without limitation, (a) taxes on gross or net income, profits and
gains, and (b) all other taxes, levies, duties, imposts, charges and
withholdings of any nature, including any excise, property, value added, sales,
use, occupation, transfer, franchise and payroll taxes and any national
insurance or social security contributions, and any payment whatsoever which the
relevant person may be or become bound to make to any person as a result of the
discharge by that person of any tax which the relevant person has failed to
discharge, together with all penalties, charges and interest relating to any of
the foregoing or to any late or incorrect return in respect of any of them, and
regardless of whether such taxes, levies, duties, imposts, charges,
withholdings, penalties and interest are chargeable directly or primarily
against or attributable directly or primarily to the relevant person or any
other person and of whether any amount in respect of them is recoverable from
any other person.
8.5 The indemnity contained in Clause 8.4 shall not apply to Damages incurred
by Indemnitees as a result of, in respect of, by reference to or in consequence
of or arising out of the filing of elections referred to in sub-paragraphs (ii)
and (iii) of the definition of Post Completion Steps contained in Clause 8.4
provided that:
(a) the Purchaser gives Phoenix not less than 14 days notice of its intention
to make such election, identifying the Group Company concerned; and
(b) the Purchaser provides Phoenix with such other information regarding the
election that it may reasonably require.
8.6 All sums payable by the Purchaser under Clause 8.4 shall be paid free and
clear of all deductions or withholdings unless the deduction or withholding is
required by law, in which event the Purchaser shall pay such additional amount
as shall be required to ensure that the net amount received by the relevant
Indemnitee will equal the full amount which would have been received by it had
no such deduction or withholding been required to be made.
8.7 If any tax authority brings into charge to tax any sum paid to any
Indemnitee under Clause 8.4 (including in circumstances where any relief is
available in respect of such charge to tax), then the Purchaser shall pay such
additional amount as shall be required to ensure that the total amount paid,
less the tax chargeable on such amount (or that would be so chargeable but for
such relief), is equal to the amount that would otherwise be payable under that
Clause.
8.8 Clause 8.7 shall apply in respect of any amount deducted or withheld as
contemplated by Clause 8.6 as it applies to sums paid to any such Indemnitee,
save to the extent that in computing the tax chargeable any Indemnitee is able
to obtain a credit for the amount deducted or withheld.
31
9. VENDOR WARRANTIES
9.1 Capacity and Authority. Each Mezzanine Lender warrants severally to the
Purchaser in respect of itself that as of the date of this Agreement:
(a) it has obtained all corporate authorisations required to empower it to
enter into and to perform its obligations under this Agreement;
(b) this Agreement constitutes a valid and binding obligation of it in
accordance with its terms subject to applicable bankruptcy, insolvency,
reorganisation, moratorium and similar laws affecting creditors' rights
and remedies generally; and
(c) the execution and delivery of, and the performance by it of its
obligations under, this Agreement will neither:
(i) conflict with, or result in the breach of, any provision of its
Memorandum or Articles of Association or other constitutional or
empowering agreement (if any); nor
(ii) violate any statute, rule, regulation, order, judgment or decree of,
or undertaking to, any court or governmental body or authority by
which it is bound.
9.2 Ownership of Company Warrants and DIPs. Each Mezzanine Lender warrants
severally to the Purchaser in respect of itself and the Company Warrants and
DIPs it owns that as of the date of this Agreement:
(a) it is the sole legal and beneficial owner of the Company Warrants set out
in Schedule 1 identified against that Mezzanine Lender's name; and
(b) it is the sole legal and beneficial owner of the DIPs set out in Schedule
1 identified against that Mezzanine Lender's name; and
in each case, such Mezzanine Lender owns such Company Warrants and DIPs free
from all security interests, options, equities, claims or other third party
rights (including rights of pre-emption) of any nature whatsoever.
9.3 Capacity and Authority. Each Investor warrants severally to the Purchaser
in respect of itself that as of the date of this Agreement:
(a) it has obtained all corporate authorisations required to empower it to
enter into and to perform its obligations under this Agreement;
(b) this Agreement constitutes a valid and binding obligation of it in
accordance with its terms subject to applicable bankruptcy, insolvency,
reorganisation, moratorium and similar laws affecting creditors' rights
and remedies generally; and
(c) the execution and delivery of, and the performance by it of its
obligations under, this Agreement will neither:
32
(i) conflict with, or result in the breach of, any provision of its
Memorandum or Articles of Association or other constitutional or
empowering agreement (if any); nor
(ii) violate any statute, rule, regulation, order, judgment or decree of,
or undertaking to, any court or governmental body or authority by
which it is bound.
9.4 Ownership of the Sale Shares. Each BCcH Shareholder warrants severally to
the Purchaser in respect of itself and the Sale Shares it owns that as of the
date of this Agreement it is the sole legal and beneficial owner of the Sale
Shares set out in Schedule 1 identified against that BCcH Shareholder's name and
such BCcH Shareholder owns such Sale Shares and, with the exception of such
pledges, charges, liens and encumbrances held for the benefit of the lenders
under the Senior Credit Agreement and the Mezzanine Lenders, such shares are
free from all security interests, options, equities, claims or other third party
rights (including rights of pre-emption) of any nature whatsoever.
9.5 Each Investor warrants severally to the Purchaser that as of the date of
this Agreement:
(a) the information contained in Schedule 2 and Exhibit 2 (in the case of
Schedule 2 and Exhibit 2, subject to any disposal of any shareholding in
any Group Company that is consented to by the Purchaser) is true, complete
and accurate in all material respects; and
(b) the Sale Shares and the Foundation Shares constitute all of the issued
Shares in the Company and save for the Company Warrants no person has the
right (whether exercisable now or in the future and whether contingent or
not) to call for the allotment, issue, sale or transfer of any Shares or
unissued shares in the Company or any Group Company under any option or
other agreement (including conversion rights and rights of pre-emption)
and
(i) with the exception of such pledges, charges, liens and encumbrances
held for the benefit of the lenders under the Senior Credit
Agreement and the Mezzanine Lenders, there are no claims, charges,
liens, equities or encumbrances on the shares of any Group Company
other than the Company that would be reasonably likely to have an
adverse effect on the ability of the Group Companies to exercise
their rights in relation to, or to transfer, any such shares; and
(ii) The Company has no subsidiaries apart from the Subsidiaries. Each of
the Company and its Subsidiaries is a corporation duly organised and
validly existing under the laws of the jurisdiction of its
organisation in all material respects.
9.6 The BCcH Shareholders acknowledge that the Purchaser and VEG have entered
into this Agreement in reliance upon the Vendor Warranties.
9.7 If and to the extent that there is a liability in respect of any Claim
with respect to the warranties given by the Investors in Clause 9.5 in respect
of which any one or more BCcH Shareholders are liable, then each such BCcH
Shareholder shall only be
33
responsible for the sum equal to the Relevant Percentage of such liability. In
relation to any given BCcH Shareholder, Relevant Percentage means the percentage
of the issued share capital which the shares identified against that BCcH's
Shareholder's name in Schedule 1 represent of the entire issued share capital at
the date of this Agreement.
9.8 Each BCcH Shareholder, each Mezzanine Lender and the Foundation shall be
severally, and neither jointly nor jointly and severally, liable to perform any
and all obligations expressed to be assumed by the BCcH Shareholders and/or the
Mezzanine Lenders and/or the Foundation in this Agreement and the liability of
each of the BCcH Shareholders, each of the Mezzanine Lenders and the Foundation
under or in respect of any matter or thing referred to in this Agreement shall
be several and neither joint nor joint and several.
Other Warranty Provisions
9.9 Each of the Vendor Warranties shall be construed as a separate warranty
and (save as expressly provided to the contrary) shall not be limited or
restricted by reference to or inference from the terms of any other warranty or
any other term of this Agreement.
9.10 The Vendor Warranties, confirmations and undertakings set out in this
Agreement are given on a several basis. A breach thereof by a particular BCcH
Shareholder shall not itself amount to a breach of any corresponding Vendor
Warranty, confirmation or undertaking given by any other BCcH Shareholder or
Mezzanine Lender.
9.11 Each of the Vendor Warranties shall be deemed to include a further
warranty, that it shall remain true and accurate at all times up to and
including the Cut-Off Date.
9.12 None of the BCcH Shareholders shall have any liability in respect of any
breach of Vendor Warranty that is capable of remedy unless the relevant BCcH
Shareholder(s) are given written notice of such breach and such breach is not
remedied within thirty (30) days after the date on which such notice is so
served.
9.13 The Vendor Warranties are subject to any written information contained in
the Data Room or otherwise supplied to the Purchaser or any of its advisers
during the course of any investigation (whether authorised by any of the parties
to this Agreement or not) by or on behalf of the Purchaser into the affairs of
the Foundation, the Company or any member of the Group. All such information
shall be deemed to be disclosed to the Purchaser. 9.14 The liability of any BCcH
Shareholder for any Claim in respect of any fact, matter, event or circumstance
shall be reduced or extinguished to the extent that such Claim would not have
arisen but for any of the Relevant Actions (as defined in Clause 8.4), or is
increased as a result of any of the Relevant Actions to an extent it would not
have been increased had such Relevant Action not been taken.
10. PURCHASER WARRANTIES
10.1 The Purchaser and VEG each warrant to each of the BCcH Shareholders, the
Foundation and the Mezzanine Lenders that as of the date of this Agreement:
34
(a) VEG is a company duly incorporated, organised and validly existing and in
good standing under the laws of Germany and the Purchaser is a company
duly incorporated, organised and validly existing and in good standing
under the laws of the State of Delaware;
(b) it has obtained all corporate authorisations required to empower it to
enter into and to perform its obligations under this Agreement;
(c) this Agreement constitutes (or, to the extent that, in order to be valid
and binding on VEG under the laws of Germany, this Agreement requires to
be notarised before notaries public in any one or more jurisdictions, it
will constitute for VEG after such notarisations have been duly made) a
valid and binding obligation of it in accordance with its terms subject to
applicable bankruptcy, insolvency, reorganisation, moratorium and similar
laws affecting creditors' rights and remedies generally, and
(d) the execution and delivery of, and the performance by it of its
obligations under, this Agreement will neither:
(i) conflict with, or result in the breach of, any provision of its
Certificate of Incorporation, by-laws or other constitutional or
empowering agreement (if any); nor
(ii) violate any statute, rule, regulation, order, judgment or decree of,
or undertaking to, any court or governmental body or authority by
which it is bound.
(e) The authorised capital stock of the Purchaser consists of 300,000,000
shares of common stock, par value $0.10 per share (the Common Stock),
20,000,000 shares of class B convertible common stock, par value $0.10 per
share (the Class B Stock) and 1,000,000 shares of preferred stock, par
value $1.00 per share (the Preferred Stock). As of October 31, 2002, (i)
144,280,672 shares of Common Stock were issued and outstanding, (ii)
15,383,476 shares of Class B Stock were issued and outstanding, (iii) no
shares of Preferred Stock were issued and outstanding, (iv) 15,383,476
shares of Common Stock were issuable upon conversion of outstanding shares
of Class B Stock, (v) 9,717,724 shares of Common Stock were issuable upon
conversion of the Purchaser's Liquid Yield Option Notes, (vi) 6,300,000
shares of Common Stock were issuable upon conversion of the 5.75%
convertible notes due 2006 of the Purchaser's General Semiconductor, Inc.
subsidiary and (vii) 9,133,447 shares of Common Stock were issuable upon
exercise of stock options issued under the Purchaser's stock option plans.
(f) Except as disclosed in Clause 10.1(e) above or as contemplated by this
Agreement, there is no existing option, warrant, call, right, commitment
or other agreement of any character to which the Purchaser is a party
requiring, nor are there securities of the Purchaser outstanding which
upon conversion or exchange would require, the issuance, sale or transfer
of any additional shares of capital stock or other equity securities of
the Purchaser, or other securities convertible into, exchangeable for or
evidencing the right to subscribe for or purchase shares of capital stock
or other equity securities of the Purchaser. Except as disclosed in the
Purchaser's Proxy Statement on Schedule 14A filed
35
with the United States Securities and Exchange Commission on April 22,
2002, or as contemplated in the Agreement, Purchaser is not a party to any
voting trust or other voting agreement with respect to or agreement
relating to the transfer or disposition of any of the capital stock of the
Purchaser.
(g) The Purchaser has the corporate power and authority to sell, transfer,
assign and deliver (or provide for the sale, transfer, assignment or
delivery of) the Consideration Warrants and to issue the Notes and enter
into the Put and Call Agreement.
10.2 Each of the Purchaser Warranties shall be construed as a separate
Purchaser Warranty and (save as expressly provided to the contrary) shall not be
limited or restricted by reference to or inference from the terms of any other
Purchaser Warranty or any other terms of this Agreement.
10.3 Each of the Purchaser Warranties shall be deemed to include a further
warranty, that it shall remain true and accurate at all times up to and
including Completion.
10.4 The Purchaser and VEG acknowledge that each of the BCcH Shareholders and
the Foundation have entered into this Agreement in reliance upon the Purchaser
Warranties.
11. ENTIRE AGREEMENT
This Agreement, the Confidentiality Agreement and the side letter entered into
on the same date as this Agreement relating to the satisfaction or otherwise of
the conditions set out in Clause 3.1 together set out the entire agreement and
understanding between the parties in respect of its subject matter. It is agreed
that:
(a) no party has entered into this Agreement in reliance upon any
representation, warranty or undertaking of any other party or any of its
Related Persons which is not expressly set out or referred to in this
Agreement;
(b) a party may claim in contract for breach of warranty under this Agreement
but shall have no claim or remedy in respect of misrepresentation (whether
negligent or otherwise, and whether made prior to, and/or in, this
Agreement) or untrue statement made by any other party or any of its
Related Persons;
(c) this Clause shall not exclude any liability for, or remedy in respect of,
fraudulent misrepresentation by a party or any of its Related Persons; and
(d) save as expressly set out in this Agreement, no party or Related Person
shall owe any duty of care to any other party or Related Person.
Each party contracts in this Clause on its own behalf and as agent for each of
its Related Persons. Each Related Person which contracts through the agency of a
party may enforce this Clause direct against each other party and Related
Person. Related Person means (a) a party's officers, employees, group
undertakings, agents and advisers, (b) officers, employees, agents and advisers
of a party's group undertakings; and (c) officers, employees and partners of any
such agent or adviser or of any group undertaking of such an agent or adviser.
For the avoidance of doubt, for the purpose
36
of this Clause 11 each Group Company shall be treated as a group undertaking of
Phoenix.
For the avoidance of doubt, this Clause 11 applies in respect of the estimate
delivered by Phoenix pursuant to Clause 5.1(b).
12. NO THIRD PARTY RIGHTS
Save as set forth in Clause 11, a person who is not a party to this Agreement
shall have no right under the Contracts (Rights of Third Parties) Act 1999 to
enforce any of its terms (including without limitation those of Clause 7.1).
13. VARIATION
13.1 Subject to Clause 13.2, no variation of this Agreement (or of any of the
documents referred to herein) shall be valid unless it is in writing and signed
by or on behalf of each of the parties hereto. The parties acknowledge that in
respect of variations of a non-material nature, Phoenix may sign such written
variation on behalf of all the BCcH Shareholders, the Foundation and the
Mezzanine Lenders. The expression "variation" shall include any variation,
supplement, deletion or replacement however effected.
13.2 Unless expressly agreed, no variation shall constitute a general waiver of
any provisions of this Agreement, nor shall it affect any rights, obligations or
liabilities under or pursuant to this Agreement which have already accrued up to
the date of variation, and the rights and obligations of the parties under or
pursuant to this Agreement shall remain in full force and effect, except and
only to the extent that they are so varied.
14. ASSIGNMENT
No party shall be entitled to assign the benefit of any provision of this
Agreement without the prior written consent of all the other parties save that
the Purchaser may assign the rights under this Agreement to the Purchaser or any
subsidiary of the Purchaser. Any assignment in contravention of this Clause
shall be void. If the benefit of the whole or any part of this Agreement is
assigned by the Purchaser to any subsidiary of the Purchaser in accordance with
this Clause 14 then, where any such assignee subsequently ceases to be a
subsidiary of the Purchaser, the Purchaser shall procure that before it so
ceases it shall assign that benefit to the Purchaser or to another subsidiary of
the Purchaser.
15. SUCCESSORS
This Agreement shall be binding on and inure for the benefit of the successors
and permitted assigns of the parties.
16. AGREEMENT TO REMAIN IN FORCE
So far as it remains to be performed, this Agreement shall continue in full
force and effect notwithstanding Completion.
37
17. NO RIGHT TO RESCIND
Without prejudice to any rights of termination contained in this Agreement, the
sole remedy against any of the BCcH Shareholders, the Foundation and/or
Mezzanine Lenders for any breach of this Agreement shall be an action for
damages and the Purchaser shall not be entitled to rescind this Agreement.
Nothing in this Agreement shall exclude any remedy for fraudulent
misrepresentation by any BCcH Shareholder, the Foundation or Mezzanine Lender
save that, in the case of fraudulent misrepresentation by any of the foregoing,
the Purchaser will not be entitled to rescind this Agreement with respect to any
other BCcH Shareholder, the Foundation or Mezzanine Lender.
18. INTEREST
If payment of any sum due under the terms of this Agreement shall be delayed,
the payer shall pay interest on such sum, from the date on which such sum is due
until the date of payment, at a rate equal to two and a half cent. (2.5%) above
LIBOR such interest to accrue on a daily basis with six monthly rests.
19. ANNOUNCEMENTS
19.1 Subject to Clause 19.2, prior to Completion, except as otherwise agreed to
by the parties, the parties shall not issue any report, statement or press
release or otherwise make any public statements with respect to this Agreement
and the transactions contemplated hereby, except as in the reasonable judgment
of the party may be required by law or the rules of any stock exchange, in which
case the parties will use their commercially reasonable efforts to reach mutual
agreement as to the language of any such report, statement or press release.
Upon the signing of this Agreement and on Completion, the parties will consult
with each other with respect to the issuance of a joint report, statement or
press release with respect to this Agreement and the transactions contemplated
hereby.
19.2 Each of the BCcH Shareholders and the Foundation may make confidential
communications to their respective general and limited partners or other
investors or prospective investors.
20. COSTS
20.1 Subject to Clauses 6.8, 8.2, 8.4 and 20.2, and any other Clause of this
Agreement entitling one party to recover Costs from another party if particular
conditions are not fulfilled, each of the parties shall pay its own Costs
incurred in connection with the negotiation, preparation and implementation of
this Agreement.
20.2 The Purchaser shall bear all stamp or other documentary or transaction
duties and any other transfer taxes arising as a result or in consequence of any
of the transfers which take place at Completion or otherwise pursuant to this
Agreement or of its implementation.
21. INVALIDITY
If any provision of this Agreement is held to be invalid or unenforceable, then
such provision shall (so far as it is invalid or unenforceable) be given no
effect and shall be deemed not to be included in this Agreement but without
invalidating any of the
38
remaining provisions of this Agreement, provided that no party's rights under
the Agreement, taken as a whole, are materially adversely effected thereby. The
parties shall then use all reasonable endeavours to replace the invalid or
unenforceable provisions by a valid and enforceable provision the effect of
which is as close as possible to the intended effect of the invalid or
unenforceable provision.
22. COUNTERPARTS
This Agreement may be entered into in any number of counterparts and by the
parties to it on separate counterparts, each of which, when executed and
delivered, shall be an original, but all the counterparts shall together
constitute one and the same instrument.
23. PURCHASER GUARANTEE
23.1 In consideration of the BCcH Shareholders, the Foundation and the
Mezzanine Lenders entering into this Agreement, the Purchaser unconditionally
and irrevocably guarantees as a continuing obligation the proper and punctual
performance by VEG of all its obligations under or pursuant to this Agreement
and any other documents of transfer or otherwise or obligations entered or to be
entered into according to the terms of this Agreement.
23.2 The Purchaser's liability under this Agreement shall not be discharged or
impaired by:
(a) any amendment to or variation of this Agreement, or any waiver of or
departure from its terms, or any assignment of it or any part of it, or
any document entered into under this Agreement;
(b) any release of, or granting of time or other indulgence to any of the BCcH
Shareholders, the Foundation and the Mezzanine Lenders or any third party,
or the existence or validity of any other security taken by any of the
BCcH Shareholders, the Foundation and the Mezzanine Lenders in relation to
this Agreement or any enforcement of or failure to enforce or the release
of any such security; or
(c) any winding up, dissolution, reconstruction, arrangement or
reorganisation, legal limitation, incapacity or lack of corporate power or
authority or other circumstances of, or any change in the constitution or
corporate identity or loss of corporate identity by, any of the BCcH
Shareholders or the Foundation (or any act taken by any of the BCcH
Shareholders, the Foundation or the Mezzanine Lenders in relation to any
such event).
24. AUTHORITY
24.1 Each of the BCcH Shareholders and the Foundation hereby appoint Phoenix as
their agent for:
(a) the receipt of any Consideration Warrants or any other consideration or
amounts deliverable or payable to them under this Agreement by the
Purchaser and payment or issue to Phoenix of such consideration or money
will be sufficient discharge of the corresponding obligation and the
Purchaser shall not be obliged to consider the existence or suitability of
any agreement
39
among the Mezzanine Lenders, the BCcH Shareholders and the Foundation, or
any of them;
(b) the delivery to the Purchaser of directions as to the proportion each BCcH
Shareholder or the Foundation is to receive of Consideration Warrants and
Notes and the Purchaser shall be entitled to rely on any such direction
without any enquiry of the BCcH Shareholder.
25. WAIVER
25.1 Any delay by any party in exercising, or failure to exercise, any right or
remedy under this Agreement shall not constitute a waiver of the right or remedy
or a waiver of any other rights or remedies or preclude its exercise at any
subsequent time and no single or partial exercise of any rights or remedy under
this Agreement or otherwise shall prevent any further exercise of the right or
remedy or the exercise of any other right or remedy.
25.2 The rights and remedies of any party under this Agreement are cumulative
and may be exercised as often as such party considers it appropriate and are not
exclusive of any rights or remedies provided by law.
26. FURTHER ASSURANCE
26.1 Each of the BCcH Shareholders, the Foundation and the Mezzanine Lenders
shall do or procure to be done all such further acts and things, and execute and
deliver (or procure the execution and delivery of) all such other documents, as
the Purchaser may from time to time reasonably require, whether on or after
Completion, for the purpose of giving to the Purchaser the full benefit of all
of the provisions of this Agreement.
26.2 The Purchaser shall do or procure to be done all such further acts and
things, and execute and deliver (or procure the execution and delivery of) all
such other documents, as Phoenix may from time to time reasonably require or
request on behalf of the BCcH Shareholders, the Foundation or Mezzanine Lenders,
whether on or after Completion, for the purpose of giving to any of the
foregoing the full benefit of all of the provisions of this Agreement.
27. NOTICES
27.1 Any notice or other communication to be given under, or in connection
with, this Agreement shall be in writing and signed by or on behalf of the party
giving it and may be served by leaving it or sending it by fax, prepaid recorded
delivery or registered post to the address and for the attention of the relevant
party set out in Clause 27.2 (or as otherwise notified from time to time
hereunder). Any notice so served by fax or post shall be deemed to have been
received:
(a) in the case of fax, twelve (12) hours after the time of transmission;
(b) in the case of prepaid recorded delivery or registered post, forty eight
(48) hours from the date of posting in the case of inland delivery and
four (4) Business Days in the case of international delivery.
40
27.2 The addresses and fax numbers of the parties for the purpose of Clause
27.1 are as follows:
Phoenix: 398 route d'Esch,
L-1471
Luxembourg
For the attention of: Marc Feider
Fax: 00352 4444 55222
With a copy to: Compass Partners International Limited
4 Grosvenor Place
London SW1X 7HJ
United Kingdom
For the attention of: Franklin J. Rudd
Fax: +44 207 761 2020
BCcH Shareholders: The address, fax number and to the
attention of the person set out beside each name in
Schedule 1.
Purchaser: Vishay Intertechnology Inc.
63 Lincoln Highway
Malvern
Pennsylvania 19355-2120
For the attention of: A. Eden
Fax: 001 610 8892161
27.3 In proving such service it shall be sufficient to prove that the envelope
containing such notice was properly addressed and delivered either to the
address shown thereon or into the custody of the postal authorities as a
pre-paid recorded delivery or registered post letter, or that the facsimile
transmission was made after obtaining in person or by telephone appropriate
evidence of the capacity of the addressee to receive the same, as the case may
be.
27.4 For the purposes of notices given under or pursuant to Clauses 5.1 and
6.11:
(a) such notices may, in addition to the methods contemplated by Clause 27.1
above, be given by email to the email addresses of the relevant party set
out in Clause 27.5 below. Any notice so served by email shall be deemed to
have been received upon receipt by the sender of an automated delivery
receipt in respect of that email; and
(b) notwithstanding the provisions of Clause 27.1 above, such notices shall,
if given by fax, be deemed to have been received at the time of
transmission,
41
except where it is indicated by the equipment used to transmit the fax
that transmission has failed;
provided that any such notice shall, if transmitted by fax or email, only be
treated as having been served on a given day if served prior to 5pm UK time on
that day (and, if served later than that time, shall be deemed served on the
next following day).
27.5 The email addresses of the parties for the purposes of Clause 27.4 are as
follows:
Phoenix: daviddiamond@cpil.co.uk
-----------------------
with a copy to: david.crook@freshfields.com
---------------------------
Vishay: avieden@aol.com and avieden@vishay.com
--------------------------------------
With a copy to: david.kinch@edwincoe.com; and
-----------------------------
adienstag@kramerlevin.com
-------------------------
28. GOVERNING LAW AND JURISDICTION
28.1 This Agreement and the relationship between the parties shall be governed
by and construed in accordance with the laws of England.
28.2 Each of the parties agrees that the courts of England are to have
exclusive jurisdiction to settle any disputes which may arise in
connection with this Agreement.
28.3 Phoenix shall at all times maintain an agent for service of process and
any other documents in proceedings in England or any other proceedings in
connection with the Agreement. Such agent shall be Freshfields (for the
attention of David Winfield and David Crook) and any claim form, judgment
or other notice of legal process shall be sufficiently served on Phoenix
if delivered to such agent at its address for the time being. Phoenix
undertakes not to revoke the authority of the above agent and if, for any
reason, the Purchaser requests that Phoenix do so, it shall promptly
appoint another such agent with an address in England and advise the
Purchaser thereof. If following such a request Phoenix fails to appoint
another agent, the Purchaser shall be entitled to appoint one on behalf of
Phoenix.
28.4 Each of the BCcH Shareholders shall at all times maintain an agent for
service of process and any other documents in proceedings in England or
any other proceedings in connection with the Agreement. Such agent shall
be Freshfields (for the attention of David Winfield and David Crook) and
any claim form, judgment or other notice of legal process shall be
sufficiently served on each of the BCcH Shareholders if delivered to such
agent at its address for the time being. The BCcH Shareholders undertake
not to revoke the authority of the above agent and if, for any reason, the
Purchaser requests any of the BCcH Shareholders to do so, it shall
promptly appoint another such agent with an address in England and advise
the Purchaser thereof. If following such a request the relevant BCcH
Shareholder fails to appoint another agent, the Purchaser shall be
entitled to appoint one on behalf of that BCcH Shareholder.
43
28.5 The Purchaser and VEG shall at all times maintain an agent for service of
process and any other documents in proceedings in England or any other
proceedings in connection with the Agreement. Such agent shall be Edwin
Coe, Solicitors, of 2 Stone Buildings, Lincoln's Inn, London WC2A 3TH and
any claim form, judgment or other notice of legal process shall be
sufficiently served on the Purchaser and/or VEG if delivered to such agent
at its address for the time being. The Purchaser and VEG undertake not to
revoke the authority of the above agent and if, for any reason, Phoenix
requests the Purchaser or VEG to do so, they shall promptly appoint
another such agent with an address in England and advise Phoenix thereof.
If following such a request the Purchaser or Purchaser fails to appoint
another agent, Phoenix shall be entitled to appoint one on behalf of the
Purchaser and/or VEG.
AS WITNESS this Agreement has been signed on behalf of the parties the day and
year first before written.
43
Schedule 1
BCcH Shareholders and MEZZANINE LENDERS
Part A
Investors and their holdings of Sale Shares
Name Address Sale Shares
Phoenix Acquisition 398 route d'Esch, 7,099,703 A Shares
Company S.A.R.L L-1471: Luxembourg
Fax 00352444455222
Compass Partners 6 Front Street 1 B Share
European Equity Fund Hamilton HM11
(Bermuda), L.P. Bermuda
Fax: 0014412996563
Compass Partners 6 Front Street 30,112 A Shares
European Equity Hamilton HM11
Investors, L.P. Bermuda
Fax: 0014412996563
Compass Partners 1999 6 Front Street 24,311 A Shares
Fund, L.P. Hamilton HM11
Bermuda
Fax: 0014412996563
European Private Equity Wilmington, 1209 516,426 A Shares
Investors LLC Orange Street
NEW CASTLE COUNTY
Delaware 19801, USA
Part B
Foundation Shares
Stichting Administratiekantoor Meerenakkerplein 27-30 150,304 D Shares
Phoenix 5652 BJ Eindhoven
The Netherlands
Part C
Mezzanine Lenders and their holdings of Sale Shares, Company Warrants and DIPs
Sale DIPS Company
Name Address Shares Warrants
Sankaty High 111 Huntingdon 65,853 1 0.765632%
Yield Asset Avenue, A shares Warrants
Partners L.P. Boston, MA 02199, USA on A Shares
44
BCM Capital 111 Huntington Avenue 44,594 1 0.518476%
Partners L.P. Boston, MA 02199, USA A shares Warrants
on A shares
BCIP Associates 111 Huntington Avenue 251 A 1 0.002911%
II Boston, MA 02199, USA shares Warrants
on A shares
BCIP Trust 111 Huntington Avenue 1,211 A 1 0.014090%
Associates II Boston, MA 02199, USA shares Warrants
on A shares
JP Morgan 1221, Avenue of the 283,321 1 5.040284%
Partners (BHCA), Americas, 39th floor A shares Warrants
L.P. NEW YORK on A shares
NY 10020-1000 USA
formerly named
Chase Equity
Associates, L.P.
GarMark Partners One Landmark Square 277,275 1 2.417785%
L.P. 6th Floor, A shares Warrants
Stamford, CT 06901 on A shares
BCIP Trust 111 Huntington Avenue 21 A 1 0.000246%
Associates II-B Boston, MA 02199, USA shares Warrants
on A shares
Bain Capital V 111 Huntington Avenue 61,366 1 0.713466%
Mezzanine Fund Boston, MA 02199, USA A shares Warrants
L.P. on A shares
45
Schedule 2
Corporate Details of the Company
1. Name: BCcomponents Holdings B.V.
2. Date of Incorporation: 21 August 1996
3. Place of Incorporation: The Netherlands
4. Class of Company: Private limited liability company
5. Registered Number: Dutch Trade Register No.17094574
6. Registered Office: Meerenakkerplein 27-30, 5652 BJ
Eindhoven, The Netherlands
7. Directors: Supervisory Board:
Luther Johnson Clark
Kenneth George Hanna
Franklin John Rudd
Statutory Board:
Nazario Proietto
James Douglas Belt
Marc Frans Johan Sevenans
8. Authorised Capital: Euro 150,000-- divided into:
14,842,696 A shares of 0.01Euro each;
1,000 B shares of 0.01Euro each;
6,000 C shares of 0.01Euro each;
150,304 D shares of 0.01Euro each;
9. Issued Capital: 8,404,444 A shares
1 B share
0 C shares
150,304 D shares
10. Registered Shareholders: Phoenix
The Investors
Foundation
11. Accounting Reference
Date: 31 December
12. Auditors: Deloitte and Touche
13. Tax Residence: The Netherlands
46
List of Subsidiaries
Subsidiary Country % of issued capital
- ---------- ------- -------------------
BCcomponents Holdings (Netherlands) Netherlands 100%
B.V.
BCcomponents B.V. Netherlands 100%
BCcomponents International B.V. Netherlands 100%
BCcomponents Austria GmbH Austria 100%
BCcomponents Lux S.a.r.l Luxembourg 100%
BCcomponents Holding GmbH Germany 100%
BCcomponents Beyschlag GmbH Germany 100%
BCcomponents Vertriebs GmbH Germany 100%
BC Components, Inc. USA 100%
Capfoil, LLC USA 49%
BCcomponents SAS France 100%
BCcomponents Estate NV Belgium 100%
BCcomponents NV Belgium 100%
BCcomponents UK Ltd United Kingdom 100%
Valen Ltd Hong Kong 100%
BCcomponents (Shanghai) Company Ltd China 95%
BC Components South Europe SRL Italy 100%
BCcomponents India Pvt. Ltd India 100%
BCcomponents Hong Kong Ltd Hong Kong 100%
BCcomponents China Ltd Hong Kong 100%
BCcomponents Singapore Pte. Ltd Singapore 100%
BCcomponents Trading (Shanghai) Co. China 100%
Ltd
BCcomponents (Taiwan) Ltd Taiwan 100%
47
Schedule 3
preparation of Adjusted Financial Debt Statement
Part A
1. INTERPRETATION
1.1 In this Schedule 3, the following expressions shall have the following
meanings:
Accounts means the audited consolidated accounts of the Company and the
Subsidiaries, prepared in accordance with Dutch GAAP, for the accounting period
ended December 31 2001, comprising a balance sheet, profit and loss account,
notes and auditors' report;
Adjusted Financial Debt Statement has the meaning given in Part B of this
Schedule 3;
Independent Firm means KPMG of The Netherlands or such other Dutch
independent firm as is appointed pursuant to Part B of this Schedule;
Phoenix's Accountants means either or both of PwC and Deloitte & Touche,
as directed by Phoenix;
Purchaser's Accountants means Ernst & Young;
Review Period has the meaning given Part B in this Schedule 3; and
Spot Rate means the spot rate of exchange (closing mid point) on the
relevant date, as quoted in the London edition of the Financial Times first
published thereafter or, where no such rate of exchange is published in respect
of that date, at the rate quoted by Citibank N.A. as at the close of business in
London on that date.
1.2 For the purposes of calculating the Adjusted Financial Debt, any amounts
which are to be included in the calculation and which are expressed in a
currency other than euros shall be converted into euros using the Spot Rate on
the close of business on the Completion Date.
Part B
2. PREPARATION AND FINALISATION OF THE ADJUSTED FINANCIAL DEBT
2.1 Phoenix (on behalf of the BCcH Shareholders and the Foundation) shall
deliver to the Purchaser as soon as practicable after the Cut-Off Date and in
any event no later than ten (10) Business Days after the Cut-Off Date, a draft
Adjusted Financial Debt Statement in relation to the Company in the form set out
in Exhibit 3 (the Draft Adjusted Financial Debt Statement).
2.2 The Purchaser shall have until the date which is thirty (30) days after
the date of delivery of the Draft Adjusted Financial Debt Statement (the Review
Period), in conjunction with the Purchaser's Accountants, to review the Draft
Adjusted Financial
48
Debt Statement and to present to Phoenix in writing any objections (stating in
reasonable detail, including specific amounts, the matters in dispute) it may
have to the Draft Adjusted Financial Debt Statement and the Adjusted Financial
Debt set forth therein. The only grounds upon which the Purchaser shall be
entitled to object to any Adjusted Financial Debt Statement or Adjusted
Financial Debt are arithmetical errors in the computation of such amounts or
that it has not been prepared in accordance with the provisions of Part C of
this Schedule. Any such objections must be accompanied by a recalculation of
each amount in the Draft Adjusted Financial Debt Statement to which such
objections relate.
2.3 For the purposes of enabling Phoenix and Phoenix's Accountants to prepare
the Draft Adjusted Financial Debt Statement, the Purchaser shall and shall
procure that the Group shall, following Completion, give Phoenix and Phoenix's
Accountants reasonable access at all reasonable times (until the Adjusted
Financial Debt Statement has been agreed or finally determined) to all
employees, books and records, and all computer files relating to the business of
the Company and the Group and generally shall provide Phoenix and Phoenix's
Accountants with such other information and assistance as Phoenix and Phoenix's
Accountants may reasonably request, provided that Phoenix and Phoenix's
Accountants shall not be entitled to any such access and information which goes
beyond that which is reasonably necessary to determine whether the Draft
Adjusted Financial Debt Statement has been prepared in accordance with the
provisions of Part C of this Schedule. If the Draft Adjusted Financial Debt
Statement is delivered before Completion, for the purposes of enabling the
Purchaser and the Purchaser's Accountants to commence the review contemplated by
paragraph 2.2 above, Phoenix shall and shall procure that the Group shall,
before Completion, give the Purchaser and the Purchaser's Accountants reasonable
access at all reasonable times to all employees, books and records, and all
computer files relating to the business of the Company and the Group and
generally shall provide the Purchaser and the Purchaser's Accountants with such
other information and assistance as the Purchaser and the Purchaser's
Accountants may reasonably request, provided that the Purchaser and the
Purchaser's Accountants shall not be entitled to any such access and information
which goes beyond that which is reasonably necessary to determine whether the
Draft Adjusted Financial Debt Statement has been prepared in accordance with the
provisions of Part C of this Schedule.
2.4 If no such written objections as are referred to in paragraph 2.2 are
properly presented to Phoenix by the end of the Review Period, then the Draft
Adjusted Financial Debt Statement and the Adjusted Financial Debt set forth
therein shall, as between the BCcH Shareholders and the Foundation and the
Purchaser, be deemed to have been accepted and approved by the BCcH Shareholders
and the Foundation and the Purchaser and the Draft Adjusted Financial Debt
Statement shall be final and binding on all of the parties to this Agreement and
shall constitute the Adjusted Financial Debt Statement for the purposes of this
Agreement.
2.5 If any such written objections as are referred to in paragraph 2.2 are
properly presented to Phoenix by the end of the Review Period then Phoenix (on
behalf of the BCcH Shareholders and the Foundation) and the Purchaser shall
attempt to resolve the objections in good faith negotiations. To facilitate
Phoenix's review of any such objections, the Purchaser shall provide Phoenix and
Phoenix's Accountants with such information and explanations as Phoenix and
Phoenix's Accountants may reasonably require for the purpose of the review. If
Phoenix and the Purchaser resolve all matters in dispute in relation to the
Draft Adjusted Financial Debt Statement, then such Draft
49
Adjusted Financial Debt Statement (as adjusted to reflect the matters so
resolved) shall, as between the BCcH Shareholders and the Foundation and the
Purchaser, be deemed to have been accepted and approved by the BCcH Shareholders
and the Foundation and the Purchaser and such Draft Adjusted Financial Debt
Statement (as adjusted to reflect the matters so resolved) and the Adjusted
Financial Debt set forth therein shall be final and binding on all of the
parties to this Agreement and shall constitute the Adjusted Financial Debt
Statement and Adjusted Financial Debt respectively for the purposes of this
Agreement.
2.6 If there are any such objections which have not been resolved in good
faith negotiations within a period of fifteen (15) days after the end of the
Review Period, then the specific matters in dispute shall be referred for
determination to the Independent Firm not later than ten (10) days after the end
of such period. The Independent Firm shall be instructed to notify the Purchaser
and Phoenix of its determination within fifteen (15) days of such referral.
2.7 If the Independent Firm shall for any reason be unable or unwilling to act
or shall then maintain, or have at any time in the preceding five year period
maintained, any material business relationship (whether as auditor or otherwise)
with any member of any party's group, another independent firm of chartered
accountants shall be appointed to act in its place, by agreement of Phoenix and
the Purchaser and, in default of such agreement, at the request of either
Phoenix or the Purchaser, by the President of the Institute of Chartered
Accountants in England and Wales for the time being.
2.8 In making its determination, the Independent Firm shall act as expert and
not as arbitrator and the determination by the Independent Firm and the Draft
Adjusted Financial Debt Statement, as adjusted to reflect the Independent Firm's
determination, shall, in the absence of manifest error, be final and binding on
the parties and shall be deemed to have been accepted and approved by the
parties. The fees and the costs of the Independent Firm shall be shared as to
fifty per cent. (50%) by the BCcH Shareholders and the Foundation (as between
themselves, in proportion to their respective allocations) and as to fifty per
cent. (50%) by the Purchaser, unless otherwise directed by the Independent Firm
(which shall have the authority to make such direction if it deems it
equitable).
2.9 The Purchaser shall and shall procure that the Company and each member of
the Group shall, give the Independent Firm reasonable access at all reasonable
times to all books and records, and all computer files relating to the business
of the Group, in their respective possession or control and generally shall
provide the Independent Firm with such other information and assistance as the
Independent Firm may reasonably request.
Part C
3. BASIS OF PREPARATION OF THE ADJUSTED FINANCIAL DEBT
3.1 The Adjusted Financial Debt Statement shall:
(a) be based on the books and records of the Group;
(b) include a statement of the Adjusted Financial Debt;
50
(c) subject to paragraph 3.2 and the consistent application of the defined
terms of Adjusted Financial Debt, be prepared on the same basis and in
accordance with the same principles, policies, procedures, methods and
practices of accounting as were applied for the purposes of the Accounts
and on the basis that the application of principles, policies, procedures,
methods and practices of accounting will be consistent with such exercise
as applied in relation to the Accounts, provided that there shall be no
requirement to perpetuate a material error in preparing the Accounts;
(d) subject to sub-paragraphs (b) and (c) and paragraph 3.2, be prepared in
accordance with Dutch GAAP.
Sub-paragraphs (c) and (d) of paragraph 3.1 are intended to be applied as a
hierarchy, with paragraph (c) being applied first and with paragraph (d) being
applied only where ambiguity remains following application of the previous
paragraph.
3.2 The Adjusted Financial Debt Statement shall be prepared on the basis that
it relates to the Group as a going concern and exclude any effects of the change
of control or ownership of it contemplated by this Agreement or any other effect
of this Agreement.
51
Schedule 4
Part A: Precompletion Undertakings
All capitalised terms in this Schedule 4 which are not defined in this Agreement
are as defined in the Senior Credit Agreement:
(a) Maintenance of Legal Validity and Legal Status; Conduct of Business. Each
Group Company shall do all such things as are reasonably necessary to
maintain its existence as a legal person. In addition, each Group Company
shall ensure that it has the right and is duly qualified to conduct its
business as it is conducted from time to time in all applicable
jurisdictions and does all things reasonably necessary to obtain, preserve
and keep in full force and effect all material rights including, without
limitation, all franchises, contracts, licences, consents and other
material rights which are necessary for the conduct of its business;
(b) Claims and Discharges. Except with respect to Capfoil LLC or which in the
aggregate equals (euro)500,000, no Group Company shall pay, repurchase,
discharge or satisfy any of its claims, liabilities or obligations
(absolute, accrued, asserted or unasserted, contingent or otherwise),
other than payment, discharge or satisfaction in the ordinary course of
business and consistent with past practice;
(c) Disposals. No Group Company shall sell, lease, transfer or otherwise
dispose of, by one or more transactions or series of transactions (whether
related or not), the whole or any part of its revenues or its assets or
its business or undertakings other than in the ordinary course of business
and consistent with past practice;
(d) Mergers. No Group Company shall merge or consolidate with any other
person, enter into any demerger transaction or participate in any other
type of corporate reconstruction;
(e) Acquisitions. No Group Company shall:
(i) purchase, subscribe for or otherwise acquire any shares (or other
securities or any interest therein) in, or incorporate, any other
company or in any other way change the organisational structure of
the Group as provided in Exhibit 2 or agree to do any of the
foregoing; or
(ii) purchase or otherwise acquire any assets (other than in the ordinary
course of business) or acquire any business or interest therein or
agree to do so; or
(iii) form, or enter into, any partnership, consortium, joint venture or
other like arrangement or agree to do so;
(f) Joint Ventures. No Group Company shall enter into or acquire or subscribe
(or agree to enter into or acquire or subscribe) for any shares, stocks,
securities or other interest in or transfer of any assets to or lend to or
guarantee or give security for the obligations of any joint ventures;
52
(g) No Changes to the Management Equity Plans, Annual Incentive Plans or Bonus
Plans. No Group Company shall
(i) pay or make any accrual or arrangement for payment pursuant to the
Management Equity Plan or any annual incentive or bonus plan except
to the extent that any Group Company is unconditionally obligated to
do so on the date of this Agreement;
(ii) except in the ordinary course of business, adopt or pay, grant,
issue, accelerate or accrue salary or other payments or benefits
pursuant to any such plan, or any agreement or arrangement relating
thereto, except to the extent the Group Company is unconditionally
obligated to so on the date of this Agreement; or
(iii) amend in any material respect such plans, or any agreement or
arrangement in relation thereto;
(h) No Changes to the Terms and Conditions of Employment of the Senior
Managers. No Group Company shall enter into or amend any employment,
severance, consulting, termination or other agreement with, or employee
benefit plan for, or make any loan or advance to, any of the executive
officers of the Group Companies or make any change in its existing
borrowing or lending arrangements for or on behalf of any such person
pursuant to an employee benefit plan or otherwise;
(i) Limitations on Capital Expenditure. No Group Company shall enter into any
contract or commitment (or make a bid or offer which may lead to a
contract or commitment) having a value or involving expenditure per item
or project in excess of (euro)500,000 or which may result in any material
change in the nature or scope of the operations of the Group;
(j) Dividends and Distributions. No Group Company, except for distributions
made between Group Companies, shall pay, make or declare any dividend,
return on capital, repayment of capital contributions or other
distribution (whether in cash or in kind) or make any distribution of
assets or other payment whatsoever in respect of share capital whether
directly or indirectly;
(k) Share Capital. No Group Company shall issue or redeem or repurchase,
purchase, defease or retire any shares or grant any person the right
(whether conditional or unconditional) to call for the issue or allotment
of any share of any Group Company (including an option or right of
pre-emption or conversion) or any other equity investments, howsoever
called, or alter any rights attaching to its issued shares (including
ordinary and preference shares);
(l) Facility Limits no Group Company shall increase the facility limit in
force in respect of any particular Local Facility to a level which is more
than 10% above the relevant Existing Local Facility Limit;
(m) Insurance. Each Group Company shall effect and maintain insurances on and
in relation to its business and assets with reputable underwriters or
insurance companies against such risks and to such extent as is usual for
prudent companies carrying on a business such as that carried on by such
member of
53
the Group (including, but not limited to, loss of earnings, business
interruption, directors and officers liability cover);
(n) Environmental Matters. Each Group Company shall comply in all material
respects with all Environmental Law and obtain and maintain any
Environmental Permits and take all reasonable steps in anticipation of
known or expected future changes to or obligations under the same, breach
of which (or failure to obtain, maintain or take which) could reasonably
be expected to have a Material Adverse Effect;
(o) Consents and Approvals. Each Group Company shall comply with all
applicable laws, rules, regulations and orders and obtain and maintain all
governmental and regulatory consents, licences, authorisations and
approvals the failure to comply with which or the failure to obtain and
maintain which could be reasonably be expected to have a Material Adverse
Effect;
(p) Tax
(i) save to the extent not prohibited by the Senior Credit Agreement,
each Group Company shall duly and punctually pay and discharge (a)
all taxes, assessments and governmental charges imposed upon it or
its assets within the time period allowed therefor; and (b) all
lawful claims which, if unpaid, would by law become encumbrances
upon its assets which are not Permitted Encumbrances;
(ii) save to the extent not prohibited by the Senior Credit Agreement, no
Group Company shall change its place of residence for tax purposes;
(q) Preservation of Assets. Except in such cases which would not have a
Material Adverse Effect on such Group Company, each Group Company shall
maintain and preserve all of its assets that are necessary in the conduct
of its business as conducted at the date hereof in good working order and
condition, ordinary wear and tear excepted;
(r) Pensions. Each Group Company shall ensure that all pension schemes are
administered and funded in accordance with applicable law;
(s) Intellectual Property. Each Group Company shall do all acts as are
reasonably practicable to maintain, protect and safeguard the Intellectual
Property necessary for the business of the relevant Group Company and not
terminate or discontinue the use of any such Intellectual Property save
that licensing arrangements in relation to such Intellectual Property may
be entered into between Group Companies provided that (i) such licensing
arrangements do not allow any further sub-licensing by the licensee and
(ii) such licensing arrangements would not have a material adverse effect
on the value of any of the Intellectual Property the subject matter of
such licensing arrangements;
(t) Negative Pledge. Except for Permitted Encumbrances, no Group Company shall
create or permit to subsist any encumbrance over all or any of its present
or future revenues or assets other than a Permitted Encumbrance or create
any restriction or prohibition on encumbrances over all or any of its
present or future revenues or assets;
54
(u) Loans and Guarantees. Except as required under the Senior Credit
Agreement, no Group Company shall make any loans, grant any credit or
other financial accommodation or give any guarantee or indemnity to or for
the benefit of any person or otherwise voluntarily assume any liability,
whether actual or contingent, in respect of any obligation of any other
person except:
(i) trade credit or indemnities or guarantees granted in the ordinary course
of trading and upon terms usual for such trade;
(ii) Permitted Transactions; and
(iii) in relation to the Subordinated Guarantee or the Subordinated Loan;
(v) Financial Indebtedness. No Group Company shall incur, create or
permit to subsist or have outstanding any Financial Indebtedness or
enter into any agreement or arrangement whereby it is entitled to
incur, create or permit to subsist any Financial Indebtedness other
than, in either case, Permitted Financial Indebtedness;
(w) Amendments. Other than as provided in the Senior Credit Agreement, no
Group Company shall amend, vary, novate, supplement or terminate any of
the Acquisition Documents, the Mezzanine Credit Agreement, the
Subordinated Guarantee, the Subordinated Loan, the DIPs or such Group
Company's constitutional documents;
(x) Change of Business. Except as provided under the Senior Credit Agreement,
no Group Company shall make any material changes to the general nature of
the business of the Group as carried on at the date hereof, or carry on
any other business which results in any material change to the nature of
such business;
(y) Fees and Commissions. Other than as provided in the Senior Credit
Agreement, no Group Company shall pay any fees or commissions to any
person other than any fees payable on arm's length terms to third parties
who have rendered service or advice to such Group Company required by such
Group Company in the proper course of management of the Group's business;
(z) Treasury Transactions. No Group Company shall enter into any Treasury
Transaction which is not a Permitted Treasury Transaction;
(aa) Subordinated Debt and Closing Intra-Group Loans. No Group Company shall,
unless permitted under the Senior Credit Agreement or the Intercreditor
Deed, pay, prepay or repay or defease, exchange, redeem or repurchase any
amount under (a) the Mezzanine Credit Agreement, (b) any Intra-Group Loan
subordinated under the Intercreditor Deed, (c) the DIPs or (d) the
Subordinated Loan; and
(bb) Hedging. No Group Company shall enter into any hedging arrangement except
as provided for under the Senior Credit Agreement.
55
Part B: Exceptions from Clause 4.1
1. Payment to CPIL or Compass or any of their respective affiliates by the
Company or any other relevant member of the Group of any sums in respect
of any advisory fees or expenses which fall due at any time during the
relevant period which shall be no greater than an aggregate cap of
(euro)100,000 monthly.
2. The Company incurring or agreeing to incur, or making arrangements for the
reimbursement of Transaction Fees.
3. Actions relating to the compliance/repayment and cancellation of the
existing Management Equity Plans or the inclusion of additional members of
management to such plans, including any Sale Bonus Arrangements.
4. Activities relating to the implementation of the following initiatives:
(a) actions and payments relating to closure of the site in Roermond and
continuation of the production movement of Roermond products to the Loni,
India site;
(b) actions relating to the Capfoil, LLC settlement;
(c) actions relating to the sale of the assets or shares of BC Components
Inc.;
(d) actions and payments relating to the closure of the Roeselare Potmeter
site;
(e) the potential disposal of certain excess land in Zwolle;
(f) the proposed disposal of certain assets situated in Taiwan by BCcomponents
(Taiwan) Ltd; and
(g) actions or payments related to early retirement schemes in Belgium and
Germany.
56
Schedule 5
THE FOUNDATION
1. CONDITION TO THE FOUNDATION'S OBLIGATIONS BECOMING EFFECTIVE UNDER THE
AGREEMENT
Save for paragraph 2.1 below, the provisions of this Agreement shall take effect
with respect to the Foundation but only in relation to those Foundation Shares
represented by Depositary Receipts that have been transferred to and cancelled
by the Foundation and only at the point when they have been so transferred and
cancelled, and subject also to the satisfaction of all conditions required to be
satisfied under the Foundation Rules and applicable law in order for the
provisions of this Agreement so to take effect.
2. FOUNDATION UNDERTAKINGS
2.1 Procedure in relation to Depositary Receipts. Unless all of the holders of
Depositary Receipts provide irrevocable powers of attorney in favour of a named
officer of the Foundation (or such other person as the Foundation shall
nominate) to execute private deeds pursuant to which their Depositary Receipts
will be transferred to the Foundation (in which event any and all other actions
on the part of the Foundation as described below in this paragraph 2.1 shall not
be required), the Foundation hereby agrees to take such steps as it is entitled
to take under the terms of the Foundation Rules (including without limitation:
(a) convening a meeting of the holders of the Depositary Receipts, for the
purpose of approving the transfer of the Depositary Receipts by the
respective holders to the Foundation and the transfer by the Foundation of
the Foundation Shares to the Purchaser;
(b) the submission to the holders of the Depositary Receipts of relevant forms
of proxy; and
(c) initiating such Court proceedings in The Netherlands as the Board of the
Foundation reasonably considers necessary),
to procure that the Depositary Receipts are all transferred to the Foundation,
in each case through the execution of a private deed. The Foundation
acknowledges and agrees that, to enable the Foundation to transfer the
Foundation Shares to the Purchaser at or after Completion:
(i) each such private deed shall stipulate that any rights attached to
any Depositary Receipt are cancelled as a result of any such
transfer and that, as a result of the transfers of all the
Depositary Receipts to the Foundation, the Foundation will hold the
Foundation Shares and there will be no outstanding Depositary
Receipts;
(ii) each such private deed will also stipulate that the Foundation Share
Consideration will be allotted, issued or otherwise transferred by
the Purchaser to, and held in the name of, Phoenix, which will then
hold
57
that Foundation Shares Consideration on the basis provided for in
paragraph 2.3 below on behalf of all the persons that have
transferred Depositary Receipts to the Foundation; and
(iii) the Foundation will transfer the Foundation Shares directly to the
Purchaser, instead of transferring them to the holders of the A
Shares in the capital of the Company for onward transfer to the
Purchaser;
The Foundation further undertakes that in accordance with paragraph 2.2 below it
will:
(d) transfer at Completion to the Purchaser Foundation Shares pro rata to the
Depository Receipts that have then been transferred to and cancelled by
the Foundation, with the number of Foundation Shares so transferred being
rounded down to the nearest whole share; and
(e) thereafter upon the transfer to and cancellation by the Foundation of all
the remaining Depository Receipts, transfer the remaining Foundation
Shares to the Purchaser.
2.2 Delivery and Escrow Arrangements for Foundation Share Consideration.
If:
(a) the Foundation has the authority to transfer all the Foundation Shares to
the Purchaser at Completion, then the Foundation Share Consideration shall
be delivered by the Purchaser to Phoenix in accordance with Clause 6 of
this Agreement, at the same time as the Sale Shares are transferred to the
Purchaser, and be held by Phoenix on the basis provided for in paragraph
2.3 below; whereas
(b) if the Foundation has the authority to transfer only part of the
Foundation Shares to the Purchaser at Completion:
(i) the Foundation Share Consideration shall be delivered pro rata to
the Foundation Shares transferred to the Purchaser in accordance
with Clause 6 of this Agreement, at the same time as the Sale Shares
are transferred to the Purchaser and shall be held by Phoenix on the
basis provided for in paragraph 2.3 below; and
(ii) the Purchaser shall deposit the remaining Foundation Share
Consideration in an escrow account set up jointly by Phoenix and the
Purchaser and such Foundation Share Consideration shall not be
released until the completion of the transfer of the outstanding
Foundation Shares has taken place, at which point Phoenix and the
Purchaser shall issue a joint instruction for such Foundation Share
Consideration to be released from that escrow account and delivered
to Phoenix, from which point onwards Phoenix shall hold the
Foundation Share Consideration on the basis provided for in
paragraph 2.3 below; and
(c) if the Foundation does not have authority to transfer any of the
Foundation Shares to the Purchaser at Completion, then the Purchaser shall
deposit the
58
Foundation Share Consideration in an escrow account set up jointly by
Phoenix and the Purchaser and such Foundation Share Consideration shall
not be released until the completion of the transfer of the Foundation
Shares to the Purchaser has taken place, at which point Phoenix and the
Purchaser shall issue a joint instruction for such Foundation Share
Consideration to be released from that escrow account and delivered to
Phoenix, from which point onwards Phoenix shall hold the Foundation Share
Consideration on the basis provided for in the paragraph 2.3 below.
2.3 Powers of Phoenix. The Foundation hereby gives irrevocable authority to
Phoenix, as its attorney:
(a) to receive and to hold the Foundation Share Consideration in the name of
Phoenix;
(b) to negotiate and agree on behalf of the Foundation the terms on which the
Foundation Share Consideration is to be allocated as between the
Foundation (for itself and on behalf of the holders of the Depositary
Receipts) on the one hand and any one or more other parties to this
Agreement on the other hand;
(c) to determine in its sole and absolute discretion whether and when to
realise the Foundation Share Consideration, and the terms of such
realisation, subject to accounting to the persons other than the Mezzanine
Lenders that have transferred Depositary Receipts to the Foundation in
accordance with this Schedule 5, either directly or through the
Foundation, for the net cash proceeds of such realisation (such cash to be
distributed to and amongst those persons on a pro rata basis based upon
the percentage and classification of the Depositary Receipts respectively
so transferred by those persons);
(d) to execute on behalf of the Foundation any and all deeds, documents or
agreements and to take any and all such other actions and to do any and
all such things on behalf of the Foundation as may be necessary, desirable
or conducive to give effect to the foregoing and to exercise in its
absolute discretion any rights pursuant to any such deed, document or
agreement,
and everything with the power of substitution and with indemnity for Phoenix for
all activities it performs pursuant to the above power of attorney.
The Foundation also acknowledges and agrees that Phoenix and any Transferee (as
defined below) shall be entitled to transfer some or all of the Foundation Share
Consideration to Phoenix Bermuda L.P. or any group undertaking of, or entity
established by, Phoenix, Phoenix Bermuda L.P. or any of the Other Investors
other than European Private Equity Investors L.L.C. (any such transferee being a
Transferee). The Foundation undertakes to Phoenix that, if such a transfer takes
place, then the Foundation shall grant an irrevocable power of attorney to the
Transferee concerned in the same terms as this paragraph 2.3 on receipt of
notice in writing from Phoenix requiring such grant to be made.
2.4 Delivery of an Opinion on the Delivery of the Foundation Shares. At the
Completion of the transfer by the Foundation of the Foundation Shares to the
Purchaser, the Purchaser shall receive an opinion as to the Foundation in the
agreed form.
59
3. PURCHASER UNDERTAKINGS WITH RESPECT TO THE FOUNDATION
3.1 The Purchaser hereby agrees that the Foundation Consideration in respect
of the Foundation Shares shall be allotted, issued or otherwise transferred by
the Purchaser to, and held in the name of, Phoenix on the basis provided for in
paragraph 2.3 above.
3.2 The Purchaser hereby agrees that, if for any reason any of the Depositary
Receipts are transferred to the Purchaser, the Purchaser shall immediately
transfer all such Depositary Receipts to the Foundation for cancellation, shall
waive all right, title and interest that the Purchaser may have with respect to
such Depositary Receipts and shall execute and deliver all documents to the
Foundation necessary to effect such waiver, including, without limitation, a
private deed.
4. OTHER PARTIES' UNDERTAKINGS WITH RESPECT TO THE FOUNDATION
4.1 Each party to this Agreement which holds Depositary Receipts at the date
of this Agreement hereby agrees with respect to the Depositary Receipts it
holds:
(a) to provide before or at Completion an irrevocable power of attorney in
favour of a named officer of the Foundation (or such other person as the
Foundation shall nominate) to execute private deeds pursuant to which its
Depository Receipts will be transferred to the Foundation; and, if
applicable
(b) to vote affirmatively for (upon the convening of a meeting of the holders
of the Depositary Receipts to consider such proposal), or to provide an
appropriate proxy in favour of, the transfer of the Depositary Receipts to
the Foundation on the basis described in paragraph 2 and (ii) to transfer
to the Foundation all such Depositary Receipts for cancellation, waive all
right, title and interest that such Party Shareholder may have with
respect to such Depositary Receipts and execute and deliver all documents
to the Foundation necessary to effect such waiver, including, without
limitation, a private deed.
4.2 Each Mezzanine Lender undertakes to Phoenix that, if any payment is made
to it by or on behalf of the Foundation which is attributable or relates to the
Foundation Share Consideration and/or that Mezzanine Lender's holding of
Depositary Receipts, it will promptly account to Phoenix for the whole of the
sum so received in order for Phoenix to distribute it, either directly or
through the Foundation, to the other persons who have transferred Depositary
Receipts in accordance with this Schedule 5.
60
Schedule 6
(Letters of Credit Guarantees)
SBLCs outstanding under the Senior Credit Agreement
Currency Amount Final Expiry Date Beneficiary Fronting Bank
J.P. Morgan Chase
Bank of America Bank, London
USD 17,000,000 31-Dec-02 NT&SA, Taipei Branch
J.P. Morgan Chase
Bank of America Bank, London
USD 7,000,000 31-Dec-02BT&SA, Taipei Branch
J.P. Morgan Chase
Bank of America Bank, London
USD 550,000 18-Jul-03 N.A., Singapore Branch
J.P. Morgan Chase
Bank of America Bank, London
USD 330,000 17-Apr-03 N.A., Hong Kong Branch
Citibank, N.A., J.P. Morgan Chase
Bank, London
Citibank, N.A., Bank, London
USD 8,505,000 13-Jul-03 Shanghai Branch
J.P. Morgan Chase
J.P. Morgan Chase Bank, London
EUR 1,000,000 25-Apr-03 Bank, London Branch Branch
The Workers Council J.P. Morgan
of BCcomponents BV Bank, London
EUR 1,950,000 28-Feb-03 Roermond Location Branch
reduced to 1,500,000 per 01-Nov-02
reduced to 600,000 per 01-Dec-02
reduced to 160,000 per 01-Jan-03
61
Schedule 7
(Senior Management)
Managers earning over (euro)100,000 per annum whose Contracts of Employment have
been disclosed:
Nazario Proietto Chief Executive Officer
James Belt Chief Financial Officer
Johan Vandoorn VP Global Operations
Cees de Wit VP EMEA
Allan Choy VP Asia Pacific
Nigel Blakeway VP Americas
Daan Warners Chief Human Resources Officer
Marc Libert VP Capacitors
Peter Belien VP Resistors
Marc Sevenans Chief Corporate Development Officer
Rob Pimontel Director Global Marketing and Sales Services
Wilfred Renders Site Manager and Controller Belgium
Johan de Baets HR Manager (Belgium)
Maurizio Passi Director Financial Analysis and Planning (Group)
Giuseppe Corti Sales Director Europe South
Lyle Fette Sales and application Engineer USA
Walter Bonomo Regional Product Manager USA
Siegfried Stuefter Site Manager Klagenfurt
Chao Min Leong Senior Product Manager China
SH Wang Plant Manager Danshui (China)
George Fan Plant Manager Shanghai
Marcus Chan Controller Asia Region
Uwe Mette Site Manager and Controller Germany (Beyschlag)
Thomas Amrein Chief IT Officer (Group)
Christine Beck Treasury Manager (Group)
Eric Chung Regional Sales Director A/P (China)
Stephen George Industry marketing Director (Germany)
Joachim Aschenbremer F&A manager sales (Germany)
Joachim Ahrendt Area Sales Director (Germany)
Mark Boshart Director of Operations (America)
John Sauer Business Development Manager (America)
Danny Knight Information Technology Manager (America)
David Campbell Distribution Manager (America)
Robert Gourdeau VP Sales North America
Wayne Knott CFO North America
62
SCHEDULE 8
EXISTING LOCAL FACILITY LIMITS
Facility Currency Amount
- -----------------------------------------------------------------------
Treasury Overdraft........................... EUR 1,000,000
Austria Overdraft............................ EUR 1,453,456.68
Belgium Uncommitted.......................... EUR 1,253,066.22
China ST Cash................................ USD 10,800,000
China ST Cash................................ RMB 6,000,000
Hong Kong ST Tax-loan........................ HKD 778,000
Hong Kong ST Multi-purpose................... USD 300,000
India Term Loan.............................. INR 78,000,000
India Term Loan.............................. INR 80,000,000
India ST Cash ............................... INR 90,000,000
India ST Cash ............................... INR 70,000,000
India L/Cs................................... INR 10,000,000
India Bank Guarantees........................ INR 5,000,000
India L/Cs................................... INR 30,000,000
India Bank Guarantees........................ INR 10,000,000
Singapore ST Multi-purpose................... USD 500,000
Taiwan ST Multi -purpose..................... TWD 795,724,003.89
63
SIGNED )
for and on behalf of )
PHOENIX ACQUISITION COMPANY )
S.a.r.l )
)
SIGNED )
for and on behalf of )
COMPASS PARTNERS EUROPEAN )
EQUITY FUND (BERMUDA) L.P. )
)
SIGNED )
for and on behalf of )
COMPASS PARTNERS EUROPEAN )
EQUITY INVESTORS L.P )
SIGNED )
for and on behalf of )
COMPASS PARTNERS 1999 FUND L.P. )
)
SIGNED )
for and on behalf of )
EUROPEAN PRIVATE EQUITY )
INVESTORS LLC )
SIGNED )
for and on behalf of )
SANKATY HIGH YIELD ASSET )
PARTNERS L.P. )
SIGNED )
for and on behalf of )
BCM CAPITAL PARTNERS L.P. )
)
SIGNED )
for and on behalf of )
BCIP ASSOCIATES II )
)
64
SIGNED )
for and on behalf of )
BCIP TRUST ASSOCIATES II )
)
SIGNED )
for and on behalf of )
JP MORGAN PARTNERS (BHCA), L.P. )
)
SIGNED )
for and on behalf of )
GARMARK PARTNERS L.P. )
)
SIGNED )
for and on behalf of )
BCIP TRUST ASSOCIATES II-B )
)
SIGNED )
for and on behalf of )
BAIN CAPITAL V MEZZANINE )
FUND L.P. )
SIGNED )
for and on behalf of )
Stichting Administratiekantoor )
Phoenix )
)
SIGNED )
for and on behalf of )
VISHAY INTERTECHNOLOGY INC. )
)
SIGNED )
for and on behalf of )
VISHAY EUROPE GMBH )
65
SIGNED )
for and on behalf of )
BCCOMPONENTS INTERNATIONAL )
B.V. )
66
EXHIBIT 1
SALE BONUS ARRANGEMENTS
o A discretionary payment authorised by Phoenix Acquisition Company S.ar.l
provided that the executive has performed in a professional manner
throughout the sale process
o In particular, this discretionary award is dependent on:
- Maintaining confidentiality
- Maintaining morale/performance of the Group
- Timely response to information requests
- Generally, "supporting the transaction" (for the benefit of the
buyer and the seller)
- Running the business "in the normal course" during the sale and any
regulatory process
o The award for the CEO will be based on the recommendation of Phoenix
Acquisition Company S.a.r.l
o The award for nominated executives will be based on the recommendation of
Naz Proietto and Ken Hanna
o The award will total (euro)1million in aggregate plus applicable directly
related employer social security cost and will be paid subject to tax in
the ordinary course.
---------------------------------------------------------------------
Name Sale Bonus (excluding
directly related employer
social security cost)
---------------------------------------------------------------------
Naz Proietto, CEO (euro)250,000
---------------------------------------------------------------------
Peter Belien, VP Resistors 50,000
---------------------------------------------------------------------
Jim Belt, CFO 150,000
---------------------------------------------------------------------
Nigel Blakeway, VP Americas 70,000
---------------------------------------------------------------------
Allan Choy, VP Asia Pacific 70,000
---------------------------------------------------------------------
Cees de Wit, VP EMEA 70,000
---------------------------------------------------------------------
Marc Libert, VP Capacitors 70,000
---------------------------------------------------------------------
Rob Pimontel, Corporate Marketing 25,000
---------------------------------------------------------------------
Marc Sevenans, VP Corporate Development 70,000
---------------------------------------------------------------------
Johan Vandoorn, VP Operations 70,000
---------------------------------------------------------------------
Daan Warners, VP Human Resources 30,000
---------------------------------------------------------------------
Maurizio Passi, Financial Planning 50,000
Manager
---------------------------------------------------------------------
Christine Beck, Treasurer 25,000
---------------------------------------------------------------------
EXHIBIT 2
GROUP STRUCTURE CHART
[OMITTED]
EXHIBIT 3
Form of Draft Adjusted Financial Debt Statement
Threshold Amount [ ] A
Adjusted Financial Debt:
Senior Term A............................... [ ]
Senior Term B............................... [ ]
Senior Term C............................... [ ]
Senior Revolving Advances................... [ ]
Treasury Overdraft.......................... [ ]
Austrian Overdraft.......................... [ ]
Belgian Uncommitted......................... [ ]
India Local Debt............................ [ ]
Taiwan Local Debt........................... [ ]
China Local Debt............................ [ ]
Singapore Local Debt........................ [ ]
Hong Kong Local Debt........................ [ ]
Senior and Local Debt Accrued Interest...... [ ]
Breakage Costs.............................. [ ]
Capital Expenditure......................... ([ ])
Restructuring Costs......................... ([ ])
Adjusted Financial Debt:.......................... [ ] B
Transaction Fees:
Compass Advisory Fee........................
Merrill Lynch Fee...........................
Winchester Fee..............................
Compass Management Fee......................
Sale Bonus Arrangement......................
Other Advisers
Total Transaction Fees............................ [ ] C
Sale Bonus Arrangements........................... [ ] D
Co-Investor Loan Payment.......................... A - B - C - D
10 November 2002
PHOENIX ACQUISITION COMPANY S.a.r.l
THE OTHER INVESTORS
THE FOUNDATION
THE MEZZANINE LENDERS
VISHAY INTERTECHNOLOGY, INC.
VISHAY EUROPE GMBH
AND
BCCOMPONENTS INTERNATIONAL B.V.
==================================================================
SHARE SALE AND PURCHASE AGREEMENT
relating to the sale and purchase of
the issued share capital of
BCcomponents Holdings B.V.
(as amended by an amendment agreement dated 4
December 2002)
==================================================================
FRESHFIELDS BRUCKHAUS DERINGER
CONTENTS
CLAUSE PAGE
1. Interpretation..................................................2
2. Sale and Purchase..............................................10
3. Conditions to Completion.......................................13
4. Pre-Completion Undertakings....................................19
5. Preparation for Completion.....................................21
6. completion.....................................................22
7. Determination of Co-investor Loan Payment and
other matters..................................................29
8. Post Completion Undertakings...................................30
9. Vendor Warranties..............................................32
10. Purchaser Warranties..........................................34
11. Entire Agreement..............................................36
12. No Third Party Rights.........................................37
13. Variation.....................................................37
14. Assignment....................................................37
15. Successors....................................................37
16. Agreement to Remain in Force..................................37
17. No Right to Rescind...........................................38
18. Interest......................................................38
19. Announcements.................................................38
20. Costs.........................................................38
21. Invalidity....................................................38
22. Counterparts..................................................39
23. Purchaser Guarantee...........................................39
24. Authority.....................................................39
25. Waiver........................................................40
26. Further Assurance.............................................40
27. Notices.......................................................40
28. Governing Law and Jurisdiction................................42
Schedule 1 BCcH Shareholders and MEZZANINE
LENDERS...........................................................44
PART A INVESTORS AND THEIR HOLDINGS OF SALE SHARES.............44
European Private Equity Investors LLC.............................44
PART B FOUNDATION SHARES.......................................44
PART C MEZZANINE LENDERS AND THEIR HOLDINGS OF SALE SHARES,
COMPANY WARRANTS AND DIPS...................................44
BCIP Associates II................................................45
BCIP Trust Associates II..........................................45
JP Morgan Partners (BHCA), L.P....................................45
BCIP Trust Associates II-B........................................45
Schedule 2 Corporate Details of the Company.......................46
Schedule 3 preparation of Adjusted Financial Debt Statement.......48
PART A.........................................................48
1. Interpretation........................................48
PART B.........................................................48
2. Preparation and Finalisation of the Adjusted
Financial Debt........................................48
PART C.........................................................50
3. Basis of Preparation of the Adjusted Financial
Debt..................................................50
Schedule 4........................................................52
PART A : PRECOMPLETION UNDERTAKINGS............................52
PART B : EXCEPTIONS FROM CLAUSE 4.1............................56
Schedule 5 the Foundation.........................................57
1. Condition to the Foundation's obligations becoming
effective under the Agreement...............................57
2. Foundation Undertakings.....................................57
3. Purchaser Undertakings with Respect to the Foundation.......60
4. Other Parties' undertakings with respect to the
Foundation..................................................60
Schedule 6 (Letters of Credit Guarantees).........................61
Schedule 7 (Senior Management)....................................62
Schedule 8 existing local facility limits.........................63
Exhibit 1 Sale bonus arrangements.................................67
Exhibit 2 group structure chart..................................68
Exhibit 3.........................................................69
Exhibit 2.2
THIS AMENDMENT AGREEMENT is made on 4 December 2002
BETWEEN:
(1) PHOENIX ACQUISITION COMPANY S.ar.l (registered at the Luxembourg Trade and
Companies Registry under No. 66455) whose registered office is at 398
route d'Esch, L-1471 Luxembourg (Phoenix);
(2) THE PERSONS other than Phoenix whose names and addresses are set out in
Part A of Schedule 1 of the SPA (as defined below) (the Other Investors
and each an Other Investor and, together with Phoenix, the Investors);
(3) THE PERSONS whose names and addresses are set out in Part C of Schedule 1
of the SPA (the Mezzanine Lenders and each a Mezzanine Lender and,
together with the Investors, the BCcH Shareholders);
(4) Stichting Administratiekantoor Phoenix whose registered office is at
Meerenakkerplein 27-30, 5652 BJ Eindhoven, The
Netherlands (the Foundation);
(5) VISHAY INTERTECHNOLOGY, Inc. (the Purchaser);
(6) VISHAY EUROPE GMBH (VEG);
(7) BCCOMPONENTS INTERNATIONAL B.V. (BCc International),
(together, the Parties)
WHEREAS:
(A) On 10 November 2002, the Parties entered into a share sale and purchase
agreement under which (i) the Purchaser agreed to purchase all of the Sale
Shares, the Foundation Shares, the Company Warrants and the Co-Investor Loan,
the BCcH Shareholders agreed to sell the Sale Shares, the Mezzanine Lenders
agreed to sell the Company Warrants and the Co-Investors agreed to assign the
Co-Investor Loan, (ii) the Mezzanine Lenders agreed to assign the Mezzanine
Credit Agreement and contribute the DIPs and (iii) the Foundation undertake
certain obligations on and subject to the terms of Schedule 5 of the SPA (the
Transaction), in each case on and subject to the terms and subject to the
conditions set out in the agreement (the SPA).
(B) The Parties wish to amend the SPA in the manner described in this
Amendment Agreement.
IT IS AGREED as follows:
INTERPRETATION
1.1 Terms and expressions defined in the SPA have the same meaning when used
in this Amendment Agreement.
1.2 The headings in this Amendment Agreement shall not affect its
interpretation.
1.3 The Schedule to this Agreement forms part of this Amendment Agreement.
AMENDMENT OF THE SPA
2.1 The Parties hereby agree that, subject to clause 2.2 below, the SPA shall
be, and shall be deemed to be, amended with effect on and from the date of this
Amendment Agreement (the Effective Date) as set out in the Schedule hereto.
2.2 The SPA, as amended by this Amendment Agreement, shall remain in full
force and effect and, save where the context otherwise requires, any reference
in the SPA to "Agreement" shall be read and construed as a reference to the SPA
as amended by this Amendment Agreement. Any schedule or exhibit attached to the
SPA shall remain valid and documents relating to the Transaction which were in
agreed form at the date of the SPA shall continue to be treated as being in
agreed form.
NOTICE
3.1 The Purchaser and VEG each hereby acknowledge and agree that the notices
served by Phoenix on the Purchaser pursuant to, on the one hand, Clause 5.1(a)
and (b) of the SPA, and, on the other hand, Clause 5.1(c) of the SPA,
respectively transmitted by fax by Phoenix to the Purchaser on 28 and 29
November 2002 (together, the Phoenix Pre-Completion Notices), were both validly
served on 29 November 2002, in accordance with the terms of the SPA in the form
in which it subsisted on that date.
3.2 Each of the Parties acknowledges and agrees that the Phoenix
Pre-Completion Notice served pursuant to Clause 5.1(a) and (b) of the SPA is
hereby revoked and shall be treated as being of no further force and effect, but
that the execution of this Amendment Agreement is without prejudice to the
Phoenix Pre-Completion Notice served pursuant to Clause 5.1(c) of the SPA and
such notice continues to be in full force and effect and has not been revoked.
WARRANTIES
4.1 Each BCcH Shareholder warrants severally to the Purchaser in respect of
itself that as of the date of this Amendment Agreement:
(a) it has obtained all corporate authorisations required to empower it to
enter into and to perform its obligations under this Amendment Agreement;
2
(b) this Amendment Agreement constitutes a valid and binding obligation of it
in accordance with its terms subject to applicable bankruptcy, insolvency,
reorganisation, moratorium and similar laws affecting creditors' rights
and remedies generally; and
(c) the execution and delivery of, and the performance by it of its
obligations under, this Amendment Agreement will neither:
(i) conflict with, or result in the breach of, any provision of its
Memorandum or Articles of Association or other constitutional or
empowering agreement (if any); nor
(ii) violate any statute, rule, regulation, order, judgment or decree
of, or undertaking to, any court or governmental body or
authority by which it is bound.
and the provisions of sub-clauses 9.6 to 9.14 inclusive (other than sub-clause
9.11) of the SPA shall apply in respect of the above warranties, mutatis
mutandis.
4.2 The Purchaser and VEG each warrant to each of the BCcH Shareholders and
the Foundation that as of the date of this Amendment Agreement:
(a) it has obtained all corporate authorisations required to empower it to
enter into and to perform its obligations under this Amendment Agreement;
(b) this Amendment Agreement constitutes (or, to the extent that, in order to
be valid and binding on VEG under the laws of Germany, this Amendment
Agreement requires to be notarised before notaries public in any one or
more jurisdictions, it will constitute for VEG after such notarisations
have been duly made) a valid and binding obligation of it in accordance
with its terms subject to applicable bankruptcy, insolvency,
reorganisation, moratorium and similar laws affecting creditors' rights
and remedies generally; and
(c) the execution and delivery of, and the performance by it of its
obligations under, this Amendment Agreement will neither:
(i) conflict with, or result in the breach of, any provision of its
Certificate of Incorporation, by-laws or other constitutional or
empowering agreement (if any); nor
(ii) violate any statute, rule, regulation, order, judgment or decree
of, or undertaking to, any court or governmental body or
authority by which it is bound.
and the provisions of sub-clauses 10.2 and 10.4 of the SPA shall apply in
respect of the above warranties, mutatis mutandis.
3
GENERAL
5.1 The provisions of Clauses 11-17, 19-23 and 25-28 (in each case inclusive)
of the SPA shall apply in respect of this Amendment Agreement, mutatis mutandis.
5.2 The Parties to this Amendment Agreement hereby agree that, if any or all
of them are party to any other agreement entered into prior to the date of this
Amendment Agreement which refers to any sub-clauses in Clause 6 of the SPA, such
agreements shall, with effect from the amendments provided for in this Amendment
Agreement, be deemed to refer to to the applicable provisions as renumbered in
the amended SPA which is attached hereto as a Schedule.
4
IN WITNESS whereof this Amendment Agreement has been signed by and on behalf of
the Parties on the day and year first before written.
SIGNED )
for and on behalf of )
PHOENIX ACQUISITION COMPANY )
S.a.r.l )
SIGNED )
for and on behalf of )
COMPASS PARTNERS EUROPEAN )
EQUITY FUND (BERMUDA) L.P. )
SIGNED )
for and on behalf of )
COMPASS PARTNERS EUROPEAN )
EQUITY INVESTORS L.P )
SIGNED )
for and on behalf of )
COMPASS PARTNERS 1999 FUND L.P. )
SIGNED )
for and on behalf of )
EUROPEAN PRIVATE EQUITY )
INVESTORS LLC )
SIGNED by SANKATY ADVISORS, LLC )
for and on behalf of )
SANKATY HIGH YIELD ASSET )
PARTNERS L.P. )
SIGNED by SANKATY ADVISORS, LLC )
for and on behalf of )
BCM CAPITAL PARTNERS L.P. )
5
SIGNED by SANKATY ADVISORS, LLC )
for and on behalf of )
BCIP ASSOCIATES II )
SIGNED by SANKATY ADVISORS, LLC )
for and on behalf of )
BCIP TRUST ASSOCIATES II )
SIGNED by SANKATY ADVISORS, LLC )
for and on behalf of )
BCIP TRUST ASSOCIATES II-B )
SIGNED by SANKATY ADVISORS, LLC )
for and on behalf of )
BAIN CAPITAL V MEZZANINE )
FUND L.P. )
SIGNED )
for and on behalf of )
GARMARK PARTNERS L.P. )
SIGNED )
for and on behalf of )
JP MORGAN PARTNERS (BHCA), L.P. )
By: JPMP Master Fund Manager, L.P.,
its general partner
By: JPMP Capital Corp.,
its general partner
By: ____________________________
Name:
Title:
6
SIGNED )
for and on behalf of )
Stichting )
Administratiekantoor )
Phoenix )
SIGNED )
for and on behalf of )
VISHAY INTERTECHNOLOGY INC. )
SIGNED )
for and on behalf of )
VISHAY EUROPE GMBH )
SIGNED )
for and on behalf of )
BCCOMPONENTS INTERNATIONAL )
B.V. )
7
Schedule
Amended Form of the SPA
8
4 December 2002
PHOENIX ACQUISITION COMPANY S.a.r.l
THE OTHER INVESTORS
THE FOUNDATION
THE MEZZANINE LENDERS
VISHAY INTERTECHNOLOGY, INC.
VISHAY EUROPE GMBH
AND
BCCOMPONENTS INTERNATIONAL B.V.
============================================================
AMENDMENT AGREEMENT
to amend the Share Sale and Purchase Agreement
relating to the sale and purchase of the
issued share capital of BCcomponents Holdings
B.V.
dated 10 November 2002
======================================================================
FRESHFIELDS BRUCKHAUS DERINGER
CONTENTS
CLAUSE PAGE
1. INTERPRETATION.................................................2
2. AMENDMENT OF THE SPA...........................................2
3. NOTICE.........................................................2
4. GENERAL........................................................4
SCHEDULE..........................................................8
Exhibit 4.1
WARRANT AGREEMENT
WARRANT AGREEMENT (this "Agreement") dated as of December 13, 2002
between Vishay Intertechnology, Inc., a Delaware corporation (the "Company"),
and American Stock Transfer & Trust Co., a New York corporation, as warrant
agent (the "Warrant Agent").
WHEREAS, the Company and certain of the Initial Holders have entered
into that certain Share Sale and Purchase Agreement, of even date herewith (the
"Purchase Agreement"), by and among the parties thereto, pursuant to which,
among other things, the Company has agreed to issue to the Holders (i) Warrants
to purchase up to an aggregate of 7,000,000 shares of the Company's common
stock, par value $0.10 per share, as evidenced by warrant certificates in the
form attached hereto as Exhibit A (the "Class A Warrants") at the Class A
Exercise Price and (ii) Warrants to purchase up to an additional 1,823,529
shares of the Company's common stock, par value $0.10 per share, as evidenced by
warrant certificates in the form attached hereto as Exhibit B (the "Class B
Warrants") at the Class B Exercise Price.
WHEREAS, the Company desires the Warrant Agent to act on behalf of
the Company, and the Warrant Agent is willing to so act, in connection with the
issuance, exercise, exchange and replacement of the certificates representing
the Warrants (as defined herein) (the "Warrant Certificates") and other matters
provided herein.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereto agree as follows:
SECTION 1. Definitions. As used in this Agreement, the following
terms, when capitalized, shall have the meanings assigned below:
"Affiliate" means, with respect to any Person, any entity which
controls such Person, any entity which such Person controls, or any entity
which is under common control with such Person.
"Business Day" means any day other than a Saturday, Sunday or legal
holiday on which the commercial banks in the City of New York, Borough of
Manhattan, are required or permitted by law to remain closed.
"Class A Warrants" has the meaning specified in the preamble.
"Class A Exercise Price" means US$20.00, as such price may be
modified from time to time in accordance with the provisions herein.
"Class B Warrants" has the meaning specified in the preamble.
"Class B Exercise Price" means US$30.30, as such price may be
modified from time to time in accordance with the provisions herein.
"Common Stock" means the common stock, par value $0.10 per share, of
the Company and any other security exchanged or substituted for such
common stock or into which such common stock is converted in any
recapitalization, reorganization, merger,
1
consolidation, share exchange or other business combination transaction,
including any reclassification consisting of a change in par value or a
change from par value to no par value or vice versa.
"Daily Market Price" for any trading day means the volume-weighted
average of the per share selling prices on the New York Stock Exchange or
other principal United States securities exchange or inter-dealer
quotation system on which the relevant security is then listed or quoted
or, if there are no reported sales of the relevant equity security on such
trading day, the average of the high bid and low ask price for the
relevant equity security on the last trading day on which such sale was
reported or, if there are no high bid and low ask prices, the Daily Market
Price shall be the per share fair market value of the relevant equity
security as determined by an investment banking firm of national
reputation and standing selected by the Company and reasonably acceptable
to a Majority of the Warrant Holders (in which case, only a single
determination of value need be made by an investment banking firm,
notwithstanding any provision in the Agreement requiring an average over
more than one (1) trading day).
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder, as the same
may be amended from time to time.
"Exercise Notice" has the meaning specified in Section 5.
"Exercise Price" means the Class A Exercise Price (with respect to
the Class A Warrants) or the Class B Exercise Price (with respect to the
Class B Warrants).
"Expiration Date" means 5:00 P.M. New York City time, December 13,
2012.
"Holder" means the Initial Holders and their successors and
permitted assigns who become holders of Warrants in a manner permitted
under this Agreement, in each case until the relevant person ceases to be
a Holder of Warrants in accordance with the provisions hereof.
"Initial Holder" means the persons to whom or for whose benefit
Warrants are issued under the terms of the Purchase Agreement and who are
listed on Schedule I hereto, in each case until the relevant person ceases
to be a Holder of Warrants in accordance with the provisions hereof. For
the avoidance of doubt, the definition of Initial Holder shall include
Phoenix Bermuda, an Affiliate of Phoenix.
"Issue Date" means the date of this Agreement, which is the date as
of which the Warrants are first being issued.
"Majority of the Warrant Holders" means, at any relevant time, the
Holders of Warrants that are exercisable for more than 50% of the Warrant
Shares for which all outstanding Warrants are exercisable at such time.
2
"Person" means any individual, corporation, partnership, limited
liability company, trust, foundation, joint venture, association, joint
stock company, unincorporated organization, government agency, estate or
other entity of any nature.
"Phoenix" means Phoenix Acquisition Company S.ar.l., a
company organized under the laws of Luxembourg and an Initial
Holder.
"Phoenix Bermuda" means Phoenix Bermuda, LP, a Bermuda limited
partnership and an Affiliate of Phoenix.
"Purchase Agreement" has the meaning specified in the Preamble.
"Regulation S" means Regulation S under the Securities Act,
including any successor rule or regulation.
"Rule 144" means Rule 144 under the Securities Act, including any
successor rule or regulation.
"Rule 144A" means Rule 144A under the Securities Act, including any
successor rule or regulation.
"SEC" means the United States Securities and Exchange Commission.
"Securities Act" means the United States Securities Act of 1933, as
amended, and the rules and regulations promulgated thereunder, as the same
may be amended from time to time.
"Transfer" means any disposition of any Warrants or of any interest
therein, which would constitute a "sale" within the meaning of the
Securities Act.
"Transfer Agent" has the meaning specified in Section 10.
"Transfer Document" has the meaning specified in Section 4.
"Warrants" means Class A Warrants or Class B Warrants, subject to
adjustment as specified in this Agreement.
"Warrant Agent" has the meaning specified in the preamble.
"Warrant Certificates" has the meaning specified in the preamble.
"Warrant Register" has the meaning specified in Section 3.
"Warrant Shares" means shares of Common Stock issuable or issued
upon exercise of the Warrants, which shall be subject to adjustment as
specified in this Agreement.
Where the reference "hereof," "hereby" or "herein" appears in this
Agreement, such reference shall be deemed to be a reference to this Agreement as
a whole. Whenever the
3
words "include," "includes" or "including" are used in this Agreement, they
shall be deemed to be followed by the words "without limitation." Words denoting
the singular include the plural, and vice versa, and references to it or its or
words denoting any gender shall include all genders.
SECTION 2. Warrant Certificates.
(a) Initial Issuance. Promptly following the execution of this
Agreement, the Company shall deliver to the Warrant Agent a list of the names of
the Initial Holders and the number and class of Warrants to which each Initial
Holder is entitled, totaling, in the aggregate, Warrants to issue 8,823,529
shares of Common Stock. The Company shall deliver to the Warrant Agent, along
with this Agreement, a sufficient number of duly executed Warrant Certificates.
The Warrant Agent is hereby authorized by the Company to promptly issue and
deliver (i) the Class A Warrants, as evidenced by warrant certificates in the
form attached hereto as Exhibit A, to purchase the number of shares of Common
Stock of the Company as set forth in the Purchase Agreement and (ii) the Class B
Warrants, as evidenced by warrant certificates in the form attached hereto as
Exhibit B, to purchase the number of shares of Common Stock of the Company as
set forth in the Purchase Agreement. The Warrant Certificates requested by the
Company shall be completed and countersigned by the Warrant Agent and promptly
delivered to the Company to be mailed or delivered to the Holders pursuant to
the terms hereof.
(b) Forms of Warrant Certificates. Each Warrant Certificate to be
delivered pursuant to the Purchase Agreement, and any additional Warrant
Certificate that may be issued upon partial exercise, replacement or transfer of
any Warrant, shall be in registered form only and shall be substantially in the
form set forth in Exhibit A hereto (if such Warrant is a Class A Warrant) or
Exhibit B (if such Warrant is a Class B Warrant) (including the form of election
and the form of assignment). A single Warrant Certificate may evidence the
issuance to a holder thereof of more than one Warrant; provided, however, that
Class A Warrants and Class B Warrants may not be evidenced together by the same
certificate. Warrants may be divided or combined with other Warrants owned by
the same Holder upon presentation at the office of the Warrant Agent, together
with a written notice specifying the denominations in which new Warrants are to
be issued, signed by the Holder thereof or its agent or attorney. As to any such
division or combination, the Company shall execute and deliver a new Warrant or
Warrants in exchange for the Warrant or Warrants to be divided or combined.
(c) Execution of Warrant Certificates. Warrant Certificates shall be
signed on behalf of the Company by the Chairman or Vice Chairman of the Board or
its President or a Vice President and by its Secretary or an Assistant Secretary
under its corporate seal, and countersigned by an authorized officer of the
Warrant Agent. Each such signature upon the Warrant Certificates may be in the
form of a facsimile signature of the present or any future Chairman or Vice
Chairman of the Board, President, Vice President, Secretary or Assistant
Secretary and may be imprinted or otherwise reproduced on the Warrant
Certificates, and for that purpose the Company may adopt and use the facsimile
signature of any person who shall have been Chairman or Vice Chairman of the
Board, President, Vice President, Secretary or Assistant Secretary,
notwithstanding the fact that at the time the Warrant Certificates shall be
delivered or disposed of he shall have ceased to hold such office. The seal of
the Company may be in the form of a facsimile thereof and may be impressed,
affixed, imprinted or otherwise reproduced on the Warrant Certificates.
4
In case any officer of the Company who shall have signed any of the
Warrant Certificates shall cease to be such officer before the Warrant
Certificates so signed shall have been disposed of by the Company, such Warrant
Certificates nevertheless may be delivered or disposed of as though such person
had not ceased to be such officer of the Company; and any Warrant Certificate
may be signed on behalf of the Company by any person who, at the actual date of
the execution of such Warrant Certificate, shall be a proper officer of the
Company to sign such Warrant Certificate, although at the date of the execution
of this Warrant Agreement any such person was not such an officer.
(d) Rights Conferred. Each Class A Warrant shall evidence the right to
purchase one share of Common Stock at the Class A Exercise Price of $20.00
(subject to adjustment as described herein). Each Class B Warrant shall evidence
the right to purchase one share of Common Stock at the Class B Exercise Price of
$30.30 (subject to adjustment as described herein). Following the Expiration
Date, any Warrant not previously exercised shall be null and void.
SECTION 3. Warrant Register. The Warrant Agent shall number and
register the Warrant Certificates in a register (the "Warrant Register") as they
are issued. The Company may deem and treat such registered Holders of the
Warrant Certificates as the absolute owners thereof (notwithstanding any
notation of ownership or other writing thereon made by anyone), for all
purposes, and shall not be affected by any notice to the contrary.
SECTION 4. Transfers.
(a) Restrictions on Transfer. Each Holder agrees that any proposed
Transfer of any Warrant may be effected only (1)(w) inside the United States (I)
to a person who the seller reasonably believes is a qualified institutional
buyer within the meaning of Rule 144A in a transaction meeting the requirements
of Rule 144A, (II) in accordance with Rule 144 or (III) pursuant to another
exemption from the registration requirements of the Securities Act, (x) to the
Company, (y) outside the United States (I) to a non-U.S. person (within the
meaning of Regulation S) in a transaction meeting the requirements of Regulation
S or (II) pursuant to another exemption from the registration requirements of
the Securities Act or (z) pursuant to an effective registration statement and
(2) in each case, in accordance with the applicable securities laws of any state
of the United States or any other applicable jurisdiction. Each Holder agrees to
notify any purchaser of the resale restrictions set forth above.
(b) Requirements Prior to Transfer. Prior to any Transfer or proposed
Transfer of any restricted Warrants, the Holder thereof shall deliver written
notice, a form of which is attached hereto, to the Company and the Warrant Agent
of such holder's intention to effect such transfer. If the Transfer or proposed
Transfer is pursuant to clause (1)(w) or (1)(y) of the first sentence of the
preceding paragraph, then upon receipt of such notice, the Company may request
any or all of the following (each, a "Transfer Document") in a form reasonably
acceptable to the Company:
(i) an agreement by such transferee to the impression of the
restrictive investment legend set forth below on the Warrant;
5
(ii) an agreement by such transferee, in form and substance
reasonably satisfactory to the Company, to be bound by the
provisions of this Section 4 relating to the transfer of such
Warrant; and
(iii) an opinion of counsel with expertise in securities law matters
reasonably satisfactory to the Company that such Transfer
complies with applicable securities laws.
If the Company requests any Transfer Document(s), it shall do so as
promptly as practicable following receipt of the Holder's notice of intention to
Transfer. The Company shall thereafter cause the Transfer to be recorded and a
certificate or other evidence of ownership in the name of the transferee to be
delivered as soon as practicable after it has received Transfer Documents
complying with the terms of this Section 4(b).
(c) Legend. The Holders agree that each Warrant Certificate shall bear
a legend to the following effect:
THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR
ANY OTHER APPLICABLE SECURITIES LAWS AND HAVE BEEN ISSUED IN RELIANCE UPON
AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND
SUCH OTHER SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED, OR OTHERWISE DISPOSED OF, EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE ACT OR PURSUANT TO A TRANSACTION THAT IS
EXEMPT FROM SUCH REGISTRATION.
The foregoing legend shall be in addition to any other legend required by law.
(d) Termination of Restrictions. The restrictions referenced in
Section 4(a), 4(b), and 4(c) of this Agreement, including the legend, shall
cease and terminate as to any particular Warrants or Warrant Certificates when
(x) such Warrants or Warrant Shares have been transferred in a transaction
pursuant to Rule 144 or a registration statement or (y) in the reasonable
opinion of counsel for the Company, such restriction is no longer required in
order to assure compliance with the Securities Act and applicable state
securities laws. Whenever such restrictions shall cease and terminate as to any
Warrants, the Holder of such Warrants shall be entitled to receive from the
Company, without expense (other than applicable transfer taxes, if any, if such
unlegended shares are being delivered and transferred to any person other than
the registered Holder thereof), new certificates for a like number of Warrants
not bearing the relevant legend(s) set forth in Section 4(c).
(e) Registration of Warrants. The Warrant Agent shall from time to
time register the Transfer of any outstanding Warrant Certificates in the
Warrant Register upon surrender thereof accompanied by a written instrument or
instruments of transfer in the form set forth herein, duly executed by the
registered Holder or Holders thereof or by the duly appointed legal
representative thereof or by a duly authorized attorney. Upon any such
registration of
6
Transfer, the Warrant Agent shall issue a new Warrant Certificate to the
transferee(s), and the surrendered Warrant Certificate shall be canceled and
disposed of by the Warrant Agent. If less than all of the Warrants represented
by a Warrant Certificate are Transferred, the Warrant Agent shall issue to the
Holder a Warrant Certificate representing the remaining Warrants.
(f) Transfer from Phoenix to Phoenix Bermuda. Upon notice by Phoenix
to the Company that it intends to Transfer all or part of the Warrants that it
holds to Phoenix Bermuda, which the parties anticipate will take place within a
reasonably short period of time after the date of this Agreement, the Company
shall cause, as soon as practicable after it has received such notice, such
Transfer to be recorded and a certificate or other evidence of ownership in the
name of Phoenix Bermuda to be delivered to Phoenix Bermuda (or such other entity
as Phoenix Bermuda may direct). Such Transfer shall not be required to comply
with the terms of Section 4(b) above.
SECTION 5. Exercise of Warrants.
(a) Exercise. A Warrant may be exercised upon surrender to the Warrant
Agent (at its office designated for such purpose, the initial address of such
office being listed in Section 15 hereof) of the Warrant Certificate or
Certificates evidencing the Warrants to be exercised with the form of election
to purchase attached hereto (the "Exercise Notice") duly filled in and signed,
together with any documentation or opinion reasonably required by the Company or
the Warrant Agent specified in Section 5(b) below, and (except as provided in
Section 5(e)) upon payment to the Company of the applicable Exercise Price for
the number of Warrant Shares in respect of which such Warrants are then
exercised. Payment of such aggregate Exercise Price shall be made by wire
transfer to an account of the Company or by certified or official bank check to
the order of the Company. All Warrant Certificates surrendered upon exercise of
Warrants shall be canceled and disposed of by the Warrant Agent. Each Warrant
initially shall be exercisable for one share of Common Stock, subject to
adjustment as provided herein.
(b) Certain Conditions of Exercise. Unless the issuance of Warrant
Shares upon exercise of the Warrants shall have been registered under the
Securities Act, the Warrants may only be exercised pursuant to an exemption from
registration under the Securities Act (which in the case of non-U.S. persons may
be pursuant to Regulation S). As a condition of any proposed exercise of the
Warrants in these circumstances, if requested by the Company, the Holder shall
deliver to the Company (i) an agreement by the Holder (or any transferee of the
Holder if the Warrant Shares are to be issued in a name other than the name in
which the Warrant Certificate is registered), in form and substance reasonably
satisfactory to the Company, to the effect that the Warrant Shares may not be
transferred except pursuant to an exemption from registration under the
Securities Act and (ii) an opinion of counsel with expertise in securities law
matters reasonably satisfactory to the Company that such exercise complies with
applicable securities laws. In addition, the Holders agree that each certificate
representing the Warrant Shares shall bear a legend to the effect recited in
Section 4(c). If the Warrant Shares are issued without registration, they shall
be subject to the same restrictions and have the same rights with respect to
termination of restrictions as provided with respect to the Warrants under
Section 4.
7
(c) Exercise in Whole or in Part. The Warrants represented by a
Warrant Certificate shall be exercisable, at the election of the Holder thereof,
either in full or from time to time in part and, in the event that a Warrant
Certificate is exercised in respect of fewer than all of the Warrants
represented thereby at any time prior to the date of expiration of the Warrants,
a new Warrant Certificate evidencing the remaining Warrant or Warrants will be
issued and delivered by the Warrant Agent pursuant to the provisions of this
Section and of Section 2 hereof.
(d) Issuance of Warrant Shares. Subject to the provisions of this
Agreement (including, but not limited to Section 5(e)), upon such surrender of
the Warrant Certificates and receipt of the Exercise Price, the Company shall
issue and cause to be delivered to or upon the written order of the Holder and,
subject to Section 5(b) above, in such name or names as the Warrant Holder may
designate, a certificate or certificates or other evidences of ownership for the
aggregate number of fully paid and nonassessable Warrant Shares issuable upon
the exercise of such Warrants together with payment of the applicable Exercise
Price. The stock certificate or certificates representing such Warrant Shares
shall be delivered in such denominations as may be specified in the Exercise
Notice received by the Company and shall be registered in the name of such
holder or in such other name or names as shall have been designated in the
Exercise Notice. Such certificate or certificates shall be deemed to have been
issued and any person so designated to be named therein shall be deemed to have
become a Holder of record of such Warrant Shares as of the date of the surrender
of such Warrant Certificates and payment of the Exercise Price.
(e) Exercise in Connection with Certain Transfers. If a Holder or
Holders shall sell Warrant Shares in an underwritten offering, the Company shall
cooperate with the Holders and the underwriters for such offering so that the
Warrants may be exercised and the Warrant Shares delivered to the underwriters
for sale in the offering and, upon consummation of the offering, the
underwriters shall deliver the Exercise Price for the Warrants to the Company
out of the proceeds of the offering. If an Initial Holder (or any of its
Affiliates) shall arrange to sell Warrant Shares in a block trade, upon
reasonable notice to the Company, the Company shall cooperate with the Holder
(or such Affiliate) and the broker in the trade so that the Warrants may be
exercised and the Warrant Shares delivered to the broker and, upon consummation
of the trade, the broker shall deliver the Exercise Price for the Warrants to
the Company. "Block trade" for this purpose means the disposition at a single
time in a single transaction by one or more Initial Holders (or such Affiliates)
of not less than 1,000,000 Warrant Shares (or the equivalent thereof) in the
aggregate to one or more institutional investors or purchasers procured by a
broker on behalf of such Initial Holders (or such Affiliates). Such number of
Warrant Shares shall be subject to adjustment as provided for pursuant to
Section 11. "Institutional investor" means any insurance company, pension fund,
mutual fund, investment company, commercial bank or investment bank, or any
portfolio managed by any of the foregoing. The rights of an Initial Holder under
this paragraph shall not be assignable to any transferee of the Warrants other
than to its Affiliates.
SECTION 6. Specific Limitations on the Rights of Warrant Holders.
Prior to the exercise of the Warrants, except as may be specifically provided
for herein and, without prejudice to Section 11(b)(ii) hereof, (i) no Holder of
a Warrant Certificate, as such, shall be entitled to any of the rights of a
holder of Common Stock, including, without limitation, the right to vote at or
receive any notice of any meetings of stockholders; (ii) the consent of any such
8
Holder shall not be required with respect to any action or proceeding of the
Company; (iii) no such Holder, by reason of the ownership or possession of a
Warrant or the Warrant Certificate representing the same, shall have any right
to receive any cash dividends, stock dividends, allotments or rights or other
distributions paid, allotted or distributed or distributable to the stockholders
of the Company prior to, or for which the relevant record date preceded, the
date of the exercise of such Warrant; and (iv) no such Holder shall have any
right not expressly conferred by the Warrant or Warrant Certificate held by such
Holder.
SECTION 7. Exercise Period; Expiration.
(a) Exercise Period. Each Warrant shall be exercisable at any time
during the period from and after (i) in the case of any Holder other than an
Initial Holder or an Affiliate of an Initial Holder, the Issue Date and (ii) in
the case of an Initial Holder or an Affiliate of an Initial Holder, the first
anniversary of the Issue Date, in each case, until its respective Expiration
Date.
(b) Expiration. Any Warrant not exercised prior to its respective
Expiration Date shall become void, and all rights thereunder and all rights in
respect thereof under this Agreement shall cease as of such time.
SECTION 8. Payment of Taxes. The Company will pay all documentary
stamp taxes attributable to the initial issuance of Warrant Shares upon the
exercise of Warrants; provided, however, that the Company shall not be required
to pay any tax or taxes which may be payable in respect of any transfer involved
in the issue of any Warrant Certificates or any certificates for Warrant Shares
in a name other than that of the registered Holder of a Warrant Certificate
surrendered for registration of transfer or upon the exercise of a Warrant, and
the Company shall not be required to issue or deliver such Warrant Certificates
unless and until the person or persons requesting the issuance thereof shall
have paid to the Company the amount of such tax or shall have established to the
reasonable satisfaction of the Company that such tax has been paid.
SECTION 9. Mutilated or Missing Warrant Certificates. In case any of
the Warrant Certificates shall be mutilated, lost, stolen or destroyed, the
Warrant Agent shall issue, in exchange and substitution for and upon
cancellation of the mutilated Warrant Certificate, or in lieu of and
substitution for the Warrant Certificate lost, stolen or destroyed, a new
Warrant Certificate of like tenor and representing an equivalent number of
Warrants, and may in its discretion require evidence reasonably satisfactory to
it of such loss, theft or destruction of such Warrant Certificate and indemnity
reasonably satisfactory to it. Applicants for such substitute Warrant
Certificates shall also comply with such other reasonable regulations and pay
such other reasonable charges as the Company may require.
SECTION 10. Covenants of the Company.
(a) Reservation of Warrant Shares. The Company will at all times
reserve and keep available, out of the aggregate of its authorized but unissued
shares of Common Stock or its authorized and issued shares of Common Stock held
in its treasury, for the purpose of enabling it to satisfy any obligation to
issue Warrant Shares upon exercise of Warrants, the
9
maximum number of shares of Common Stock which may then be deliverable upon the
exercise of all outstanding Warrants. The Company or, if appointed, the transfer
agent for the Common Stock (the "Transfer Agent") and every subsequent transfer
agent for any shares of the Company's capital stock issuable upon the exercise
of any of the Warrants shall be authorized and directed at all times to reserve
such number of authorized shares as shall be required for such purpose. The
Company shall keep a copy of this Agreement on file with the Transfer Agent and
with every subsequent transfer agent for any shares of the Company's capital
stock issuable upon the exercise of the Warrants. The Company will furnish such
Transfer Agent a copy of all notices of adjustments and certificates related
thereto, transmitted to each Holder.
(b) Due Issuance. Warrant Shares, when issued pursuant to the terms
and conditions hereof, shall be duly and validly issued and fully-paid and
non-assessable, and free from all liens, encumbrances and other charges thereon.
(c) Authorizations. Before taking any action which would result in an
adjustment in the number of shares of Common Stock, the Company shall obtain all
authorizations or exemptions thereof, or consents thereto, as may be required by
law, except where failure to do so would not result in a material adverse effect
on the rights of the Holders or the Company.
(d) Listing. The Company will list or cause to have quoted such Common
Stock issuable upon exchange of the Warrants on each securities exchange or such
other market on which the Common Stock is then listed or quoted.
SECTION 11. Adjustment of Number of Warrant Shares and Exercise Price.
The number of Warrant Shares issuable upon the exercise of each Warrant and its
Exercise Price are subject to adjustment from time to time upon the occurrence
of the events enumerated in this Section 11.
(a) Declaration of Stock Dividend, Splits, Reverse Splits or
Reclassification or Reorganization; Other Distributions
(i) In case the Company shall declare any dividend or other
distribution upon its outstanding shares of Common Stock payable in
Common Stock or shall subdivide its outstanding shares of Common Stock
into a greater number of shares, then the number of shares of Common
Stock which may thereafter be purchased upon the exercise of any
Warrant shall be increased in proportion to the increase in the number
of shares of Common Stock outstanding through such dividend, other
distribution, or subdivision and the Exercise Price per share shall be
decreased in such proportion such that the amount payable to the
Company upon the exercise of a Warrant shall be the same after such
adjustment as before such adjustment. In case the Company shall at any
time combine the outstanding shares of its Common Stock into a smaller
number of shares, the number of shares of Common Stock which may
thereafter be purchased upon the exercise of any Warrant shall be
decreased in proportion to the decrease in the number of shares of
Common Stock outstanding through such combination and the Exercise
Price per share shall be increased in such proportion such that the
amount payable to the Company upon the exercise of a Warrant shall be
the same after such adjustment as before such
10
adjustment. The Company shall cause a notice to be mailed to each
Holder at least ten (10) Business Days prior to the applicable record
date for the activity covered by this Section 11(a)(i). The Company's
failure to give the notice required by this Section 11(a)(i) or any
defect therein shall not affect the validity of the activity covered
by this Section 11(a)(i). Notwithstanding the foregoing, nothing in
this paragraph will prejudice the rights of the Holders pursuant to
this Agreement.
(ii) In case the Company shall at any time (including in connection
with any merger, consolidation or sale of all or substantially all the
assets of the Company in which Section 11(d) hereof is not applicable)
(i) issue any evidence of indebtedness, shares of its stock or any
other securities to all holders of shares of Common Stock by
reclassification of its shares of Common Stock, (ii) distribute any
rights, options or warrants to purchase or subscribe for any evidence
of indebtedness, shares of its stock (other than distributions for
which adjustment may be made pursuant to Section 11(b) or Section
11(e)) or any other securities to all holders of shares of Common
Stock, (iii) distribute cash (other than regular quarterly or
semi-annual cash dividends) or other property to all holders of shares
of Common Stock, or (iv) issue by means of a capital reorganization
other securities of the Company in lieu of the Common Stock or in
addition to the Common Stock, then the Warrant shall be adjusted so
that the Warrant shall be exercisable into the kind and number of
shares or other securities of the Company or the successor entity or
cash or other property as that the Holder would have owned or have
been entitled to receive after the happening of the event described
above, had such Warrant been exercised immediately prior to the
happening of such event or any record date with respect thereto. The
Company shall cause a notice to be mailed to each Holder at least ten
(10) Business Days prior to the applicable record date for the
activity covered by this Section 11(a)(ii). The Company's failure to
give the notice required by this Section 11(a)(ii) or any defect
therein shall not affect the validity of the activity covered by this
Section 11(a)(ii). Notwithstanding the foregoing, nothing in this
paragraph will prejudice the rights of the Holders pursuant to this
Agreement.
(iii) An adjustment made pursuant to this Section 11(a) shall become
effective immediately after the effective date of such event
retroactive to the record date, if any, for such event.
(b) Adjustment for Rights Issuance.
(i) (A) In case the Company shall at any time distribute any rights,
options or warrants to all holders of Common Stock entitling them, for a period
expiring sixty (60) days or less after the date of determination of the
stockholders entitled to receive such rights (the "Record Date") (or any longer
period resulting from the extension of the exercise period which is announced
following the time that the rights, options or warrants are first issued) for
such distribution, to purchase or subscribe for shares of Common Stock at a
price per share less than ninety percent (90%) of the Daily Market Price of the
Common Stock on the Record Date, then the number of shares issuable upon
exercise of each Warrant immediately prior thereto shall be adjusted in
accordance with the formula:
N = No x (O + A)/ (O + (C/M))
11
where:
N = the adjusted number of Warrant Shares issuable upon exercise of
such Warrant.
No = the number of Warrant Shares issuable upon exercise of such
Warrant prior to such adjustment.
O = the number of shares outstanding immediately prior to the issuance
of such rights, options or warrants as referred to in this Section
11(b)(i)(A).
A = the maximum number of shares issuable pursuant to such rights,
options or warrants as referred to in this Section 11(b)(i)(A).
C = the aggregate consideration receivable by the Company for the
issuance of Common Stock upon exercise of such rights, options or
warrants as referred to in this Section 11(b)(i)(A).
M = the average of the Daily Market Prices of the Common Stock for the
ten (10) consecutive trading days immediately preceding the Record
Date.
Provided that, in no adjustment shall N be less than No.
(B) If any adjustment is made to increase the number of shares
issuable upon exercise of any Warrant pursuant to this Section 11(b), the
Exercise Price per share of such Warrant shall be correspondingly decreased,
such that the amount payable to the Company upon the exercise of a Warrant shall
be the same after such adjustment as before such adjustment. The adjustment
shall become effective immediately after the Record Date for the determination
of shareholders entitled to receive the rights, warrants or options to which
this Section 11(b) applies. If less than all of such rights, warrants or options
have been exercised when such rights, warrants or options expire, then the
number of shares issuable upon the exercise of each Warrant and corresponding
adjustment to the Exercise Price of each such Warrant shall promptly be
readjusted to the number of shares issuable upon the exercise of each Warrant
and the Exercise Price that would then be in effect had the adjustment upon the
issuance of such rights, warrants or options been made on the basis of the
actual number of shares of Common Stock issued upon the exercise of such rights,
warrants or options.
(ii) In case the Company shall at any time distribute any rights,
options or warrants to all holders of Common Stock entitling them, for a period
expiring more than sixty (60) days after the Record Date therefor (excluding any
rights, options or warrants originally issued with an exercise period of sixty
(60) days or less, which, by virtue of one or more extensions, expire more than
sixty (60) days after the Record Date therefor), to purchase or subscribe for
shares of Common Stock at a price per share less than ninety percent (90%) of
the Daily Market Price of the Common Stock as of such Record Date, then the
Company shall similarly distribute such rights, options or warrants to the
12
Holders on such Record Date (without any exercise of Warrants by Holders) as if
such Holders had exercised their Warrants immediately prior to the Record Date.
(c) Liquidation, Dissolution or Winding Up. Notwithstanding any
other provisions hereof, in the event of the liquidation, dissolution, or
winding up of the affairs of the Company (other than in connection with a
consolidation, merger or sale or conveyance of all or substantially all of its
assets or a Change or Spin-Off), the right to exercise this Warrant shall
terminate and expire at the close of business on the last full business day
before the earliest date fixed for the payment of any distributable amount on
the Common Stock. The Company shall cause a notice to be mailed to each Holder
at least ten (10) Business Days prior to the applicable record date for such
payment stating the date on which such liquidation, dissolution or winding up is
expected to become effective, and the date on which it is expected that holders
of record of shares of Common Stock shall be entitled to exchange their shares
of Common Stock for securities or other property or assets (including cash)
deliverable upon such liquidation, dissolution or winding up, and that each
Holder may exercise outstanding Warrants during such ten (10) Business Day
period and, thereby, receive consideration in the liquidation on the same basis
as other previously outstanding shares of the same class as the shares acquired
upon exercise. The Company's failure to give notice required by this Section
11(c) or any defect therein shall not affect the validity of such liquidation,
dissolution or winding up. Notwithstanding the foregoing, nothing in this
paragraph will prejudice the rights of the Holders pursuant to this Agreement.
(d) Merger, Consolidation, Etc.
(i) In any event when (A) any person (the "Acquirer") directly or
indirectly acquires the Company in a transaction in which the Company
is merged with or into or consolidated with another person or (B) the
Company sells or conveys all or substantially all of its assets to
another person (unless, subsequent to such merger, consolidation or
other transaction, the Company is the surviving entity and has
reporting obligations under the Exchange Act as a result of having
common equity securities outstanding, in which case, this Section
shall not apply with respect to such merger, consolidation or other
transaction)(such merger, consolidation or other transaction referred
to hereinafter as a "Change"), then, upon exercise of each Warrant at
any time after the consummation of the Change but prior to the
Expiration Date, in lieu of the shares of the Company's Common Stock
(or other securities, cash, assets or other property) purchasable upon
the exercise of the Warrant prior to such Change, the Holder shall be
entitled to receive such shares of stock, securities, cash, assets or
any other property whatsoever (including warrants or other purchase or
subscription rights) which such Holder would have been entitled to
receive after the happening of such Change had such Warrant been
exercised immediately prior to such Change.
(ii) Notwithstanding the foregoing, but subject to the following
sentence, if a Holder of a Warrant so elects by giving written notice
thereof to the Company on or before the day immediately preceding the
date of the consummation of such Change, the Holder shall not be
required to make any payment upon exercise of the Warrant, and shall
be entitled to receive from the Company or the Acquirer (in lieu of
the adjustment provided for in Section 11(d)(i) above) a cash amount
equal to the Black-Scholes Value
13
of the Warrant (the "Cash-Out Option") upon surrender of the Warrant
Certificate representing such Warrant. The right of a Holder to elect
the Cash-Out Option shall not be available if
(A) the payment or offering of any Cash-Out Option would
(x) in the reasonable opinion of counsel to the
Company, prevent a Change from otherwise being
treated as a tax-free reorganization; or
(y) in the reasonable opinion of counsel or
accountants to the Company, prevent a Change from
being accounted for using a pooling of interests
accounting method or other similar accounting
method, if any, under US GAAP which would
otherwise be available; and
(B) the payment of the Cash-Out Option in the form of
securities of the Acquirer, as described below, would
not preserve such tax or accounting treatment.
If the payment of the Cash-Out Option in the form of Acquirer securities
issued to the Company's stockholders in the Change (the "Acquirer
Securities") would preserve the tax or accounting treatment of the
Change, the Holders shall have the right to elect the Cash-Out Option,
but only in the form of Acquirer Securities. In such case,
(1) the Cash-Out Option will be payable in the Acquirer
Securities; and
(2) the number of securities payable to the Holder on
exercise of the Cash-Out Option will equal (x) the dollar
amount of the Cash-Out Option divided by (y) the per share (or
other unit) fair market value of the securities in which the
Cash-Out Option is payable.
"Fair market value" for this purpose means the average Daily Market Price
of the securities of the Acquirer for the first ten (10) consecutive
trading days immediately preceding but not including the date of
effectiveness of the Change; provided, however, that if the securities of
the Acquirer are not listed or traded on an exchange or interdealer
quotation system, then the "fair market value" of such securities shall be
determined by an investment banking firm of national reputation and
standing selected by the Company and reasonably acceptable to a Majority
of the Warrant Holders. If the Holders of the Warrants do not have the
right to elect the Cash-Out Option provided in Section 11(d)(ii) herein,
the adjustment provided for in Section 11(d)(i) above shall apply.
(iii) Notwithstanding the foregoing, in the case of any such Change
where,
14
(A) the Acquirer is a company with reporting obligations under the
Exchange Act with respect to common equity securities (such common equity
securities being referred to herein as the "Acquirer Shares"), and
(B) the Acquirer is offering as consideration with respect to the
Change a combination of Acquirer Shares and cash or other consideration,
if a Holder of a Warrant so elects by giving written notice thereof to the
Company on or before the day immediately preceding the effective date of such
Change, then, in lieu of the adjustment to the Warrant provided under Section
11(d)(i), upon the consummation of the Change and surrender of the Certificate
representing the Warrant, the Holder shall receive (x) a warrant (an "Acquirer
Warrant") exercisable for Acquirer Shares, in an amount and for an exercise
price calculated as described below, and (y) a cash amount, calculated as
described below (the "Adjusted Cash-Out Option"). The terms of the Acquirer
Warrants shall be identical to the terms of the Warrants mutatis mutandis,
except that the exercise price and the number of securities issuable upon the
exercise of the Acquirer Warrants (subject to adjustment as provided therein)
shall be determined as provided below:
the Exercise Price of the Acquirer Warrants shall be calculated as
follows:
Ew = (Eo x (Pa/Pt)) where:
Ew = the adjusted Exercise Price of the Acquirer Warrants.
Eo = the Exercise Price of the Warrants immediately prior to such
adjustment.
Pt = the average of the Daily Market Prices of the Common Stock for the
ten (10) consecutive trading days immediately preceding the effective
date of the Change.
Pa = the fair market value per share of the Acquirer Shares. As used in
this formula, "fair market value" shall mean the average Daily Market
Price of the Acquirer Shares for the ten (10) consecutive trading
days immediately preceding the effective date of the Change.
The number of Acquirer Shares issuable upon exercise of an Acquirer
Warrant shall be calculated as follows:
N = a x No
where:
N = the number of shares issuable by the Acquirer upon exercise of the
Acquirer Warrant.
a = the number of Acquirer Shares delivered in the Change to holders of
Common Stock for each share of Common Stock.
15
No = the number of Warrant Shares issuable upon exercise of the original
Warrant in exchange for which the Acquirer Warrant was issued.
If the Holders of Common Stock may elect to receive in the Change Acquirer
Shares, cash or other consideration, or a combination of Acquirer Shares
and cash or other consideration as selected by the Holders (whether or not
subject to proration), then the number of Acquirer Shares delivered in the
Change for each share of Common Stock shall be determined, for purposes of
the preceding formula and the determination below of the amount of the
Adjusted Cash-Out Option, as follows:
a = Nas/Nts
where
Nas = the aggregate number of Acquirer Shares delivered in the Change to
holders of Common Stock. Nts = the total number of shares of Common
Stock outstanding immediately prior to the effectiveness of the
Change and exchanged for consideration in the Change.
The amount of the Adjusted Cash-Out Option for a Warrant shall be
calculated as follows:
AC = BSw x (1-((a x Pa) /C ))
where the symbols previously defined in this Section have their previously
defined meanings and:
AC = the amount of the Adjusted Cash-Out Option of the Warrant
BSw = the Black-Scholes Value of the Warrant, ignoring the effect of the
Change, as determined pursuant to (iv) below.
C = the total fair market value of the consideration delivered in the
Change to Holders of Common Stock for each share of Common Stock.
For purposes of determining this amount--
(A) the fair market value of the component of the
consideration consisting of Acquirer Shares shall equal
(x) the average Daily Market Price of the Acquirer
Shares for the first ten (10) consecutive trading days
immediately preceding the effective date of the Change
multiplied by (y) the number of Acquirer Shares
delivered in the Change for each share of Common Stock;
16
(B) the fair market value of any cash component shall be the
amount of the cash delivered in the Change for each
share of Common Stock; and
(C) the fair market value of any other consideration
delivered in the Change for each share of Common Stock
shall be as determined by an investment banking firm of
national reputation and standing selected by the Company
and reasonably acceptable to a Majority of the Warrant
Holders.
The right to make the election to receive Acquirer Shares and the Adjusted
Cash-Out Option as provided in this Section 11(d)(iii) shall be subject to
the same limitations as provided in Section 11(d)(ii)(A) and (B) above
regarding the right to elect the Cash-Out Option; provided, however, that
if the payment of the Adjusted Cash-Out Option in the form of Acquirer
Securities would preserve the tax or accounting treatment of the Change,
the election may be exercised with the Adjusted Cash-Out Option being paid
in Acquirer Securities as provided in clauses (1) and (2) of Section
11(d)(ii).
(iv) As used herein, "Black-Scholes Value" of the Warrants, shall be
determined on the basis of the Black-Scholes methodology by an investment
banking firm of national reputation and standing, selected by the Company
and reasonably acceptable to a Majority of the Warrant Holders; provided,
however, that no Black-Scholes Value of a Warrant shall exceed the Daily
Market Price of the Common Stock on the day immediately preceding the
Change. For purposes of applying the Black-Scholes methodology, (i) the
price per share of the Common Stock shall be deemed to be the average of
the Daily Market Prices for the ten (10) full trading days ending ten (10)
trading days prior to the first public announcement of the Change, and
(ii) the methodology shall be applied as if the relevant Change had not
occurred.
(v) The Company shall give written notice of any Change to each
Holder, in accordance with Section 15 hereof, at least ten (10) Business
Days prior to the effective date of the Change; provided, however, that if
either Section 11(d)(ii) or (iii) is applicable, one or more notices shall
be given to the Holders sufficiently in advance of the Change to allow for
selection of the investment banking firm referred to in the previous
paragraph and for notice to the Holders of the Black-Scholes Value at
least ten (10) Business Days prior to the effective date of the Change.
The Company's failure to give notice required by this Section 11(d) or any
defect therein shall not affect the validity of the Change covered by this
Section 11(d). However, if the Company fails to give notice, the
responsibilities of the Company with respect to this Section 11(d) shall
be assumed by the Acquirer and nothing in this paragraph will prejudice
the rights of the Holders pursuant to this Agreement.
(e) Spin-Off.
(i) In case the Company shall at any time pay a dividend or make a
distribution to all holders of its Common Stock consisting of the capital
stock of any class or series, or similar interests, of or relating to a
subsidiary or other business unit of the Company (such transaction, a
"Spin-Off"; such capital stock or other interests, the "Spin-
17
Off Shares"; and such subsidiary or business unit, the "Spin-Off
Company"), then each holder of a Warrant outstanding and unexercised on
the date of the Spin Off shall become entitled to a spin-off warrant
("Spin-Off Warrants") evidencing a right to purchase a number of shares of
capital stock of the Spin-Off Company that the Holder would have received
had the Holder exercised such Warrants immediately prior to the record
date for the Spin-Off (the "Spin-Off Record Date"); provided, however,
that in the event that the distribution of Spin-Off Shares to the Holders
would, in the reasonable opinion of counsel to the Company, (y) prevent
the tax-free nature of such Spin-Off or (z) require registration with the
SEC in circumstances where registration would not otherwise be required,
then at the election of the Company, either (y) the Holders shall not
receive Spin-Off Warrants pursuant to this Section 11(e)(i) and the
Warrants shall instead be adjusted pursuant to the terms of Section
11(e)(ii) or (z) the Holders shall receive Spin-Off Warrants as
contemplated above in this Section 11(e)(i). The terms of the Spin-Off
Warrants shall be identical to the terms of the Warrants mutatis mutandis,
except that the exercise price of a Spin-Off Warrant (subject to
adjustment as provided therein) shall be determined by the following
formula:
Es = Eo x Ps / (Pp+ (r x Ps))
where:
Es = the Exercise Price per Spin-Off Share of the Spin-Off Warrants.
Eo = the Exercise Price per share of Common Stock of the relevant
Warrant immediately prior to adjustment for the relevant Spin-Off.
Pp = the average of the Daily Market Prices of the Common Stock for the
ten (10) full consecutive trading days following the date on which
the Spin-Off is consummated.
r = the number of Spin-Off Shares (which may be one or a fraction less
than or greater than one) distributed pursuant to the Spin-Off in
respect of each share of Common Stock.
Ps = the fair market value per share of the Spin-Off Shares. As used in
this section, "fair market value" shall mean the average Daily
Market Price of the Spin-Off Shares for the first ten (10)
consecutive trading days following the date on which the Spin-Off
is consummated; provided, however, that if such distributed
securities do not begin trading within two trading days of the
consummation of such Spin-Off or do not trade for at least ten
(10) consecutive trading days within twenty (20) days after the
Spin-Off, then the "fair market value" of such distributed
securities shall be determined by an investment banking firm of
national reputation and standing selected by the Company and
reasonably acceptable to a Majority of the Warrant Holders on the
Spin-Off Record Date.
Following the Spin-Off, the Exercise Price of each Warrant
shall be adjusted in accordance with the following formula:
18
En = Eo x Pp / (Pp+ (r x Ps))
where:
En = the adjusted exercise price per share of Common Stock of the
Warrants.
(with the other symbols in such formula having the meanings specified in
the preceding formula).
(ii) In case the Company shall engage in a Spin-Off, and Section
11(e)(i) shall not be available to the Holders as a result of the
proviso in the first paragraph of Section 11(e)(i), then the Holders
shall not receive Spin-Off Warrants and instead the number of shares
issuable upon the exercise of each Warrant immediately prior thereto
shall be adjusted in accordance with the formula:
N = No x (Pp + (Ps x r))/Pp
where:
N = the adjusted number of Warrant Shares issuable upon exercise of
such Warrant.
No = the number of Warrant Shares issuable upon exercise of such
Warrant prior to such adjustment.
Pp = the average of the Daily Market Prices of the Common Stock for the
ten (10) full consecutive trading days following the date on which
the Spin-Off is consummated.
Ps = the average Daily Market Price of the Spin-Off Shares for the
first ten (10) full consecutive trading days following the date on
which the Spin-Off is consummated; provided, however, that if such
distributed securities do not begin trading within two trading
days of the consummation of such Spin-Off or do not trade for at
least ten (10) consecutive trading days within twenty (20) days
after the Spin-Off, then this quantity shall mean the "fair market
value" per share of the Spin-Off Shares as of the date the
Spin-Off is consummated, determined by an investment banking firm
of national reputation and standing selected by the Company and
acceptable to a Majority of the Warrant Holders on the Spin-Off
Record Date.
r = the number of Spin-Off Shares (which may be one or a fraction less
than or greater than one) distributed pursuant to the Spin-Off in
respect of each share of Common Stock.
If any adjustment is made to increase the number of Warrant
Shares issuable upon exercise of any Warrant pursuant to this Section
11(e)(ii), the Exercise Price per share of such Warrant shall be adjusted
in accordance with the following formula.
19
En = Eo x (No/N)
Where:
En = the adjusted exercise price per share of Common Stock of the
Warrants.
Eo = the Exercise Price per share of Common Stock of the relevant
Warrant immediately prior to adjustment for the relevant Spin-Off.
(with the other symbols in such formula having the meanings specified in
the preceding formula).
(iii) An adjustment made pursuant to Section 11(e)(ii) shall
become effective immediately after the determination of the adjusted
number of Warrant Shares issuable upon exercise of the Warrants,
retroactive to the date for the Spin-Off.
(iv) The Company shall give written notice of any Spin-Off, in
accordance with Section 15 hereof, at least ten (10) Business Days
prior to the Record Date therefor. The Company's failure to give notice
required by this Section 11(e)(iv) or any defect therein shall not
affect the validity of the Spin-Off covered by this Section 11(e).
Notwithstanding the foregoing, nothing in this paragraph will prejudice
the rights of the Holders pursuant to this Agreement.
(f) Good Faith Determination.
(i) Subject to the following clause (ii), any determination as to
whether an adjustment or limitation of exercise is required pursuant to
this Section 11 (and the amount of any adjustment) shall be binding
upon the Holders and the Company if made in good faith by the board of
directors of the Company.
(ii) If a Majority of the Warrant Holders shall object to any
determination of the board of directors of the Company within ten (10)
Business Days of receipt of notice of such determination, then such
determination shall be referred to a national independent accounting
firm in the United States (the "Accounting Firm") selected by the
Company and reasonably acceptable to a Majority of the Warrant Holders.
The determination of the adjustment made by the Accounting Firm shall
be strictly in accordance with the terms of this Agreement and shall be
binding upon the Holders and the Company. The Accounting Firm shall be
instructed to notify the Company and such Majority of the Warrant
Holders of its determination regarding the adjustment within fifteen
(15) Business Days of such referral.
(iii) Whenever this Agreement provides for the reasonable approval
or acceptance of a Majority of the Warrant Holders of any action or
determination, such approval or acceptance shall be deemed to be given
if a Majority of the Warrant Holders do not reasonably object to such
action or determination by written notice to the Company within ten
(10) Business Days of the date on which notice thereof is first given
20
to the Holders. No objection shall be deemed reasonable if the reasons
for such objection are not set forth in reasonable detail in the notice
of objection given to the Company as aforesaid.
(g) Notice of Adjustment. Whenever the number of shares of Common
Stock purchasable upon the exercise of the Warrants or the Exercise Price is
adjusted, the Company shall promptly file, in the custody of its Secretary or an
Assistant Secretary at its principal office and with the Warrant Agent, an
officer's certificate setting forth the number of shares of Common Stock
purchasable upon the exercise of the Warrants, the Exercise Price after such
adjustment, a statement, in reasonable detail, of the facts requiring such
adjustment and the computation by which such adjustment was made. Each such
officer's certificate shall be made available during regular business hours for
inspection by the Holders at the office of the Warrant Agent.
(h) No Change of Warrant Necessary. Irrespective of any adjustment in
the Exercise Price or in the number or kind of shares issuable upon exercise of
the Warrants, the Warrant Certificates may continue to express the same price
and number and kind of shares as are stated in the Warrant Certificates as
initially issued.
(i) Subsequent Adjustments. The adjustment provisions of this Section
11 shall be applied successively and from time to time as the circumstances
requiring such adjustments shall occur. If as a result of an adjustment made
pursuant to this Section 11 (except as otherwise specifically provided herein)
the Holder of any Warrants thereafter surrendered for conversion shall be
entitled to receive any securities other than shares of Common Stock, the number
and kind of the securities issuable upon exercise of the Warrants and the
Exercise Price therefor shall be subject to adjustment, from time to time, in a
manner and on terms as nearly equivalent as practicable to the provisions with
respect to the Common Stock contained in this Section 11.
SECTION 12. Fractional Interests. The Company shall not be required to
issue fractional shares of Common Stock on the exercise of the Warrants. If any
fraction of a share of Common Stock would be issuable upon the exercise of the
Warrants (or any specified portion thereof), the Company shall pay an amount in
cash equal to the product of (x) such fraction and (y) the Daily Market Price of
the Common Stock on the trading day prior to the date the Warrant is exercised.
SECTION 13. Appointment of Warrant Agent. The Company hereby appoints
the Warrant Agent as its agent to issue the Warrant Certificates, as set forth
herein, subject to resignation or replacement of the Warrant Agent as provided
herein. The Warrant Agent agrees to accept such appointment, subject to the
terms and conditions as set forth herein and to issue, transfer and exchange the
Warrant Certificates pursuant to the terms provided for herein and to notify the
Company to issue or cause to be issued the certificates or other evidence of
ownership representing the appropriate number of shares of Common Stock (or
other consideration) upon exercise of the Warrants.
SECTION 14. Duties of the Warrant Agent. The Warrant Agent acts
hereunder as agent and in a ministerial capacity for the Company, and its duties
shall be determined solely
21
by the provisions hereof. The Warrant Agent shall not by issuing and delivering
Warrant Certificates, or by any other act hereunder, be deemed to make any
representations (i) as to the validity, value or authorization of the Warrant
Certificates or the Warrants represented thereby or of any securities or other
property delivered upon exercise of any Warrant, or (ii) whether any stock
issued upon exercise of any Warrant is fully paid and nonassessable.
Without prejudice to any liability of any other party hereof, the
Warrant Agent shall not at any time be under any duty or responsibility to any
Holder of Warrant Certificates to make or cause to be made any adjustment of the
Warrant Price provided in this Agreement, or to determine whether any fact
exists that may require any such adjustment, or with respect to the nature or
extent of any such adjustment, when made, or with respect to the method employed
in making the same. The Warrant Agent shall not (i) be liable for any recital or
statement of facts contained herein or for any action taken, suffered or omitted
by it in reliance on any Warrant Certificate or other document or instrument
believed by it in good faith to be genuine and to have been signed or presented
by the proper party or parties, (ii) be responsible for any failure on the part
of the Company to comply with any of its covenants and obligations contained in
this Agreement or in any Warrant Certificate, or (iii) be liable for any act or
omission in connection with this Agreement except for its own gross negligence
or willful misconduct.
Any notice, statement, instruction, request, direction, order or
demand of the Company shall be sufficiently evidenced by an instrument signed by
the Company's Chairman or Vice Chairman of the Board, President, any Vice
President, its Secretary, or Assistant Secretary (unless other evidence in
respect thereof is herein specifically prescribed). Without prejudice to any
liability of any other party hereof, the Warrant Agent shall not be liable for
any action taken, suffered or omitted by it in accordance with such notice,
statement, instruction, request, direction, order or demand believed by it to be
genuine.
The Company agrees to pay the Warrant Agent reasonable compensation
for its services hereunder and to reimburse it for its reasonable expenses
hereunder and further agrees to indemnify the Warrant Agent and save it harmless
against any and all losses, expenses and liabilities, including judgments, costs
and counsel fees, for anything done or omitted by the Warrant Agent in the
execution of its duties and powers hereunder except losses, expenses and
liabilities arising as a result of the Warrant Agent's gross negligence or
willful misconduct.
The Warrant Agent may resign its duties and be discharged from all
further duties and liabilities hereunder (except liabilities arising as a result
of the Warrant Agent's own gross negligence or willful misconduct), after giving
thirty days' prior written notice to the Company. At least fifteen (15) days
prior to the date such resignation is to become effective, the Warrant Agent
shall cause a copy of such notice of resignation to be mailed to the Holder of
each Warrant Certificate at the Company's expense. Upon such resignation, or any
inability of the Warrant Agent to act as such hereunder, the Company shall
appoint a new warrant agent in writing. The Company shall have complete
discretion in the naming of a new warrant agent, who may be an affiliate,
subsidiary or department of the Company, or any person used by the Company as
transfer agent for the Common Stock. If the Company shall fail to make such
appointment within a period of thirty (30) days after it has been notified in
writing of such resignation by the resigning Warrant Agent, then the Holder of
any Warrant Certificate may apply to any court of competent jurisdiction for the
appointment of a new warrant agent.
22
The Company may, upon notice to the Holders, remove and replace the
Warrant Agent if the Warrant Agent is the transfer agent for the Company's
Common Stock and the Warrant Agent ceases to be the transfer agent for the
Company's Common Stock for any reason.
After acceptance in writing of an appointment by a new warrant agent
is received by the Company, such new warrant agent shall be vested with the same
powers, rights, duties and responsibilities as if it had been originally named
herein as the Warrant Agent, without any further assurance, conveyance, act or
deed. Any former warrant agent hereby agrees to cooperate with and deliver all
records and Warrant Certificates to the new warrant agent at the direction of
the new agent and the Company.
Any corporation into which the Warrant Agent or any new warrant agent
may be converted or merged or any corporation resulting from any consolidation
to which the Warrant Agent or any new warrant agent shall be a party or any
corporation succeeding to the trust business of the Warrant Agent shall be a
successor warrant agent under this Agreement without any further act. Any such
successor warrant agent shall promptly cause notice of its succession as warrant
agent to be mailed to the Company and to each Holder.
The Warrant Agent shall perform its duties with all due care and
attention. If for any period no person is acting as Warrant Agent, then the
Company shall discharge the obligations that would otherwise fall to be
discharged by the Warrant Agent during such period.
Nothing herein shall preclude the Warrant Agent from acting in any
other capacity for the Company.
SECTION 15. Notices. Any notice or demand authorized by this Agreement
to be given or made to or on the Company or the Warrant Agent shall be
sufficiently given or made when and if delivered by a recognized international
courier service or hand delivery, or by telecopier with copy sent by first class
or registered mail, postage prepaid, to the applicable address set forth below
(until the Holders are otherwise notified in accordance with this Section by the
Company):
If to the Company, then to:
Vishay Intertechnology, Inc.
63 Lincoln Highway
Malvern, PA 19355
Attn.: Chief Financial Officer
Telecopier No.: (610) 889-2161
Confirm No.: (610) 644-1300
23
If to the Warrant Agent, then to:
American Stock Transfer & Trust Co.,
59 Maiden Lane
New York, NY 10038
Attn.: Exchange Department
Telecopier No. 718-234-5001
Confirm No. 718-921-8200
Any notice pursuant to this Agreement to be given to any Holder of any
Warrant Certificate shall be sufficiently given when and if delivered to such
Holder at the address appearing on the Warrant Register of the Company (until
the Company and the Warrant Agent are otherwise notified in accordance with this
Section by such Holder). Any such notice shall be delivered by overnight or hand
delivery, by telecopier with copy sent by first class mail, postage prepaid, or
by first class or registered mail, postage prepaid.
SECTION 16. Supplements and Amendments. The Company and the Warrant
Agent may from time to time amend or supplement this Agreement in good faith
without the approval of any Holders only in order to cure any ambiguity or to
correct or supplement any provision contained herein which may be defective or
inconsistent with any other provision herein. Any other amendment or supplement
to this Agreement shall require the written consent of a Majority of the Warrant
Holders.
SECTION 17. Successors. All the covenants and provisions of this
Agreement by or for the benefit of the Company or the Warrant Agent shall bind
and inure to the benefit of its successors and assigns hereunder; provided,
however, that any assignment by the Company shall not relieve the Company of any
of its obligations hereunder. This Agreement shall be binding upon and inure to
the benefit of the successors and registered assigns of the Initial Holder and
all subsequent Holders of Warrants.
SECTION 18. Governing Law. THIS AGREEMENT AND EACH WARRANT CERTIFICATE
ISSUED HEREUNDER SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE
STATE OF NEW YORK AND FOR ALL PURPOSES SHALL BE CONSTRUED IN ACCORDANCE WITH THE
INTERNAL LAWS OF SAID STATE.
SECTION 19. No Third Party Beneficiaries. Nothing in this Agreement
shall be construed to give to any Person other than the Company, the Warrant
Agent and the Holders of the Warrants or holders of Warrant Shares any legal or
equitable right, remedy or claim under this Agreement; but this Agreement shall
be for the sole and exclusive benefit of the Company, the Warrant Agent and the
Holders of the Warrants and the holders of Warrant Shares.
SECTION 20. Notification of Delisting. Prior to the occurrence of a
Delisting Event, the Company will, at least ten (10) Business Days before the
occurrence thereof, notify each Holder of such event. Any notice will be in
writing and shall specify the date of such Delisting Event. For these purposes
"Delisting Event" means the common stock of the Company being delisted from the
principal United States national or regional securities exchange or national
quotation system on which the shares of common stock are then listed or traded.
24
SECTION 21. Headings. The descriptive headings of the several sections
and subsections of this Agreement are inserted for convenience only, do not
constitute a part of this Agreement and shall not affect in any way the meanings
or interpretation of this Agreement.
SECTION 22. Counterparts. This Agreement may be executed in
counterparts and all such counterparts shall for all purposes be deemed to be an
original, and all such counterparts shall together constitute but one and the
same instrument.
[Signature Page Follows.]
25
[Signature Page of Warrant Agreement]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed, as of the day and year first above written.
VISHAY INTERTECHNOLOGY, INC.
By: __________________________________
Name:
Title:
AMERICAN STOCK TRANSFER & TRUST CO.
By: __________________________________
Name:
Title:
26
EXHIBIT A
[Form of Class A Warrant Certificate]
[Face]
THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY OTHER
APPLICABLE SECURITIES LAWS AND HAVE BEEN ISSUED IN RELIANCE UPON AN EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND SUCH OTHER
SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN
MAY BE SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED, OR OTHERWISE DISPOSED
OF, EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR
PURSUANT TO A TRANSACTION THAT IS EXEMPT FROM SUCH REGISTRATION. ***
EXERCISABLE ON OR BEFORE 5:00 P.M. NEW YORK CITY TIME ON__________.
No. ____ _______ Warrants
Class A Warrant Certificate
Vishay Intertechnology, Inc.
This Warrant Certificate certifies that _______________, or
registered assigns, is the registered holder (the "Holder") of ___________ Class
A Warrants expiring ____________ (the "Warrants" or "Class A Warrants") to
purchase Common Stock, $0.10 par value per share (the "Common Stock"), of Vishay
Intertechnology, Inc., a Delaware corporation (the "Company"). Each Class A
Warrant entitles the Holder upon exercise to receive from the Company, on or
before 5:00 p.m. New York City Time on ______________ (the "Expiration Date"),
one fully paid and nonassessable share of Common Stock (a "Warrant Share") at
the initial exercise price (the "Exercise Price") of $20.00 per share (subject
to adjustment as provided herein), payable in lawful money of the United States
of America upon surrender of this Warrant Certificate at the office of the
Company designated for such purpose, but only subject to the conditions set
forth herein and in the Warrant Agreement, as defined below. Capitalized terms
not otherwise defined herein shall have the meaning ascribed to them in the
Warrant Agreement.
This Warrant Certificate and each Class A Warrant represented hereby
are issued pursuant to and are subject in all respects to the terms and
conditions set forth in the Warrant Agreement (the "Warrant Agreement"), dated
December 13, 2002 by and between the Company and American Stock Transfer & Trust
Co. (the "Warrant Agent"), which Warrant Agreement is hereby incorporated by
reference in and made a part of this instrument and is hereby referred to
- ------------------------
*** This legend may be removed if the Warrants represented by this certificate
have been resold pursuant to an effective registration under the Securities Act.
27
for a description of the rights, limitation of rights, obligations, duties and
immunities thereunder of the Company and the Holders (the words "Holder" or
"Holders" meaning the registered holder or registered holders of the Warrants).
A copy of the Warrant Agreement may be obtained by the Holder from the Company
at 63 Lincoln Highway, Malvern, Pennsylvania 19355-2120 by a written request
from the Holder hereof and may be inspected by the Holder or his agent at the
principal office of the Warrant Agent.
This Class A Warrant shall be exercisable at any time during the
period from and after (i) in the case of any Holder other than the Initial
Holder of this Class A Warrant or an Affiliate of such Initial Holder, the Issue
Date and (ii) in the case of the Initial Holder of this Class A Warrant or an
Affiliate of such Initial Holder, the first anniversary of the Issue Date until
the Expiration Date.
The number of Warrant Shares issuable upon exercise of the Warrants
and the Exercise Price are subject to adjustment upon the occurrence of certain
events set forth in the Warrant Agreement.
No Warrant may be exercised after 5:00 p.m., New York City time on
the Expiration Date, and to the extent not exercised by such time, such Warrants
shall become void.
The Holder of Class A Warrants evidenced by this Warrant Certificate
may exercise them by surrendering this Warrant Certificate, with the form of
election to purchase set forth hereon properly completed and executed, together
with payment of the Exercise Price in cash at the office of the Company
designated for such purpose. In the event that upon any exercise of Class A
Warrants evidenced hereby the number of Class A Warrants exercised shall be less
than the total number of Class A Warrants evidenced hereby, there shall be
issued to the Holder hereof or his assignee a new Warrant Certificate evidencing
the number of Class A Warrants not exercised.
The Warrant Agreement provides that upon the occurrence of certain
events the number of Warrant Shares issuable upon exercise of each Warrant set
forth on the face hereof and the Exercise Price thereof shall be adjusted. No
fractions of a share of Common Stock will be issued upon the exercise of any
Class A Warrant, but the Company will pay the cash value thereof determined as
provided in the Warrant Agreement.
Warrant Certificates, when surrendered at the office of the Company
by the registered Holder thereof in person or by its legal representative or
attorney duly authorized in writing, may be exchanged, in the manner and subject
to the limitations provided in the Warrant Agreement, but without payment of any
service charge, for another Warrant Certificate or Warrant Certificates of like
tenor evidencing in the aggregate a like number of Class A Warrants.
Upon due presentation for registration of transfer of this Warrant
Certificate at the office of the Company, a new Warrant Certificate or Warrant
Certificates of like tenor and evidencing in the aggregate a like number of
Class A Warrants shall be issued to the transferee(s) in exchange for this
Warrant Certificate, subject to the limitations provided in the Warrant
Agreement, without charge except for any tax or other governmental charge
imposed in connection therewith.
28
The Company may deem and treat the registered Holder(s) of this
Warrant Certificate as the absolute owner(s) thereof (notwithstanding any
notation of ownership or other writing hereon made by anyone), for the purpose
of any exercise hereof, of any distribution to the Holder(s) hereof, and for all
other purposes, and the Company shall not be affected by any notice to the
contrary. Neither the Class A Warrants nor this Warrant Certificate entitles any
Holder hereof to any rights of a stockholder of the Company.
29
IN WITNESS WHEREOF, Vishay Intertechnology, Inc. has caused this
Class A Warrant Certificate to be signed by its President and by its Secretary,
each by a facsimile of his signature, and has caused a facsimile of its
corporate seal to be affixed hereunto or implied hereon.
Dated: _______, 2002
By:_______________________
By:________________________
AMERICAN STOCK TRANSFER & TRUST CO.
By:
---------------------------------
Name:
Title:
30
ASSIGNMENT FORM
If you, the Holder, want to assign this Class A Warrant, fill in the
form below:
I or we assign and transfer this Class A Warrant to:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(Print or type name, address and zip code and
social security or tax ID number of assignee)
and irrevocably appoint _________________________________________ agent to
transfer this Class A Warrant on the books of the Company. The agent may
substitute another to act for him.
Date:___________________________ Signed: ___________________________________
(Signed exactly as your name appears on the
other side of this Warrant)
In connection with any transfer of this Class A Warrant occurring
prior to the date of the declaration by the Securities and Exchange Commission
of the effectiveness of a registration statement under the Securities Act of
1933, as amended (the "Securities Act"), covering resales of this Class A
Warrant (which effectiveness shall not have been suspended or terminated at the
date of transfer) at all times when such securities are deemed to be "restricted
securities" within the meaning of the Securities Act, the undersigned confirms
that it has not utilized any general solicitation or general advertising in
connection with the transfer and that this Class A Warrant is being transferred:
[Check One]
(1) [ ] to the Company or a subsidiary thereof; or
(2) [ ] pursuant to and in compliance with Rule 144A under the Securities
Act; or
(3) [ ] to an institutional "accredited investor" (as defined in Rule
501(a)(1),(2), (3) or (7) under the Securities Act); or
(4) [ ] outside the United States to a person who is not a "US person," in
compliance with Rule 904 of Regulation S under the Securities Act; or
(5) [ ] pursuant to the exemption from registration provided by Rule 144
under the Securities Act; or
1
(6) [ ] pursuant to another available exemption from the registration
requirements of the Securities Act.
Unless one of the boxes is checked, the Company shall not be obligated to
register any of the Class A Warrants evidenced by this certificate in the name
of any person other than the registered Holder thereof. If box (3), (4), (5) or
(6) is checked, the Company may require, upon the terms described in the Warrant
Agreement, prior to registering any such transfer of the Warrant Certificate,
such legal opinions, certifications and other information as the Company
reasonably requests to confirm that such transfer is being made pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act.
Date:______________________________ Signed:_________________________________
(Sign exactly as your name appears on
the other side of this Warrant
Certificate)
2
ELECTION TO PURCHASE FORM
If you, the Holder, want to exercise the Class A Warrants represented by
this Certificate, fill in the form below.
I or we, the registered owner of the Class A Warrants represented by this
Certificate irrevocably exercise ________________________________ Class A
Warrants for the purchase of _________________________________ shares or other
securities or property
of Common Stock of Vishay Intertechnology, Inc., at the price and on the terms
and conditions specified in the Class A Warrants and request that certificates
for the shares of Common Stock hereby purchased (and any securities or other
property issuable or transferable upon such exercise) be issued in the name of
and delivered to:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(Print or type name, address and zip code and
social security or tax ID number of owner)
and, if such Class A Warrants shall not constitute all of the Class A Warrants
represented by this Certificate, that a new Class A Warrant Certificate of like
tenor and date for the balance of the Class A Warrants represented hereby be
delivered to the undersigned.
Number of Class A Warrants represented by this Certificate ________
Number of Class A Warrants being exercised ________
Balance ________
Date:____________________________ Signed:________________________________
(Signed exactly as your name appears on
this Warrant)
Note: Each certificate represents a certain number of Warrants. Each Warrant is
exercisable for one share, subject to adjustment (which may result in
exercisability for other securities on property).
1
EXHIBIT B
[Form of Class B Warrant Certificate]
[Face]
THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY OTHER
APPLICABLE SECURITIES LAWS AND HAVE BEEN ISSUED IN RELIANCE UPON AN EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND SUCH OTHER
SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN
MAY BE SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED, OR OTHERWISE DISPOSED
OF, EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR
PURSUANT TO A TRANSACTION THAT IS EXEMPT FROM SUCH REGISTRATION. ***
EXERCISABLE ON OR BEFORE 5:00 P.M. NEW YORK CITY TIME ON _________.
No. ____ _______ Class B Warrants
Class B Warrant Certificate
Vishay Intertechnology, Inc.
This Warrant Certificate certifies that _______________, or
registered assigns, is the registered holder (the "Holder") of ___________ Class
B Warrants expiring ____________ (the "Warrants" or "Class B Warrants") to
purchase Common Stock, $0.10 par value per share (the "Common Stock"), of Vishay
Intertechnology, Inc., a Delaware corporation (the "Company"). Each Class B
Warrant entitles the Holder upon exercise to receive from the Company, on or
before 5:00 p.m. New York City Time on ______________ (the "Expiration Date"),
one fully paid and nonassessable share of Common Stock (a "Warrant Share") at
the initial exercise price (the "Exercise Price") of $30.30 per share (subject
to adjustment as provided herein), payable in lawful money of the United States
of America upon surrender of this Warrant Certificate at the office of the
Company designated for such purpose, but only subject to the conditions set
forth herein and in the Warrant Agreement, as defined below. Capitalized terms
not otherwise defined herein shall have the meaning ascribed to them in the
Warrant Agreement.
This Warrant Certificate and each Class B Warrant represented hereby
are issued pursuant to and are subject in all respects to the terms and
conditions set forth in the Warrant Agreement (the "Warrant Agreement"), dated
13 December, 2002 by and between the Company and American Stock Transfer & Trust
Co. (the "Warrant Agent"), which Warrant Agreement is hereby incorporated by
reference in and made a part of this instrument and is hereby referred to
- ------------------------
*** This legend may be removed if the Warrants represented by this
certificate have been resold pursuant to an effective registration under
the Securities Act.
2
for a description of the rights, limitation of rights, obligations, duties and
immunities thereunder of the Company and the Holders (the words "Holder" or
"Holders" meaning the registered holder or registered holders of the Warrants).
A copy of the Warrant Agreement may be obtained by the Holder from the Company
at 63 Lincoln Highway, Malvern, Pennsylvania, 19355-2120 by a written request
from the Holder hereof and may be inspected by the Holder or his agent at the
principal office of the Warrant Agent.
This Class B Warrant shall be exercisable at any time during the
period from and after (i) in the case of any Holder other than the Initial
Holder of this Class B Warrant or an Affiliate of such Initial Holder, the Issue
Date and (ii) in the case of the Initial Holder of this Class B Warrant or an
Affiliate of such Initial Holder, the first anniversary of the Issue Date until
the Expiration Date.
The number of Warrant Shares issuable upon exercise of the Warrants
and the Exercise Price are subject to adjustment upon the occurrence of certain
events set forth in the Warrant Agreement.
No Class B Warrant may be exercised after 5:00 p.m., New York City
time on the Expiration Date, and to the extent not exercised by such time, such
Class B Warrants shall become void.
The Holder of Class B Warrants evidenced by this Warrant Certificate
may exercise them by surrendering this Warrant Certificate, with the form of
election to purchase set forth hereon properly completed and executed, together
with payment of the Exercise Price in cash at the office of the Company
designated for such purpose. In the event that upon any exercise of Class B
Warrants evidenced hereby the number of Class B Warrants exercised shall be less
than the total number of Class B Warrants evidenced hereby, there shall be
issued to the Holder hereof or his assignee a new Warrant Certificate evidencing
the number of Class B Warrants not exercised.
The Warrant Agreement provides that upon the occurrence of certain
events the number of Warrant Shares issuable upon exercise of each Class B
Warrant set forth on the face hereof and the Exercise Price thereof shall be
adjusted. No fractions of a share of Common Stock will be issued upon the
exercise of any Class B Warrant, but the Company will pay the cash value thereof
determined as provided in the Warrant Agreement.
Warrant Certificates, when surrendered at the office of the Company
by the registered Holder thereof in person or by its legal representative or
attorney duly authorized in writing, may be exchanged, in the manner and subject
to the limitations provided in the Warrant Agreement, but without payment of any
service charge, for another Warrant Certificate or Warrant Certificates of like
tenor evidencing in the aggregate a like number of Class B Warrants.
Upon due presentation for registration of transfer of this Warrant
Certificate at the office of the Company, a new Warrant Certificate or Warrant
Certificates of like tenor and evidencing in the aggregate a like number of
Class B Warrants shall be issued to the transferee(s) in exchange for this
Warrant Certificate, subject to the limitations provided in the Warrant
3
Agreement, without charge except for any tax or other governmental charge
imposed in connection therewith.
The Company may deem and treat the registered Holder(s) of this
Warrant Certificate as the absolute owner(s) thereof (notwithstanding any
notation of ownership or other writing hereon made by anyone), for the purpose
of any exercise hereof, of any distribution to the Holder(s) hereof, and for all
other purposes, and the Company shall not be affected by any notice to the
contrary. Neither the Class B Warrants nor this Warrant Certificate entitles any
Holder hereof to any rights of a stockholder of the Company.
4
IN WITNESS WHEREOF, Vishay Intertechnology, Inc. has caused this
Class B Warrant Certificate to be signed by its President and by its Secretary,
each by a facsimile of his signature, and has caused a facsimile of its
corporate seal to be affixed hereunto or implied hereon.
Dated: _______, 2002
By:___________________________
By:___________________________
AMERICAN STOCK TRANSFER & TRUST CO.
By:
----------------------------------
Name:
Title:
5
ASSIGNMENT FORM
If you, the Holder, want to assign this Class B Warrant, fill in the
form below:
I or we assign and transfer this Class B Warrant to:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(Print or type name, address and zip code and
social security or tax ID number of assignee)
and irrevocably appoint _________________________________________ agent to
transfer this Class B Warrant on the books of the Company. The agent may
substitute another to act for him.
Date:____________________________ Signed:_________________________________
(Signed exactly as your name appears on
the other side of this Warrant)
In connection with any transfer of this Class B Warrant occurring
prior to the date of the declaration by the Securities and Exchange Commission
of the effectiveness of a registration statement under the Securities Act of
1933, as amended (the "Securities Act"), covering resales of this Class B
Warrant (which effectiveness shall not have been suspended or terminated at the
date of transfer) at all times when such securities are deemed to be "restricted
securities" within the meaning of the Securities Act, the undersigned confirms
that it has not utilized any general solicitation or general advertising in
connection with the transfer and that this Class B Warrant is being transferred:
[Check One]
(1) [ ] to the Company or a subsidiary thereof; or
(2) [ ] pursuant to and in compliance with Rule 144A under the Securities
Act; or
(3) [ ] to an institutional "accredited investor" (as defined in Rule
501(a)(1),(2), (3) or (7) under the Securities Act); or
(4) [ ] outside the United States to a person who is not a "US person," in
compliance with Rule 904 of Regulation S under the Securities Act;
or
(5) [ ] pursuant to the exemption from registration provided by Rule 144
under the Securities Act; or
1
(6) [ ] pursuant to another available exemption from the registration
requirements of the Securities Act.
Unless one of the boxes is checked, the Company shall not be obligated to
register any of the Class B Warrants evidenced by this certificate in the name
of any person other than the registered Holder thereof. If box (3), (4), (5) or
(6) is checked, the Company may require, upon the terms described in the Warrant
Agreement, prior to registering any such transfer of the Warrant Certificate,
such legal opinions, certifications and other information as the Company
reasonably requests to confirm that such transfer is being made pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act.
Date:___________________________ Signed:____________________________________
(Sign exactly as your name appears on the
other side of this Warrant Certificate)
2
ELECTION TO PURCHASE FORM
If you, the Holder, want to exercise the Class B Warrants
represented by this Certificate, fill in the form below.
I or we, the registered owner of the Class B Warrants represented by this
Certificate irrevocably exercise ________________________________ Class B
Warrants for the purchase of _________________________________ shares or other
securities or property
of Common Stock of Vishay Intertechnology, Inc., at the price and on the terms
and conditions specified in the Class B Warrants and request that certificates
for the shares of Common Stock hereby purchased (and any securities or other
property issuable or transferable upon such exercise) be issued in the name of
and delivered to:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(Print or type name, address and zip code and
social security or tax ID number of owner)
and, if such Class B Warrants shall not constitute all of the Class B Warrants
represented by this Certificate, that a new Class B Warrant Certificate of like
tenor and date for the balance of the Class A Warrantes represented hereby be
delivered to the undersigned.
Number of Class B Warrants represented by this Certificate ________
Number of Class B Warrants being exercised ________
Balance ________
Date:_____________________________ Signed:__________________________________
(Signed exactly as your name appears on
this Warrant)
Note: Each certificate represents a certain number of Warrants. Each Warrant is
exercisable for one share, subject to adjustment (which may result in
exercisability for other securities on property).
1
Exhibit 4.2
NOTE PURCHASE AGREEMENT is made on December 13, 2002.
BETWEEN
(1) VISHAY INTERTECHNOLOGY, Inc. (the Company); and
(2) THE SUBSCRIBERS listed in the Schedule (the Subscribers).
WHEREAS:
(A) The Company has entered into a Loan Note Instrument of even date (the
Instrument), constituting up to $105,000,000 unsecured loan notes 2102
(the Loan Notes).
(B) The Subscribers propose to subscribe the Loan Notes.
NOW IT IS HEREBY AGREED as follows:
1. DEFINITIONS AND INTERPRETATION
1.1 The headings in this Agreement are for convenience only and shall not
affect the interpretation hereof. All references to provisions of statutes shall
be deemed also to refer to the corresponding provision of any statutory
modification or re-enactment thereof. Words in this Agreement denoting the
singular only shall include the plural and vice versa.
1.2 Capitalised terms defined in the Instrument shall have, unless otherwise
defined in this Agreement, the same meanings when used in this Agreement.
2. WARRANTIES OF THE COMPANY
In consideration of the Subscribers subscribing the Loan Notes, the Company
hereby represents and warrants as follows:
Organisation, Power and Authority
2.1 The Company is duly incorporated and validly existing under the laws of
the jurisdiction of its incorporation. The Company has the corporate power and
authority to own or hold under lease the properties it purports to own or hold
under lease, to transact the business it transacts, to execute and deliver this
Agreement and the Instrument and to issue the Loan Notes and to perform the
provisions hereof and thereof.
Compliance with Laws, Other Instruments, etc.
2.2 The execution, delivery and performance by the Company of this Agreement
and the Instrument and the issuance of the Loan Notes on the terms and
conditions set out in the Instrument and any amendments thereto, (a) have been
duly authorised by all necessary corporate action on the part of the Company and
(b) do not, and will not, (i) contravene, result in any breach of, or constitute
a default under, the constitutional documents of the Company as of the date
hereof, any indenture, mortgage, deed, loan,
1
purchase or credit agreement, lease, corporate charter or by-laws, or any other
agreement or instrument to which the Company is bound or by which the Company or
any of its properties may be bound or (ii) conflict with or result in a breach
of any of the terms, conditions or provisions of any order, judgment, decree, or
ruling of any court, arbitrator or governmental authority applicable to the
Company, or (iii) violate any provision of any statute or other rule or
regulation of any governmental authority applicable to the Company.
Authorisation, etc.
2.3 All necessary authorisations, consents, licences and approvals required by
the Company for and in connection with the performance by the Company of its
obligations hereunder and in connection with the execution and performance of
the Instrument or the issue of the Loan Notes have been obtained and are in full
force and effect. Each of this Agreement, the Instrument and the Loan Notes
constitute a legal, valid and binding obligation of the Company enforceable
against the Company in accordance with its respective terms (subject to general
equitable principles limiting the enforceability of claims and to all applicable
insolvency, bankruptcy and other laws of general application relating to
creditors' rights or claims and to the laws relating to prescription). The due
payment of the principal and interest (including any additional amounts payable
under the terms of the Loan Notes) in respect of the Loan Notes, the due and
punctual payment of all amounts payable by the Company in respect of the Loan
Notes or under any of the aforementioned agreements to which it is a party will
not infringe the terms of any such authorisation, consent or approval or any
existing provisions of law.
Events Entitling Noteholders to Redeem
2.4 There exists no condition, event or circumstance that would, or that would
with the giving of notice and/or the issue of a certificate or report and/or the
lapse of time, entitle a Noteholder to redeem the Loan Notes held by it pursuant
to clause 7 of the Instrument.
Governmental Authorisations, etc.
2.5 No consent, approval or authorisation of, or registration, filing or
declaration with, any governmental authority is required in connection with the
execution, delivery or performance by the Company of this Agreement, the
Instrument or the Loan Notes.
Pari Passu Ranking
2.6 The Company's obligations under the Notes will rank at least pari passu,
without preference or priority in right of payment, with all other unsecured and
unsubordinated payment obligations of the Company.
2
3. NOTICES
Any notices or other document in connection with this Agreement shall be given
or sent to the parties in accordance with Conditions 14, 15 and 16 of the
Instrument as though the same were set out herein mutatis mutandis.
4. RIGHTS OF NOTEHOLDERS
4.1 The Company agrees that the benefit of the representations and the
warranties contained in this Agreement shall accrue to the benefit of the
Noteholders from time to time with the intent that each such Noteholder will be
entitled to all rights and remedies in respect thereof.
4.2 For the avoidance of doubt, the Company confirms that the rights of the
Noteholders hereunder are divided rights that may be separately enforced by each
of them.
5. COUNTERPARTS
This Agreement may be entered into in any number of counterparts and by the
parties to it on separate counterparts, each of which, when executed and
delivered, shall be an original, but all the counterparts shall together
constitute one and the same instrument.
6. GOVERNING LAW AND JURISDICTION
6.1 This Agreement shall be governed by and construed in accordance with the
laws of the State of New York.
6.2 Each of the parties agrees that the courts of the State of New York are to
have exclusive jurisdiction to settle any disputes that may arise in connection
with this Agreement.
3
SCHEDULE
THE SUBSCRIBERS
Name and Address Contact details Nominal Amount
of Notes (US$)
Column 1 Column 2 Column 3
Phoenix Acquisition Company S.ar.l Fax: 00352444455222 4,038,000
398 route d'Esch Attn: Marc Feider
L-1471
Luxembourg
Sankaty High Yield Asset Partners Fax +1 617 516 2710 9,027,000
L.P. Tel:+1 617 516 2724
111 Huntington Avenue
Boston, MA 02199 Attn: Stuart Davies
USA
BCM Capital Partners L.P. As for Sankaty 6,113,000
111 Huntington Avenue High Yield Asset
Boston, MA 02199 Partners L.P.
USA
BCIP Associates II As for Sankaty 34,000
111 Huntington Avenue High Yield Asset
Boston, MA 02199 Partners L.P.
USA
BCIP Trust Associates II As for Sankaty 166,000
111 Huntington Avenue High Yield Asset
Boston, MA 02199 Partners L.P.
USA
JP Morgan Partners (BHCA), L.P. Tel: +1 212 899 3663 47,508,000
1221, Avenue of the Americas, Attn: Richard D.
39th floor Waters, Jr.
NEW YORK
NY 10020-1000 USA
formerly named Chase Equity
Associates, L.P.
GarMark Partners L.P. Fax: +1 203 325 8522 29,700,000
One Landmark Square Tel: +1 203 325 8500
6th Floor
Stamford, CT 06901
BCIP Trust Associates II-B As for Sankaty 3,000
111 Huntington Avenue High Yield Asset
Boston, MA 02199 Partners L.P.
USA
Bain Capital V Mezzanine Fund L.P. As for Sankaty 8,411,000
111 Huntington Avenue High Yield Asset
Boston, MA 02199 Partners L.P.
USA
Total = 105,000,000
4
IN WITNESS whereof the parties have executed this Agreement on the date
specified above.
The Company
SIGNED )
for and on behalf of )
VISHAY INTERTECHNOLOGY, INC. )
5
The Subscribers
SIGNED )
for and on behalf of )
PHOENIX ACQUISITION )
COMPANY S.AR.L )
SIGNED by SANKATY ADVISORS, LLC)
for and on behalf of )
SANKATY HIGH YIELD ASSET )
PARTNERS L.P. )
SIGNED by SANKATY ADVISORS, LLC)
for and on behalf of )
BCM CAPITAL PARTNERS L.P. )
SIGNED by SANKATY ADVISORS, LLC)
for and on behalf of )
BCIP ASSOCIATES II )
SIGNED by SANKATY ADVISORS, LLC)
for and on behalf of )
BCIP TRUST ASSOCIATES II )
SIGNED by SANKATY ADVISORS, LLC)
for and on behalf of )
BCIP TRUST ASSOCIATES II-B )
SIGNED by SANKATY ADVISORS, LLC)
for and on behalf of )
BAIN CAPITAL V MEZZANINE )
FUND L.P. )
SIGNED )
for and on behalf of )
GARMARK PARTNERS L.P. )
6
SIGNED )
for and on behalf of )
JP MORGAN PARTNERS (BHCA), L.P.)
By: JPMP Master Fund Manager, L.P.,
its general partner
By: JPMP Capital Corp.,
its general partner
By: ____________________________
Name:
Title:
7
December 13, 2002
VISHAY INTERTECHNOLOGY, INC.
(the Company)
and
THE SUBSCRIBERS
==========================================================
NOTE PURCHASE AGREEMENT
==========================================================
FRESHFIELDS BRUCKHAUS DERINGER
CONTENTS
CLAUSE PAGE
1. Definitions and interpretation.................................1
2. Warranties of the Company......................................1
3. Notices........................................................3
4. Rights of Noteholders..........................................3
5. Counterparts...................................................3
6. Governing Law and Jurisdiction.................................3
Schedule the Subscribers.............................................4
Exhibit 4.3
THIS INSTRUMENT is made on the13th day of December 2002 by VISHAY
INTERTECHNOLOGY, INC. a company incorporated in the State of Delaware USA, (the
Company).
WHEREAS
(A) The Company has created up to $105,000,000 Floating Rate Unsecured Loan
Notes 2102 and has determined to constitute the said Loan Notes as
hereinafter provided.
(B) Pursuant to the SPA as defined below, the Company, and certain other
persons have entered into a Note Purchase Agreement (the Note Purchase
Agreement) of even date, and the Loan Notes are issued with the benefit of
certain representations and warranties contained in the Note Purchase
Agreement.
NOW THIS INSTRUMENT WITNESSES AND THE COMPANY HEREBY DECLARES as follows:-
1. In this Instrument and in the Schedules hereto the following expressions
shall, where the context permits, have the following meanings:
the Conditions means the conditions to be endorsed on the Loan Notes in the form
or substantially in the form set out in Schedule 2 hereto as the same may from
time to time be modified in accordance with the provisions herein contained;
Directors means the Board of Directors for the time being of the Company or a
duly authorised committee of the Board of Directors;
Exchange Act means the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder, as the same may be amended from
time to time;
Instrument means this instrument and the Schedules hereto as from time to time
modified in accordance with the provisions herein contained;
LIBOR means, in relation to any amount owed by the Company hereunder and any
interest period:
(a) the percentage rate per annum equal to the offered quotation which appears
on the page of the Telerate Screen which displays an average British
Bankers Association Interest Settlement Rate for US Dollars for such
period at or about 11.00 a.m. (London time) on the first day of the
relevant interest period; or
(b) if a rate is not available pursuant to (a) above, the percentage rate per
annum which is the arithmetic mean of the rates as supplied to the Company
at its request quoted by three banks selected by the Company (one of which
shall include, if in existence at the time, Barclays Bank plc) to leading
banks in the the London inter-bank market for three month deposits of
similar size and currency.
Loan Notes means up to $105,000,000 Floating Rate Unsecured Loan Notes 2102 of
the Company to be issued under this Instrument or (as the context may require)
the principal amount thereof for the time being issued and outstanding;
Noteholders means the several persons for the time being entered in the
Register;
Put and Call Agreement means the put and call agreement relating to the Loan
Notes entered into by the Company and other persons in connection with the SPA
on or about the date hereof;
Register means the register of Noteholders referred to in clause 8 hereof;
Registration Rights Agreement means the registration rights agreement entered
into by the Company and other persons in connection with the SPA on or about the
date hereof;
SPA means the share sale and purchase agreement entered into by the Company as
purchaser and other persons on or about the date hereof; and
Vishay Group means the Company (including its successors) and its subsidiaries
from time to time.
Words denoting the singular number only shall include the plural number and vice
versa. Words denoting persons shall include corporations.
2. The Loan Notes shall be known as the Vishay Intertechnology, Inc. Floating
Rate Unsecured Loan Notes 2102 and shall be issued in amounts and multiples of
$1000 by the Company to such persons at such times and on such terms as the
Directors may determine.
3. The aggregate principal amount of the Loan Notes is limited to
$105,000,000. The Loan Notes, as and when issued, and all accrued and unpaid
interest thereon, shall (except as regards the first payment of interest) rank
pari passu equally and rateably without discrimination or preference as an
unsecured debt obligation of the Company.
4. As and when the Loan Notes or any part thereof fall to be redeemed or
repaid in accordance with the provisions hereof, the Company will pay to the
Noteholders entitled thereto the principal amount of the Loan Notes to be repaid
together with accrued interest (subject to any requirement to deduct any income
tax therefrom).
5. Until such time as the Loan Notes are redeemed or repaid in accordance
with the provisions hereof, the Company will pay to the Noteholders interest
(subject to any requirement to deduct any income tax therefrom) on the principal
amount of the Loan Notes outstanding at the rates and the times and as otherwise
provided in the Conditions.
6. Every Noteholder shall be entitled without charge to one certificate for
the Loan Notes held by it. However, joint holders of Loan Notes will be entitled
only to one Loan Note certificate (provided that the Company shall not be bound
to register
2
more than four persons as the joint holders of any Loan Note) and such Loan Note
will be sent to that one of the joint holders who is first named in the
Register. Every Loan Note certificate shall be issued under the common or
securities seal of the Company and shall be substantially in the form set out in
Schedule 1 hereto and shall have the Conditions endorsed thereon. The Company
shall comply with the provisions of the Loan Notes and the Conditions and the
Loan Notes shall be held subject to all such provisions which shall be binding
on the Company and the Noteholders and all persons claiming through or under
them respectively.
7. Each Noteholder shall be entitled to require all or any part (being $1000
nominal amount or any integral multiple thereof) of the Loan Notes held by it to
be repaid at par together with accrued interest (subject to any requirement to
deduct any income tax therefrom) if:
(a) any principal or interest on any of the Loan Notes held by that Noteholder
due to it shall fail to be paid in full within thirty days after receipt
of written demand by the Company, addressed to its financial controller
(with a copy to Abbe Dienstag of Kramer Levin Naftalis & Frankel) and made
by the relevant Noteholder following failure to pay; or
(b) the Company breaches any of its obligations to issue shares or, if
applicable, to pay cash under the Put and Call Agreement and such breach,
if capable of remedy, is not remedied within ten days after written
notification to the Company addressed to its financial controller (with a
copy to Abbe Dienstag of Kramer Levin Naftalis & Frankel); or
(c) any indebtedness of any member or members of the Vishay Group having in
aggregate a principal amount in excess of US$50,000,000 is not paid on its
due date or within any applicable grace period, and such default in
payment is not waived or remedied within a period of one month; or
(d) the Company or Vishay Europe GmbH (VEG) pursuant to or under or within the
meaning of any Bankruptcy Law:
(i) commences a voluntary case or proceeding;
(ii) consents to the entry of an order for relief against it in an
involuntary case or proceeding or the commencement of any case
against it;
(iii) consents to the appointment of a Custodian of it or for any
substantial part of its property;
(iv) makes a general assignment for the benefit of its creditors;
(v) files a petition in bankruptcy or answer or consent seeking
reorganization or relief; or
(vi) consents to the filing of such petition or the appointment of
or taking possession by a Custodian; or
3
(e) a court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:
(i) is for relief against the Company or VEG in an involuntary
case or proceeding, or adjudicates the Company or VEG
insolvent or bankrupt;
(ii) appoints a Custodian of the Company or VEG for any substantial
part of its property; or
(iii) orders the winding up or liquidation of the Company or VEG;
and the order or decree remains unstayed and in effect for 60
days; or
(f) any event analogous to (d) or (e) above occurs in any jurisdiction.
In paragraphs (d) and (e) above:
Bankruptcy Law means Title 11, United States Code, or any similar Federal or
state law for the relief of debtors.
Custodian means any receiver, trustee, assignee, liquidator, custodian or
similar official under any Bankruptcy Law.
The Company shall notify each of the Noteholders forthwith on the occurrence of
any of the events described in sub-clause (a) to (f) of this clause 7.
8. A register of the Noteholders will be kept at 63 Lincoln Highway, Malvern,
Pennsylvania 19355-2120 (or at such other place as the Company may from time to
time have appointed for the purpose and have notified to the Noteholders) and
there shall be entered in the Register:
(a) the names and addresses of the Noteholders;
(b) the telecopier numbers of the Noteholders;
(c) the principal amount of the Loan Notes held by each Noteholder;
(d) the date on which the name of each Noteholder is entered in respect of the
Loan Notes standing in its name; and
(e) the serial number of each Loan Note.
9. Any change of name or address on the part of any Noteholder which is
notified to the Company at the address set out in clause 8 above shall be
entered in the Register.
10. Any Noteholder may at all reasonable times during office hours inspect the
Register.
4
11. The Company hereby covenants with the Noteholders and each of them duly to
perform and observe the obligations herein contained and imposed on it to the
intent that these presents shall enure for the benefit of all Noteholders, each
of whom may sue for the performance or observance of the provisions hereof so
far as its holding of Loan Notes is concerned.
12. The Conditions and provisions contained in the Schedules hereto shall have
effect in the same manner as if such Conditions and provisions were herein set
forth.
13. A memorandum of execution of any instrument supplemental to this
Instrument shall be endorsed by the Company on this Instrument.
14. This Instrument and the Loan Notes shall be governed by and construed in
accordance with the laws of the State of New York.
15. Each of the parties agrees that the courts of the State of New York are to
have exclusive jurisdiction to settle any disputes that may arise in connection
with this Agreement.
IN WITNESS WHEREOF this Instrument has been duly executed by the Company the day
and year first above written.
5
SCHEDULE 1
Form of Loan Note
No._____ Amount $_____
VISHAY INTERTECHNOLOGY, INC.
(Incorporated in the State of Delaware)
UP TO $105,000,000 VISHAY INTERTECHNOLOGY, INC. FLOATING RATE
UNSECURED LOAN NOTES 2102
THIS IS TO CERTIFY THAT _____ _____ is/are the registered holder(s) of the above
principal amount of the Vishay Intertechnology, Inc. Unsecured Loan Notes 2102
(the Loan Notes) constituted by an Instrument entered into by the Company on
December 13, 2002 (together with any instruments supplemental thereto) (the
Instrument) and issued with the benefit of, and subject to the provisions
contained in, the Instrument and the Conditions endorsed hereon. The Loan Notes
further take the benefit of certain representations and warranties of the
Company contained in the Note Purchase Agreement referred to in the Instrument.
Interest is payable on the Loan Notes quarterly in arrears on the interest
payment dates in each year and at a floating rate determined in accordance with
the Conditions endorsed hereon.
The Loan Notes are redeemable in accordance with Condition 8 endorsed hereon.
The Loan Notes are transferable on the terms set out in the Conditions endorsed
hereon. This Loan Note certificate must be surrendered before any transfer can
be registered or any new Loan Note certificate can be issued in exchange.
[The Loan Notes have not been, and will not be, registered under the United
States Securities Act of 1933, as amended and, accordingly, certain restrictions
on ownership and transfer apply to the Loan Notes.1]
Copies of the Instrument constituting the Loan Notes are available for
inspection at the registered office of the Company.
The Loan Notes shall be governed by and construed in accordance with the laws of
the State of New York.
IN WITNESS whereof Vishay Intertechnology, Inc. has executed this Loan Note
Certificate.
_______________________________________________________________________________
1 The provisions of the Registration Rights Agreement of even date made between
the Company and the Original Holders (as such term is defined in the
Registration Rights Agreement) shall govern whether or not legends in
compliance with the United States Securities Act of 1933 appear on the face
of the Loan Note certificates.
6
Issued on [ ] 20[__]
7
SCHEDULE 2
The Conditions
1. The Loan Notes are issued in amounts and multiples of $1000 and constitute
unsecured obligations of the Company.
2. Interest on the Loan Notes will be calculated on the basis of a 360 day
year and will be payable (subject to any requirement to deduct any income tax
therefrom) by quarterly instalments in arrears on 31 March, 30 June, 30
September and 31 December in each year (or if such day is not a business day in
New York and Frankfurt, on the immediately preceding common business day in such
cities) (interest payment dates) in respect of the preceding interest period (as
defined below) ending on the interest payment date at a rate calculated for each
interest period as provided in Condition 3 below, except that the first interest
payment on the Loan Notes, which shall be made on 31 December 2002 will be in
respect of the period from (and including) the first date of issue of any of the
Loan Notes to (but excluding) 31 December 2002. The period from (and including)
the first date of issue of any Loan Notes to (but excluding) 31 December 2002
and the period from (and including) 31 December 2002 or any subsequent quarter
date (where quarter date means any of 31 March, 30 June, 30 September or 31
December) to (but excluding) the next following quarter date is herein called an
interest period.
3. (a) The rate of interest on the Loan Notes for any interest period ending
on or prior to 31 December 2006 will be the rate per annum equal to LIBOR
for such interest period plus 1.5 per cent. (1.5%).
(b) Subject to Condition 3(c), the rate of interest on the Loan Notes for any
interest period commencing on or after 1 January 2007 will be LIBOR for
such interest period.
(c) If at any time during the period beginning on the date of issue of the
Loan Notes and ending on 31 December 2010, the Common Stock has a Market
Value of equal to or more than the Target Price per share for 30 or more
consecutive trading days, then the rate of interest on the Loan Notes for
all interest periods commencing on or after 1 January 2011 will be the
rate per annum equal to fifty per cent. (50%) of LIBOR for such interest
period.
In this Condition 3:
Common Stock means the common stock, par value US$0.10, of the Company and any
other security exchanged or substituted for such common stock or into which such
common stock is converted in any recapitalization, reorganization, merger,
consolidation, share exchange or other business combination transaction,
including any reclassification consisting of a change in par value or a change
from par value to no par value or vice versa;
Majority of the Noteolders means, at any relevant time, the Noteholders of a
majority of the principal amount of the Loan Notes that are at any relevant time
outstanding;
8
Market Value for any trading day means the volume-weighted average of the per
share selling prices on the New York Stock Exchange or other principal United
States securities exchange or inter-dealer quotation system on which the Common
Stock is then listed or quoted (or, if there is no sale of the Common Stock
reported on such trading day, the average of the low ask and high bid price for
the Common Stock reported on the last trading day in which such sale was
reported) or, if there are no high bid and low ask prices, the Market Value
shall be the per share fair market value of the Common Stock or other security
as determined by an investment banking firm of national reputation and standing
selected by the Company and reasonably acceptable to the Majority of the
Noteholders;
Target Price means $45.00 per share of Common Stock, provided that if any
event(s) described in Article IV of the Put and Call Agreement shall occur, then
the Target Price shall be subject to adjustment in the manner and to the extent
applicable to the Target Price (as defined in the Put and Call Agreement);
trading day means any day on which securities are traded or quoted on the
principal securities exchange or interdealer quotation system on which the
Common Stock is listed for trading or quotation; and
Securities Act means the United States Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder, as the same may be amended
from time to time.
4. If the Company fails to pay any amount payable by it under this Instrument
or the Loan Notes, it must immediately on demand by the relevant Noteholder pay
interest on the overdue amount from its due date up to the date of actual
payment, both before, on and after judgement at the rate per annum equal to the
Relevant Rate plus one per cent. (1%). For these purposes the Relevant Rate is
the rate for the time being applicable pursuant to Condition 3 above.
5. Each interest payment shall be made (subject to any requirement to deduct
any income tax therefrom) to the Noteholder on the register of Noteholders at
the close of business on the twenty-eighth day preceding the date for payment of
such interest and every such Noteholder shall be deemed, for the purpose of
these presents, to be the holder on such interest payment date of the Notes held
by it on such preceding date notwithstanding any intermediate transfer or
transmission of any such Notes.
6. In circumstances where the Company is required (or would in the absence of
any relevant filing be required) to make a deduction or withholding for or on
account of any taxes or any other deductions, (and where any Noteholder is
entitled to a reduced rate of withholding), the Company shall (to the extent it
is entitled or required to do so) co-operate in a timely manner in filing such
forms and documents as the Internal Revenue Service and any other taxation
authority may require in order to enable the Company to make relevant payments
under the Loan Notes without having to make such deduction or withholding, or at
the relevant reduced rate of withholding.
7.1 If the Company at any time is subject to a transaction pursuant to which
it becomes a subsidiary of any other person, it will thereafter procure that its
ultimate parent company from time to time, as soon as practicable after becoming
such,
9
provides the Noteholders with a binding, irrevocable and unconditional
guarantee of all of the obligations of the Company in respect of the Notes, the
Registration Rights Agreement and the Put and Call Agreement in customary form.
7.2 If the Company ceases to be a reporting company under Section 13(d) or 15
of the Exchange Act (a Reporting Entity), then, for so long as it does not have
a holding company that has issued a guarantee to the Noteholders as required by
Condition 7.1, it will in respect of each of its financial quarters provide each
Noteholder promptly after the same is prepared with such quarterly and annual
financial statements as it prepares in the ordinary course in respect of itself
and its subsidiaries and as is of the type customarily provided to bank
creditors.
7.3 If a guarantee of a holding company is in effect as contemplated by
Condition 7.1 above but the relevant guarantor is not a Reporting Entity, then
the Company shall be obliged to procure that the relevant guarantor for the time
being provides to each Noteholder the information referred to in Condition 7.2
above in respect of itself and its subsidiaries within the timeframe
contemplated by that Condition.
8. Each Noteholder shall be entitled to require all or any part (being $1000
nominal amount or any integral multiple thereof) of the Loan Notes held by it to
be repaid at par together with accrued interest (subject to any requirement to
deduct any income tax therefrom) up to (but excluding the date of repayment) in
the circumstances specified in clause 7 of the Instrument. Unless previously
repaid, redeemed or purchased and cancelled, the Company will redeem the Loan
Notes on 31 December, 2102 at par together with accrued interest (subject to any
requirement to deduct income tax therefrom) up to (but excluding) the date of
repayment.
9. Any Loan Notes repaid, redeemed or purchased pursuant to Condition 8 shall
forthwith be cancelled and the Company shall not be at liberty to reissue the
same.
10. Every Noteholder any of whose Loan Notes is due to be repaid or redeemed
under these Conditions shall, not later than the due date for such repayment or
redemption, deliver up to the Company, at the address specified in clause 8 of
the Instrument constituting the Loan Notes, the Loan Notes which are due to be
repaid or redeemed in order that the same may be cancelled. Upon such delivery
and against a receipt for the principal moneys payable in respect of the Loan
Notes to be repaid or redeemed, the Company shall pay to the Noteholder the
amount payable to it in respect of such repayment or redemption.
11. Interest shall cease to accrue on any Loan Notes becoming liable to
repayment or redemption as from the due date for repayment or redemption of such
Loan Notes, unless (upon the Noteholder demanding on or after such date and at
the address specified in clause 8 of the Instrument payment of the principal
moneys payable in respect thereof and tendering the certificate(s) therefor and
a receipt for such moneys duly signed and authenticated in such manner as the
Company may reasonably require) payment of such moneys shall not be made by the
Company, in which case interest will accrue from the date of such demand until
(but excluding) the date of payment by the Company.
10
12. Amounts in respect of interest on any Loan Notes which remain unclaimed by
the Noteholder for a period of five years and amounts due in respect of
principal which remain unclaimed for a period of ten years, in each case from
the date on which the relevant payment first becomes due, shall revert to the
Company and the Noteholder shall cease to be entitled thereto.
13. Any Notes acquired by or on behalf of any member of the Vishay Group shall
be automatically cancelled.
14. The provisions of the Instrument constituting the Loan Notes and the
rights of the Noteholders are subject to modification, abrogation or compromise
in any respect but only in accordance with the provisions of Schedule 4 of the
said Instrument and with the consent of the Company.
15. The Loan Notes are in registered form, and are transferable in accordance
with the provisions of Schedule 3 of the Instrument.
16. All Loan Notes shall form a single series and shall rank pari passu
equally and rateably without discrimination or preference as an unsecured debt
obligation of the Company.
17. No application has been or is intended to be made to any stock exchange
for the Loan Notes to be listed or dealt in.
18. Any notice or other document (including a Loan Note certificate) to be
given to a Noteholder may be given or sent to the Noteholder at its registered
address for the giving of notice to it by a method permitted pursuant to
Condition 19. In the case of joint registered holders of any Loan Notes, a
notice given to the Noteholder whose name stands first in the register in
respect of such Loan Notes shall be sufficient notice to all joint holders.
Notice may be given to the persons entitled to any Loan Notes in consequence of
the bankruptcy of any Noteholder by sending the same by a method permitted
pursuant to Condition 19 addressed to them by name or by the title of the
representative or trustee of such holder at the address (if any) in the United
Kingdom supplied for the purpose by such persons or (until such address is
supplied) by giving notice in the manner in which it would have been given if
the bankruptcy had not occurred.
19. Any notice required to be given to the Company under the Instrument shall
be sent in writing to the address specified in clause 8 of the Instrument and
shall be sufficiently given or made when and if delivered by a recognized
international courier service or hand delivery, or by telecopier with in each
case a copy sent by first class or registered mail, post prepaid.
20. Words and expressions defined in the Instrument shall have the same
respective meanings whenever used in these Conditions.
11
SCHEDULE 3
Provisions as to Registration, Transfer and Other Matters
1. Except as required by law or as ordered by a court of competent
jurisdiction, the Company will recognise the registered holder of any Loan Notes
as the absolute owner thereof and shall not be bound to take notice or see to
the execution of any trust, whether express, implied or constructive, to which
any Loan Notes may be subject. The receipt of the registered holder for the time
being of any Loan Notes or, in the case of joint registered holders, the receipt
of any of them for the interest from time to time accruing due in respect
thereof or any other moneys payable in respect thereof shall be a good discharge
to the Company, notwithstanding any notice it may have, whether express or
otherwise, of the right, title, interest or claim of any other person to or in
such Loan Notes, interest or moneys. The Company shall not be bound to enter
notice of any trust, whether express, implied or constructive, on the register
in respect of any Loan Notes.
2. Every Noteholder will be recognised by the Company as entitled to its Loan
Notes free from any equity, set-off or counter-claim on the part of the Company
against the original or any intermediate holder of the Loan Notes.
3. The Loan Notes are transferable:
(a) in whole or in part (but in the case of a transfer of part in a minimum
principal amount of at least $2,000,000 and such that the transferor's
holding of Loan Notes after such transfer would not be less than
$2,000,000) (and for these purposes a transfer of less than $2,000,000
shall not be a transfer in whole if it does not relate to all of the Loan
Notes held by a transferor and its affiliates);
(b) subject to compliance with the restrictions set out in Schedule 6; and
(c) in whole or in part to any affiliate of a Noteholder provided that, in the
case of a transfer in part, the transferor and the transferee have entered
into such documentation as the Company may reasonably require to provide
that:
(i) one member of the transferor's group shall act as administrative
agent for all Noteholders who are members of such group, with the
effect that the Company will only be required to deal with one
member of the transferor's group in relation to the Loan Notes;
and
(ii) if the transferee ceases to be an affiliate of the transferor,
the Company will be notified and able to require the relevant
Loan Notes promptly to be transferred back to the transferor.
For these purposes, an affiliate of any person is (i) any other person that is a
holding company or subsidiary of the first, or a subsidiary of any such holding
company; (ii) in the case of a transferor that is a fund management company,
investment company, or venture capital or private equity company, any fund,
limited partnership or similar entity that is advised or managed by that
transferor; and (iii) in the case of a transferor
12
that is a fund, limitedpartnership or similar entity, any other such entity
that is under common management with the transferor.
No assignment, transfer, sale or other disposal of any holding of Loan Notes
will be registered except in accordance with paragraphs 4 and 5 below save that,
if Phoenix transfers all or part of the Loan Notes that are registered in its
name to Phoenix Bermuda, the Company shall not have the right to require any
legal opinions pursuant to the footnote to paragraph 6 of the form of instrument
of transfer set out in Schedule 5 . For these purposes:
Phoenix means Phoenix Acquisition Company S.ar.l., a company
organized under the laws of Luxembourg; and
Phoenix Bermuda means Phoenix Bermuda, LP, a Bermuda limited partnership and an
affiliate of Phoenix.
4. Every instrument of transfer shall be substantially in the form set out in
Schedule 5 and must be signed by the transferor and the transferor shall be
deemed to remain the owner of the Loan Notes to be transferred until the name of
the transferee is entered in the register in respect thereof and until the
transferee shall have executed an assignment substantially in the form set out
in Annex I to the Put and Call Agreement.
5. Every instrument of transfer must be left for registration with the
Company at the address specified in clause 8 of the Instrument accompanied by
the certificate for the Loan Notes to be transferred together with any
certificates required and such other evidence as the Directors may require to
prove the title of the transferor or its right to transfer the Loan Notes, and,
if the instrument of transfer is executed by some other person on its behalf,
the authority of that person to do so. The transfer will then (subject to
paragraphs 3 and 4 above) be registered and a note of such registration will be
entered in the Register and a new certificate for Loan Notes issued accordingly.
6. All instruments of transfer that are registered shall be retained by the
Company.
7. No fee shall be charged for the registration of any transfer or other
document relating to or affecting the title to any Loan Notes.
8. Any person becoming entitled to Loan Notes in consequence of the
bankruptcy of a holder of Loan Notes or of any other event giving rise to the
transmission of such Loan Notes by operation of law may, upon producing such
evidence that it sustains the character in respect of which it proposes to act
under this Condition or of its title as the Company shall think sufficient be
registered itself as the holder of such Loan Notes.
9. The interest or other moneys payable in respect of the Loan Notes and the
principal amount of the Loan Notes or any part thereof may be paid by electronic
transfer to the bank account notified for such purpose by the relevant
Noteholder to the Company no less than 14 days prior to the relevant date for
payment; or if no such account is so satisfied, by cheque sent through the post
at the risk of the holder or
13
holders to the registered address of the holder or, in the case of joint
registered holders, to the registered address of that one of the joint
registered holders who is first named on the register in respect of such
holding, or to such person and to such address as the registered holder or the
joint registered holders may in writing direct. Every such cheque shall be made
payable to the order of the person to whom it is sent and payment of the cheque
shall be a satisfaction of the moneys represented thereby.
10. If any Loan Note certificate is defaced, lost or destroyed, it may be
replaced on such terms (if any) as to evidence and indemnity as the Company may
require but so that, in the case of defacement, the defaced Loan Note
certificate shall be surrendered before the new Loan Note certificate is issued.
14
SCHEDULE 4
Amendments, Supplements and Waivers
Except as described below the Company may amend the terms of the Loan Notes with
the written consent of Noteholders holding 66?% of the aggregate principal
amount of the then outstanding Loan Notes. Noteholders holding a 66?% of the
aggregate principal amount of the outstanding Loan Notes may waive compliance by
the Company with any provision of the Loan Notes. However, without the consent
of each affected Noteholder, an amendment, supplement or waiver may not:
(a) change the maturity of the principal of or any instalment of interest on
any Loan Note in a manner adverse to the Noteholders;
(b) reduce the principal amount of any Loan Note;
(c) reduce the rate of or extend the time for payment of interest on any Loan
Note;
(d) change the place or currency of payment of principal of or interest on any
Loan Note;
(e) modify any provision of the Loan Notes relating to the waiver of past
defaults or the right of the Noteholders to institute suit for the
enforcement of any payment on or with respect to any Loan Notes or the
modification and amendment provisions of the Loan Notes;
(f) reduce the percentage of the principal amount of outstanding Loan Notes
necessary for amendment to or waiver of compliance with any provision of
the Loan Notes or for waiver of any breach of the terms thereof;
(g) waive a default in the payment of principal of, interest on, or redemption
payment with respect to, the Loan Notes;
(h) modify the ranking or priority of any Loan Note in any manner adverse to
the Noteholders;
It shall not be necessary for the consent of the Noteholders under this Schedule
4 to approve the particular necessary for the consent of the Noteholders under
this Schedule 4 to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Schedule 4 becomes
effective, the Company shall notify the Noteholders affected thereby a notice
briefly describing the amendment; supplement or waiver. Any failure by the
Company to send such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such amendment, supplement or waiver.
15
SCHEDULE 5
Form of Transfer Certificate
To: Vishay Intertechnology, Inc. (the Company)
TRANSFER CERTIFICATE
This Transfer Certificate relates to the Instrument constituting up to
$105,000,000 Vishay Intertechnology, Inc. Floating Rate Loan Notes 2102 dated
December 13, 2002 of Vishay Intertechnology, Inc. (the Instrument).
Capitalised terms defined in the Instrument shall have, unless otherwise defined
in this Transfer Certificate, the same meanings when used in this Transfer
Certificate.
1. [Transferor] (the Transferring Holder) confirms that the principal
outstanding amount of Notes that it holds is $[_____] (the Transferring Holder's
Notes).
2. The Transferring Holder requests:
(a) [___________] [Transferee] (the Transferee) to accept and procure the
transfer to the Transferee of [the Transferring Holder's Notes//[_____]
principal amount of the Transferring Holder's Notes, being a principal
amount greater than $2,000,000] as further specified in the Appendix (the
Transfer Notes) by countersigning and delivering this Transfer Certificate
to the Company at its address for the service of notices specified in the
Instrument; [and
(b) the Company to issue a certificate in its name in relation to that portion
of the Transferring Holder's Notes not comprising the Transfer Notes (the
Retained Notes) in accordance with clause 6 of the Instrument. For the
avoidance of doubt, the Transferor acknowledges that this Transfer
Certificate shall not affect its rights, undertakings, liabilities and
obligations in respect of the Retained Notes.]
3. The Transferring Holder makes no representation or warranty and assumes no
responsibility with respect to the legality, validity, effectiveness, adequacy
or enforceability of the Instrument or any document relating thereto and assumes
no responsibility for the financial condition of the Company or for the
performance and observance by the Company of any of its respective undertakings,
liabilities and obligations under the Instrument or any document relating
thereto, and any and all such conditions and warranties, whether express or
implied by law or otherwise, are hereby excluded.
4. In connection with the transfer of the Transfer Notes, the Transferring
Holder confirms that it has not utilised any general solicitation or general
advertising in connection with the Transfer Notes or the transfer of the
Transfer Notes.
16
5. Unless, either (i), one of the boxes below is checked by the Transferring
Holder or (ii) the Loan Notes are transferred pursuant to an effective
registration statement under the Securities Act, the Company shall not be
obliged to register any of the Loan Notes evidenced in the name of any person
other than the Transferring Holder.
6. By checking the box checked below, the Transferring Holder confirms that
the Transfer Notes are being transferred2:
(i) [_____] to the Company or a subsidiary thereof; or
(ii) [_____] pursuant to and in compliance with Rule 144A under the
Securities Act; or
(iii) [_____] to an institutional "accredited investor" (as defined in
Rule 501(a)(1), (2), (3) or (7) under the Securities Act); or
(iv) [_____] outside the United States to a "foreign person" in
compliance with Rule 904 of Regulation S under the Securities
Act; or
(v) [_____] pursuant to the exemption from registration provided by
Rule 144 under the Securities Act; or
(vi) [_____] pursuant to another available exemption from the
registration requirements of the Securities Act.]
7. The Transferee hereby requests the Company:
(a) to accept this Transfer Certificate as being delivered to it pursuant to,
and for the purposes of, paragraph 5 of Schedule 3 to the Instrument in
relation to the Transfer Notes; and
(b) to register it in the Register as the Noteholder in respect of the
Transfer Notes; and
(c) to issue a certificate in its name in relation to the Transfer Notes in
accordance with clause 6 of the Instrument.
8. The Transferee confirms that it has acceded to the Put and Call Agreement
in accordance with paragraph 4 of Schedule 3 to the Instrument and encloses
herewith:
(i) a copy of the form of assignment prescribed by the Put Call
Agreement duly executed by it; and
_______________________________________________________________________________
2 If box (iii), (iv), (v) or (vi) is checked, the Company may require, prior to
registering any such transfer of the Transfer Notes such legal opinions, as
the Company reasonably requests to confirm that such transfer is being made
pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act. For the avoidance of doubt
and in accordance with Schedule 3, if Transferor is Pheonix and the
Transferee is Phoenix Bermuda, the Company shall have no right to request any
such legal opinions in relation to such Transfer.
17
(ii) the certificate that evidences the Transferring Holder's title to
the Transfer Notes.
9. The Transferee warrants that it has received a copy of the Instrument
together with such other information as it has required in connection with this
transaction and that it has not relied, and will not hereafter rely, on the
Transferring Holder to check or enquire on its behalf into the legality,
validity, effectiveness, adequacy, accuracy or completeness of any such
information and further agrees that it has not relied, and will not rely, on the
Transferring Holder to assess or keep under review on its behalf the financial
condition, creditworthiness, condition, affairs, status or nature of the
Company.
10. The Transferee hereby undertakes with the Transferring Holder and each of
the other parties to the Instrument that it will perform in accordance with
their terms all those undertakings, liabilities and obligations that by the
terms of the Instrument will be assumed by it after delivery of this Transfer
Certificate to the Company and satisfaction of the conditions subject to which
this Transfer Certificate is expressed to take effect.
11. This Transfer Certificate is not assignable or otherwise negotiable
(without prejudice to the provisions of Schedule 3 to the Instrument which shall
be applicable to the Transferring Holder in respect of the Retained Notes and to
the Transferee in relation to any transfer or assignment of the rights,
undertakings, liabilities and obligations assumed by it pursuant hereto).
12. This Transfer Certificate and the rights, undertakings, liabilities and
obligations of the parties hereunder shall be governed by and construed in
accordance with the laws of the State of New York.
13. Each of the Transferor and the Transferee agrees that the courts of the
State of New York are to have exclusive jurisdiction to settle any disputes that
may arise in connection with this Agreement.
18
APPENDIX
[Insert details of Transfer Notes.]
- ------------------------ ----------------------------
For and on behalf of the For and on behalf of the
Transferring Holder Transferee
19
SCHEDULE 6
Restrictions on Transfer of Loan Notes
(a) Each Noteholder agrees that any proposed transfer of any Loan Notes, or
any shares of Common Stock issuable upon conversion or exchange thereof, may be
effected only (1)(w) inside the United States of America (I) to a person who the
seller reasonably believes is a qualified institutional buyer within the meaning
of Rule 144A in a transaction meeting the requirements of Rule 144A, (II) in
accordance with Rule 144 or (III) pursuant to another exemption from the
registration requirements of the Securities Act, (x) to the Company, (y) outside
the United States of America (A) to a non-U.S. person (within the meaning of
Regulation S) in a transaction meeting the requirements of Regulation S or (B)
pursuant to another exemption from the registration requirements of the
Securities Act or (z) pursuant to an effective registration statement and (2) in
each case, in accordance with the application securities laws of any state of
the United States of America or any other application jurisdiction. Each
Noteholder agrees to notify any purchaser of the resale restrictions set forth
above.
(b) Prior to any Transfer or proposed Transfer of any Loan Notes, the
Noteholder thereof shall deliver written notice to the Company in the form set
out in Schedule 5 of such Noteholder's intention to effect such transfer. If the
transfer or proposed transfer is pursuant to clause (1)(w) or (1)(y) of the
first sentence of the preceding paragraph, then upon receipt of such notice, the
Company may request any or all of the following (each a Transfer Document) in a
form reasonably acceptable to the Company:
(i) an agreement by such transferee to the impression of the
restrictive investment legend set forth below on the Loan Note
certificates, or any shares of Common Stock issuable upon
conversion or exchange thereof;
(ii) an agreement by such transferee, in form and substance reasonably
satisfactory to the Company, to be bound by the provisions of
this Schedule 6 relating to the transfer of such Loan Notes, or
any shares of Common Stock issuable upon conversion or exchange
thereof; and
(iii) an opinion of counsel with expertise in securities law matters
reasonably satisfactory to the Company that such transfer
complies with applicable securities laws.
If the Company requests any Transfer Document(s), it shall do so as
promptly as practicable following receipt of the Holder's notice of
intention to Transfer. The Company shall thereafter cause the Transfer to
be recorded and a certificate or other evidence of ownership in the name
of the transferee to be delivered as soon as practicable after it has
received Transfer Documents complying with the terms of this Schedule.
20
(c) The Noteholders agree that each certificate issued to evidence Loan Notes,
or any shares of Common Stock issuable upon conversion of exchange thereof
shall bear a legend to the following effect:
THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE ACT), OR
ANY OTHER APPLICABLE SECURITIES LAWS AND HAVE BEEN ISSUED IN RELIANCE UPON
AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND
SUCH OTHER SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED, OR OTHERWISE DISPOSED OF, EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE ACT OR PURSUANT TO A TRANSACTION THAT IS
EXEMPT FROM SUCH REGISTRATION.
The foregoing legend shall be in addition to any other legend required by
law.
(d) The restrictions referenced in this Schedule, including the legend, shall
cease and terminate as to any particular Loan Notes, or any shares Common
Stock issuable upon conversion or exchange thereof when (x) such Loan
Notes, or any shares Common Stock issuable upon conversion or exchange
thereof have been transferred in a transaction pursuant to Rule 144 or a
registration statement or (y) in the reasonable opinion of counsel for the
Company, such restriction is no longer required in order to assure
compliance with the Securities Act and applicable state securities laws.
Whenever such restrictions shall cease and terminate as to any Notes, the
Noteholder shall be entitled to received from the Company, without expense
(other than applicable transfer taxes, if any, if such unlegended shares
are being delivered and transferred to any person other than the
registered Noteholder thereof), new certificates for a like number of
Notes not bearing the relevant legend(s) set forth in this Schedule.
21
The Company
VISHAY INTERTECHNOLOGY, Inc.
acting by
22
December 13, 2002
VISHAY INTERTECHNOLOGY, INC
(as Issuer)
==========================================================
INSTRUMENT
constituting
up to $105,000,000
FLOATING RATE
UNSECURED LOAN NOTES 2102
==========================================================
FRESHFIELDS BRUCKHAUS DERINGER
Exhbit 4.4
SECURITIES INVESTMENT AND
REGISTRATION RIGHTS AGREEMENT
THIS SECURITIES INVESTMENT AND REGISTRATION RIGHTS AGREEMENT is
made and entered into as of December 13, 2002 (the "Issue Date," being the
completion date under the Purchase Agreement, defined below), by and among
Vishay Intertechnology, Inc., a Delaware corporation (the "Company"), and
Phoenix, the BCcH Shareholders, the Mezzanine Lenders, Phoenix Bermuda and the
Foundation (each as defined below; the "Original Holders"), pursuant to and in
furtherance of the transactions contemplated by the Purchase Agreement.
W I T N E S S E T H
WHEREAS, the Company and the Original Holders have entered into
that certain Share Sale and Purchase Agreement, dated November 10, 2002 (as
amended from time to time, the "Purchase Agreement"), by and among the parties
thereto, pursuant to which, among other things, the Company has agreed to issue
to the Original Holders the Consideration Securities (as defined below).
WHEREAS, the Company and the Original Holders wish to enter into
certain covenants and agreements in respect of the Consideration Securities in
order to provide for certain rights contemplated by the parties in entering into
the Purchase Agreement and to comply with the securities laws of the United
States in which the Company is domiciled.
WHEREAS, the execution of this Agreement is a condition to the
completion of the transactions contemplated by the Purchase Agreement.
NOW, THEREFORE, in consideration of the premises and for other good
and valuable consideration receipt of which is acknowledged, the parties agree
as follows:
SECTION 1. Definitions.
(a) As used in this Agreement, the following terms have the
meanings assigned in this Section:
"A Warrants" has the meaning set forth in the definition of
"Warrants" below.
"Accredited Investor" has the meaning assigned in Regulation D
under the Securities Act and set forth on Schedule A hereto.
"Affiliate" has the meaning assigned in paragraph (a)(1) of Rule
144.
"B Warrants" has the meaning set forth in the definition of
"Warrants" below.
"BCcH Shareholders" means those persons whose names and addresses
are set out in Part A of Schedule 1 to the Purchase Agreement.
1
"Business Day" means any day, other than a Saturday or Sunday or a
day on which banking institutions in The City of New York are authorized or
obligated by law or executive order to close.
"Common Stock" means the common stock, par value $0.10 per share,
of the Company and any other security exchanged or substituted for such common
stock or into which such common stock is converted in any recapitalization,
reorganization, merger, consolidation, share exchange or other business
combination transaction, including any reclassification consisting of a change
in par value or a change from par value to no par value or vice versa.
"Company" has the meaning set forth in the first paragraph of this
Agreement.
"Consideration Securities" means the Notes and the Warrants.
"Deferral Event" has the meaning set forth in Section 9(b) hereof.
"Designated Counsel" means Freshfields Bruckhaus Deringer or any
other counsel of recognized national standing in the interpretation of the
securities laws in the United States selected by the Designated Holders.
"Designated Holders" means, collectively, the Designated Note
Holder and the Designated Warrant Holder.
"Designated Note Holder" means a person chosen by a majority of the
Holders of the then outstanding Exchange Shares; provided, however, that in the
event at any time there is no person acting in the capacity of the Designated
Note Holder: (i) all notices or other communications required to be provided
herein to the Designated Note Holder shall be provided to Designated Counsel and
(ii) any decisions required to be made herein by the Designated Note Holder
shall be made by the Holders of a majority of the then outstanding Exchange
Shares.
"Designated Warrant Holder" means Phoenix, an Affiliate of Phoenix
designated by Phoenix, or, if neither Phoenix nor any of its Affiliates desire
any longer to act as the Designated Warrant Holder or Phoenix and its Affiliates
no longer own any Warrant Shares, such other person or entity approved by the
Holders of a majority of the then outstanding Warrant Shares; provided, however,
that in the event at any time there is no person acting in the capacity of the
Designated Warrant Holder: (i) all notices or other communications required to
be provided herein to the Designated Warrant Holder shall be provided to
Designated Counsel and (ii) any decisions required to be made herein by the
Designated Warrant Holder shall be made by the Holders of a majority of the then
outstanding Warrant Shares.
"Distributor" means any underwriter, dealer, or other person who
participates, pursuant to a contractual arrangement, in the distribution of the
securities offered or sold in reliance on Regulation S.
"Effectiveness Period" means either the Primary Effectiveness
Period or the Resale Effectiveness Period, as the case may be.
2
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the SEC promulgated thereunder.
"Exchange Shares" means the shares of Common Stock issuable upon
exchange of the Notes (and the Spin-Off Notes, if applicable) in accordance with
the terms and conditions of the Put and Call Agreement. For purposes of this
Agreement, references to Holders of Exchange Shares shall include Holders of
Notes (and Spin-Off Notes, if applicable) exchangeable for such shares, with the
number of Exchange Shares deemed held for these purposes determined on an as
exchanged basis.
"Foundation" means Stichting Administratiekantoor Phoenix whose
registered office is at Meerenakkerplein 27-30, 5652 BJ Eindhoven, The
Netherlands.
"Hold-Back Election" has the meaning set forth in Section 9(a)
hereof.
"Holder" means any of the Original Holders and any person who
becomes a registered holder of any Registrable Securities in compliance with the
terms of this Agreement.
"Indemnifiable Losses" has the meaning set forth in Section 12(a)
hereof.
"Initiating Note Holders" has the meaning set forth in Section 4(b)
hereof.
"Initiating Warrant Holders" has the meaning set forth in Section
4(a) hereof.
"Issue Date" has the meaning set forth in the first paragraph of
this Agreement.
"Material Event" has the meaning set forth in Section 6(f) hereof.
"Mezzanine Lenders" means the persons whose names and addresses are
set out in Part C of Schedule 1 to the Purchase Agreement.
"NASD" means the National Association of Securities Dealers, Inc.
"Notes" means US$105,000,000 principal amount of notes due 2102
issued by the Company and delivered to the Mezzanine Lenders under the terms of
the Purchase Agreement, and exchangeable for shares of Common Stock pursuant to
a Put and Call Agreement, of even date herewith, between the Company and certain
of the Original Holders.
"Note Holder" means a holder of the Notes, and for the registration
provisions of this Agreement, shall include a holder of Exchange Shares that are
Resale Securities.
"Notice and Questionnaire" means a written notice delivered to the
Company by a holder of Resale Securities, containing the information called for
by the Form of Selling Securityholder Notice and Questionnaire attached hereto
as Annex A.
"Notice Holder" means, on any date, any Holder that has delivered a
Notice and Questionnaire to the Company on or prior to such date.
3
"Original Holders" has the meaning set forth in the first paragraph
of this Agreement.
"Other Holders" has the meaning set forth in Section 4(i) hereof.
"Phoenix" means Phoenix Acquisition Company S.a.r.l (registered at
the Luxembourg Trade and Companies Registry under No. 66455) whose registered
office is at 58 rue Charles Martel, L-2134 Luxembourg.
"Phoenix Bermuda" means Phoenix Bermuda, LP, a Bermuda limited
partnership and an Affiliate of Phoenix.
"Primary Registration Statement" means a registration statement
registering the issuance of the Warrant Shares under the Securities Act.
"Primary Effectiveness Period" means the period ending on the
earlier of (x) ten years from the Issue Date and (y) the date on which all of
the Warrants have been exercised for Warrant Shares.
"Prospectus" means the prospectus included in any Registration
Statement (including, without limitation, a prospectus that discloses
information previously omitted from a prospectus filed as part of an effective
registration statement in reliance upon Rule 415 promulgated under the
Securities Act), as amended or supplemented by any amendment or prospectus
supplement, including post-effective amendments, and all materials incorporated
by reference in such Prospectus.
"Purchase Agreement" has the meaning set forth in the preamble
hereto.
"Put and Call Agreement" means that certain Put and Call Agreement
between the Company and certain of the Original Holders of even date herewith.
"Registrable Securities" means:
(i) the Warrant Shares to the extent eligible for registration
under the Primary Registration Statement;
(ii) the Resale Securities; and
(iii) any securities issued with respect to the securities referred
to in (i) and (ii) above (or issuable upon the conversion,
exchange or exercise of any warrant, right or other security
which is issued) by way of a dividend or other distribution
with respect to, or in exchange for or in replacement of, such
securities in connection with a recapitalization, merger,
consolidation or other reorganization.
For purposes of determining the Holders of a majority of any Registrable
Securities at any time outstanding, a Holder of Warrants shall be deemed to hold
the underlying Warrant Shares and a Holder of Notes shall be deemed to hold the
underlying Exchange Shares.
4
"Registration Statement" means the Primary Registration Statement,
the Resale Registration Statement, and any piggyback registration statement
pursuant to Section 5 hereof and includes the Prospectus, all amendments
(including post-effective amendments) and supplements, all exhibits, and all
materials included or incorporated by reference in such registration statement.
"Regulation S" means Regulation S under the Securities Act, as the
same may be amended from time to time, or any similar rule or regulation
hereafter adopted by the SEC.
"Requesting Securityholder" has the meaning set forth in Section
5(a) hereunder.
"Resale Effectiveness Period" means the period ending on the
earlier to occur of (x) the first date on which there are no longer outstanding
any Resale Securities and (y) the tenth anniversary of the Issue Date and, to
the extent applicable to permit a Holder to sell pursuant to a Resale
Registration Statement, four (4) months after the tenth anniversary of the Issue
Date.
"Resale Registration Statement" means a registration statement
registering the Resale Securities for resale under the Securities Act.
"Resale Securities" means:
(i) the Exchange Shares;
(ii) the Warrants;
(iii) the Warrant Shares, but only if such Warrant Shares:
(I) (a) for any reason are not eligible for registration
under the Primary Registration Statement; or (b) are
issued upon exercise of the Warrants by the Original
Holders or any of their respective Affiliates and
continue to be held by such Holders or their Affiliates;
or
(II) are, or are intended to be, issued upon exercise of the
Warrants in connection with an Underwritten Offering to
facilitate the sale of such Warrant Shares; and
(iv) any securities issued with respect to the securities referred
to in (i), (ii) and (iii) above (or issuable upon the
conversion, exchange or exercise of any warrant, right or
other security which is issued) by way of a dividend or other
distribution with respect to, or in exchange for or in
replacement of, such securities in connection with a
recapitalization, merger, consolidation or other
reorganization;
5
provided, however, that such Resale Securities shall cease to constitute Resale
Securities when they are sold either pursuant to a Registration Statement filed
under the Securities Act (other than the Primary Registration Statement) or
pursuant to Rule 144. For purposes of determining the Holders of a majority of
the Resale Securities at any time outstanding, a Holder of Warrants shall be
deemed to hold the underlying Warrant Shares and a Holder of Notes shall be
deemed to hold the underlying Exchange Shares.
"Restricted Securities" has the meaning assigned to such term in
Rule 144.
"Restricted Period" has the meaning set forth in Section 2(c)(iv)
hereunder.
"Rule 144" means Rule 144 under the Securities Act, as the same may
be amended from time to time, or any similar rule or regulation hereafter
adopted by the SEC.
"Rule 415" means Rule 415 under the Securities Act, as the same may
be amended from time to time, or any similar rule or regulation hereafter
adopted by the SEC.
"SEC" means the Securities and Exchange Commission or its
successors.
"Section 4(2)" means Section 4(2) under the Securities Act, as the
same may be amended from time to time, or any successor statute.
"Securities Act" means the Securities Act of 1933, as amended, and
the rules and regulations promulgated by the SEC thereunder.
"Spin-Off" has the meaning set forth in (x) Section 11(e) of the
Warrant Agreement (as such Spin-Off relates to the Warrants) and (y) Section
4.01(e) of the Put and Call Agreement (as such Spin-Off relates to the Notes).
"Spin-Off Company" has the meaning set forth in (x) Section 11(e)
of the Warrant Agreement (as it relates to the Spin-Off Warrants) and (y)
Section 4.01(e) of the Put and Call Agreement (as it relates to the Spin-Off
Notes).
"Spin-Off Notes" has the meaning set forth in Section 4.01(e) of
the Put and Call Agreement.
"Spin-Off Warrants" has the meaning set forth in Section 11(e) of
the Warrant Agreement.
"Transfer" means any disposition of any Consideration Securities or
of any interest therein, which would constitute a "sale" within the meaning of
the Securities Act. The term "transferee" shall mean any person that acquires
any interest in any Consideration Securities in a Transfer.
"Transfer Document" has the meaning set forth in Section 15(b)
hereunder.
"Underwritten Offering" means an SEC registered offering in which
securities of the Company or a Spin-Off Company, including Resale Securities
that are Warrant Shares or
6
Exchange Shares (or, in the case of Spin-Off Warrants and Spin-Off Notes, the
shares issuable upon the exercise or exchange thereof), as the case may be, are
sold to an underwriter for reoffering to the public or placed to the public by
an underwriter on an agency basis.
"U.S. person" has the meaning assigned in Regulation S and set
forth on Schedule B hereto.
"Warrant Agreement" means that certain Warrant Agreement dated as
of December 13, 2002 between the Company and the Warrant Agent (as defined
therein), pursuant to which the Warrants are issued.
"Warrant Holder" means a holder of A Warrants, B Warrants and/or
Warrant Shares.
"Warrants" means:
(i) the warrants to acquire 7,000,000 shares of Common Stock
having an exercise price of $20.00 per share (the "A
Warrants"); and
(ii) the warrants to acquire 1,823,529 shares of Common Stock
having an exercise price of $30.30 per share (the "B
Warrants"),
such A Warrants and B Warrants (w) being issued as consideration under the
Purchase Agreement, (x) being subject to adjustment in accordance with the
Warrant Agreement, (y) having an expiration date on the tenth anniversary of the
Issue Date and (z) being immediately exercisable by all Holders other than an
Original Holder or an Affiliate of an Original Holder and being exercisable by
an Original Holder or any Affiliate of an Original Holder following the first
anniversary of the Issue Date.
"Warrant Shares" means the shares of Common Stock issuable upon
exercise of the Warrants (and the Spin-Off Warrants, if applicable). For
purposes of this Agreement, references to a Holder of Warrant Shares shall
include Holders of Warrants (and Spin-Off Warrants, if applicable) exercisable
for such shares with the number of Warrant Shares deemed held for these purposes
determined on an as exercised basis.
(b) Construction.
(i) The terms defined herein have the respective meanings
set forth herein for all purposes, and such meanings are equally applicable to
both the singular and plural forms of the terms defined.
(ii) The words "include," "includes" and "including" shall be
deemed to be followed by the words "without limitation" whether or not they are
in fact followed by such words or words of like impact. "Writing," "written" and
comparable terms refer to printing, typing, lithography and other means of
reproducing words in a visible form.
(iii) Any instrument, agreement or other document defined or
referred to herein means such instrument, agreement or other document as from
time to time amended,
7
modified or supplemented, including by waiver or consent, in accordance with the
provisions hereof or thereof, and includes references to all appendices,
exhibits, schedules, supplements, addenda and other attachments thereto and
instruments, agreements or other documents incorporated therein.
(iv) Any term defined below by reference to any instrument,
agreement or other document has such meaning whether or not such instrument,
agreement or other document is in effect. References to a person are, unless the
context otherwise requires, also to such person's successors and assigns.
(v) The words "herein", "hereof" and "hereunder" and
comparable terms refer, unless the context otherwise requires, to the entire
Agreement and not to any particular article, section or other subdivision
hereof. References herein to "Article", "Section" or another subdivision or to
"Appendix", "Exhibit", "Schedule" or other attachment are, unless the context
otherwise requires, to an article, section or subdivision hereof or an appendix,
exhibit, schedule or other attachment hereto.
(vi) References to any gender include, unless the context
requires otherwise, references to all genders and references to the singular
include, unless the context requires otherwise, references to the plural and
vice versa. "Shall" and "will" have equal force and effect.
(vii) All references in this Agreement to "$" are to United
States dollars.
SECTION 2. Representations and Warranties of the Original Holders.
(a) Each of the Original Holders severally acknowledges and
understands that the issuance of the Consideration Securities pursuant to the
Purchase Agreement is not being registered by the Company under the Securities
Act or the securities laws of any state of the United States and that the
issuance of the Consideration Securities is being effected in reliance upon an
exemption from registration afforded either under Section 4(2) of the Securities
Act for transactions by an issuer not involving a public offering or Regulation
S for offers and sales of securities outside the United States. By its execution
of this Agreement, each of the Original Holders represents and warrants,
severally and not jointly, as indicated on its signature page to this Agreement,
either that:
(i) it is, and at all times since the execution of the Purchase
Agreement it has been, an Accredited Investor, so that the
Company may rely on the exemption of Section 4(2); or
(ii) it is not, and at all times since the execution of the
Purchase Agreement it has not been, a U.S. person, so that
the Company may rely on the exemption of Regulation S.
Each such Holder severally understands that the Consideration Securities,
including the shares of Common Stock issuable upon exchange or exercise thereof,
are being offered and sold to such Holder pursuant to the Purchase Agreement in
reliance upon the truth and accuracy of the
8
representations, warranties, agreements, acknowledgments and understandings of
such Holder set forth in this Agreement, in order that the Company may determine
the applicability and availability of the exemptions from registration of the
Consideration Securities on which the Company is relying.
(b) Each Original Holder indicating that it is an Accredited
Investor further represents and warrants to the Company as follows:
(i) Such Holder qualifies as an Accredited Investor on the
basis set forth on its signature page to this Agreement.
(ii) Such Holder has sufficient knowledge and experience in
finance, securities, investments and other business matters to be able to
protect such Holder's interests in connection with the transactions contemplated
by the Purchase Agreement.
(iii) Such Holder has consulted, to the extent that it has
deemed necessary, with its tax, legal, accounting and financial advisors
concerning its investment in the Consideration Securities and the shares of
Common Stock issuable upon exchange or exercise thereof.
(iv) Such Holder understands the various risks of an
investment in the Consideration Securities, and any shares of Common Stock
issuable upon exchange or exercise thereof, and can afford to bear such risks
for an indefinite period of time, including, without limitation, the risk of
losing its entire investment in the Consideration Securities, and any shares of
Common Stock issuable upon exchange or exercise thereof.
(v) Such Holder has had access to the Company's publicly filed
reports with the SEC, is aware of the risk factors concerning the Company
described from time to time in such reports, and has had the opportunity to ask
questions about the contents of such reports and is satisfied with the responses
to its questions.
(vi) Such Holder has been furnished during the course of the
transactions contemplated by the Purchase Agreement with all other public
information regarding the Company that such Holder has requested and, assuming
such publicly available information complies with U.S. securities laws, all such
public information is sufficient for such Holder to evaluate the risks of
investing in the Consideration Securities.
(vii) Such Holder has been afforded the opportunity to ask
questions of and receive answers concerning the terms and conditions of the
issuance of the Consideration Securities, and any shares of Common Stock
issuable upon exchange or exercise thereof.
(viii) Such Holder is not relying on any representations and
warranties concerning the Company made by any officer, employee or agent of the
Company, other than those, if any, contained in the Purchase Agreement.
(ix) Such Holder is acquiring the Consideration Securities,
and any shares of Common Stock issuable upon exchange or exercise thereof, for
such Holder's own account, for investment and not for distribution or resale to
others, except for such transfers to its
9
partners and investors as would not violate the provisions of the Securities
Act, the securities laws of any state of the United States or this Agreement.
(x) Such Holder will not sell or otherwise transfer the
Consideration Securities, or any shares of Common Stock issuable upon exchange
or exercise thereof, unless either (A) the transfer of such securities is
registered under the Securities Act or (B) an exemption from registration of
such securities is available.
(xi) Such Holder understands and acknowledges that there
currently is no public market for the Consideration Securities and that no such
market may ever develop.
(xii) Such Holder understands and acknowledges that the
Company is under no obligation to register the Notes for sale under the
Securities Act and that only the Registrable Securities are obligated to be
registered under this Agreement.
(xiii) Such Holder consents to the placement of a legend on
any certificate or other document evidencing the Consideration Securities, and
any shares of Common Stock issuable upon exchange or exercise thereof, stating
that such securities have not been registered under the Securities Act or
applicable state securities laws and setting forth or referring to the
restrictions on transferability and sale thereof.
(xiv) Such Holder represents that the address furnished by
such Holder on its signature page to this Agreement is such Holder's principal
residence if he is an individual or its principal business address if it is a
corporation or other entity.
(c) Each Original Holder indicating that it is not a U.S. person
further represents and warrants to the Company as follows:
(i) At the time of (a) the offer by the Company and (b) the
acceptance of the offer by such Holder, of the Consideration Securities, such
Holder was outside the United States.
(ii) No offer to acquire the Consideration Securities or
otherwise to participate in the transactions contemplated by the Purchase
Agreement was made to such Holder or its representatives inside the United
States.
(iii) Such Holder is not purchasing the Consideration
Securities, and will not be acquiring any shares of Common Stock issuable upon
exchange or exercise thereof, on behalf of, as nominee for or with a view
towards distribution to any U.S. person in violation of the registration
requirements of the Securities Act.
10
(iv) Such Holder will make all subsequent offers and sales of
the Consideration Securities, and the shares of Common Stock issuable upon
exchange or exercise thereof, either (x) outside of the United States in
compliance with Regulation S; (y) pursuant to a registration under the
Securities Act; or (z) pursuant to an exemption from registration under the
Securities Act. Specifically, such Holder will not resell the Consideration
Securities, or the shares of Common Stock issuable upon exchange or exercise
thereof, to any U.S. person or within the United States prior to the expiration
of a period commencing on the Issue Date and ending on the date that is one year
thereafter (the "Restricted Period"), except pursuant to registration under the
Securities Act or an exemption from registration under the Securities Act.
(v) Such Holder has no present plan or intention to sell the
Consideration Securities, or the shares of Common Stock issuable upon exchange
or exercise thereof, in the United States or to a U.S. person at any
predetermined time, has made no predetermined arrangements to sell the
Consideration Securities, or the shares of Common Stock issuable upon exchange
or exercise thereof, and is not acting as a Distributor of such securities.
(vi) Neither such Holder, its Affiliates nor any person acting
on such Holder's behalf, has entered into, has the intention of entering into,
or will enter into any put option, short position or other similar instrument or
position in the U.S. with respect to the Consideration Securities, or the shares
of Common Stock issuable upon exchange or exercise thereof, at any time after
the Issue Date through the Restricted Period except in compliance with the
Securities Act.
(vii) The Consideration Securities, and the shares of Common
Stock issuable upon exchange or exercise thereof, will contain a legend to the
effect that transfer is prohibited except in accordance with the provisions of
Regulation S, pursuant to registration under the Securities Act or pursuant to
an available exemption from registration, and that hedging transactions
involving those securities may not be conducted unless in compliance with the
Securities Act.
(viii) Such Holder is not acquiring the Consideration
Securities, or the shares of Common Stock issuable upon exchange or exercise
thereof, in a transaction (or an element of a series of transactions) that is
part of any plan or scheme to evade the registration provisions of the
Securities Act.
(d) Each Original Holder further represents and warrants to the
Company as follows:
(i) Such Holder understands and acknowledges that the
Consideration Securities, and the shares of Common Stock issuable upon exchange
or exercise thereof, are subject to restrictions on transferability and that the
Company may refuse to transfer the Consideration Securities, and the shares of
Common Stock issuable upon exchange or exercise thereof, unless such Holder
complies with the provisions in Section 15 of this Agreement related to
restrictions on transferability.
(ii) Such holder understands and acknowledges that the
Consideration Securities, and the shares of Common Stock issuable upon exchange
or exercise thereof, have
11
not been recommended by any federal or state securities commission or regulatory
authority, that the foregoing authorities have not confirmed the accuracy or
determined the adequacy of any information concerning the Company that has been
supplied to such Holders and that any representation to the contrary is a
criminal offense.
(iii) Such Holder acknowledges that the representations,
warranties and agreements made by such Holder herein shall survive the execution
and delivery of this Agreement, the purchase of the Consideration Securities and
the exchange or exercise thereof.
(e) Phoenix Bermuda and Phoenix each hereby represents and warrants
that if Phoenix transfers the Consideration Securities to Phoenix Bermuda, which
the parties anticipate will take place within a reasonably short period of time
following the date hereof, the representations and warranties in this Section 2
will be true and correct as to Phoenix Bermuda on the date hereof and on the
date on which Phoenix transfers the Consideration Securities to Phoenix Bermuda.
(f) The Company represents and warrants to each Holder as follows:
(i) The Company is acquiring the Sale Shares (as defined in
the Purchase Agreement) for its own account, for investment purposes only and
not with a view to distribution (as such term is used in Section 2(11) of the
Securities Act). The Company understands that the Sale Shares have not been
registered under the Securities Act and cannot be sold unless subsequently
registered under the Securities Act or an exemption from such registration is
available.
(ii) None of the Company, any Affiliate of the Company, or any
person acting on its or their behalf has offered or sold or will offer or sell
any Consideration Securities by means of any general solicitation or general
advertisement within the meaning of Section 502(c) of the Securities Act or by
means of any "directed selling efforts" within the meaning of Rule 903 under the
Securities Act.
SECTION 3. Registration Generally.
(a) The Company shall prepare and file with the SEC no later than
the date that is thirty (30) days after the Issue Date:
(i) a Resale Registration Statement for an offering to be made on a
delayed or continuous basis pursuant to Rule 415 of the Securities
Act registering the resale from time to time by Holders thereof of
all of the Resale Securities (and which shall include no other
securities); and
(ii) a Primary Registration Statement for an offering to be made on a
delayed or continuous basis pursuant to Rule 415 of the Securities
Act registering the issuance by the Company, in a primary
registration, from time to time of Warrant Shares upon the
exercise of the Warrants, to the Holders thereof.
Each Registration Statement shall be prepared and filed on Form S-3
or another appropriate form permitting registration of the Registrable
Securities on a delayed or continuous
12
basis. The method of distribution by the Holders under the Resale Registration
Statement shall include any public or private sale by the Holders or pursuant to
an Underwritten Offering (as provided in this Agreement). The Resale
Registration Statement shall also permit the sale of the Resale Securities under
Rule 144.
(b) The Company shall use its reasonable best efforts:
(i) to cause each Registration Statement to be declared effective
under the Securities Act by the date that is one hundred eighty
(180) days after the Issue Date;
(ii) to keep the Resale Registration Statement continuously effective
under the Securities Act until the expiration of the Resale
Effectiveness Period; and
(iii) to keep the Primary Registration Statement continuously effective
under the Securities Act until the expiration of the Primary
Effectiveness Period,
the foregoing clauses each being subject to the rights of the Company to
determine that a Deferral Event has occurred in accordance with Section 9(b)
herein.
(c) In the event of a Spin-Off pursuant to which:
(i) a Warrant Holder receives Spin-Off Warrants; and/or
(ii) a Note Holder receives Spin-Off Notes,
the Company agrees to take such action as is reasonably necessary to cause the
Spin-Off Company to register the shares of common stock of the Spin-Off Company
issuable upon exchange of the Spin-Off Notes and/or upon exercise of the
Spin-Off Warrants on a resale registration statement on terms substantially
identical to the terms and conditions of this Agreement, including but not
limited to the indemnification, piggyback registration and holdback provisions
hereof, except that the Spin-Off Company shall be substituted for the Company in
such agreement, rights to demand underwritten offerings in respect of the
Spin-Off Warrants and the Spin-Off Notes shall be as described in Section 4(c)
hereof and holders of such securities shall not be required to make
representations similar to those contained in Section 2 hereof.
SECTION 4. Demand Underwritten Offering.
(a) Warrant Shares. Subject to Section 9(a) hereof, upon the written
request of one or more Holders of Warrant Shares that are Resale Securities
(such Holder or Holders, the "Initiating Warrant Holders") requesting that the
Company effect the disposition of such Warrant Shares on the Resale Registration
Statement by means of an Underwritten Offering, the Company will cooperate with
the Initiating Warrant Holders to facilitate such an Underwritten Offering;
provided, however, that the Company shall not be obligated to:
(i) effect more than an aggregate of two (2) demand Underwritten
Offerings pursuant to this Section 4(a) or more than one demand
Underwritten Offering pursuant to this Section 4(a) in any twelve
(12) month period; or
13
(ii) effect a demand Underwritten Offering pursuant to this Section
4(a) unless:
(A) the Resale Securities for which a demand Underwritten
Offering is made pursuant to this Section 4(a) constitute
at least three million (3,000,000) shares of Common Stock;
and
(B) in the case of an Underwritten Offering in which any
Warrants have been or are intended to be exercised in
connection with the offering,
(1) the sale price of a share of Common Stock (or, if no
sale price for the Common Stock is reported on any
trading day, the average of the low ask and high bid
prices for the Common Stock on such trading day, or,
if there are no low ask and high bid prices, the per
share fair market value of the Common Stock as
determined by an investment banking firm of national
reputation and standing selected by the Company and
reasonably acceptable to holders of a majority of
the then outstanding Warrant Shares) exceeds the
lesser of (i) US$1.00 more than the then applicable
exercise price per share of such Warrants and (ii)
five percent (5%) more than the then applicable
exercise price per share of such Warrants, on the
principal securities exchange or interdealer
quotation system on which the Common Stock is then
listed for trading or quoted, if any, on each of
twenty (20) trading days in any thirty (30) trading
day period; and
(2) such Initiating Warrant Holders provide the Company
with written notice of a demand Underwritten
Offering no later than five Business Days (5) days
following any thirty (30) day trading period
referred to in clause (1).
(b) Exchange Shares. Subject to Section 9(a) hereof, upon the
written request of one or more Holders of Exchange Shares that are Resale
Securities (such Holder or Holders, the "Initiating Note Holders") requesting
that the Company effect the disposition of such Exchange Shares on the Resale
Registration Statement by means of an Underwritten Offering, the Company will
cooperate with the Initiating Note Holders to facilitate an Underwritten
Offering; provided, however, that the Company shall not be obligated to:
(i) effect more than an aggregate of two (2) demand Underwritten
Offerings pursuant to this Section 4(b) or more than one demand
Underwritten Offering pursuant to this Section 4(b) in any twelve
(12) month period; or
(ii) effect a demand Underwritten Offering in accordance with this
Section 4(b) unless the Resale Securities for which a demand
Underwritten Offering is made pursuant to this Section 4(b)
constitute at least three million (3,000,000) shares of Common
Stock.
(c) Spin-Off Notes and Spin-Off Warrants. In the event of a Spin-Off
as contemplated by Section 3(c) hereof, subject to an appropriate provision
substantially equivalent
14
to Section 9(a) hereof, upon the written request of (x) one or more holders of
Spin-Off Warrants (such holder or holders, the "Initiating Spin-Off Warrant
Holders") or (y) one or more holders of Spin-Off Notes (such holder or holders,
the "Initiating Spin-Off Note Holders"), requesting that the Company effect the
disposition of the shares of common stock issuable (I) upon the exercise of such
Spin-Off Warrants and/or (II) upon the exchange of such Spin-Off Notes,
respectively, on a resale registration statement by means of an Underwritten
Offering, the Company shall cause the Spin-Off Company to cooperate with such
Initiating Spin-Off Warrant Holders and/or Spin-Off Note Holders, as the case
may be, to facilitate such Underwritten Offering; provided, however, that the
Spin-Off Company shall not be obligated to:
(i) effect (x) more than an aggregate of four (4) demand Underwritten
Offerings pursuant to this Section 4(c), of which the Holders of
Spin-Off Warrants and the Holders of the Spin-Off Notes shall each
be entitled to two (2) of such demand Underwritten Offerings, or
(y) more than one demand Underwritten Offering for the holders of
Spin-Off Warrants and one demand Underwritten Offering for the
holders of Spin-Off Notes pursuant to this Section 4(c) in any
twelve (12) month period; or
(ii) effect a demand Underwritten Offering pursuant to this Section
4(c) unless such demand Underwritten Offering covering the offer
and sale of common stock of the Spin-Off Company for the account
of such Holders to the public will result in gross proceeds of not
less than thirty million US dollars (US$30,000,000), before
deducting underwriting commissions.
The mechanics and other aspects of any such underwritten offering shall be as
described in paragraphs (d) through (k) below with appropriate adjustments to
reflect that the rights and responsibilities of the Company described in such
paragraphs shall, in the case of an Underwritten Offering pursuant to this
Section 4(c), be rights and responsibilities of the Spin-Off Company and rights
and responsibilities of Holders shall be rights and responsibilities of Spin-Off
Warrant Holders and Spin-Off Note Holders.
(d) Notices. Each such written request delivered by the Initiating
Warrant Holders and/or Initiating Note Holders, as the case may be, shall set
forth (i) the proposed timing of such Underwritten Offering, (ii) the number of
Resale Securities to be offered and (iii) any other material information
concerning such Holders relevant to a proposed Underwritten Offering, including
such information reasonably necessary for the preparation of any required
supplement to a Prospectus.
(e) Adjustments. The number and kind of shares in Section
4(a)(ii)(A) and Section 4(b)(ii) above and the share prices referred to in
Section 4(a)(ii)(B) shall be appropriately adjusted for any stock dividend,
stock split, reverse stock split, combination, recapitalization,
reclassification, exchange or similar transaction with respect to the shares of
Common Stock.
15
(f) Non-Initiating Holders. Upon receipt of written notice from (i)
one or more Initiating Warrant Holders to effectuate an Underwritten Offering
pursuant to Section 4(a) or (ii) one or more Initiating Note Holders to
effectuate an Underwritten Offering pursuant to Section 4(b), the Company shall
promptly give written notice of such request to all other Holders of Warrant
Shares and Exchange Shares. Subject to the cutback provisions in Section 4(i)
hereof, the Company shall include in such Underwritten Offering all such Warrant
Shares and Exchange Shares requested to be included by such of the other Holders
who shall make such request by written notice to the Company delivered within
ten (10) days of their receipt of the Company's notice. If the Company shall
receive a request for inclusion in the Underwritten Offering of the Warrant
Shares and Exchange Shares of other Holders, it shall promptly so inform the
Initiating Warrant Holders and/or Initiating Note Holders, as the case may case.
(g) Revocation of Demand. The Initiating Warrant Holders and/or
Initiating Note Holders, as the case may be, may, at any time prior to the
consummation of such Underwritten Offering, revoke such request by providing a
written notice to the Company and the underwriters, if any, revoking such
request; provided, however, that the Holder or Holders revoking such request for
an Underwritten Offering, at their option, may elect to either (i) pay all
reasonable expenses of the Company incurred with respect to such revoked request
or (ii) have such revoked request deemed a consummated Underwritten Offering for
purposes of this Section 4.
(h) Piggyback Rights of the Company. If at any time the Company is
required to effect an Underwritten Offering in accordance with this Section 4,
the Company shall have the right, but not the obligation, to distribute its
securities (whether equity, debt or otherwise) in connection with such
Underwritten Offering by advising the Initiating Warrant Holders and/or
Initiating Note Holders, as the case may be, in writing within ten (10) days
after the date of receipt of a demand notice from such Initiating Warrant
Holders and/or Initiating Note Holders, as the case may be (which notice shall
set forth the amount and kind of securities to be distributed by the Company
pursuant to such Underwritten Offering), and the Company shall be permitted to
include in such Underwritten Offering all securities it has so advised will be
included therein.
(i) Cutbacks. If the managing underwriter or underwriters of any
proposed Underwritten Offering advise the Company in writing that the total
amount or kind of securities which the Holders of Warrant Shares, the Holders of
Exchange Shares, the Company and any other persons requesting registration of
securities pursuant to rights similar to the rights of Holders under Section 5
(such other persons, "Other Holders") intended to be included in such
Underwritten Offering is sufficiently large to materially adversely affect the
success of such Underwritten Offering, then the amount or kind of securities to
be offered for the accounts of the Holders of Warrant Shares, the Holders of
Exchange Shares, the Company and the Other Holders shall be reduced to the
extent necessary to reduce the total amount or kind of securities to be included
in such Underwritten Offering to the amount or kind recommended by such managing
underwriter or underwriters as follows:
o first, pro rata from all Other Holders;
o second, from the Company;
16
o third, pro rata, from all Note Holders requesting registration, in
the case of an Underwritten Offering requested by Initiating
Warrant Holders, or from all Warrant Holders requesting
registration, in the case of an Underwritten Offering requested by
Initiating Note Holders; and
o fourth, pro rata, from all Warrant Holders requesting
registration, in the case of an Underwritten Offering requested by
Initiating Warrant Holders, or from all Note Holders requesting
registration, in the case of an Underwritten Offering requested by
Initiating Note Holders;
provided, however, that if both Warrant Holders and Note Holders exercise a
demand for an Underwritten Offering in any one twelve (12) month period, then in
the second such demand Underwritten Offering, the securities that the Company
has requested to be included in such Underwritten Offering shall be cut-back pro
rata with the Warrant Holders, in the case of an Underwritten Offering requested
by Initiating Warrant Holders, and pro rata with the Note Holders, in the case
of an Underwritten Offering requested by Initiating Note Holders, but otherwise
the order of cut-back shall remain the same.
(j) Calculation of Demand Offerings.
(i) If (x) a demand Underwritten Offering is made at the
request of Initiating Warrant Holders, (y) Note Holders participate in the
Underwritten Offering and (z) at least three million (3,000,000) Exchange Shares
(adjusted as provided in Section 4(e) hereof) are offered and sold in the
Underwritten Offering, the Underwritten Offering shall count as one of the
demand Underwritten Offerings of the Warrant Holders under Section 4(a) hereof.
If (x) a demand Underwritten Offering is made at the request of Initiating Note
Holders, (y) Warrant Holders participate in the Underwritten Offering and (z) at
least three million (3,000,000) Warrant Shares (adjusted as provided in Section
4(e) hereof) are offered and sold in the Underwritten Offering, the Underwritten
Offering shall count as one of the demand Underwritten Offerings of the Note
Holders under Section 4(b).
(ii) If, as a result of the implementation of the proviso to
Section 4(i) hereof, the Warrant Holders, in the case of an Underwritten
Offering requested by Initiating Warrant Holders, or the Note Holders, in the
case of an Underwritten Offering requested by Initiating Note Holders, are able
to offer and sell less than three million (3,000,000) shares of Common Stock
(adjusted as provided in Section 4(e) hereof), the Warrant Holders or the Note
Holders, as the case may be, shall be entitled to one demand Underwritten
Offering in addition to those to which they are otherwise entitled hereunder.
(iii) If Warrant Holders participate in an Underwritten
Offering of the Company pursuant to Section 5 hereof in which at least three
million (3,000,000) Warrant Shares (adjusted as provided in Section 4(e) hereof)
are offered and sold, the number of demand Underwritten Offerings to which the
Warrant Holders are entitled under Section 4(a) hereof shall be reduced by one.
If Note Holders participate in an Underwritten Offering of the Company pursuant
to Section 5 hereof in which at least three million (3,000,000) Exchange Shares
(adjusted as provided in Section 4(e) hereof) are offered and sold, the number
of demand
17
Underwritten Offerings to which the Note Holders are entitled under Section 4(b)
hereof shall be reduced by one.
(k) Road Shows. The Company agrees to use its reasonable best
efforts to cooperate in a marketing effort in respect of any Underwritten
Offering, including participation in a "road show" with appropriate senior
management, to assist the Holders in selling the Resale Securities intended to
be sold in such offering.
SECTION 5. Piggyback Registration.
(a) If the Company at any time proposes to file a registration
statement for an Underwritten Offering with respect to any class of equity
securities, whether for its own account or the account of a holder of securities
of the Company pursuant to registration rights granted by the Company (a
"Requesting Securityholder"), and (i) the Registration Statement relating to
such Underwritten Offering was not filed as a registration statement pursuant to
Section 3 hereof or (ii) such Underwritten Offering is not effected as a draw
down off of a registration statement providing for sale on a continuous or
delayed basis pursuant to Rule 415, then the Company shall in each case give
written notice of such proposed filing to all Holders of Warrant Shares and
Exchange Shares at least fifteen (15) days before the anticipated filing date of
any such registration statement by the Company, and such notice shall offer to
all Holders the opportunity to have any or all of the Warrant Shares and/or
Exchange Shares held by such Holders included in such registration statement.
(b) Each Holder of Warrant Shares and/or Exchange Shares desiring to
have such shares registered under this Section 5 shall so advise the Company in
writing within ten (10) days after the date of receipt of such notice (which
request shall set forth the amount of shares for which registration is
requested), and the Company shall include in such Registration Statement all
such Warrant Shares and/or Exchange Shares so requested to be included therein.
Any Holder shall be entitled to revoke its request for inclusion in the
Registration Statement not later than five (5) Business Days prior to the date
contemplated by the managing underwriters for the pricing of the related
Underwritten Offering.
(c) Notwithstanding the foregoing, if the managing underwriter or
underwriters of any such proposed public offering advises the Company in writing
that the total amount or kind of securities which the Holders of Warrant Shares
and/or Exchange Shares, the Company and any other persons intended to be
included in such proposed public offering is sufficiently large to materially
adversely affect the success of such proposed public offering, then the amount
or kind of securities to be offered in the Underwritten Offering shall be
reduced as follows:
o first, pro rata from all the Holders and all Other Holders; and
o second, from the Company and the Requesting Securityholders, if
any, as determined in the instrument providing for the rights of
the Requesting Securityholders to registration.
18
SECTION 6. Registration Procedures Generally. In connection with the
registration obligations of the Company under Section 3 and any registered
offering in which the Holders participate under Section 5 hereof, to the extent
applicable, the Company shall:
(a) Before filing an initial Registration Statement with the SEC,
furnish to Designated Counsel and the underwriters, if any, at least five (5)
Business Days prior to any filing, copies of all such documents proposed to be
filed and reflect in each such document when so filed with the SEC such comments
as Designated Counsel and the underwriters, if any, may reasonably propose.
(b) Before the filing of any amendment to any Registration
Statement, any Prospectus or any supplement to any Prospectus, afford Designated
Counsel and the underwriters, if any, such advance notice as shall be reasonable
in the circumstances in order to allow Designated Counsel and the underwriters,
if any, the opportunity to participate in the preparation thereof and to comment
thereon.
(c) Prepare and file with the SEC such amendments and post-effective
amendments to any Registration Statement as may be necessary to keep such
Registration Statement continuously effective for the applicable effectiveness
period specified in Section 3(b); cause the related Prospectus to be
supplemented by any required Prospectus supplement, and as so supplemented to be
filed pursuant to Rule 424 (or any similar provisions then in force) under the
Securities Act; and use reasonable best efforts to comply with the provisions of
the Securities Act applicable to it with respect to the disposition of all
securities covered by such Registration Statement during the applicable
Effectiveness Period in accordance with the intended methods of disposition set
forth in such Registration Statement as so amended or such Prospectus as so
supplemented.
(d) Use reasonable best efforts to obtain the withdrawal of any
order suspending the effectiveness of a Registration Statement or the lifting of
any suspension of the qualification (or exemption from qualification) of any of
the Registrable Securities for sale in any jurisdiction in which they have been
qualified for sale, in either case at the earliest possible moment or, if a
Deferral Event is in effect, at the earliest possible moment after the Deferral
Event.
(e) Comply with all applicable rules and regulations of the SEC and
make generally available to the Company's securityholders earning statements
(which need not be audited) satisfying the provisions of Section 11(a) of the
Securities Act and Rule 158 thereunder (or any similar rule promulgated under
the Securities Act) no later than ninety (90) days after the end of the first
12-month period constituting a fiscal year commencing on the first day of the
first fiscal quarter of the first fiscal year of the Company commencing after
the effective date of a Registration Statement, which statements shall cover
said 12-month periods.
19
(f) Subject to the rights of the Company pursuant to Section 9(b)
hereof, upon the occurrence of a Deferral Event or any other event as a result
of which the Prospectus, Prospectus supplement, Registration Statement or
post-effective amendment to a Registration Statement includes an 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 (such
an event, a "Material Event"), as promptly as practicable prepare and file a
post-effective amendment to any Registration Statement effective at the time or
a supplement to the related Prospectus or any document incorporated therein by
reference or file any other required document that would be incorporated by
reference into such Registration Statement and Prospectus, so that there is no
longer a Deferral Event or occurrence of a Material Event, to the extent
applicable, and, in the case of a post-effective amendment to a Registration
Statement, use reasonable best efforts to cause such post-effective amendment to
be declared effective as promptly as is practicable.
(g) Upon the issuance by the SEC of a stop order suspending the
effectiveness of a Registration Statement, take all action reasonable in the
circumstances to obtain removal of the suspension as promptly as practicable.
(h) Furnish to Designated Counsel and each managing underwriter, if
applicable, copies of notices of effectiveness and other notices and
correspondence with the SEC concerning the Registration Statement or Prospectus,
as the case may be.
(i) Furnish to Designated Counsel, the Designated Holders and, upon
written request, to any Holder, a copy of each Registration Statement and
exhibits, and amendments or supplements thereto, as may be filed with the SEC,
in conformity with the requirements of the Securities Act, and such other
documents that are not confidential as such person may reasonably request in
order to facilitate the disposition of Registrable Securities owned by such
Holder.
(j) Furnish to the Holders and each managing underwriter, if
applicable, copies of stop orders, and, after a withdrawal of a stop order,
provide prompt notice to each Holder of such withdrawal.
(k) List the Warrant Shares and the Exchange Shares on each national
securities exchange or interdealer quotation system on which the Common Stock is
then listed or quoted for trading.
SECTION 7. Resale Registration.
(a) At the time the Resale Registration Statement is declared
effective, each Holder that became a Notice Holder on or prior to the date that
is five (5) Business Days prior to such time of effectiveness shall be named as
a selling securityholder in the Resale Registration Statement and the related
Prospectus, in such a manner as to permit such Holder to deliver the Prospectus
to purchasers of Resale Securities in accordance with applicable law. None of
the Company's securityholders (other than the Holders of Resale Securities)
shall have the right to include any of the Company's securities in any such
Resale Registration Statement referred to in this Agreement.
20
(b) If a Holder of Resale Shares that has not become a Notice Holder
as provided in Section 7(a) desires at any time to become a selling
securityholder under the Resale Registration Statement, such Holder shall
deliver to the Company a Notice and Questionnaire, and thereafter the Company
shall as promptly as reasonably practicable:
(i) if required by applicable law, file with the SEC a post-effective
amendment to the Resale Registration Statement or prepare and/or
file a supplement to the related Prospectus or a supplement or
amendment to any document incorporated by reference therein or
file any other document required by the SEC so that the Holder is
named as a selling securityholder in such Registration Statement
and the related Prospectus in such a manner as to permit such
Holder to deliver such Prospectus to purchasers of the Resale
Securities in accordance with applicable law and, if the Company
shall file a post-effective amendment to a Registration Statement,
use reasonable best efforts to cause such post-effective amendment
to be declared effective under the Securities Act as promptly as
reasonably practicable; and
(ii) notify Designated Counsel and the underwriters, if any, as
promptly as reasonably practicable after the effectiveness under
the Securities Act of any post-effective amendment filed pursuant
to this Section 7(b);
provided, however, that if a Notice and Questionnaire is delivered during a
Deferral Event, the Company shall so inform the Holder delivering such Notice
and Questionnaire and shall take the actions set forth in clauses (i) and (ii)
above upon expiration of the Deferral Event.
SECTION 8. Resale Registration Procedures.
In connection with the registration obligations of the Company under
Section 7 hereof, to the extent applicable, the Company shall:
(a) As promptly as practicable, give notice to Designated Counsel,
the Designated Holders and any managing underwriter:
(i) when any Prospectus, Prospectus supplement, Registration Statement
or post-effective amendment to a Registration Statement has been
filed with the SEC and, with respect to a Registration Statement
or any post-effective amendment, when the same has been declared
effective;
(ii) of any request, following the effectiveness of a Registration
Statement by the SEC or any other federal or state governmental
authority for amendments or supplements to such Registration
Statement or related Prospectus or for additional information;
(iii) of the issuance by the SEC or any other federal or state
governmental authority of any stop order suspending the
effectiveness of a Registration Statement or the initiation of any
proceedings for that purpose;
21
(iv) of the receipt by the Company of any notification with respect to
the suspension of the qualification or exemption from
qualification of any of the Resale Securities for sale in any
jurisdiction or the initiation of any proceeding for such purpose;
(v) in the case of an Underwritten Offering, if at any time the
representations and warranties of the Company contemplated by
Section 8(f)(i) cease to be true and correct as of any time they
are required to be true and correct;
(vi) of the occurrence of (but not the nature of or details concerning)
(A) a Deferral Event or (B) a Material Event; provided, however,
that no notice by the Company shall be required pursuant to this
clause (vi) in the event that the Company either (I) promptly
files a Prospectus supplement to update the Prospectus or (II)
files a Form 8-K or other appropriate Exchange Act report that is
incorporated by reference into the Registration Statement, which,
in either case, contains the requisite information with respect to
such Deferral Event or Material Event, as the case may be, so that
the use of the Resale Registration Statement is not required to be
suspended; and
(vii) of the determination by the Company that a post-effective
amendment to a Registration Statement will be filed with the SEC.
(b) If reasonably requested by the managing underwriter or
underwriters, if any, or any Notice Holder, as promptly as reasonably
practicable, incorporate in a Prospectus supplement or post-effective amendment
to a Registration Statement on which such Notice Holders' Resale Securities are
registered, such information as such managing underwriter or underwriters, if
any, and/or any Notice Holder (on the basis of an opinion of
nationally-recognized counsel experienced in such matters) shall determine to be
required to be included therein by applicable law and including, without
limitation, information with respect to the aggregate number of shares of Resale
Securities being sold to such underwriters, the purchase price being paid
therefor by such underwriters and with respect to any other terms of the
Underwritten Offering or the Resale Securities to be sold in such offering, if
applicable, and make any required filings of such Prospectus supplement or such
post-effective amendment; provided, that the Company shall not be required to
take any actions under this Section 8(b) that are not, in the reasonable opinion
of counsel for the Company, in compliance with applicable law.
(c) The Company will not file any Registration Statement or
amendment thereto or any Prospectus or any supplement thereto (including such
documents incorporated by reference and proposed to be filed under the initial
filing of the Registration Statement) to which the managing underwriters of any
Underwritten Offering, if any, or Designated Counsel, shall reasonably object;
provided that the Company may file such documents in a form required by law or
upon the reasonable advice of its counsel.
22
(d) As promptly as reasonably practicable, furnish without charge to
Designated Counsel and each managing underwriter, if any, and such underwriters'
respective counsel, and upon prior written request (which, in the present
instance, shall include telephonic requests confirmed via electronic mail) to
each Notice Holder, at least one (1) conformed copy of the Registration
Statement in which such Notice Holder's Resale Securities are registered, and
any amendment thereto, including financial statements, but excluding schedules,
all documents incorporated or deemed to be incorporated therein by reference and
all exhibits (unless specifically requested in writing).
(e) During the Resale Effectiveness Period, deliver to each Notice
Holder in connection with any sale of Resale Securities pursuant to a
Registration Statement and each underwriter, if any, without charge, as many
copies of the Prospectus or Prospectuses pursuant to which such Notice Holder's
Resale Securities are being offered, and any amendment or supplement thereto, as
such Notice Holder may reasonably request in writing; and the Company hereby
consents (except during such periods that a Deferral Notice is outstanding and
has not been revoked) to the use of such Prospectus and each amendment or
supplement thereto by each Notice Holder in connection with any offering and
sale of the Resale Securities covered by such Prospectus or any amendment or
supplement thereto in the manner set forth therein.
(f) In the case of any Underwritten Offering initiated in accordance
with Section 4(a) and/or Section 4(b) hereof or in any registered offering in
which Holders participate under Section 5 hereof, enter into an underwriting
agreement and take all such other actions in connection therewith in order to
expedite and facilitate the disposition of such Resale Securities, in each case
as are reasonable and customary, and in connection therewith (at each closing
under such underwriting or similar agreement):
(i) make such representations and warranties to the Holders of such
Resale Securities and the underwriters in form, substance and
scope as are customarily made by issuers to underwriters in
secondary underwritten offerings;
(ii) obtain opinions of counsel to the Company and updates thereof
(which counsel and opinions (in form, scope and substance) shall
be reasonably satisfactory to the underwriters and the Designated
Holder(s) of such Resale Securities and shall cover the matters
customarily covered in opinions requested in secondary
underwritten offerings and such other matters as may be reasonably
requested by such Holders and underwriters);
(iii) obtain "cold comfort" letters and updates thereof from the
independent certified public accountants of the Company addressed,
if permitted by applicable accounting standards, to the selling
Holder(s) of such Resale Securities (provided that the selling
Holder(s) provide such letters of representation to the
accountants as are requested by the accountants in order to
prepare the "cold comfort" letters and as are acceptable in form
and substance to such accountants) and the underwriters, such
letters to be in customary form and covering matters of the type
customarily covered in "cold comfort" letters in connection with
secondary underwritten offerings;
23
(iv) the underwriting agreement shall set forth indemnification
provisions reasonable and customary for underwritten offerings
similar to the Underwritten Offerings contemplated by this
Agreement; and
(v) the Company shall deliver such documents and certificates as may
be reasonably requested by the Designated Holder(s) of such Resale
Securities and the managing underwriters to evidence compliance
with clause (i) above and with any customary conditions contained
in the underwriting agreement or other agreement entered into by
the Company in respect of the relevant offering.
(g) Use reasonable best efforts to register or qualify or cooperate
with the Notice Holders, the underwriters, if any, and their respective counsel
in connection with the registration or qualification (or exemption from such
registration or qualification) of such Resale Securities for offer and sale
under the securities or blue sky laws of such jurisdictions within the United
States as any Notice Holder or underwriter reasonably requests in writing (which
written request, in the case of any Notice Holder, may be included in the Notice
and Questionnaire), it being agreed that no such registration or qualification
will be made unless so requested; prior to any public offering of the Resale
Securities pursuant to a Registration Statement, use reasonable efforts to keep
each such registration or qualification (or exemption therefrom) effective
during the Resale Effectiveness Period, to the extent applicable, in connection
with such Notice Holder's offer and sale of Resale Securities pursuant to such
registration or qualification (or exemption therefrom) and do any and all other
acts or things reasonably necessary to enable the disposition in such
jurisdictions of such Resale Securities in the manner set forth in the relevant
Registration Statement and the related Prospectus; provided, that the Company
will not be required to:
(i) qualify as a foreign corporation or as a dealer in securities in
any jurisdiction where the Company is not otherwise qualified but
for this Agreement;
(ii) take any action that would subject the Company to general service
of process in suits in any such jurisdiction where it is not then
so subject; or
(iii) subject the Company to taxation in any such jurisdiction where it
is not then so subject.
(h) Promptly inform each Notice Holder, Designated Counsel and the
underwriters, if any, of:
(i) the issuance by the SEC of a stop order suspending the
effectiveness of a Registration Statement or the initiation of
proceedings with respect to a Registration Statement under Section
8(d) or 8(e) of the Securities Act;
(ii) the occurrence of a Material Event; or
(iii) the occurrence of any Deferral Event (as provided in Section 9(b)
hereof):
and give notice to the Notice Holders, Designated Counsel and the underwriters,
if any, that the availability of the Resale Registration Statement has been
suspended. Each Notice Holder agrees
24
not to sell any Resale Securities pursuant to such Registration Statement until
such Notice Holder is advised in writing by the Company that the Prospectus may
be used, and has received copies of any additional or supplemental filings that
are incorporated or deemed incorporated by reference in such Prospectus. If so
directed by the Company, each Notice Holder will deliver to the Company (at the
Company's expense) all copies, other than permanent file copies, then in such
Notice Holder's possession, of the Registration Statement or the related
Prospectus current at the time of receipt by such Notice Holder of any such
notice. In addition, the Company shall make all reasonable best efforts to
resume the use of the Registration Statement and the included Prospectus, and to
so notify the Notice Holders, as promptly as practicable after such notice.
(i) If reasonably requested in writing in connection with the
disposition of Resale Securities pursuant to the Resale Registration Statement,
make reasonably available for inspection during normal business hours by
Designated Counsel or other representatives for the Notice Holders designated by
the Designated Warrant Holder (or the Designated Note Holder if only Exchange
Shares are being sold), any underwriter participating in any disposition of such
securities, and any attorney or accountant retained by the underwriters, if any,
all relevant financial and other records, pertinent corporate documents and
properties of the Company and its subsidiaries, and cause the appropriate
executive officers, directors and designated employees of the Company and its
subsidiaries to make reasonably available for inspection during normal business
hours all relevant information reasonably requested by such representatives for
the Notice Holders, underwriter (if any), attorney or accountant, in each case
as is customary for similar "due diligence" examinations.
Any such representative of the Notice Holders, including,
but not limited to, the Designated Counsel or other attorney (or, if as a matter
of policy such Designated Counsel or attorney cannot agree in writing to keep
such designated information confidential, the respective Designated Holder on
behalf of such Designated Counsel or attorney), underwriter (if any) or
accountant shall be required to first agree in writing with the Company that any
information that is reasonably designated by the Company as confidential at the
time of delivery of such information shall be kept confidential by such persons
and shall be used solely for the purposes of exercising rights under this
Agreement and such person shall comply with applicable securities laws, unless
and to the extent:
(i) disclosure of such information is required by court or
administrative order or is necessary to respond to inquiries of
regulatory authorities;
(ii) disclosure of such information is required by law (including any
disclosure requirements pursuant to federal securities laws in
connection with the filing of any Registration Statement or the
use of any Prospectus referred to in this Agreement);
(iii) such information becomes generally available to the public other
than as a result of a disclosure or failure to safeguard by any
such person; or
(iv) such information becomes available to any such person from a
source other than the Company and such source is not known by such
representative to be bound by a confidentiality agreement.
25
(j) Cooperate with each Notice Holder and the managing underwriter,
if any, to facilitate the timely preparation and delivery of certificates
representing Resale Securities sold pursuant to a Registration Statement, and
cause such Resale Securities to be in such denominations and registered in such
names as such Notice Holder, or in the case of an Underwritten Offering, as such
managing underwriters, may request in writing at least two (2) Business Days
prior to any sale of such Registrable Securities or, if such Registrable
Securities are determined to be eligible for trading under the terms of trading
established by The Depository Trust Company ("DTC"), use its reasonable best
efforts to do all things necessary, including, without limitation, providing
CUSIP numbers for the Registrable Securities and all other letters and
documentation required by DTC, in order to make such Registrable Securities
eligible to trade within DTC.
(k) Make reasonable efforts to provide such information as any
Notice Holder or underwriter, if any, shall require in respect of any filings
required to be made with the NASD.
(l) Enter into such customary agreements and take all such other
actions necessary or reasonably desirable in connection therewith in order to
expedite or facilitate disposition of such Resale Securities.
SECTION 9. Holdback Agreements.
(a) Hold-Back Election. Subject to Section 9(c) below, in the case
of the registration of any Underwritten Offering initiated by the Company or any
Requesting Securityholder (other than (I) any registration by the Company on
Form S-4 or Form S-8 (or any successor or substantially similar form), or of (A)
an employee stock option, stock purchase or compensation plan or of securities
issued or issuable pursuant to any such plan, or (B) a dividend reinvestment
plan or (II) any Underwritten Offering initiated at the request of the
Initiating Warrant Holders or Initiating Note Holders), each Holder agrees, if
and to the extent requested in writing by the managing underwriter or
underwriters administering such offering as promptly as reasonably practicable
prior to the commencement of the seven (7) day period referred to below (a
"Hold-Back Election"), not to effect any public sale or distribution of
securities of the Company except as part of such underwritten registration,
during the period beginning seven (7) days prior to the closing date of such
underwritten offering and ending on the earlier of (i) ninety (90) days after
such closing date and (ii) the date such sale or distribution is permitted by
such managing underwriter or underwriters; provided, however, that the volume
limitations of the preceding proviso shall not apply to any Holder who, together
with its Affiliates and any person with whom it is acting together as
contemplated by subparagraph (e)(3)(vi) of Rule 144, holds securities that
constitute (on a Common Stock equivalent basis) less than 2% of the Common Stock
then outstanding. Notwithstanding the foregoing provisions of this Section 9(a),
no Holder shall be obligated to refrain from making any public sale or
distribution of securities of the Company in the case of any underwritten
secondary offering initiated at the request of any person who has not agreed in
writing to expressly recognize and give effect to the Holders' rights under the
documentation governing such underwritten secondary offering similar to those
under this Section 9(a) (whether or not the related documentation makes specific
references to this Section 9(a)) and to be subject to provisions that are at
least as favorable to the Holders as the provisions contained in this Section
9(a) are to such holder.
26
(b) Deferral Event. Subject to Section 9(c) below, the Company shall
be entitled, for a period of time not to exceed forty five (45) consecutive
days, to postpone the filing of any Registration Statement otherwise required to
be prepared and filed by it pursuant to Section 3 and/or to request that the
Holders refrain from effecting any public sales or distributions of their
Registrable Securities if (each such event referred to in clauses (i), (ii) and
(iii) of this Section 9(b) below, a "Deferral Event"):
(i) the board of directors of the Company determines in its reasonable
good faith business judgment that such registration and/or such
public sales or distributions would have a material adverse effect
on the business, assets, condition (financial or otherwise),
results of operations or prospects of the Company; or
(ii) the board of directors of the Company determines that the
premature disclosure of a material event at such time would have a
material adverse effect on the business, assets, condition
(financial or otherwise), results of operations or prospects of
the Company; or
(iii) the disclosure otherwise relates to a material business
transaction which has not been publicly disclosed and the board of
directors of the Company determines that any such disclosure would
jeopardize the success of such transaction.
The board of directors of the Company shall, as promptly as practicable, give
the Holders written notice of any such Deferral Event. In the event of a
determination by the board of directors to postpone the filing of a Registration
Statement required to be filed under Section 3 hereof, the Company shall be
required to file such Registration Statement as soon as reasonably possible
after the board of directors of the Company shall determine, in its reasonable
business judgment, that the filing of such registration statement and the
offering thereunder shall not interfere with the aforesaid material transaction
or development, but in any event no later than the end of such 45-day period. In
addition, if the board of directors of the Company has requested that the
Holders refrain from making public sales or distributions of their Registrable
Securities, such board shall, as promptly as practicable following its
determination that the Holders may recommence such public sales and
distributions, notify such Holders in writing of such determination (but in any
event no later than the end of such 45-day period).
27
(c) Company Hold-Back. In the case of any Underwritten Offering of
Resale Securities pursuant to Section 4 hereof, the Company agrees, if and to
the extent requested in writing by the managing underwriter or underwriters
administering such offering, not to effect any public sale or distribution
(other than sales pursuant to the same Registration Statement, as and to the
extent permitted under this Agreement, or any registration on Form S-8 or S-4
(or any successor or substantially similar form) of (A) an employee stock
option, stock purchase or compensation plan or of securities issued or issuable
pursuant to any such plan, (B) securities proposed to be issued in exchange for
securities or assets of, or in connection with a merger, combination or
consolidation with, another corporation, or (C) a dividend reinvestment plan) of
any securities of the Company during the period beginning seven (7) days prior
to the closing date of each such Underwritten Offering and ending on the earlier
of (i) ninety (90) days after such closing date and (ii) the date such sale or
distribution is permitted by such managing underwriter or underwriters. Any
agreement entered into after the date of this Agreement pursuant to which the
Company issues or agrees to register any privately placed securities similar to
the registration of the Resale Securities shall contain a provision under which
holders of such securities agree not to effect any public sale or distribution
of any such securities during the period described in the next preceding
sentence; provided, however, that the volume limitations of this sentence shall
not apply to any holder who, together with its Affiliates and any person with
whom it is acting together as contemplated by subparagraph (e)(3)(vi) of Rule
144, holds securities that constitute (on a Common Stock equivalent basis) less
than 2% of the Common Stock then outstanding; provided further that the
limitations shall be no more restrictive to the holders of such privately placed
securities than analogous terms of this Agreement with respect to the Holders of
Resale Securities.
(d) Certain Limitations.
(i) In no event shall the restrictions under Section 9(a),
pursuant to one or more underwritten offerings, remain in effect for more than
ninety (90) days in the aggregate in any consecutive twelve (12) month period.
(ii) In no event shall the restrictions under Section 9(b),
pursuant to one or more Deferral Events, remain in effect for more than ninety
(90) days in the aggregate in any consecutive twelve (12) month period.
(iii) In no event shall the restrictions under Section 9(a)
and Section 9(b), pursuant to one or more Hold-Back Elections or Deferral
Events, remain in effect for more than one hundred twenty (120) days, in the
aggregate, in any consecutive twelve (12) month period.
(iv) In no event shall the restrictions under Section 9(c)
pursuant to one or more Underwritten Offerings, remain in effect for more than
one hundred eighty (180) days, in the aggregate, in any consecutive twelve (12)
month period.
28
SECTION 10. Holders Obligations.
(a) Each Holder of Resale Securities agrees, by acquisition of the
Resale Securities, that such Holder shall not be entitled to sell any of such
Resale Securities pursuant to a Resale Registration Statement or to receive a
Prospectus relating thereto, unless such Holder has previously delivered to the
Company a completed and accurate copy of a Notice and Questionnaire (including
the information required to be included in such Notice and Questionnaire) and
the information set forth in the next subsection.
(b) Each Notice Holder further agrees promptly to furnish to the
Company all information required to be disclosed in order to make the
information previously furnished to the Company (including any information
provided in a Notice and Questionnaire) not misleading and any other information
regarding such Notice Holder and the distribution of such Registrable Securities
as may be required to be disclosed in the Registration Statement under
applicable law or pursuant to SEC comments, if any.
(c) Each Holder further agrees to notify the Company within ten (10)
Business Days of a written request received by such Holder from the Company, of
the amount of Registrable Securities sold pursuant to the Registration Statement
and, in the absence of a response, the Company may assume that all of the
Holder's Registrable Securities were so sold.
SECTION 11. Registration Expenses. The Company shall bear all fees and
expenses incurred in connection with the performance by the Company of its
obligations under this Agreement whether or not any Registration Statement is
declared effective. Such fees and expenses shall include, without limitation:
(i) all registration and filing fees (including, without limitation,
fees and expenses (x) with respect to filings required to be made
with the NASD and (y) of compliance with federal and state
securities or blue sky laws to the extent such filings or
compliance are required pursuant to this Agreement (including,
without limitation, reasonable fees and disbursements of the
counsel specified in clause (iv) below in connection with blue sky
qualifications of the Resale Securities under the laws of such
jurisdictions as the Designated Warrant Holder (or the Designated
Note Holder if only Exchange Shares are being offered and sold)
may designate));
(ii) printing expenses;
(iii) duplication expenses relating to copies of any Registration
Statement or Prospectus delivered to any Holders hereunder; and
(iv) fees and disbursements of counsel for the Company in connection
with the preparation and filing of each Registration Statement.
In addition, the Company shall pay the internal expenses of the Company
(including, without limitation, all salaries and expenses of officers and
employees performing legal or accounting duties), the expense of any annual
audit, the fees and expenses incurred in connection with the listing of the
Registrable Securities on the New York Stock Exchange or any securities exchange
29
on which the same securities of the Company are then listed and the fees and
expenses of any person, including special experts, retained by the Company.
Notwithstanding anything contained herein to the contrary, Registration Expenses
shall not include any underwriting discounts, commissions or fees attributable
to the sale of the Registrable Securities.
SECTION 12. Indemnification; Contribution.
(a) Indemnification by the Company. The Company agrees to indemnify
and hold harmless each Holder of Resale Securities and each officer and director
of, and each other person, if any, who controls, any Holder of Resale Securities
within the meaning of either Section 15 of the Securities Act or Section 20 of
the Exchange Act against any and all loss, liability, claim, damage and expense
whatsoever, including, without limitation, costs of investigating, preparing to
defend and defending (collectively, "Indemnifiable Losses"), as incurred,
arising out of any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement (or any amendment thereto), or the
omission or alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading or arising
out of any untrue statement or alleged untrue statement of a material fact
included in any preliminary prospectus or the Prospectus (or any amendment or
supplement thereto), or the omission or alleged omission therefrom of a material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided, however,
that this indemnity shall not apply to Indemnifiable Losses to the extent
arising out of any untrue statement or omission or alleged untrue statement or
omission made in reliance upon and in conformity with written information
furnished to the Company by such Holder of Resale Securities (which also
acknowledges the indemnity provisions herein), or any person, if any, who
controls any such Holder of Resale Securities, expressly for use in a
Registration Statement (or any amendment thereto), or any preliminary prospectus
or the Prospectus (or any amendment or supplement thereto); provided, further,
that this indemnity shall not apply to any Indemnifiable Losses (1) arising from
an offer or sale of Resale Securities occurring during the period in which a
Holder was notified and instructed by the Company not to sell due to a Deferral
Event or Material Event or such other event as would legally require a Holder
not to sell (including, but not limited to, the issuance of any stop order or
the initiation of any proceedings by the SEC), or (2) if the Holder fails to
deliver at or prior to the written confirmation of sale, if legally required to
do so, the most recent Prospectus, as amended or supplemented, and such
Prospectus, as amended or supplemented, would have corrected such untrue
statement or omission or alleged untrue statement or omission of a material
fact.
(b) Indemnification by Holders of Resale Securities. In connection
with any Registration Statement in which a Holder of Resale Securities is
participating, each Holder of Resale Securities agrees, severally and not
jointly, to indemnify and hold harmless the Company and each person, if any, who
controls the Company within the meaning of either Section 15 of the Securities
Act or Section 20 of the Exchange Act, against any and all Indemnifiable Losses,
as incurred by such person, with respect to any untrue statements or omissions,
or alleged untrue statements or omissions, made in the Registration Statement
(or any amendment thereto), or any preliminary prospectus or the Prospectus (or
any amendment or supplement thereto) in reliance upon and in conformity with
written information furnished to the Company by or on behalf of such Holder of
Resale Securities (which also acknowledges the indemnity provisions herein),
30
or any person, if any, who controls any such Holder of Resale Securities,
expressly for use in the Registration Statement (or any amendment thereto) or
such preliminary prospectus or the Prospectus (or any amendment or supplement
thereto).
(c) Conduct of Indemnification Proceedings.
(i) Each indemnified party shall give notice as promptly as
reasonably practicable to each indemnifying party of any action commenced
against it in respect of which indemnity may be sought hereunder, but failure to
so notify an indemnifying party shall not relieve such indemnifying party from
any liability hereunder to the extent it is not materially prejudiced as a
result thereof and in any event shall not relieve it from any liability which it
may have otherwise than on account of the indemnity under subsection (a) or (b),
as applicable, of this Section 12.
(ii) The indemnifying party, upon written request of the
indemnified party, shall retain counsel reasonably satisfactory to the
indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the fees and
disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
conflicting interests between them. It is understood that the indemnifying party
shall not, in respect of the legal expenses of any indemnified party in
connection with any proceeding or related proceedings in the same jurisdiction,
be liable for (x) the fees and expenses of more than one separate firm (in
addition to any local counsel), whose fees must be reasonable, for Holders of
Resale Securities, and all persons, if any, who control the Holders of Resale
Securities within the meaning of either Section 15 of the Securities Act or
Section 20 of the Exchange Act, collectively or (y) the reasonable fees and
expenses of more than one separate firm (in addition to any local counsel), for
the Company and each person, if any, who controls the Company within the meaning
of either such Section, and that all fees and expenses payable under (x) and (y)
above shall be reimbursed as they are incurred. In the case of any such separate
firm for the Holders of Resale Securities, and control persons of Holders of
Resale Securities, such firm shall be designated in writing by the Designated
Holders (provided, however, that if the parties involved in the proceeding or
proceedings include only Warrant Holders, the Designated Warrant Holder shall
designate such firm and, if such parties include only Note Holders, the
Designated Note Holder shall designate such firm). In the case of any such
separate firm for the Company and control persons of the Company, such firm
shall be designated in writing by the Company.
(iii) The indemnifying party shall not be liable for any
settlement of any proceeding effected without its written consent (which consent
shall not be unreasonably withheld), but if settled with such consent or if
there is a final non-appealable judgment for the plaintiff, the indemnifying
party agrees to indemnify the indemnified party from and against any and all
loss or liability by reason of such settlement or judgment. No indemnifying
party shall, without the prior written consent of the indemnified parties (which
consent shall not be
31
unreasonably withheld), settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever in respect of which indemnification or contribution could be sought
under this Section 12 (whether or not the indemnified parties are actual or
potential parties thereto), unless such settlement, compromise or consent (i)
includes an unconditional release of each indemnified party from all liability
arising out of such litigation, investigation, proceeding or claim and (ii) does
not include a statement as to or an admission of fault, culpability or a failure
to act by or on behalf of any indemnified party.
(d) Reimbursement. If at any time an indemnified party shall have
requested an indemnifying party to reimburse the indemnified party for fees and
expenses of counsel, such indemnifying party agrees that it shall be liable for
any settlement of the nature contemplated by this Section 12 effected without
its written consent if (i) such settlement is entered into more than 45 days
after receipt by such indemnifying party of aforesaid request, (ii) such
indemnifying party shall have received notice of the terms of such settlement at
least 30 days prior to such settlement being entered into and (iii) such
indemnifying party shall not have reimbursed such indemnified party in
accordance with such request prior to the date of such settlement; provided,
that an indemnifying party shall not be liable for any such settlement effected
without its consent if such indemnifying party (1) reimburses such indemnified
party in accordance with such request to the extent it considers such request to
be reasonable and (2) provides written notice to the indemnified party
substantiating the unpaid balance as unreasonable, in each case prior to the
date of such settlement.
(e) Contribution.
(i) If the indemnification to which an indemnified party is
entitled under this Section 12 is for any reason unavailable to an indemnified
party or insufficient, although applicable in accordance with its terms, to hold
harmless an indemnified party in respect of any Indemnifiable Losses, then each
indemnifying party shall contribute to the aggregate amount of such
Indemnifiable Losses incurred by such indemnified party, as incurred, in such
proportion as is appropriate to reflect the relative fault of the indemnifying
party or parties on the one hand and of the indemnified party on the other hand
in connection with the statements or omissions which resulted in such
Indemnifiable Losses, as well as any other relevant equitable considerations.
(ii) The relative fault of the Company, on the one hand, and a
Holder of the Resale Securities, on the other hand, shall be determined by
reference to, among other things, whether any such untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a material
fact relates to information supplied by the Company or by such Holder of the
Resale Securities and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
(iii) The parties hereto agree that it would not be just and
equitable if contribution pursuant to this Section 12(e) were determined by pro
rata allocation or by any other method of allocation which does not take into
account the equitable considerations referred to above in this Section 12(e).
The aggregate amount of Indemnifiable Losses incurred by an indemnified party
and referred to above in this Section 12(e) shall be deemed to include any
out-
32
of-pocket legal or other expenses reasonably incurred by such indemnified party
in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
(iv) No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
(v) For purposes of this Section 12, each officer and director
of, and each other person, if any, who controls, any Holder of Resale Securities
within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act shall have the same rights to contribution as such Holder, and each
person, if any, who controls the Company within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act shall have the same rights to
contribution as the Company.
SECTION 13. Rule 144 Reporting. With a view to making available to the
Holder the benefits of certain rules and regulations under the Securities Act
and the Exchange Act which may permit the sale of the Registrable Securities to
the public without registration, the Company agrees to use its reasonable best
efforts to:
(a) make and keep public information available, as those terms are
understood and defined in Rule 144 under the Securities Act or any similar or
analogous rule promulgated under the Securities Act;
(b) file with the SEC, in a timely manner, all reports and other
documents required of the Company under the Securities Act and the Exchange Act;
and
(c) so long as any Holder owns any Registrable Securities, furnish
to the Holder forthwith upon request: (i) a written statement by the Company as
to its compliance with the reporting requirements of said Rule 144 of the
Securities Act and (ii) provide copies of all Exchange Act reports, including
copies of the most recent annual or quarterly report of the Company, and such
other reports and documents filed by the Company with the SEC as the Holder may
reasonably request in availing itself of any rule or regulation under the
Securities Act and the Exchange Act, allowing it to sell any such securities
without registration.
SECTION 14. Participation in Underwritten Offerings.
(a) If any of the Resale Securities covered are to be sold in an
Underwritten Offering under Section 4 hereof, the investment banker or
investment bankers and manager or managers that will administer the offering
will be selected by the Designated Warrant Holder, unless such Resale Securities
include only Exchange Shares or such Underwritten Offering is being conducted
pursuant to Section 4(b) hereof, in which case by the Designated Note Holder;
provided in each case that (i) such investment banker or investment bankers and
manager or managers are top-tier firms of national recognition within the United
States and (ii) the Company has consented to the appointment of such investment
banker or investment bankers and manager or managers, which consent, in each
case, shall not be unreasonably withheld.
33
(b) If any of the securities are to be sold in an Underwritten
Offering under Section 5 hereof, the investment banker or investment bankers and
manager or managers that will administer the offering will be selected by the
Company.
(c) No person may participate in any Underwritten Offering hereunder
unless such person (i) agrees to sell such person's Resale Securities on the
basis provided in any underwriting arrangements approved by the persons entitled
to approve such arrangements, as provided in Section 14(d), and (ii) completes
and executes all questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents required under the terms of such underwriting
arrangements. Nothing in this Section 14 shall be construed to create any
additional rights regarding the registration of Registrable Securities in any
person otherwise than as set forth herein.
(d) The Designated Warrant Holder (or if such Underwritten Offering
is being conducted pursuant to Section 4(b) hereof, the Designated Note Holder)
shall be entitled to approve all underwriting arrangements under Section 4
hereof with the consent of the Company, which consent shall not be unreasonably
withheld. The Company shall be entitled to approve all underwriting arrangements
in connection with an Underwritten Offering under Section 5 hereof.
SECTION 15. Restriction on Transfer.
(a) Each Holder (including each Original Holder) agrees that any
proposed Transfer of any Consideration Securities, or any shares of Common Stock
issuable upon exchange or exercise thereof, may be effected only:
(1) (v) inside the United States:
(I) to a person who the seller reasonably
believes is a qualified institutional buyer
within the meaning of Rule 144A in a
transaction meeting the requirements of Rule
144A;
(II) in accordance with Rule 144; or
(III) pursuant to another exemption from the
registration requirements of the Securities
Act;
(w) to the Company;
(x) outside the United States (A) to a non-U.S. person
(within the meaning of Regulation S) in a
transaction meeting the requirements of Regulation S
or (B) pursuant to another exemption from the
registration requirements of the Securities Act;
(y) in the case of Warrant Shares, if the issuance
thereof has been registered under the Primary
Registration Statement; or
34
(z) pursuant to an effective registration statement; and
(2) in each case, in accordance with the applicable securities
laws of any state of the United States or any other applicable jurisdiction.
Each Holder agrees to notify any purchaser of the resale restrictions set forth
above.
(b) Prior to any Transfer or proposed Transfer of any Consideration
Securities, or any shares of Common Stock issuable upon exchange or exercise
thereof, the Holder thereof shall deliver written notice (a form of which is
attached hereto) to the Company of such Holder's intention to effect such
Transfer. If the Transfer or proposed Transfer is pursuant to clause (1)(v) or
(1)(x) of the first sentence of the preceding paragraph, then upon receipt of
such notice, the Company may request any or all of the following (each, a
"Transfer Document") in form and substance reasonably acceptable to the Company:
(i) an agreement by such transferee to the impression of the
restrictive investment legend set forth in subsection (c) of this
Section 15 below on the Consideration Securities, or any shares of
Common Stock issuable upon exchange or exercise thereof;
(ii) an agreement by such transferee to be bound by the provisions of
this Section 15 relating to the transfer of such Consideration
Securities, or any shares of Common Stock issuable upon exchange
or exercise thereof; and
(iii) an opinion of counsel with expertise in securities law matters
reasonably satisfactory to the Company that such Transfer complies
with applicable U.S. securities laws.
If the Company requests any Transfer Document(s), it shall do so as promptly as
practicable following receipt of the Holder's notice of intention to Transfer.
The Company shall thereafter cause the Transfer to be recorded and a certificate
or other evidence of ownership in the name of the transferee to be delivered. If
the Company has requested any Transfer Documents in connection with such
transfer, it will take such actions as soon as practicable after it has received
Transfer Documents complying with the terms of this Section 15(b).
(c) Each certificate issued to evidence Consideration Securities, or
any shares of Common Stock issuable upon exchange or exercise thereof, whose
transfer has not been registered by the Company under the Securities Act shall
bear a legend to the following effect:
THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"),
OR ANY OTHER APPLICABLE SECURITIES LAWS AND HAVE BEEN ISSUED IN RELIANCE
UPON AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT AND SUCH OTHER SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY
INTEREST OR PARTICIPATION HEREIN MAY BE SOLD,
35
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED, OR OTHERWISE DISPOSED OF,
EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR
PURSUANT TO A TRANSACTION THAT IS EXEMPT FROM SUCH REGISTRATION.
The foregoing legend shall be in addition to any other legend required by law or
any contract.
(d) Termination of Restrictions. The restrictions referenced in this
Section 15, including the legend, shall cease and terminate as to any particular
Consideration Securities, or shares of Common Stock issuable upon exchange or
exercise thereof, when (x) such securities have been transferred in a
transaction pursuant to Rule 144 or a registration statement or (y) in the
opinion of counsel for the Company, such restriction is no longer required in
order to assure compliance with the Securities Act and applicable state
securities laws. Whenever such restrictions shall cease and terminate as to any
Consideration Securities, or shares of Common Stock issuable upon exchange or
exercise thereof, the Holder of such securities shall be entitled to receive
from the Company, without expense (other than applicable transfer taxes, if any,
if such unlegended shares are being delivered and transferred to any person
other than the registered Holder thereof), new certificates for a like number of
securities not bearing the relevant legend(s) set forth in this Section 15.
SECTION 16. Miscellaneous.
(a) Amendments and Waivers. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given, unless the Company has obtained the written consent of each of
the Designated Holders. Notwithstanding the foregoing, a waiver or consent to
depart from the provisions hereof with respect to a matter that relates
exclusively to the rights of (i) Warrant Holders that does not directly or
indirectly affect the rights of the Note Holders may be given by the Designated
Warrant Holder, (ii) Note Holders that does not directly or indirectly affect
the rights of the Warrant Holders may be given by the Designated Note Holder,
and (iii), except as otherwise specifically provided herein, Holders of
Registrable Securities whose securities are being sold pursuant to a
Registration Statement and that does not directly or indirectly affect the
rights of other Holders of Registrable Securities may be given by Holders of at
least two-thirds of the Registrable Securities being sold by such Holders
pursuant to such Registration Statement; provided, that the provisions of this
sentence may not be amended, modified, or supplemented except in accordance with
the provisions of the immediately preceding sentence.
Each Holder of Registrable Securities outstanding at the time
of any such amendment, modification, supplement, waiver or consent, and any
successor or assignee thereof, thereafter shall be bound by any such amendment,
modification, supplement, waiver or consent effected pursuant to this Section
16, whether or not any notice, writing or marking indicating such amendment,
modification, supplement, waiver or consent appears on the Registrable
Securities or is delivered to such Holder. No waiver of any provision of this
Agreement shall constitute a waiver of any other provision of this Agreement and
no waiver on one occasion shall
36
constitute a waiver on a further occasion with respect to the same or any other
provision of this Agreement.
(b) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand delivery, by telecopier, by
courier guaranteeing overnight delivery or by first-class mail, return receipt
requested, and shall be deemed given (i) when made, if made by hand delivery,
(ii) upon confirmation, if made by telecopier, (iii) one (1) Business Day after
being deposited with such courier, if made by overnight courier or (iv) on the
date indicated on the notice of receipt, if made by first-class mail, to the
parties as follows:
(i) if to a Notice Holder, at the most current address given by such
Holder to the Company;
(ii) if to the Company, to:
Vishay Intertechnology, Inc.
63 Lincoln Highway
Malvern, PA 19335-2120
Attention: Chief Financial Officer
Telecopier No.: (818) 225-4055
with a copy to:
Kramer Levin Naftalis & Frankel LLP
919 Third Avenue
New York, NY 10019
Attention: Abbe Dienstag, Esq.
Telecopier: (212) 715-8000
(iii) if to the Designated Holders or Designated Counsel, at such
addresses as they shall provide in writing to the Company in
accordance with this Section 16(b);
and
(iv) if to any Holder(s), to the most current address for such
Holder(s) provided to the Company in accordance with the
provisions of this Section 16(b) which address (including
facsimile number) initially is as set forth next to such Holder's
signature on the signature page hereto;
or to such other address as such person may have furnished to the other persons
identified in this Section 16(b) in writing in accordance herewith.
(c) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and permitted assigns of each of
the parties whether by operation of law, or otherwise; provided, however, that
no such assignment shall relieve the Company of any of its obligations
hereunder. For the avoidance of doubt, the Company agrees that any successor
company shall be required to provide to the Holders substantially equivalent
37
registration rights as those hereunder to provide for the orderly disposition of
any securities then held by them in exchange for or in replacement of the
Registrable Securities. No person shall be a permitted assign of any Holder
unless such person received a transfer of Consideration Securities, or the
shares of Common Stock or other securities issuable upon exchange or exercise
thereof, in compliance with the provisions of Section 15 hereof, but if so
received, such person shall be a permitted assign; provided, that the rights
specifically granted to the Original Holders or their Affiliates under this
Agreement (as distinct from rights of the Original Holders or their Affiliates
under this Agreement which are common to all Holders), either individually, or
in the aggregate, may not be assigned except by operation of law or to an
Affiliate of such Original Holder. The Company shall not be required to
recognize any person (other than an Original Holder) as a Holder of
Consideration Securities, or shares of Common Stock issuable upon exchange or
exercise thereof, for purposes of this Agreement unless the transfer of
securities to such person has been registered on the books and records of the
Company or its subsidiary, as the case may be. However, for the purpose of the
preceding sentence, such registration by the Company on its books and records
shall not be unreasonably withheld or delayed.
(d) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be original and all of which taken together
shall constitute one and the same agreement.
(e) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(f) Governing Law; Jurisdiction. This Agreement shall be governed
by, construed, applied and enforced in accordance with the laws of the State of
New York, except that no doctrine of choice of law shall be used to apply any
law other than that of New York, and no defense, counterclaim or right of
set-off given or allowed by the laws of any other state or jurisdiction, or
arising out of the enactment, modification or repeal of any law, regulation,
ordinance or decree of any foreign jurisdiction, shall be interposed in any
action hereon or thereon.
The parties hereto agree that any suit, action or proceeding
to enforce any right arising out of this Agreement may be commenced in the
Supreme Court of New York situated in New York City or in the United States
District Court for the Southern District of New York, and the parties hereto
consent to such jurisdiction, agree that venue will be proper in such courts in
any such matter, agree that New York is the most convenient forum for litigation
in any such suit, action or proceeding, and agree that a summons and complaint
commencing a suit, action or proceeding in any such court shall be properly
served and shall confer personal jurisdiction upon a person if served by
registered or certified mail to the address specified with respect to such
person pursuant to Section 16(b), or as otherwise provided by the laws of the
State of New York or the United States. The parties hereto agree that a final
judgment in any such suit, action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law.
38
(g) Severability. If any term, provision, covenant or restriction of
this Agreement is held to be invalid, illegal, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions set forth herein
shall remain in full force and effect and shall in no way be affected, impaired
or invalidated thereby, and the parties hereto shall use their reasonable best
efforts to find and employ an alternative means to achieve the same or
substantially the same result as that contemplated by such term, provision,
covenant or restriction, it being intended that all of the rights and privileges
of the parties shall be enforceable to the fullest extent permitted by law.
(h) Entire Agreement. This Agreement is intended by the parties as a
final expression of their agreement and is intended to be a complete and
exclusive statement of the agreement and understanding of the parties hereto in
respect of the subject matter contained herein and the registration rights
granted by the Company with respect to the Registrable Securities. Except as
provided in the Purchase Agreement, there are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein,
with respect to the registration rights granted by the Company with respect to
the Registrable Securities. This Agreement supersedes all prior agreements and
undertakings among the parties solely with respect to such registration rights.
(i) Termination. This Agreement and the obligations of the parties
hereunder shall terminate upon the end of the applicable Effectiveness Period,
except for any liabilities or obligations under Sections 2, 11 or 12 hereof.
(j) No Third-Party Beneficiaries. This Agreement is intended for the
benefit of the parties hereto and their respective permitted successors and
assigns and the other persons specified in Section 12 and Section 16(c) hereof
and is not for the benefit of, nor may any provision hereof be enforced by, any
other person.
[SIGNATURE PAGES FOLLOW]
39
COUNTERPART SIGNATURE PAGE
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first written above.
VISHAY INTERTECHNOLOGY, INC.
By: ____________________________
Avi D. Eden
Executive Vice President
COUNTERPART SIGNATURE PAGE
(FOR ISSUANCES PURSUANT TO REGULATION S)
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first written above.
[ENTITY]
By: ____________________________
Name:
Title:
Offshore Delivery Instructions:
__________________________________________
PRINT EXACT NAME IN WHICH YOU WANT
THE SECURITIES TO BE REGISTERED
Attn: ____________________________________
Address: ____________________________________
____________________________________
____________________________________
Phone No. ____________________________________
41
COUNTERPART SIGNATURE PAGE
(FOR ISSUANCES PURSUANT TO SECTION 4(2))
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first written above.
[ENTITY]
By: ____________________________
Name:
Title:
Circle the category under which you are an "accredited investor" pursuant to
Schedule A:
1 2 3 4 5 6 7 8
__________________________________________
PRINT EXACT NAME IN WHICH YOU WANT
THE SECURITIES TO BE REGISTERED
Attn: ____________________________________
Address: ____________________________________
____________________________________
____________________________________
Phone No. ____________________________________
42
SCHEDULE A
The term "accredited investor" means:
(1) A bank as defined in Section 3(a)(2) of the Securities Act, or a savings
and loan association or other institution as defined in Section
3(a)(5)(A) of the Securities Act, whether acting in its individual or
fiduciary capacity; a broker or dealer registered pursuant to Section 15
of the Securities Exchange Act of 1934; an insurance company as defined
in Section 2(13) of the Securities Act; an investment company registered
under the Investment Company Act of 1940 (the "Investment Company Act")
or a business development company as defined in Section 2(a)(48) of the
Investment Company Act; a Small Business Investment Company licensed by
the U.S. Small Business Administration under Section 301(c) or (d) of the
Small Business Investment Act of 1958; a plan established and maintained
by a state, its political subdivisions or any agency or instrumentality
of a state or its political subdivisions for the benefit of its
employees, if such plan has total assets in excess of $5,000,000; an
employee benefit plan within the meaning of the Employee Retirement
Income Security Act of 1974 ("ERISA"), if the investment decision is made
by a plan fiduciary, as defined in Section 3(21) of ERISA, which is
either a bank, savings and loan association, insurance company, or
registered investment advisor, or if the employee benefit plan has total
assets in excess of $5,000,000 or, if a self-directed plan, with
investment decisions made solely by persons that are accredited
investors.
(2) A private business development company as defined in Section 202(a)(22)
of the Investment Advisers Act of 1940.
(3) An organization described in Section 501(c)(3) of the Internal Revenue
Code, corporation, Massachusetts or similar business trust, or
partnership, not formed for the specific purpose of acquiring the
securities offered, with total assets in excess of $5,000,000.
(4) A director or executive officer of the Company.
(5) A natural person whose individual net worth, or joint net worth with that
person's spouse, at the time of his or her purchase exceeds $1,000,000.
(6) A natural person who had an individual income in excess of $200,000 in
each of the two most recent years or joint income with that person's
spouse in excess of $300,000 in each of those years and has a reasonable
expectation of reaching the same income level in the current year.
(7) A trust, with total assets in excess of $5,000,000, not formed for the
specific purpose of acquiring the securities offered, whose purchase is
directed by a sophisticated person as described in Rule 506(b)(2)(ii)
(i.e., a person who has such knowledge and experience in financial and
business matters that he is capable of evaluating the merits and risks of
the prospective investment).
43
(8) An entity in which all of the equity owners are accredited investors. (If
this alternative is checked, the Purchaser must identify each equity
owner and provide statements signed by each demonstrating how each is
qualified as an accredited investor.)
44
SCHEDULE B
(1) "U.S. person" (as defined in Regulation S) means:
(i) Any natural person resident in the United States;
(ii) Any partnership or corporation organized or incorporated under the
laws of the United States;
(iii) Any estate of which any executor or administrator is a U.S.
person;
(iv) Any trust of which any trustee is a U.S. person;
(v) Any agency or branch of a foreign entity located in the
United States;
(vi) Any non-discretionary account or similar account (other
than an estate or trust) held by a dealer or other
fiduciary for the benefit or account of a U.S. person;
(vii) Any discretionary account or similar account (other than an
estate or trust) held by a dealer or other fiduciary
organized, incorporated, or (if an individual) resident in
the United States; and
(viii) Any partnership or corporation if: (A) organized or
incorporated under the laws of any foreign jurisdiction;
and (B) formed by a U.S. person principally for the purpose
of investing in securities not registered under the Act,
unless it is organized or incorporated, and owned, by
accredited investors (as defined in Rule 501(a)) who are
not natural persons, estates or trusts.
(2) Notwithstanding paragraph (1) above, any discretionary account or similar
account (other than an estate or trust) held for the benefit or account
of a non-U.S. person by a dealer or other professional fiduciary
organized, incorporated, or (if an individual) resident in the United
States shall not be deemed a "U.S. person."
(3) Notwithstanding paragraph (1), any estate of which any professional
fiduciary acting as executor or administrator is a U.S. person shall not
be deemed a U.S. person if:
(i) An executor or administrator of the estate who is not a U.S.
person has sole or shared investment discretion with respect to
the assets of the estate; and
(ii) The estate is governed by foreign law.
(4) Notwithstanding paragraph (1), any trust of which any professional
fiduciary acting as trustee is a U.S. person shall not be deemed a U.S.
person if a trustee who is not a U.S. person has sole or shared
investment discretion with respect to the trust assets, and no
beneficiary of the trust (and no settlor if the trust is revocable) is a
U.S. person.
45
(5) Notwithstanding paragraph (1), an employee benefit plan established and
administered in accordance with the law of a country other than the
United States and customary practices and documentation of such country
shall not be deemed a U.S. person.
(6) Notwithstanding paragraph (1), any agency or branch of a U.S. person
located outside the United States shall not be deemed a "U.S. person" if:
(i) The agency or branch operates for valid business reasons; and
(ii) The agency or branch is engaged in the business of insurance or
banking and is subject to substantive insurance or banking
regulation, respectively, in the jurisdiction where located.
(7) The International Monetary Fund, the International Bank for
Reconstruction and Development, the Inter-American Development Bank, the
Asian Development Bank, the African Development Bank, the United Nations,
and their agencies, affiliates and pension plans, and any other similar
international organizations, their agencies, affiliates and pension plans
shall not be deemed "U.S. persons."
46
ANNEX A
FORM OF
SELLING SECURITYHOLDER
NOTICE AND QUESTIONNAIRE
The undersigned beneficial holder of Registrable Securities understands
that the Company has filed or intends to file with the SEC a Resale Registration
Statement in accordance with the terms of the Securities Investment and
Registration Rights Agreement, dated as of __________, 2002 (the "Agreement").
All capitalized terms not otherwise defined herein shall have the meaning
ascribed thereto in the Agreement.
Each beneficial owner of Registrable Securities is entitled to the
benefits of the Agreement. In order to sell or otherwise dispose of any
Registrable Securities pursuant to the Resale Registration Statement, a
beneficial owner of Registrable Securities generally will be required to be
named as a selling securityholder in the related prospectus, deliver a
prospectus to purchasers of Registrable Securities and be bound by those
provisions of the Agreement applicable to such beneficial owner (including
certain indemnification provisions, as described below). Beneficial owners are
encouraged to complete and deliver this Notice and Questionnaire at least five
(5) Business Days prior to the effectiveness of the Resale Registration
Statement so that such beneficial owners may be named as selling securityholders
in the related prospectus at the time of effectiveness. Upon receipt of a
completed Notice and Questionnaire from a beneficial owner following the
effectiveness of a Resale Registration Statement, the Company will, as promptly
as practicable, file such amendments to a Resale Registration Statement or
supplements to the related prospectus as are necessary to permit such holder to
deliver such prospectus to purchasers of Registrable Securities.
Certain legal consequences arise from being named as a selling
securityholder in a Resale Registration Statement and the related prospectus.
Accordingly, holders and beneficial owners of Registrable Securities are advised
to consult their own securities law counsel regarding the consequences of being
named or not being named as a selling securityholder in a Resale Registration
Statement and the related prospectus.
NOTICE
The undersigned beneficial owner (the "Selling Securityholder") of
Registrable Securities hereby gives notice to the Company of its intention to
sell or otherwise dispose of Registrable Securities beneficially owned by it and
listed below pursuant to a Resale Registration Statement. The undersigned, by
signing and returning this Notice and Questionnaire, understands that it will be
bound by, and agrees to comply with, the terms and conditions of this Notice and
Questionnaire and the Agreement.
47
The undersigned hereby provides the following information to the Company
and represents and warrants that such information is accurate and complete:
QUESTIONNAIRE
1. General Information
a. State the exact name in which the shares of Common Stock and/or
Warrants to be registered for your account for resale (the "Resale
Securities") are or will be registered of record and the address
of the record holder:
Name: _______________________
Address: _______________________
_______________________
_______________________
If the Resale Securities are or will be held of record by more
than one record holder, please furnish similar information for
each additional record holder.
b. State the exact name of the beneficial owner1 of the Resale
Securities as it should appear in the Registration Statement:
Name: _______________________________________________
c. State below your address, telephone number and fax number for
purposes of communication:
Address: _______________________________
_______________________________
_______________________________
Telephone No.: ( ) _____________________
Fax No.: ( ) __________________________
- ----------------------
1 See Appendix A to this Notice & Questionnaire for definition of "beneficial
owner".
48
2. Beneficial Ownership of Shares
The Registration Statement is required to disclose the number of shares of
Common Stock and/or Warrants that will be beneficially owned2 by you as of
the most recent available date, whether or not registered in your name,
and the number of shares and/or Warrants to be registered for your account
and included in the Registration Statement.
ONLY THE PARTICULAR SHARES OF COMMON STOCK AND/OR WARRANTS LISTED IN YOUR
NAME IN THE REGISTRATION STATEMENT MAY BE SOLD OR RESOLD UNDER THE
REGISTRATION STATEMENT.
a. Shares of Common Stock to be Registered
Indicate the number of shares of Common Stock beneficially owned by
you and to be included in the Registration Statement for your
account:
_______________
b. Warrants to be Registered
Indicate the number of Warrants beneficially owned by you and to be
included in the Registration Statement for your account:
_______________
c. Other shares of Common Stock Beneficially Owned
Please indicate the number of shares of Common Stock beneficially
owned by you other than the shares of Common Stock referred to in
Item 2(a) above:
______________
3. Nature of Beneficial Ownership
a. Are any shares of Common Stock and/or Warrants indicated in response
to Item 2 above as beneficially owned by you owned other than for
your own economic benefit?
Yes __________ No __________
- ---------------------
2 See Appendix A for definition of "beneficially owned".
49
If your answer is yes, please explain:
b. Do you have the right to acquire beneficial ownership within 60 days
(e.g., by reason of the ownership of options, warrants or other
convertible securities to acquire Common Stock or otherwise) of any
shares of Common Stock and/or Warrants indicated in response to Item
2 above as beneficially owned by you?
Yes __________ No __________
If your answer is yes, please describe such right to acquire and the
number of shares subject to such right:
c. If you are the beneficial owner of more than five percent (5%) of
any class of voting securities of the Company, are any of such
securities held subject to any voting trust or other similar
arrangement?
Yes __________ No __________
If your answer is yes, state the amount held or to be held, the
duration of the agreement, the names and addresses of the voting
trustees, and describe briefly the voting rights and powers under
such agreement:
4. Relationships with the Company
a. Have you held any position or office with the Company or any of its
predecessors3 or affiliates4 within the past three years?
Yes __________ No __________
If your answer is yes, please describe:
- ----------------------
3 See Appendix A for definition of "predecessor".
4 See Appendix A for definition of "affiliate".
50
b. Have you or any of your affiliates had any other material5
relationship, directly or indirectly, with the Company or any of its
predecessors or affiliates within the past three years?
Yes __________ No __________
If your answer is yes, please describe:
5. Transactions with the Company
YOU NEED TO ANSWER THE QUESTIONS UNDER THIS ITEM ONLY IF YOU BENEFICIALLY OWN 5%
OR MORE OF THE COMMON STOCK OR IF YOU ARE (OR WERE AT ANY TIME AFTER THE END OF
THE COMPANY'S MOST RECENT FISCAL YEAR) A DIRECTOR OR EXECUTIVE OFFICER OF THE
COMPANY OR AN IMMEDIATE FAMILY6 MEMBER OF ANY OF THE ABOVE.
a. Has any of the following described persons7 had, or will any of them
have, any direct or indirect material interest (i) in any
transaction or series of similar transactions since the end of the
most recent fiscal year of the Company to which the Company was a
party or (ii) in any currently proposed transaction to which the
Company may be or is to be a party? (No information need be given as
to any transaction or series of similar transactions if the amount
involved in the transaction or series of similar transactions,
including all periodic installments in the case of any lease or
other agreement providing for periodic payments or installments,
does not exceed $60,000.)
(i) You:
Yes __________ No __________
(ii) Any corporation or organization (other than the Company) of
which you are or were an officer, director or the beneficial
owner, directly or indirectly (either alone or together with
other directors or officers of the Company and persons and
entities listed under (iii) through (v) below), of an equity
interest of five percent or more:
Yes __________ No __________
- ----------------------
5 See Appendix A for definition of "material".
6 See Appendix A for definition of "immediate family".
7 See Appendix A for definition of "person".
51
(iii) Any partnership or firm of which you are or were a general
partner or of which your limited partnership interest (either
alone or together with other directors or officers of the
Company and persons and entities listed under (ii) above and
(iv) below) is ten percent or more:
Yes __________ No __________
(iv) Any trust, custodianship or estate in which you have or had a
substantial beneficial interest or as to which you serve or
served as trustee, custodian, executor or in a similar
fiduciary capacity:
Yes __________ No __________
(v) Any member of your immediate family:
Yes __________ No __________
If your answer to any of the above questions is yes, please describe
the transaction(s), the amount of the transaction(s), the interest
in the transaction(s) of such person, corporation, organization,
partnership, firm, trust, custodianship or estate and indicate the
date on which each transaction took place. In addition, if any of
the transactions mentioned above involve the sale or purchase of
assets by or to the Company, other than in the ordinary course of
business, please state the cost of such assets to the purchaser and,
if acquired by the seller within two years prior to the transaction,
the original cost to the seller.
6. Involvement in Legal Proceedings
a. Is the Company or the property of the Company a party to or the
subject of any pending legal proceeding in which you or an
associate8 of yours (i) is an adverse party or (ii) has a material
interest adverse to the Company?
Yes __________ No __________
If your answer is yes, we will contact you for further information.
7. State whether you (i) are, or, at any time within the past five years,
have been, a director, officer, or controlling person of, or (ii) own, or
have, at any time within the past five years, owned, directly or
indirectly, in excess of a ten percent equity interest in any entity which
is a member of the NASD.
Yes ____________ No ____________
- ----------------------
8 See Appendix A for definition of "associate".
52
If the answer is "Yes" please describe.
The undersigned acknowledges that it understands its obligation to comply
with the provisions of the Exchange Act and the rules thereunder relating to
stock manipulation, particularly Regulation M thereunder (or any successor rules
or regulations), in connection with any offering of Registrable Securities
pursuant to a Registration Statement. The undersigned agrees that neither it nor
any person acting on its behalf will engage in any transaction in violation of
such provisions.
The Selling Securityholder hereby acknowledges its obligations to comply
with all the terms and provisions of the Agreement applicable to Holders and
Notice Holders, including the obligation to indemnify and hold harmless certain
persons as set forth therein.
Pursuant to the Agreement, the Company has agreed under certain
circumstances to indemnify the Selling Securityholders against certain
liabilities.
In accordance with the undersigned's obligation under the Agreement to
provide such information as may be required by law for inclusion in a
Registration Statement, the undersigned agrees to promptly notify the Company of
any inaccuracies or changes in the information provided herein that may occur
subsequent to the date hereof at any time while a Registration Statement remains
effective. All notices hereunder and pursuant to the Agreement shall be made in
writing at the address set forth below.
By signing below, the undersigned consents to the disclosure of the
information contained herein in its answers to items (1) through (6) above and
the inclusion of such information in a Registration Statement and the related
prospectus. The undersigned understands that such information will be relied
upon by the Company in connection with the preparation or amendment of a
Registration Statement and the related prospectus.
53
IN WITNESS WHEREOF, the undersigned, by authority duly given, has caused
this Notice and Questionnaire to be executed and delivered either in person or
by its duly authorized agent.
Dated: ________________________
Beneficial Owner
By: __________________________________
Name:
Title:
PLEASE RETURN THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE TO
VISHAY AT:
Investor Relations
Attn: Robert Freece
Vishay Intertechnology, Inc.
63 Lincoln Highway
Malvern, Pennsylvania 19355-2120
(610) 644-1300
54
Appendix A
"Affiliate" of a specified person (or entity) is a person that
directly, or indirectly through one or more intermediaries, controls, or is
controlled by, or is under common control with, the person specified.
"Associate" means (1) a corporation or organization (other than the
Company) of which such person is an officer or partner or is, directly or
indirectly, the beneficial owner of ten percent or more of any class of equity
securities, (2) any trust or other estate in which such person has a substantial
beneficial interest or as to which such person serves as trustee or in a similar
capacity, and (3) any relative or spouse of such person, or any relative of such
spouse, who has the same home as such person or who is a director or officer of
the registrant or any of its parents or subsidiaries.
"Beneficial Ownership", "Beneficial Owner", or "Beneficially Owned",
when used in this Questionnaire, a beneficial owner of a security includes any
person who, directly or indirectly, through any contract, arrangement,
understanding, relationship or otherwise, has or shares:
(1) voting power (which includes the power to vote, or to direct the
voting of, such security); and/or
(2) investment power (which includes the power to dispose, or to
direct the disposition, of such security).
In addition, a person is deemed to be the beneficial owner of a security if that
person has the right to acquire beneficial ownership of such security at any
time within 60 days, including, but not limited to, any right to acquire: (i)
through the exercise of any option, warrant or right, (ii) through the exchange
of a security or (iii) pursuant to the power to revoke a trust, discretionary
account or similar arrangement or pursuant to the automatic termination of a
trust, discretionary account or similar arrangement.
Securities owned beneficially by you include not only securities held
by you for your own benefit, whether in bearer form or registered in your own
name or otherwise, but also securities held by others as to which you have or
share voting power or investment power (regardless of how the securities are
registered) such as, for example, securities held for you by custodians, brokers
or pledgees. Securities owned by a corporation which you control are within your
power to vote and invest and are thus considered beneficially owned by you
despite the separate legal personality of the corporation.
Where by virtue of a special relationship, whether of a family or a
business nature, you have substantial influence over the decisions of another
person in investing or voting his securities, any securities owned by that
person would be considered beneficially owned by you. Thus, for example,
securities owned by all persons related to you by blood, marriage or adoption or
by other persons who share your home or are a member of your immediate family
would be considered beneficially owned by you absent a clear history of
independent decision-making in their investment and voting of the securities.
55
In addition, securities held by you solely for the benefit of another
person, for example, as nominee, trustee or executor, are considered
beneficially owned by you if you have or share voting power or investment power
with respect to such securities. More specifically, securities held by a trustee
where either the trustee or a member of his immediate family (for the purpose of
this definition only, spouse, ancestor, descendant, step-parent or step-child)
has a vested interest in the income or corpus of the trust would be considered
beneficially owned by the trustee. (If you have been named as executor of an
estate but have not yet qualified under local law, you are not considered the
beneficial owner of securities in the estate, absent other facts indicating
actual power.)
The power to vote or invest securities need not be currently
exercisable to confer beneficial ownership. The fact that securities are held
for you in trust or in a discretionary account removes them from your control;
but if you have the power to terminate the relationship and regain control of
the securities at will or within 60 days, they are considered to be subject to
your power and hence beneficially owned by you. The same applies to securities
which you can acquire by option or other right exercisable within 60 days.
You would not ordinarily be deemed the beneficial owner of securities
held by you as pledgee in the ordinary course of business pursuant to a bona
fide pledge agreement if the pledge agreement provides that you have no
substantive rights in such securities (i.e., the owner retains the investment
and voting power) until a default has occurred.
"Immediate Family" includes your spouse, parents, children, siblings,
mother and father-in-law, sons and daughters-in-law and brothers and
sisters-in-law
"Predecessor" means a person the major portion of the business and
assets of which another person acquired in a single transaction, or in a series
of related transactions in each of which the acquiring person acquired the major
portion of the business and assets of the acquired person.
56
Exhibit 4.5
PUT AND CALL AGREEMENT
PUT AND CALL AGREEMENT (this "Agreement") dated as of December 13,
2002 between Vishay Intertechnology, Inc., a Delaware corporation (the
"Company"), the Put/Call Agent (as defined herein) and each of the holders of
the Notes due December 13, 2102 (the "Notes") issued by the Company, including
initially those holders whose names appear on the signature page to this
Agreement (the "Initial Holders").
WHEREAS, the Company and the Initial Holders have entered into that
certain Share Sale and Purchase Agreement and Note Purchase Agreement, each
dated as of even date herewith, by and among the parties thereto, pursuant to
which, among other things, the Company has agreed to issue Notes in the
aggregate nominal amount of US$105,000,000 to the Initial Holders.
WHEREAS, it is a condition of the Notes that each Initial Holder
execute and be a party to this Agreement, and each other transferee in relation
to the Notes become a party to this Agreement by execution of an Assignment
Form, as defined herein.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1. Definitions. As used in this Agreement, the following terms, when
capitalized, shall have the meanings assigned below:
"Assignment Form" means an assignment form substantially in the form
attached hereto as Annex I.
"Business Day" means any day other than a Saturday, Sunday or legal
holiday on which the commercial banks in the City of New York, Borough of
Manhattan, are required or permitted by law to remain closed.
"Call" means the right of the Company to call all of the Notes in
exchange for the issuance of shares of Common Stock or cash in accordance
with the provisions of Article III.
"Call Exercise Notice" has the meaning described in Section 3.02.
"Call Period" means the period beginning on January 2, 2018 and
ending on the date that is 30 days prior to the Maturity Date.
1
"Call Target Price" means $35.00 per share of Common Stock, which
price shall be appropriately adjusted in the event of any stock dividend,
stock split, reverse stock split, combination, recapitalization,
reclassification, exchange or similar transaction with respect to the
shares of Common Stock.
"Common Stock" means the common stock, par value US$.10 per share,
of the Company and any other security exchanged or substituted for such
common stock or into which such common stock is converted in any
recapitalization, reorganization, merger, consolidation, share exchange or
other business combination transaction, including any reclassification
consisting of a change in par value or a change from par value to no par
value or vice versa.
"Company" has the meaning set forth in the introduction to this
Agreement.
"Daily Market Price" for any trading day means the volume-weighted
average of the per share selling prices on the New York Stock Exchange or
other principal United States securities exchange or inter-dealer
quotation system on which the relevant equity security is then listed or
quoted or, if there are no reported sales of the relevant equity security
on such trading day, the average of the high bid and low ask price for the
relevant equity security on the last trading day on which such sale was
reported or, if there are no high bid and low ask prices, the Daily Market
Price shall be the per share fair market value of the relevant equity
security as determined by an investment banking firm of national
reputation and standing selected by the Company and reasonably acceptable
to a Majority of the Holders (in which case, only a single determination
of value need be made by an investment banking firm, notwithstanding any
provision in the Agreement requiring an average over more than one (1)
trading day).
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder, as the same
may be amended from time to time.
"Holder" means the Initial Holders and their successors and
permitted assigns who become holders of Notes in a manner permitted
thereunder, in each case until the relevant person ceases to be a holder
of Notes in accordance with the provisions of the Notes and this
Agreement.
"Initial Holder" has the meaning set forth in the introduction to
this Agreement. For the avoidance of doubt, the definition of Initial
Holder shall include Phoenix Bermuda, LP, a Bermuda limited partnership
and an affiliate of Phoenix Acquisition Company S.ar.l.
"Interest Rate Hurdle", means the "Target Price" (initially $45 per
Common Share), as defined in Schedule 2 of the Notes which may be adjusted
pursuant to the provisions herein, and whereby (pursuant to Schedule 2,
Item 3(c) of the Notes) the interest rate on the Notes is adjusted for the
period commencing on or after January 1, 2011 based upon certain
performance parameters of the shares of Common Stock.
2
"Majority of the Holders" means, at any relevant time, the Holders
of a majority of the nominal amount of the Notes that are at any relevant
time outstanding.
"Maturity Date" means December 31, 2102, the final maturity date of
the Notes.
"Notes" has the meaning set forth in the introduction to this
Agreement.
"person" means any individual, corporation, partnership, limited
liability company, trust, foundation, joint venture, association, joint
stock company, unincorporated organization, government agency, estate or
other entity of any nature.
`Put" means the right of a Holder to require the Company to exchange
the Notes, in whole or in part (as permitted herein), for shares of Common
Stock in accordance with the provisions of Article II.
"Put/Call Agent" means American Stock Transfer & Trust Co., a New
York corporation, or any successor as provided in Article V.
"Put/Call Rate" means $17.00 per share, subject to adjustment
pursuant to Article IV herein.
"Put Exercise Notice" means the notice of intention to exercise the
Put in the form attached to this Agreement in the form of Annex II.
"Put Period" means the period during which the Notes are
outstanding, ending on the Maturity Date.
"SEC" means the United States Securities and Exchange Commission.
"Securities Act" means the United States Securities Act of 1933, as
amended, and the rules and regulations promulgated thereunder, as the same
may be amended from time to time.
Where the reference "hereof," "hereby" or "herein" appears in this
Agreement, such reference shall be deemed to be a reference to this Agreement as
a whole. Whenever the words "include," "includes" or "including" are used in
this Agreement, they shall be deemed to be followed by the words "without
limitation." Words denoting the singular include the plural, and vice versa, and
references to it or its or words denoting any gender shall include all genders.
ARTICLE II
THE PUT
SECTION 2.01 Put Exercise Generally. At any time during the Put
Period, a Holder may exercise the Put with respect to (i) the aggregate nominal
amount of all Notes held by such Holder or (ii) a portion of the nominal amount
of any Note in integral multiples of US$2,000,000. The number of shares of
Common Stock issuable upon exercise of the Put shall equal (i) the nominal
amount of the Notes for which the Put is being exercised by the Holders, divided
by (ii) the Put/Call Rate as of the Put Date (as defined below). No adjustment
to the
3
Put/Call Rate shall be made in respect of any accrued but unpaid interest on the
Notes, whether before or after the record date for payment of any such interest.
SECTION 2.02 Put Exercise Procedure. To exercise the Put, the Holder
must (i) surrender to the Put/Call Agent (at its office designated for such
purpose, the initial address of such office being listed in Section 6.01 hereof)
the certificate or certificates representing the Notes to be exchanged together
with the Put Exercise Notice duly completed and executed, (ii) deliver a form of
transfer in the form specified by the Notes executed by the Holder with the name
of the transferee left blank and (iii) pay any transfer or similar tax required
to be paid by the Holder pursuant to Section 2.04.
The date on which the Holder satisfies all the requirements for
exercise of the Put is referred to as the "Put Date." As soon as practicable
after the Put Date, the Company will cause the Put/Call Agent to deliver to the
Holder in exchange for the Notes (or, pursuant to this Section 2.02, a portion
thereof) as to which the Put has been exercised a certificate (or other evidence
of ownership) for the number of full shares of Common Stock issuable upon the
exercise of the Put and cash in lieu of any fractional share determined pursuant
to Section 2.03. The person in whose name the certificate is registered shall be
treated as a stockholder of record on and after the Put Date, and such person,
following the exchange of the relevant Note or part thereof in accordance
herewith, shall no longer be a Holder of the Notes as to which the Put has been
exercised as of such date.
If the Holder exercises the Put for more than one Note at the same
time, the number of shares of Common Stock issuable upon exchange of the Notes
shall be based on the total nominal amount of the Notes exchanged.
Upon surrender of a Note that is exchanged in part, the Company will
execute and deliver to the Holder a Note certificate in an authorized
denomination equal in nominal amount to the unexchanged portion of the Note
surrendered.
SECTION 2.03 Fractional Shares. The Company will not issue a
fractional share of Common Stock upon exchange of a Note. Instead, the Company
will deliver cash for the fractional share, to the nearest 1/10,000th of a
share, equal to an amount determined by multiplying (i) such fractional share by
(ii) the closing sale price of the Common Stock on the principal exchange or
quotation system on which the Common Stock is then traded (or if there is no
sale of the Common Stock reported on such trading day, the average of the low
ask and high bid prices for the Common Stock on such trading day) on the last
trading day prior to the Put Date and rounding the product to the nearest whole
cent.
SECTION 2.04 Taxes on Conversion. If a Holder exercises the Put, the
Company shall pay any documentary, stamp or similar issue or transfer tax due on
the issue of shares of Common Stock upon exchange. However, the Holder shall pay
any such tax which is due because the Holder requests the shares to be issued in
a name other than the Holder's name. The Put/Call Agent may refuse to deliver
the certificates representing the Common Stock being issued in a name other than
the Holder's name until the Put/Call Agent receives a sum sufficient to pay any
tax which will be due because the shares are to be issued in a name other than
the
4
Holder's name. Nothing herein shall preclude any tax withholding required by law
or regulations by the Company.
SECTION 2.05 Reservation of Stock, Validity of Shares; Listing. The
Company will at all times reserve and keep available, out of the aggregate of
its authorized but unissued shares of Common Stock or its authorized and issued
shares of Common Stock held in its treasury, for the purpose of enabling it to
satisfy any obligation to issue shares of Common Stock upon exchange of the
Notes following exercise of the Put, the maximum number of shares of Common
Stock which may then be deliverable upon the exchange of all outstanding Notes
upon the exercise of the Put. The Company may in its discretion use such shares
of Common Stock reserved for the Put pursuant to this Section with respect to
any Call. The Company or, if appointed, the transfer agent for the Common Stock
(the "Transfer Agent") and every subsequent transfer agent for any shares of the
Company's capital stock issuable upon the exchange of any of the Notes upon
exercise of the Put shall be authorized and directed at all times to reserve
such number of authorized shares as shall be required for such purpose. The
Company shall keep a copy of this Agreement on file with the Transfer Agent and
with every subsequent transfer agent for any shares of the Company's capital
stock issuable upon the exchange of the Notes. The Company will furnish such
Transfer Agent a copy of all notices of adjustments and certificates related
thereto, transmitted to each Holder.
All shares of Common Stock delivered upon exchange of the Notes
following exercise of the Put shall be newly issued shares or treasury shares,
shall be duly and validly issued and fully paid and nonassessable and shall be
free from preemptive rights and free of any lien or adverse claim.
The Company will list or cause to have quoted such shares of Common
Stock issuable upon exercise of the Put on each securities exchange or such
other market on which the Common Stock is then listed or quoted.
ARTICLE III
THE CALL
SECTION 3.01 Call Exercise Generally. At any time during the Call
Period, the Company, at its option, may exercise the Call with respect to all of
the Notes, as provided herein. Upon exercise of the Call,
(i) if the Common Stock has had a Daily Market Price at or above the
Call Target Price then in effect for 20 or more out of 30 consecutive
trading days at any time after the Issue Date, the Company shall issue to
the Holders that number of shares of Common Stock equal to (x) the nominal
amount of the Notes exchanged divided by (y) the Put/Call Rate as of the
Call Date (as defined below) and pay to the Holders an amount in cash
equal to accrued but unpaid interest on the Notes to the Call Date or;
(ii) if the Common Stock has not had a Market Value at or above the
Call Target Price for 20 or more out of 30 consecutive trading days at any
time after the Issue Date, at the election of the Company, the Company
shall either--
5
(1) issue to the Holders that number of shares of Common Stock
equal to (x) the nominal amount of the Notes exchanged divided by
(y) the average of the Daily Market Prices for the ten trading days
ending two trading days prior to the date that the Call Exercise
Notice is first sent to Holders, and pay to the Holders an amount in
cash equal to accrued but unpaid interest on the Notes to the Call
Date; or
(2) pay to the Holders $1.00 for each $1.00 nominal amount of
Notes subject to the Call, plus an amount in cash equal to any
accrued but unpaid interest on the Notes to the Call Date.
No adjustment to the Put/Call Rate shall be made in respect of any
accrued but unpaid interest on the Notes, whether before or after the record
date for payment of any such interest.
The date that the Company specifies for the exchange of the Notes
pursuant to exercise of the Call as specified herein is referred to as the "Call
Date."
The Company shall give the notice of a Call to the Put/Call Agent at
least thirty (30) days but not more than sixty (60) days before the Call Date
(unless a shorter notice shall be satisfactory to the Put/Call Agent). The
Company shall accompany such notice with a copy of the register of the record
owners of the Notes then outstanding and shall promptly furnish the Put/Call
Agent with any changes in such register prior to the Call Date.
SECTION 3.02 Call Exercise Notice. At least thirty (30) days but not
more than sixty (60) days before a Call Date, the Company shall send a notice of
redemption ("Call Exercise Notice"), by a method permitted for the delivery of a
notice to the Holders pursuant to Section 6.1 below, to each Holder of Notes at
its registered address.
The Call Exercise Notice shall state:
(1) the Call Date;
(2) whether the Call is for shares or cash;
(3) if the call is for shares, the Put/Call Rate (as subject to
adjustment pursuant to Article IV prior to the Call Date) or, in the case
of a Call exercised pursuant to clause (ii) (1) of Section 3.01, the
number of shares of Common Stock exchangeable for each $1,000 nominal
amount of Notes;
(4) if the Call is for cash, that the Company will pay to the
Holders $1.00 for each $1.00 nominal amount of Notes subject to the Call;
(5) the accrued but unpaid interest to the Call Date, to the extent
it can be determined;
6
(6) the name and address of the Put/Call Agent;
(7) that the Notes must be surrendered to the Put/Call Agent to
receive the cash or shares of Common Stock issuable in exchange for the
Notes, as applicable; and
(8) that, unless the Company defaults in issuing the shares of
Common Stock or to pay the cash as the case may be, in exchange for the
Notes called for exchange, such Notes will cease to accrue interest on and
after the Call Date.
At the Company's request, the Put/Call Agent shall give the notice
of exercise of the Call in the Company's name and at the Company's expense,
provided that the Company makes such request at least fifteen (15) days (unless
a shorter period shall be acceptable to the Put/Call Agent) prior to the date
such notice of redemption must be mailed.
SECTION 3.03 Competing Notices/Effect of Notice of Redemption. If,
following service of a Call Exercise Notice and prior to the date falling five
(5) days before the relevant Call Date, a Put Exercise Notice is served by any
Holder pursuant to Article II above, then that Call Exercise Notice shall cease
to have effect in relation to the Notes subject to the Put Exercise Notice.
Subject thereto and provided the relevant Notes remain outstanding on the Call
Date, once notice of exercise of the Call is given pursuant to Section 3.02, the
Notes will become mandatorily exchangeable on the Call Date. Upon surrender to
the Put/Call Agent, the Notes shall be exchanged for shares of Common Stock or
cash in accordance with Section 3.01.
SECTION 3.04 Call Date. Subject only to Section 3.03 above and
Section 3.05 below, on the Call Date, -upon surrender by a Holder to the
Put/Call Agent of, and provision to the Put/Call Agent of a duly executed form
of transfer in relation to, the Notes, the Notes of any Holder shall be
exchanged on the Call Date by the Put/Call Agent for the appropriate number of
shares of Common Stock or cash as provided in Section 3.01 above, and the
Put/Call Agent shall in addition pay to each Holder its entitlement of cash in
lieu of any fractional share determined pursuant to Section 3.06 herein and any
interest accrued but unpaid.
SECTION 3.05 Deposit of Redemption Price. The Company shall make
available to the Put/Call Agent sufficient Common Stock to exchange the Notes on
the Call Date, together with cash in lieu of fractional shares as provided in
Section 3.06 and in respect of accrued but unpaid interest.
SECTION 3.06 Fractional Shares. The Company will not issue a
fractional share of Common Stock upon exchange of a Note. Instead, the Company
will deliver cash for the fractional share, to the nearest 1/10,000th of a
share, equal to an amount determined by multiplying (i) such fractional share by
(ii) the closing sale price of the Common Stock on the principal exchange or
quotation system on which the Common Stock is then traded (or if there is no
sale of the Common Stock reported on such trading day, the average of the low
ask and high bid prices for the Common Stock on such trading day) on the last
trading day prior to the Call Date and rounding the product to the nearest whole
cent.
7
SECTION 3.07 Taxes on Conversion. If the Company exercises the Call,
the Company shall pay any documentary, stamp or similar issue or transfer tax
due on the issue of shares of Common Stock upon exchange. However, the Holder
shall pay any such tax which is due because the Holder requests the shares to be
issued in a name other than the Holder's name. The Put/Call Agent may refuse to
deliver the certificates representing the Common Stock being issued in a name
other than the Holder's name until the Put/Call Agent receives a sum sufficient
to pay any tax which will be due because the shares are to be issued in a name
other than the Holder's name. Nothing herein shall preclude any tax withholding
required by law or regulations by the Company.
SECTION 3.08 Validity of Shares, Listing.
All shares of Common Stock delivered upon exchange of the Notes
following exercise of the Call shall be newly issued shares or treasury shares,
shall be duly and validly issued and fully paid and nonassessable and shall be
free from preemptive rights and free of any lien or adverse claim.
The Company will list or cause to have quoted such shares of
Common Stock issuable upon exercise of the Call on each securities exchange or
such other market on which the Common Stock is then listed or quoted.
ARTICLE IV
ADJUSTMENTS TO THE PUT/CALL RATE
SECTION 4.01 Adjustments to the Put/Call Rate. The Put/Call Rate is
subject to adjustment from time to time upon the occurrence of the events
enumerated in this Section 4.01.
(a) Declaration of Stock Dividend, Splits, Reverse Splits or Reclassification
or Reorganization; other Distributions.
(i) In case the Company shall declare any dividend or other
distribution upon its outstanding shares of Common Stock payable
in Common Stock or shall subdivide its outstanding shares of
Common Stock into a greater number of shares, then the Put/Call
Rate, the Call Target Price and the Interest Rate Hurdle shall be
decreased in inverse proportion to the increase in the number of
shares of Common Stock outstanding through such dividend, other
distribution, or subdivision. In case the Company shall at any
time combine the outstanding shares of its Common Stock into a
smaller number of shares, the Put/Call Rate, the Call Target Price
and the Interest Rate Hurdle shall be increased in inverse
proportion to the decrease in the number of shares of Common Stock
outstanding through such combination. The Company shall cause a
notice to be mailed to each Holder at least ten (10) days prior to
the applicable record date for the activity covered by this
Section 4.01(a)(i). The Company's failure to give the notice
required by this Section 4.01(a)(i) or any defect therein shall
not affect the validity of the activity covered by this Section
4.01(a)(i). Notwithstanding the
8
foregoing, nothing in this paragraph will prejudice the rights of
the Holders pursuant to this Agreement.
(ii) In case the Company shall at any time (including in connection
with any merger, consolidation or sale of all or substantially all
the assets of the Company in which Section 4.01(d) hereof is not
applicable) (i) issue any evidence of indebtedness, shares of its
stock or any other securities to all holders of shares of Common
Stock by reclassification of its shares of Common Stock, (ii)
distribute any rights, options or warrants to purchase or
subscribe for any evidence of indebtedness, shares of its stock
(other than distributions for which adjustment may be made
pursuant to Section 4.01(b) or Section 4.01(e)) or any other
securities to all holders of shares of Common Stock, (iii)
distribute cash (other than regular quarterly or semi-annual cash
dividends) or other property to all holders of shares of Common
Stock, or (iv) issue by means of a capital reorganization other
securities of the Company in lieu of the Common Stock or in
addition to the Common Stock, then the Note shall be adjusted as
is determined to be appropriate so that the Holder of each Note
shall be entitled to receive the kind and number of shares or
other securities of the Company or the successor entity or cash or
other property that the Holder would have owned or have been
entitled to receive after the happening of the event described
above, had such Note been converted immediately prior to the
happening of such event or any record date with respect thereto.
The Company shall cause a notice to be mailed to each Holder at
least ten (10) days prior to the applicable record date for the
activity covered by this Section 4.01(a)(ii). The Company's
failure to give the notice required by this Section 4.01(a)(ii) or
any defect therein shall not affect the validity of the activity
covered by this Section 4.01(a)(ii). Notwithstanding the
foregoing, nothing in this paragraph will prejudice the rights of
the Holders pursuant to this Agreement.
(iii) An adjustment made pursuant to this Section 4.01(a) shall become
effective immediately after the effective date of such event
retroactive to the record date, if any, for such event.
(b) Adjustment for Rights Issuance.
(i) (A) In case the Company shall at any time distribute any rights,
options or warrants to all holders of Common Stock entitling them,
for a period expiring within sixty (60) days after the date of
determination of the stockholders entitled to receive such rights
(the "Record Date") (or any longer period resulting from the
extension of the exercise period which is announced following the
time that the rights, options or warrants are first issued) for
such distribution, to purchase or subscribe for shares of Common
Stock at a price per share less than ninety percent (90%) of the
Daily Market Price of the Common Stock on the Record Date, then
the Put/Call Rate, the Call Target Price and the Interest Rate
Hurdle in effect immediately prior thereto shall be adjusted as
provided below:
Put Call Rate Adjustment. The Put Call Rate Adjustment shall
be determined by the following formula:
9
R = Ro x (O + C/M)
---------
(O + A)
where:
R = the adjusted Put/Call Rate;
Ro = the Put/Call Rate immediately prior to such adjustment;
O = the number of shares outstanding immediately prior to the
issuance of such rights, options or warrants as referred to
in this Section 4.01(b)(i)(A);
A = the maximum number of shares issuable pursuant to such rights,
options or warrants as referred to in this Section 4.01(b)(i)(A);
C = the aggregate consideration receivable by the Company for the
issuance of Common Stock upon exercise of such rights, options or
warrants as referred to in this Section 4.01(b)(i)(A); and
M = the average of the Daily Market Prices of the Common Stock for
the ten (10) consecutive trading days immediately preceding the
Record Date;
Call Target Price Adjustment. The Call Target Price shall be
determined in accordance with the following formula:
T = To x (O + C/M)
---------
(O + A)
where:
T = the adjusted Call Target Price;
To = the Call Target Price immediately prior to such adjustment;
and the other symbols in such formula have the meanings specified under
"Put/Call Rate Adjustment" above and the preceding paragraph.
Interest Rate Hurdle Adjustment. The Interest Rate Hurdle applicable
shall be determined in accordance with the following formula:
I = Io x (O + C/M)
---------
(O + A)
10
where:
I = the adjusted Interest Rate Hurdle;
Io = the Interest Rate Hurdle immediately prior to such adjustment;
and the other symbols in such formula have the meanings specified under
"Put/Call Rate Adjustment" above and the preceding paragraph; provided
that no adjustments shall be made in the event that R would exceed Ro.
(B) The adjustments shall become effective immediately after
the Record Date for the determination of shareholders
entitled to receive the rights, warrants or options to
which this Section 4.01(b)(i) applies. If less than all of
such rights, warrants or options have been exercised when
such rights, warrants or options expire, then the Put/Call
Rate, the Call Target Price and the Interest Rate Hurdle
shall promptly be readjusted to the Put/Call Rate, the Call
Target Price and the Interest Rate Hurdle that would then
be in effect had the adjustment upon the issuance of such
rights, warrants or options been made on the basis of the
actual number of shares of Common Stock issued upon the
exercise of such rights, warrants or options.
(ii) In case the Company shall at any time distribute any rights,
options or warrants to all holders of Common Stock entitling them,
for a period expiring more than sixty (60) days after the Record
Date therefor (excluding any rights, options or warrants
originally issued with an exercise period of sixty (60) days or
less, which, by virtue of one or more extensions, expire more than
sixty (60) days after the Record Date therefor), to purchase or
subscribe for shares of Common Stock at a price per share less
than ninety percent (90%) of the Market Price of the Common Stock
as of such Record Date, then the Company shall similarly
distribute such rights, options or warrants to the Holders on such
Record Date (without any exercise of the Put by Holders) as if
such Holders had exercised their Put immediately prior to the
Record Date.
(c) Liquidation, Dissolution or Winding Up. Notwithstanding any other
provisions hereof, in the event of the liquidation, dissolution, or
winding up of the affairs of the Company (other than in connection with a
consolidation, merger or sale or conveyance of all or substantially all
of its assets or a Change or Spin-Off), the right to exchange the Notes
shall terminate and expire at the close of business on the last full
Business Day before the earliest date fixed for the payment of any
distributable amount on the Common Stock. The Company shall cause a
notice to be mailed to each Holder at least ten (10) Business Days prior
to the applicable record date for such payment stating the date on which
such liquidation, dissolution or winding up is expected to become
effective, and the date on which it is expected that holders of record of
shares of Common Stock shall be entitled to exchange their shares of
Common Stock for securities or other property or assets (including cash)
deliverable upon such liquidation, dissolution or winding up, and that
each Holder may exercise the Put during such ten (10) Business Day period
and, thereby, receive consideration in the liquidation on the same basis
as other previously outstanding
11
shares of the same class as the shares acquired upon exercise. The
Company's failure to give notice required by this Section 4.01(c) or any
defect therein shall not affect the validity of such liquidation,
dissolution or winding up. Notwithstanding the foregoing, nothing in this
paragraph will prejudice the rights of the Holders pursuant to this
Agreement.
(d) Merger, Consolidation, etc. In any event when (A) any person (the
"Acquirer") directly or indirectly acquires the Company in a transaction
in which the Company is merged with or into or consolidated with another
person or (B) the Company sells or conveys all or substantially all of
its assets to another person (unless, subsequent to such merger,
consolidation or other transaction, the Company is the surviving entity
and has reporting obligations under the Exchange Act as a result of
having common equity securities outstanding, in which case, this Section
shall not apply with respect to such merger, consolidation or other
transaction)(such merger, consolidation or other transaction referred to
hereinafter as a "Change")), then, in the case of each such Change, the
following shall occur:
(i) The Company shall give written notice of any Change to each
Holder, in accordance with Section 6.01 hereof, at least ten (10)
Business Days immediately preceding but not including the date of
effectiveness of the Change and shall also include in such written
notice whether the Acquirer is effecting Section 4.01(d)(ii) or
Section 4.01(d)(iii) below. The Company's failure to give notice
required by this Section 4.01(d) or any defect therein shall not
affect the validity of the Change covered by this Section 4.01(d).
Notwithstanding the foregoing, nothing in this paragraph will
prejudice the rights of the Holders pursuant to this Agreement.
In addition, at the option of the Acquirer, the Acquirer will
effect either Section 4.01(d)(ii) or Section 4.01(d)(iii) below,
with respect to the rights provided to the Holders pursuant to the
Notes and the Put and Call (provided that, if Section 4.01(d)(ii)
below is not available for whatever reason, the Acquirer will
effect Section 4.01(d)(iii) below). Notwithstanding the foregoing,
if the Acquirer is not a public company with reporting obligations
under the Exchange Act (or is a continuing public company only by
virtue of securities which are not common equity securities under
the Exchange Act), then the Acquirer will effect the steps
described in Section 4.01(d)(iii)(A),(B), (C) and (D) below (and
shall result in the automatic election of Section 3.01(ii)(2).
(ii) The Roll-Over Option.
(A) The Notes shall remain the outstanding obligations of the
Company.
(B) The Company shall procure that the Acquirer provides a full
and unconditional guarantee on terms reasonably
satisfactory to a Majority of the Holders, which shall
inure for the benefit of all holders of the Notes (the
"Guarantee") of the prompt payment when due by the Company
of principal and interest under or arising out of the
Notes. Such Guarantee
12
shall rank pari passu equally and ratably without
discrimination, subordination or preference as an unsecured
debt obligation of the Acquirer.
(C) The Company shall procure that the Acquirer executes an
agreement supplemental hereto that provides that the
Acquirer will be bound by this Agreement;
(D) In the case of each such Change, thereafter each Holder
shall receive, upon such Holder's exercise of the Put
pursuant to this Agreement, shares of the Acquirer (the
"Acquirer Shares") as opposed to shares of the Company, as
provided for prior to such Change. In addition, the
Put/Call Rate, the Call Target Price, and the Interest Rate
Hurdle on the Notes shall be determined by the following
formulae:
Put/Call Rate Adjustment. After the Change, the Put/Call Rate shall be
adjusted in the following manner:
PC = PCo x (M/Mo)
where:
PC = the adjusted Put/Call Rate.
PCo = the Put/Call Rate immediately prior to such adjustment.
Mo = the average of the Daily Market Prices of the Common Stock for the
first ten (10) consecutive trading days immediately preceding but
not including the date of effectiveness of the Change.
M = the fair market value per share of the Acquirer Shares. As used in
this formula, "fair market value" shall mean the average Daily
Market Price of the Acquirer Shares for the ten (10) consecutive
trading days immediately preceding but not including the date of
effectiveness of the Change.
Call Target Price Adjustment. After the Change, the Call Target Price
shall be adjusted in the following manner:
T = To x ( M/Mo)
Where:
T = the adjusted Call Target Price.
To = the Call Target Price immediately prior to such adjustment.
and the other symbols in such formula have the meanings specified under
"Put/Call Rate Adjustment" above and the preceding paragraph.
13
Interest Rate Hurdle Adjustment. After the Change, the Interest Rate
Hurdle applicable to the Notes shall be adjusted in the following manner:
I = Io x (M/Mo)
Where:
I = the adjusted Interest Rate Hurdle;
Io = the Interest Rate Hurdle immediately prior to such adjustment.
and the other symbols in such formula have the meanings specified under
"Put/Call Rate Adjustment" above and the preceding paragraph.
(iii) The Acceleration Option. If the Acquirer chooses, or if Section
4.01(d)(ii) above is not available, or if the Acquirer is required
to do so pursuant to Section 4.01(d)(i) above, the Acquirer shall
provide a notice to the Company to such effect at least ten (10)
Business Days immediately preceding but not including the date of
effectiveness of the Change, and the Company shall inform the
Holders as soon as reasonably practicable thereafter, but in any
event not later than five (5) Business Days immediately preceding
but not including the effective date of the Change. In any such
case, the following shall occur:
(A) The Call Date shall be accelerated to be immediately prior
to the effectiveness of the Change;
(B) Except as provided in (C) below, the terms and conditions
under Section 3.01 shall apply without the adjustments
provided for in Section 4.01(d)(ii) above; provided,
however, that if the Change is not effected, the provisions
of this Section 4.01(d)(iii) shall not apply;
(C) If, with respect to this Section 4.01(d)(iii), Section
3.01(ii) is applicable, in no event will the payment made
or fair market value of shares of Common Stock issued by
the Company to the Holders be less than the fair market
value of the Notes. As used herein, the "fair market value"
of the Notes shall be determined by an investment banking
firm of national reputation and standing selected by the
Company and reasonably acceptable to a Majority of the
Holders. The fair market value shall be determined as of
the day immediately preceding the first public announcement
of the Change, and if payment for purposes of this Section
4.01(d)(iii) is in Common Stock, the Common Stock shall be
valued at the closing price for the Common Stock on the
effective date of the Change; and
(D) Notwithstanding the provisions of Section 3.02, the Call
Notice shall be sent as soon as practicable following
notice of the Acquirer as described above.
(e) Spin-Off.
14
(i) In case the Company shall at any time pay a dividend or make a
distribution to all holders of its Common Stock consisting of the capital stock
of any class or series, or similar interests, of or relating to a subsidiary or
other business unit of the Company (such transaction, a "Spin-Off"; such capital
stock or other interests, the "Spin-Off Shares"; and such subsidiary or business
unit, the "Spin-Off Company"), then the Company shall take such action, and
shall cause the Spin-Off Company to take such action, so that the Notes shall be
deemed exchanged as of the effective date of the Spin-Off, without action by any
Holder, for a combination of new floating rate unsecured loan notes of the
Company (the "New Notes") and floating rate unsecured loan notes of the Spin-Off
Company ("Spin-Off Notes"), as provided in this Section 4.01(e); provided,
however, that in the event that the distribution of Spin-Off Notes to the
Holders would, in the reasonable opinion of counsel to the Company, (i)
jeopardize the tax-free nature of such Spin-Off or (ii) require registration
with the SEC in circumstances where registration would not otherwise be
required, then, at the election of the Company, either (y) the Holders shall not
receive New Notes and Spin-Off Notes pursuant to this Section 4.01(e)(i) and the
Put/Call Rate shall instead be adjusted pursuant to the terms of Section
4.01(e)(ii) or (z) the Holders shall receive New Notes and Spin-Off Notes as
contemplated above in this Section 4.01(e)(i). The terms of the New Notes and
the Spin-Off Notes shall be identical to the terms of the Notes mutatis
mutandis, except that the Put/Call Rates, the nominal amounts, the Call Target
Prices and the Interest Rate Hurdles (subject to adjustment as provided therein)
of the New Notes and the Spin-Off Notes shall be determined as follows:
Put/Call Rate Adjustment. The Put/Call Rate of the Spin-Off Notes
shall be determined in accordance with the following formula:
Rs = Ro x Ps / (Pp+ (r x Ps))
where:
Rs = the Put/Call Rate of the Spin-Off Notes;
Ro = the Put/Call Rate of the Notes immediately prior to adjustment
for the Spin-Off pursuant to this Section 4.01(e)(i);
Pp = the average of the Daily Market Prices of the Common Stock for
the ten (10) consecutive trading days following the date on which
the Spin-Off is consummated;
r = the number of Spin-Off Shares (which may be one or a fraction
less than or greater than one) distributed pursuant to the
Spin-Off in respect of each share of Common Stock; and
Ps = the fair market value per share of the Spin-Off Shares. As used
in this section, "fair market value" shall mean the average Daily
Market Price of the Spin-Off shares for the first ten (10)
consecutive trading days following the date on which the Spin-Off
is consummated; provided, however, that if such distributed
securities do not begin trading within two trading days of the
consummation of such Spin-Off or if the Spin-Off Shares do not
trade for at
15
least ten (10) consecutive trading days within twenty (20) days
after the Spin-Off, then the "fair market value" of such
distributed securities shall be determined by an investment
banking firm of national reputation and standing selected by the
Company and acceptable to a Majority of the Holders on the record
date of the Spin-Off.
The Put/Call Rate of the New Notes shall be determined in accordance
with the following formula:
Rn = Ro x Pp / (Pp+ (r x Ps))
where
Rn = the Put/Call Rate of the New Notes,
and the other symbols in such formula have the meanings specified in the
preceding paragraph of this Section 4.01(e)(i).
Nominal Amount Adjustment. The nominal amount of each Spin-Off Note
shall be determined in accordance with the following formula:
As = Ao x (Ps x r)/(Pp + (Ps x r))
where:
As = the nominal amount of the Spin-Off Note issued in exchange
for any Note;
Ao = the nominal amount of the Note for which the Spin-Off Note
is exchanged;
and the other symbols in such formula have the meanings specified under
"Put/Call Rate Adjustment" above in this Section 4.01(e)(i).
The nominal amount of each New Note shall be determined in
accordance with the following formula:
An = Ao x Pp/ (Pp + (r x Ps))
where:
An = the nominal amount of the New Note issued in exchange for
any Note;
and the other symbols in such formula have the meanings specified under
"Put/Call Rate Adjustment" above and the preceding paragraph, in each case
in this Section 4.01(e)(i).
Call Target Price Adjustment. The Call Target Price for the Spin-Off
Notes shall be determined in accordance with the following formula:
16
Ts = To x PS / (Pp + (r x Ps))
Where:
Ts = the adjusted Call Target Price for the Spin-Off Notes.
To = the Call Target Price immediately prior to such adjustment.
and the other symbols in such formula have the meanings specified under
"Put/Call Rate Adjustment" above and the preceding paragraph, in each case
in this Section 4.01(e)(i).
The Call Target Price for the New Notes shall be determined in
accordance with the following formula:
Tn = To x Pp / (Pp + (r x Ps))
Where:
Tn = the adjusted Call Target Price for the New Notes.
and the other symbols in such formula have the meanings specified under
"Put/Call Rate Adjustment" above and the preceding paragraph, in each case
in this Section 4.01(e)(i).
Interest Rate Hurdle Adjustment. The Interest Rate Hurdle applicable
on the Spin-Off Notes shall be determined in accordance with the following
formula:
IS = Io x Ps / (Pp + (r x Ps))
Where:
Is = the adjusted Interest Rate Hurdle;
Io = the Interest Rate Hurdle immediately prior to such adjustment.
and the other symbols in such formula have the meanings specified under
"Put/Call Rate Adjustment" above and the preceding paragraph, in each case
in this Section 4.01(e)(i).
The Interest Rate Hurdle applicable on the New Notes shall be determined
in accordance with the following formula:
In = Io x Pp / (Pp + (r x Ps))
Where:
In = the adjusted Interest Rate Hurdle
Io = the Interest Rate Hurdle immediately prior to such adjustment.
17
and the other symbols in such formula have the meanings specified under
"Put/Call Rate Adjustment" above and the preceding paragraph, in each case
in this Section 4.01(e)(i).
(ii) In case the Company shall engage in a Spin-Off, and Section
4.01(e)(i) shall not be available to the Holders as a result of the proviso in
the first paragraph of Section 4.01(e)(i), then the Holders shall not receive
New Notes and Spin-Off Notes and immediately prior thereto the following shall
be adjusted in accordance with the following formulae:
Put/Call Rate Adjustment. The Put/Call Rate of the Notes shall be
determined in accordance with the following formula:
Rx = Ro x Pp/(Pp + (r x Ps))
where:
Rx = the adjusted Put/Call Rate.
Ro = the Put/Call Rate immediately prior to adjustment pursuant to
this Section 4.01(e)(ii).
Pp = the average of the Daily Market Prices of the Common Stock for
the ten (10) consecutive trading days following the date on which
the Spin-Off is consummated.
Ps = the fair market value per share of the Spin-Off Shares. As used
in this section, "fair market value" shall mean the average Daily
Market Price of the Spin-Off shares for the first ten (10)
consecutive trading days following the date on which the Spin-Off
is consummated; provided, however, that if such distributed
securities do not begin trading within two trading days of the
consummation of such Spin-Off or if the Spin-Off Shares do not
trade for at least ten (10) consecutive trading days within
twenty (20) days after the Spin-Off, then the "fair market value"
of such distributed securities shall be determined by an
investment banking firm of national reputation and standing
selected by the Company and acceptable to a Majority of the
Holders on the record date of the Spin-Off.
r = the number of Spin-Off Shares (which may be one or a fraction
less than or greater than one) distributed pursuant to the
Spin-Off in respect of each share of Common Stock. Call Target
Price Adjustment. The Call Target Price for the Notes shall be
determined in accordance with the following formula:
Tx = To x Pp / (Pp + (r x PS))
Where:
18
Tx = the adjusted Call Target Price for the Notes. To = the Call Target
Price for the Notes immediately prior to such adjustment.
and the other symbols in such formula have the meanings specified
immediately above under "Put/Call Rate Adjustment".
Interest Rate Hurdle Adjustment. The Interest Rate Hurdle applicable on
the Notes shall be determined in accordance with the following formula:
Ix = Io x Pp / (Pp + (r x PS))
Where:
Ix = the adjusted Interest Rate Hurdle.
Io = the Interest Rate Hurdle immediately prior to such adjustment
and the other symbols in such formula have the meanings specified
immediately above under "Put/Call Rate Adjustment".
An adjustment made pursuant to this Section 4.01(e)(ii) shall become effective
immediately after the determination of the adjustments referred to in this
Section 4.01(e), retroactive to the date for the Spin-Off.
(iii) The Company shall give written notice of any Spin-Off, in
accordance with Section 6.01 hereof, at least ten (10) Business
Days prior to the record date therefor. The Company's failure to
give notice required by this Section 4.01(e)(iii) or any defect
therein shall not affect the validity of the Spin-Off covered by
this Section 4.01(e). Notwithstanding the foregoing, nothing in
this paragraph will prejudice the rights of the Holders pursuant
to this Agreement.
(iv) SECTION 4.02 General Adjustment Provisions.
(a) Notice of Adjustment. Whenever the Put/Call Rate is adjusted, or the type
of securities for which the Notes are exchangeable pursuant to the Put
and the Call is changed, the Company shall promptly file, in the custody
of its Secretary or an Assistant Secretary at its principal office and
with the Put/Call Agent, an officer's certificate setting forth the
adjusted Put/Call Rate, Call Target Price and Interest Rate Hurdle, and,
if applicable, Nominal Amount and the kind or nature of any other
securities or assets for which the Notes shall become exchangeable, a
statement, in reasonable detail, of the facts requiring such adjustment
and the computation by which such adjustment was made. Each such
officer's certificate shall be made available at all reasonable times for
inspection by the Holders at the office of the Put/Call Agent.
(b) Good Faith Determination.
(i) Subject to the following clause (ii), any determination as to
whether an adjustment or limitation of exercise is required
pursuant to this Section 4.01 (and
19
the amount of any adjustment), shall be binding upon the Holders
and the Company if made in good faith by the board of directors of
the Company.
(ii) If a Majority of the Holders shall object to any determination of
the board of directors of the Company within ten (10) Business
Days of receipt of notice of such determination, then such
determination shall be referred to a national independent
accounting firm in the United States (the "Accounting Firm")
selected by the Company and reasonably acceptable to a Majority of
the Holders. The determination of the adjustment made by the
Accounting Firm shall be strictly in accordance with the terms of
this Agreement and shall be binding upon the Holders and the
Company. The Accounting Firm shall be instructed to notify the
Company and the Holders of its determination regarding the
adjustment within fifteen (15) Business Days of such referral.
(iii) Whenever this Agreement provides for the reasonable approval of a
Majority of the Holders of any action or determination, such
approval shall be deemed to be given if a Majority of the Holders
do not reasonably object to such action or determination by
written notice to the Company within ten (10) Business Days of the
date on which notice thereof is first given to the Holders. No
objection shall be deemed reasonable if the reasons for such
objection are not set forth in reasonable detail in the notice of
objection given to the Company as aforesaid.
(c) Subsequent Adjustments. The adjustment provisions of this Article IV
shall be applied successively and from time to time as the circumstances
requiring such adjustments shall occur. If as a result of an adjustment
made pursuant to this Article IV (except as otherwise specifically
provided herein) the Holder of any Notes thereafter surrendered for
conversion shall be entitled to receive any securities other than shares
of Common Stock into which the Notes were originally convertible, the
Put/Call Rate, the Call Target Price and the Interest Rate Hurdle shall
be subject to adjustment, from time to time, in a manner and on terms as
nearly equivalent as practicable to the provisions with respect to the
Common Stock contained in this Article IV.
ARTICLE V
THE PUT/CALL AGENT
SECTION 5.01 Appointment. The Company hereby appoints the Put/Call
Agent as its agent to act as set forth herein, subject to resignation or
replacement of the Put/Call Agent as provided herein. The Put/Call Agent agrees
to accept such appointment, subject to the terms and conditions as set forth
herein.
SECTION 5.02 Duties of the Put/Call Agent. The Put/Call Agent acts
hereunder as agent and in a ministerial capacity for the Company, and its duties
shall be determined solely by the provisions hereof. The Put/Call Agent shall
not by any act hereunder be deemed to make any representations as to the
validity, value or authorization of any securities or other property delivered
upon exercise of the Put or the Call.
Without prejudice to any liability of any other party hereof, the
Put/Call Agent
20
shall not (i) be liable for any recital or statement of facts contained herein
or for any action taken, suffered or omitted by it in reliance on any document
or instrument believed by it in good faith to be genuine and to have been signed
or presented by the proper party or parties, (ii) be responsible for any failure
on the part of the Company to comply with any of its covenants and obligations
contained in this Agreement or in any Note or (iii) be liable for any act or
omission in connection with this Agreement except for its own gross negligence
or willful misconduct.
Any notice, statement, instruction, request, direction, order or
demand of the Company shall be sufficiently evidenced by an instrument signed by
the Company's Chairman or Vice Chairman of the Board, President, any Vice
President, its Secretary, or Assistant Secretary (unless other evidence in
respect thereof is herein specifically prescribed). Without prejudice to any
liability of any other party hereof, the Put/Call Agent shall not be liable for
any action taken, suffered or omitted by it in accordance with such notice,
statement, instruction, request, direction, order or demand believed by it to be
genuine.
The Company agrees to pay the Put/Call Agent reasonable compensation
for its services hereunder and to reimburse it for its reasonable expenses
hereunder and further agrees to indemnify the Put/Call Agent and save it
harmless against any and all losses, expenses and liabilities, including
judgments, costs and counsel fees, for anything done or omitted by the Put/Call
Agent in the execution of its duties and powers hereunder, except losses,
expenses and liabilities arising as a result of the Put/Call Agent's gross
negligence or willful misconduct.
The Put/Call Agent may resign its duties and be discharged from all
further duties and liabilities hereunder (except liabilities arising as a result
of the Put/Call Agent's own gross negligence or willful misconduct), after
giving thirty (30) days' prior written notice to the Company. At least fifteen
(15) days prior to the date such resignation is to become effective, the
Put/Call Agent shall cause a copy of such notice of resignation to be mailed to
the Holder of each Note at the Company's expense. Upon such resignation, or any
inability of the Put/Call Agent to act as such hereunder, the Company shall
appoint a new Put/Call Agent in writing. The Company shall have complete
discretion in the naming of a new Put/Call Agent, who may be an affiliate,
subsidiary or department of the Company, or any person used by the Company as
transfer agent for the Common Stock. If the Company shall fail to make such
appointment within a period of thirty (30) days after it has been notified in
writing of such resignation by the resigning Put/Call Agent, then the Holder of
any Note may apply to any court of competent jurisdiction for the appointment of
a new Put/Call Agent.
The Company may, upon notice to the Holders, remove and replace the
Put/Call Agent if the Put/Call Agent is the transfer agent for the Company's
Common Stock and the Put/Call Agent ceases to be the transfer agent for the
Company's Common Stock for any reason. If for any period no person is acting as
Put/Call Agent, then the Company shall discharge the obligations that would
otherwise fail to be discharged by the Put/Call Agent during such period.
After acceptance in writing of an appointment by a new Put/Call
Agent is received by the Company, such new Put/Call Agent shall be vested with
the same powers, rights, duties and responsibilities as if it had been
originally named herein as the Put/Call Agent, without any further assurance,
conveyance, act or deed. Any former Put/Call Agent hereby
21
agrees to cooperate with and deliver all records to the new Put/Call Agent at
the direction of the new agent and the Company.
Any corporation into which the Put/Call Agent or any new Put/Call
Agent may be converted or merged or any corporation resulting from any
consolidation to which the Put/Call Agent or any new Put/Call Agent shall be a
party or any corporation succeeding to the trust business of the Put/Call Agent
shall be a successor Put/Call Agent under this Agreement without any further
act. Any such successor Put/Call Agent shall promptly cause notice of its
succession as Put/Call Agent to be mailed to the Company and to each Holder.
Nothing herein shall preclude the Put/Call Agent from acting in any
other capacity for the Company.
ARTICLE V
MISCELLANEOUS PROVISIONS
SECTION 6.01 Notices. Any notice or demand authorized by this
Agreement to be given or made to or on the Company or the Put/Call Agent shall
be sufficiently given or made when and if delivered by a recognized
international courier service or hand delivery, or by telecopier with copy sent
by first class or registered mail, postage prepaid, to the applicable address
set forth below (until the Holders are otherwise notified in accordance with
this Section by the Company):
If to the Company, then to:
Vishay Intertechnology, Inc.
63 Lincoln Highway
Malvern, PA 19355
Attn.: Chief Financial Officer
Telecopier No.: (610) 889-2161
Confirm No.: (610) 644-1300
If to the Put/Call Agent, then to:
American Stock Transfer & Trust Co.
59 Maiden Lane
New York, NY 10038
Attn.: Exchange Department
Telecopier No: 718-234-5001
Confirm No: 718-921-8200
Any notice pursuant to this Agreement to be given to any Holder of
Notes shall be sufficiently given when and if delivered to such Holder at the
address appearing on the register maintained for that purpose by the Company
(until the Company and the Put/Call Agent are otherwise notified in accordance
with this Section by such Holder). Any such notice shall be
22
delivered, by overnight or hand delivery, by telecopier with copy sent by first
class mail, postage prepaid, or by first class or registered mail, postage
prepaid.
SECTION 6.02 Supplements and Amendments. The Company and the
Put/Call Agent may from time to time amend or supplement this Agreement in good
faith without the approval of any Holders only in order to cure any ambiguity or
to correct or supplement any provision contained herein which may be defective
or inconsistent with any other provision herein. Any other amendment or
supplement to this Agreement shall require the written consent of the Holders of
two-thirds (2/3) in nominal amount of the Notes then outstanding.
SECTION 6.03 Assignments/Successors. All the covenants and
provisions of this Agreement by or for the benefit of the Company or the
Put/Call Agent shall bind and inure to the benefit of its successors and assigns
hereunder; provided, however, that any assignment by the Company shall not
relieve the Company of any of its obligations hereunder; provided, further, that
no Holder may assign its rights and obligations except to an assignee who has
executed and delivered to the Company an Assignment Form, which Assignment Form,
when executed by the transferor and transferee thereunder, shall inure to the
benefit of and be binding upon, the Company, the Put/Call Agent and each of the
other Holders. This Agreement shall be binding upon and inure to the benefit of
the successors and registered assigns of the Initial Holders and all subsequent
Holders of Notes.
SECTION 6.04 Governing Law. THIS AGREEMENT SHALL BE DEEMED TO BE A
CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK AND FOR ALL PURPOSES SHALL
BE CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF SAID STATE.
SECTION 6.05 No Third Party Beneficiaries. Nothing in this Agreement
shall be construed to give to any person other than the Company, the Put/Call
Agent and the Holders of the Notes any legal or equitable right, remedy or claim
under this Agreement; but this Agreement shall be for the sole and exclusive
benefit of the Company, the Put/Call Agent and the Holders of the Notes.
SECTION 6.06 Registered Holders. The Company and the Put/Call Agent
shall be entitled to treat as the Holders of the Notes solely those persons in
whose names the Notes are registered in the register maintained for that purpose
by the Company.
SECTION 6.07 Securities Laws. It is the intention of the parties
that the issuance of the shares of Common Stock upon exercise of the Put or the
Call shall be exempt from registration under the United States securities laws
pursuant to Section 3(a)(9) of the Securities Act or any successor statute. If
and to the extent that this exemption is not available, the parties will take
such action as may be required to permit the delivery of the shares of Common
Stock in exchange for the Notes in compliance with the United States securities
laws and the rules and regulations of the SEC then in effect.
SECTION 6.08 Notification of Delisting. Prior to the occurrence of a
Delisting Event, the Company will, at least ten (10) Business Days before the
occurrence thereof, notify
23
each holder of such event. Any notice will be in writing and shall specify the
date of such Delisting Event. For these purposes "Delisting Event" means the
common stock of the Company being delisted from the principal United States
national or regional securities exchange or national quotation system on which
the shares of common stock are then listed or traded.
SECTION 6.09 Headings. The descriptive headings of the several
sections and subsections of this Agreement are inserted for convenience only, do
not constitute a part of this Agreement and shall not affect in any way the
meanings or interpretation of this Agreement.
SECTION 6.10 Counterparts. This Agreement may be executed in
counterparts and all such counterparts shall for all purposes be deemed to be an
original, and all such counterparts shall together constitute but one and the
same instrument.
[Remainder of this page left blank.]
24
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed, as of the day and year first above written.
VISHAY INTERTECHNOLOGY, INC.
By:___________________________________
Name:
Title:
AMERICAN STOCK TRANSFER & TRUST CO.
By:___________________________________
Name:
Title:
25
PHOENIX ACQUISITION COMPANY S.AR.L.
By:___________________________________
Name:
Title:
PHOENIX BERMUDA, L.P.
By:___________________________________
Name:
Title:
SANKATY HIGH YIELD ASSET PARTNERS L.P.
By: Sankaty Advisors, LLC
By:___________________________________
Name:
Title:
BCM CAPITAL PARTNERS L.P.
By: Sankaty Advisors, LLC
By:___________________________________
Name:
Title:
BCIP ASSOCIATES II
By: Sankaty Advisors, LLC
By:___________________________________
Name:
Title:
26
BCIP TRUST ASSOCIATES II
By: Sankaty Advisors, LLC
By:___________________________________
Name:
Title:
JP MORGAN PARTNERS (BHCA), L.P.
By: JPMP Master Fund Manager, L.P.
its general partner
By: JPMP Capital Corp.
its general partner
By:___________________________________
Name:
Title:
GARMARK PARTNERS L.P.
By:___________________________________
Name:
Title:
BCIP TRUST ASSOCIATES II-B
By: Sankaty Advisors, LLC
BAIN CAPITAL V MEZZANINE FUND L.P.
By: Sankaty Advisors, LLC
By:___________________________________
Name:
Title:
27
ANNEX I
Form of Assignment
THIS ASSIGNMENT dated [_____20_____] is supplemental to a Put and Call Agreement
(the "Agreement") dated _____, 2002 (as amended and restated from time to time)
between Vishay Intertechnology Inc., a Delaware corporation (the "Company"),
[_____], [_____] and [_____] (each an "Initial Holder") and _____, a _________
the ("Put/Call Agent").
Unless otherwise defined in this Assignment, words and expressions defined in
the Agreement shall have the same meaning when used in this Assignment.
Whereas:
(A) [_____] (the "Transferor") is a Holder of [_____] nominal amount of Notes
(the "Transferred Notes").
(B) The Transferor proposes to transfer the Transferred Notes [(being all the
Notes held by it)] to [_____] (the "Transferee").
[(C) The Transferor proposes to retain [_____] nominal amount of Notes (the
"Retained Notes").]
Assignment
With effect from the date on which the transfer of the transferred Notes takes
effect in accordance with the terms of the Notes, in respect of the Agreement
and the Transferred Notes only:
(a) the Transferor shall be released from further undertakings, liabilities
and obligations to the Company and the Put/Call Agent and each of the
other Holders (the "Non-transferring Parties"), and each of the
Non-transferring Parties shall be released from further undertakings,
liabilities and obligations to the Transferor, and their respective
rights shall be cancelled (the discharged rights and obligations); and
(b) the Transferee shall assume such undertakings, liabilities and
obligations towards, and acquire rights against, each of the
Non-transferring Parties and each of the Non-transferring Parties shall
assume such undertakings, liabilities and obligations towards, and
acquire rights against, the Transferee that differ from such discharged
rights and obligations only insofar as each such Non-transferring Party
and the Transferee have assumed and acquired the same in place of each
such Non-transferring Party and the Transferor.
[For the avoidance of doubt, this Assignment shall not affect the rights,
undertakings, liabilities and obligations of the Transferor in respect of the
Retained Notes.]
The Transferee hereby notifies the Company that its address for notices for the
purposes of Section 6.01 of the Agreement is:
28
[_____]
Fax No: [_____]
Attention: [_____]
This Assignment is governed by the [laws of the State of New York].
Signed by
- --------------------------------
Transferor
- --------------------------------
Transferee
29
ANNEX II
PUT EXERCISE NOTICE
If you, the Holder, want to exercise the Put, fill in the form
below.
I or we, the registered owner of Notes, irrevocably Put to the Company
Notes in the nominal amount of
$_________________________________________________
(if less than the aggregate nominal amount of all Notes held by the Holder,
must be in $2,000,000 denominations)
at the Put/Call Rate and on the terms and conditions specified in that certain
Put and Call Agreement, dated as of ___________, 2002 by and among the parties
thereto, and request that certificates for the shares of Common Stock hereby
exchanged for the indicated nominal amount being put to the Company (and any
securities or other property issuable or transferable upon such exercise) be
issued in the name of and delivered to:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(Print or type name, address and zip code and
social security or tax ID number of owner)
and, if such nominal amount listed above shall be less than the full nominal
amount of the Note(s) of which I am the Holder, that a new Note of like tenor
and date for the balance of the nominal amount thereunder be delivered to the
undersigned.
Nominal amount of Note held immediately prior to exercise of the Put ________
Nominal amount of Note for which this Put is being exercised ________
Balance in nominal amount to be issued as a new Note ________
Date:____________________________ Signed:___________________________________
(Signed exactly as your name appears on
the Note)
30
Exhibit 4.6
SECOND AMENDMENT TO AMENDED AND RESTATED
VISHAY INTERTECHNOLOGY, INC. LONG TERM
REVOLVING CREDIT AGREEMENT AND CONSENT
THIS SECOND AMENDMENT AND CONSENT ("Second Amendment") is made as of this
13th day of December, 2002 by and among Vishay Intertechnology, Inc., a Delaware
corporation ("Company"), and the Permitted Borrowers, Comerica Bank and the
Lenders signatory hereto and Comerica Bank, as administrative agent for the
Lenders (in such capacity, "Agent").
RECITALS:
A. The Company and each of the Permitted Borrowers, Agent and certain
of the Lenders entered into that certain Amended and Restated Vishay
Intertechnology, Inc. Long Term Revolving Credit Agreement dated as of June 1,
1999, as amended by First Amendment dated as of August 31, 2000 (the "Credit
Agreement") under which such Lenders renewed and extended (or committed to
extend) credit to the Company and the Permitted Borrowers (collectively with the
Company, the "Borrowers"), as set forth therein.
B. At the request of the Borrowers, Agent and the requisite Lenders
signatory to this Second Amendment have agreed (i) to make certain amendments to
the Credit Agreement and to certain other Loan Documents as hereinafter set
forth and (ii) to consent to the BCc Acquisition (as defined below) and certain
related changes in capital structure, but in each case only on the terms and
conditions set forth in this Second Amendment.
NOW THEREFORE, the Borrowers, Agent and the Lenders agree:
1. Section 1 of the Credit Agreement shall be amended by:
(a) adding the following new definitions:
"BCc Acquisition" shall mean the acquisition by the Company,
directly or through its subsidiaries, of BCcomponents and its
subsidiaries (and related property and interests) pursuant, subject
to the terms hereof, to the BCc Acquisition Documents.
"BCc Acquisition Documents" shall mean the BCc Share Purchase
Agreement, together with all other related documents and instruments
(including conveyances) executed and delivered in connection with
the BCc Acquisition, as amended (subject to the terms hereof) from
time to time.
"BCcomponents" shall mean BCcomponents Holdings B.V., a Dutch
private limited liability company.
"BCc Share Purchase Agreement" shall mean that certain Share Sale
and Purchase Agreement dated November 10, 2002 by and among the BCc
Shareholders, the Foundation, BCcomponents International BV (each
such term being defined therein), the Company and Vishay Europe, as
amended (subject to the terms hereof) from time to time.
"FPB Advance Notice" shall mean notice from the Company or the
applicable Foreign Permitted Borrower that such Foreign Permitted
Borrower intends to submit a Request for Advance (or for the
issuance of a Letter of Credit) under this Agreement.
"Revolving Credit Optional Increase" shall mean an amount up to One
Hundred Million Dollars ($100,000,000), minus the portions thereof
applied from time to time pursuant to Section 2.17 hereof to
increase the Revolving Credit Aggregate Commitment.
"Second Amendment" shall mean that certain Second Amendment to the
Credit Agreement and Consent dated as of December 12, 2002 by and
among the Company, the Permitted Borrowers, Agent and the Lenders
signatory thereto.
"Second Amendment Effective Date" is defined in Section 8 of the
Second Amendment.
"Security Agreement(s)" shall mean the security agreements executed
and delivered by the Company, each Significant Domestic Subsidiary
and certain Significant Foreign Subsidiaries pursuant to this
Agreement incorporated under the laws of the United States of
America, or a state, territory, possession or other political
subdivision thereof (whether by execution thereof or by execution of
a joinder agreement attached to the form of such security agreement)
in favor of the Agent substantially in the form of the security
agreements previously delivered under this Agreement, as amended or
otherwise modified from time to time.
"Senior Debt" shall mean, with respect to the Company and its
Consolidated Subsidiaries, Total Indebtedness, excluding
Subordinated Debt.
"Subordinated Debt" shall mean all Debt of the Company and its
Subsidiaries which has been subordinated in right of payment and
priority to the Indebtedness, in each case on terms and conditions
reasonably satisfactory to the Agent and the Required Lenders,
including, without limitation, the Subordinated Debt existing on the
Second Amendment Effective Date and identified (as such) on Schedule
8.13 hereto.
(b) amending and restating the following existing definitions:
2
"Revolving Credit Aggregate Commitment" shall mean Five Hundred
Million Dollars ($500,000,000), subject to any increases in the
Revolving Credit Aggregate Commitment pursuant to Section 2.17 of
this Agreement by an amount not to exceed the Revolving Credit
Optional Increase, and subject to any reduction or termination of
the Revolving Credit Aggregate Commitment under Section 2.15 or 9.2
hereof.
"Significant Domestic Subsidiary(ies)" shall mean, on the Second
Amendment Effective Date, those Domestic Subsidiaries identified as
Significant Domestic Subsidiaries on Schedule 6.6A hereto (for
purposes of determining the required Guarantors hereunder) and
Schedule 6.6B hereto (for purposes of determining those Subsidiaries
whose share capital is required to be encumbered by a Pledge
Agreement hereunder) and thereafter shall mean the Significant
Domestic Subsidiaries as of the Second Amendment Effective Date and
all other Domestic Subsidiaries, whether existing as of the
Effective Date or created or acquired by the Company thereafter,
except any Subsidiary:
(a) the total assets of which, on an individual basis, on
any date of determination, are less than $5,000,000; and
(b) which has, as of the most recent fiscal quarter then
ending, for the four preceding fiscal quarters, an EBITDA of less
than $1,000,000;
provided however that, notwithstanding the foregoing, Siliconix
shall not be considered a Significant Subsidiary hereunder unless
and until becoming a 100% Subsidiary.
"Significant Foreign Subsidiary(ies)" shall mean, on the Second
Amendment Effective Date, those Foreign Subsidiaries which have
executed and delivered a Foreign Guaranty on or prior to the Second
Amendment Effective Date, as identified on Schedule 6.6A hereto (for
purposes of determining the required Guarantors hereunder) or whose
share capital (or any portion thereof) has been encumbered by a
Pledge Agreement on or prior to the Second Amendment Effective Date,
as identified Schedule 6.6B hereto (for purposes of determining
those Subsidiaries whose share capital is required to be encumbered
by a Pledge Agreement hereunder) and thereafter shall mean the
Significant Foreign Subsidiaries as of the Second Amendment
Effective Date and all other Foreign Subsidiaries, whether existing
as of the Effective Date or created or acquired by the Company
thereafter, except any Subsidiary:
(a) the total assets of which, on an individual basis, on
any date of determination, are less than $30,000,000; and
(b) which has, as of the most recent fiscal quarter then
ending, for the four preceding fiscal quarters, an EBITDA of less
than $2,500,000;
3
provided however that, notwithstanding the foregoing, Vishay Israel
shall not be considered a Significant Subsidiary hereunder.
"Significant Subsidiary(ies)" shall mean the Significant Domestic
Subsidiaries and the Significant Foreign Subsidiaries.
(c) amending the following existing definitions, as follows:
The references to "January 1, 1998" in the definition of "Equity
Offering Adjustment" and to "March 31, 1999" in the definition of
"Net Income Adjustment" are changed to January 1, 2003.
The definition of "Fees" is amended to delete, after the reference
to "Syndication Fee" (in the second line thereof), the words, added
by the First Amendment, "the Utilization Fee".
The definition of "Indebtedness" is amended to delete, after the
word Subsidiaries (in the fifth line thereof), the parenthetical
phrase, added by the First Amendment, "(other than any Special
Purpose Subsidiary)."
The definitions of "Intercompany Loan" and "Intercompany Loans,
Advances or Investments" are amended to delete, after each reference
to Subsidiary in such definitions, the parenthetical phrase, added
by the First Amendment, "(excluding any Special Purpose
Subsidiary)."
The definition of "Total Indebtedness" is amended to delete, at the
end of such definition, the words (added by the First Amendment) ",
including without limitation any Debt incurred by a Special Purpose
Subsidiary pursuant to a Permitted Securitization, whether or not
required to be so included in accordance with GAAP."
(d) deleting, in their entirety, the definitions of "Permitted
Securitization," "Securitization Transactions," "Special Purpose
Subsidiary," "Utilization Fee" and "Utilization Fee Percentage".
2. Section 2 of the Credit Agreement is amended as follows:
(a) Clause (a) of Section 2.1 (Commitment) of the Credit Agreement is
amended and restated in its entirety, as follows:
"(a) No Permitted Borrower shall be entitled to request an Advance
of the Revolving Credit or the Swing Line or the issuance of a
Letter of Credit hereunder until (i) it has become a party to this
Agreement, either by execution and delivery of this Agreement, or by
execution and delivery of a Permitted Borrower Addendum to this
Agreement, (ii) it has become a party to the applicable Guaranty
either by execution and delivery of such Guaranty or by execution
and delivery of a Joinder Agreement to such Guaranty, (iii) in the
case of each Domestic Permitted Borrower, it has
4
become a party to the applicable Security Agreement, (iv) in the
case of the first Advance to a Foreign Permitted Borrower after the
Second Amendment Effective Date, the Company, or such Foreign
Permitted Borrower, has submitted to the Agent, not less than 60
days prior to date of such Advance, a FPB Advance Notice and (v) in
the case of each Permitted Borrower, the Company has encumbered
and/or delivered (or caused to be encumbered and/or delivered), as
the case may be, pursuant to a Pledge Agreement those shares of
stock issued by such Permitted Borrower and owned (directly or
indirectly) by the Company which are required to be encumbered
and/or delivered under the Prior Credit Agreement or Section 7.16 or
7.17 hereof, as applicable, and accompanied in each case by
authority documents, legal opinions and other supporting documents
as reasonably required by Agent and the Required Lenders hereunder;"
(b) Section 2.13A (Utilization Fee) is deleted from the Credit
Agreement, in its entirety.
(c) Existing Section 2.17 of the Credit Agreement is redesignated in its
entirety as Section 2.18 and New Section 2.17 is added to the Credit
Agreement as follows:
"2.17 Optional Increase in Revolving Credit Aggregate Commitment.
Provided that no Default or Event of Default has occurred and is
continuing, and provided that the Company has not previously elected
to terminate the Revolving Credit Aggregate Commitment under Section
2.15 hereof, the Company may request that the Revolving Credit
Aggregate Commitment be increased in an aggregate amount (for all
such Requests for Increase (as defined below) under this Section
2.17) not to exceed the Revolving Credit Optional Increase, subject,
in each case, to Section 11.1 hereof and to the satisfaction
concurrently with or prior to the date of each such request of the
following conditions:
(a) the Company shall have delivered to the Agent not less
than thirty (30) days prior to the Revolving Credit Maturity Date
then in effect a written request for such increase, specifying the
amount of Revolving Credit Optional Increase thereby requested (each
such request, a "Request for Increase"); provided, however that in
the event the Company has previously delivered a Request for
Increase pursuant to this Section 2.17, the Company may not deliver
a subsequent Request for Increase until all the conditions to
effectiveness of such first Request for Increase have been fully
satisfied or waived hereunder (or such Request for Increase has been
withdrawn); and provided further that the Company may make no more
than two Requests for Increase in any calendar year;
(b) a lender or lenders meeting the requirements of Section
13.8(c) hereof and acceptable to the Company and the Agent (for
purposes
5
of this Section 2.17, such lenders, together with any existing
Lender which agrees to increase its commitment hereunder, being
referred to herein as the "New Lender(s)") shall have become a party
to this Agreement by executing and delivering a New Lender Addendum
(in the form attached as Exhibit K) for a minimum amount (including
for the purposes of this Section 2.17, the existing commitment of
any existing Lender) for each such New Lender of Ten Million Dollars
($10,000,000) and an aggregate amount for all such New Lenders of
that portion of the Revolving Credit Optional Increase, taking into
account the amount of any prior increase in the Revolving Credit
Aggregate Commitment (pursuant to this Section 2.17), covered by the
applicable Request for Increase, provided, however that each New
Lender shall remit to the Agent funds in an amount equal to its
Percentage (after giving effect to this Section 2.17) of all
Advances of the Revolving Credit then outstanding, such sums to be
reallocated among and paid to the existing Lenders based upon the
new Percentages as determined below;
(c) the Company (i) shall have paid to the Agent for
distribution to the existing Lenders, as applicable (based on the
existing Percentages, before giving effect to the applicable Request
for Increase) all interest, fees (including the Revolving Credit
Facility Fee and the Letter of Credit Fees) and other amounts, if
any, accrued to the effective date of such increase and any breakage
fees attributable to the reduction (prior to the last day of the
applicable Interest Period) of any outstanding Eurocurrency-based
Advances, calculated on the basis set forth in Section 11.1 hereof
as though Company has prepaid such Advances and (ii) shall have paid
to each New Lender (based on its applicable Percentage, but if an
existing Lender on such date, only to the extent of its increase in
Percentage) a special letter of credit fee on the Letters of Credit
outstanding on the effective date of such increase, calculated on
the basis of the Letter of Credit Fees which would be applicable to
such Letters of Credit if issued on the date of such increase, for
the period from the effective date of such increase to the
expiration date of such Letters of Credit;
(d) the Company and each of the Permitted Borrowers shall
have executed and delivered to the Agent, if requested by such New
Lenders, new Revolving Credit Notes payable to each of the New
Lenders in the face amount of each such New Lender's Percentage of
the Revolving Credit Aggregate Commitment (after giving effect to
this Section 2.17) and, if applicable, renewal and replacement
Revolving Credit Notes payable to each of the existing Lenders in
the face amount of each such Lender's Percentage of the Revolving
Credit Aggregate Commitment (after giving effect to this Section
2.17), each of such Revolving Credit Notes to be substantially in
the form of Exhibit B-1 or B-2 to the Credit Agreement, as
applicable, and dated as of the effective
6
date of such increase (with appropriate insertions relevant to such
Notes and acceptable to the applicable Lender, including the New
Lenders);
(e) except to the extent such representations and warranties
are not, by their terms, continuing representations and warranties,
but speak only as of a specific date, the representations and
warranties made by Company, the Permitted Borrower, or each
Guarantor in this Agreement or any of the other Loan Documents, and
the representations and warranties of any of the foregoing which are
contained in any certificate, document or financial or other
statement required to be furnished at any time hereunder or
thereunder shall have been true and correct in all material respects
when made and shall be true and correct in all material respects on
and as of the effective date of such increase; and (ii) no Default
or Event of Default shall have occurred and be continuing as of the
effective date of such increase; and
(f) such other amendments, acknowledgments, consents,
documents, instruments, any registrations, if any, shall have been
executed and delivered and/or obtained by Company as required by
Agent, in its reasonable discretion.
Promptly on or after the date on which all of the conditions to such
Request for Increase set forth above have been satisfied or waived,
Agent shall notify the Company and each of the Lenders of the amount
of the Revolving Credit Aggregate Commitment as increased pursuant
this Section 2.17 and the date on which such increase has become
effective and shall prepare and distribute to the Company and each
of the Lenders (including the New Lenders) a revised Schedule 1.1 to
this Agreement setting forth the applicable new Percentages of the
Lenders (including the New Lender(s)), taking into account such
increase and assignments (if any)."
3. Section 7 of the Credit Agreement shall be amended as follows:
(a) The preamble to Section 7 is amended to delete after the word
"Subsidiaries" (in the second line thereof) the parenthetical
phrase, added by the First Amendment, "(excluding any Special
Purpose Subsidiary)".
(b) Clause (f) of Section 7.3 (Reporting Requirements) is amended to
delete at the end of clause (f) the words, added by the First
Amendment, "and promptly following each Permitted Securitization,
copies of the principal operative documents relating to such
Permitted Securitization."
(c) Section 7.4 (Tangible Net Worth) is amended to change the date
reference in the second line thereof from "December 31, 1998" to
"December 31, 2002" and to change the reference to "Five Hundred
Fifty Two Million Four Hundred One Thousand Three Hundred Twenty
Three Dollars
7
($552,401,323)" in the third and fourth lines thereof to "Nine
Hundred Million Dollars ($900,000,000)".
(d) Section 7.5 (Leverage Ratio) is amended and restated in its entirety
as follows:
"7.5 Leverage Ratio. Maintain, as of the last day of each fiscal
quarter during the periods specified below, a Leverage Ratio of not
more than the following amounts during the periods specified below:
Period Ratio
------ -----
Effective date through December 30, 2003 3.50
December 31, 2003 through December 30, 2004 3.25
December 31, 2004 and thereafter 3.00
(e) New Section 7.6A (Senior Debt Ratio) is added to the Credit
Agreement (immediately following Section 7.6), as follows:
"7.6A Senior Debt Ratio. Maintain, as of the last day of each fiscal
quarter ending during the periods specified below, for the four
fiscal quarters then ending, a ratio of Senior Debt to Consolidated
EBITDA of not more than the following amounts during the periods
specified below:
Period Ratio
------ -----
Effective date through December 30, 2003 1.75
December 31, 2003 and thereafter 1.50
(f) Clause (a) of Section 7.16 (Future Subsidiaries) is amended and
restated in its entirety as follows:
"(a) With respect to each Person which becomes a Significant
Subsidiary subsequent to the Effective Date, cause such new
Subsidiary to execute and deliver to the Agent (i) in the case of
each such Significant Domestic Subsidiary, (x) a Joinder Agreement
whereby such Significant Domestic Subsidiary becomes obligated as a
Guarantor under the Domestic Guaranty and (y) a Joinder Agreement
whereby such Significant Domestic Subsidiary becomes obligated under
the applicable Security Agreement, such documents to be executed and
delivered within thirty days of the date such Person is created,
acquired or otherwise becomes a Significant Subsidiary (whichever
first occurs) and (ii) in the case of each such Significant Foreign
Subsidiary, (a) a Joinder Agreement whereby such Significant Foreign
Subsidiary becomes obligated as a Guarantor under the Foreign
Guaranty and (b) a Security Agreement or a Joinder Agreement whereby
such Significant Foreign Subsidiary incorporated
8
under the laws of the United States of America becomes obligated
under the applicable Security Agreement, as the case may be, such
documents to be executed and delivered within fifty-five days of the
Agent's receipt of a FPB Advance Notice; and"
(g) Clause (b) of Section 7.16 (Future Subsidiaries) is amended to add,
in the second line thereof, following the words "Effective Date"
(after the comma) the words, "if such Subsidiary is a direct
Subsidiary of the Company or a Domestic Subsidiary, and to add, at
the end of clause (b), before the semicolon, the following:
"and; for all other Foreign Subsidiaries within fifty-five days of
the Agent's receipt of a FPB Advance Notice, the Company shall
execute, or cause to be executed, and deliver to the Agent a Pledge
Agreement encumbering subject to Section 7.17 hereof, with a first
priority Lien 65% of the share capital of each such Significant
Foreign Subsidiary to secure the Indebtedness of the Company and the
Domestic Permitted Borrowers and the Indebtedness (as such term is
defined therein) of such parties under the Short Term Revolving
Credit Agreement and 100% of the share capital of each such
Significant Foreign Subsidiary to secure the Indebtedness of the
Foreign Permitted Borrowers hereunder; and"
4. Section 8 of the Credit Agreement shall be amended as follows:
(a) Clause (e) of Section 8.2 (Limitations on Fundamental Changes) is
amended to delete, after the words Permitted Transfers, the words,
added by the First Amendment, "and Permitted Securitizations."
(b) The reference in the last line of Section 8.3 (Guaranties) to
"Section 8.7(g)" is changed to "clauses (d), (e), (f) or (g) of
Section 8.7."
(c) The first clause of Clause (f) of Section 8.4 (Debt) (contained in
the first two lines of said Section) is hereby amended and restated
(without affecting the balance of said Section) to read as follows:
"Debt to third parties issued by any Foreign Subsidiary of the
Company in an aggregate amount at any time outstanding not to exceed
$55,000,000;"
(d) The words "on a pari passu basis with the Indebtedness, or"
contained in the fifth line of clause (h) of Section 8.4 (Debt) are
deleted.
(e) The period at the end of clause (i) of Section 8.4 is changed to ";
and," and new clause (j) is added, as follows:
"(j) unsecured Debt issued (or to be issued) by the Company in an
aggregate principal amount not to exceed $105,000,000 to refinance
the mezzanine debt issued by BCcomponents prior to the BCc
Acquisition (the "BCc Replacement Financing")."
9
(f) Section 8.5 (Liens) is amended to delete clause (f), added by the
First Amendment, in its entirety, and to move the "; and" from the
end of clause (e) thereof to the end of clause (d).
(g) Section 8.7 (Investments) is amended to change the reference to
"five percent (5%)" in clause (g) thereof to "seven and one-half
percent (7.5%)", and to delete clause (l) in its entirety, added by
the First Amendment, and to move the "; and" from the end of clause
(k) to the end of clause (j).
(h) Section 8.8 (Accounts Receivable) is amended to delete, at the end
of such section, the words (added by the First Amendment) ", and
except pursuant to a Permitted Securitization."
(i) Section 8.11 (Prohibition Against Certain Restrictions) is amended
to delete (after the word "Agreement" in the parenthetical phrase in
the second line thereof) the words, added by the First Amendment,
"and excluding any such agreement by a Special Purpose Subsidiary
pursuant to a Permitted Securitization, but only to the extent such
agreement applies only to such Special Purpose Subsidiary."
(j) Section 8.12 (Amendment of Various Documents) is amended to add, in
the caption (immediately preceding Temic Acquisition Agreement) the
words "BCc Acquisition Documents," and to add in the third line
thereof, immediately preceding the words "Temic Acquisition
Agreement," the words "BCc Acquisition Documents."
(k) New Sections 8.13 (Amendment of Subordinated Debt Documents), 8.14
(Limitations on Prepayments) and 8.15 (EBIT Requirement) are added
to the Credit Agreement, as follows:
"8.13 Amendment of Subordinated Debt and Other Debt Documents.
Amend, modify or otherwise alter (or suffer to be amended, modified
or altered) any of the terms and conditions of those documents or
instruments evidencing or otherwise related to any Debt set forth on
Schedule 8.13 or any other Subordinated Debt, except for those
amendments, modifications or other alterations which could not
reasonably be determined to have a material adverse effect on (a)
the business, operations, property or condition (financial or
otherwise) of the Company and its Subsidiaries, taken as a whole,
(b) the ability of the Company or any of its Subsidiaries to perform
their respective obligations under this Agreement or any other Loan
Document to which any of them is a party, or (c) the validity or
enforceability of this Agreement or any of the other Loan Documents
or the rights or remedies of the Agent or the Lenders hereunder or
thereunder, or except as may be approved by Agent and the Required
Lenders."
10
"8.14 Payment or Prepayment of Other Debts. Prepay, purchase, redeem
or defease any Subordinated Debt or other Debt set forth on Schedule
8.14, except to the extent permitted under that certain Consent
issued by the Agent, for and on behalf of the Lenders, on May 29,
2001 with respect to the Additional Debt (as defined therein) and
under that certain consent issued by the Agent for and on behalf of
the Lenders on November 2, 2001 (with respect to the Subordinated
Debt issued by General Semiconductor); and, except for regularly
scheduled payments of interest, make any payments, prepayments or
purchase, redeem or otherwise defease the BCc Replacement Financing
in cash or cash equivalents, prior to the Revolving Credit Maturity
Date as in effect on the Second Amendment Effective Date."
"8.15 EBIT Requirement. Have EBIT, determined on a Consolidated
basis for the Company and its Subsidiaries (as defined below), which
is a negative number for two or more consecutive fiscal quarters.
For purposes of this Section 8.15, "EBIT" shall mean Net Income of
the Company and its Subsidiaries (determined on a consolidated
basis) for the applicable period adjusted to exclude, without
duplication, the following items of income or expense to the extent
that such items are included in the calculation of Net Income:
Interest Expense, and total income tax expense."
5. Section 13 of the Credit Agreement shall be amended, as follows:
(a) Section 13.11 (Amendment and Waiver) is amended and restated in its
entirety, as follows:
"13.11 Amendment and Waiver. No amendment or waiver of any provision
of this Agreement or any other Loan Document, or consent to any
departure by the Company or the Permitted Borrowers therefrom, shall
in any event be effective unless the same shall be in writing and
signed by the Required Lenders (or signed by the Agent at the
direction of the Required Lenders), and then such waiver or consent
shall be effective only in the specific instance and for the
specific purpose for which given; provided, however, that (X) no
amendment, waiver or consent shall increase the Percentage or the
stated commitment amounts applicable to any Lender unless approved,
in writing, by the affected Lender and (Y) no amendment, waiver or
consent shall, unless in writing and signed by all the Lenders, do
any of the following: (a) increase the Revolving Credit Aggregate
Commitment, except pursuant to Section 2.17 hereof, (b) reduce the
principal of, or interest on, the Advances or any Fees or other
amounts payable hereunder, (c) postpone any date fixed for any
payment of principal of, or interest on, the outstanding Advances or
any Fees or other amounts payable hereunder, (d) waive any Event of
Default specified in Section 9.1(a) or (b) hereof, (e) release or
defer the granting or perfecting of a lien or security interest in
any Collateral or release any
11
guaranty or similar undertaking provided by any Person or modify any
indemnity provided to the Lenders, hereunder or under the other Loan
Documents, except as shall be otherwise expressly provided in this
Agreement or any other Loan Document, (f) take any action which
requires the signing of all Lenders pursuant to the terms of this
Agreement or any other Loan Document, (g) change the aggregate
unpaid principal amount of the outstanding Advances which shall be
required for the Lenders or any of them to take any action under
this Agreement or any other Loan Document, (h) change this Section
13.11, or (i) change the definition of "Required Lenders", "Interest
Periods", "Alternative Currencies", "Permitted Borrower" or
"Percentage"; and provided further, however, that no amendment,
waiver or consent hereunder shall, unless in writing and signed (x)
by the Agent, in addition to all the Lenders, affect the rights or
duties of the Agent under this Agreement or any other Loan Document,
whether in its capacity as Agent or the issuing bank or (y) by the
Swing Line Bank, in addition to all the Lenders, affect the rights
or duties of the Swing Line Bank under this Agreement or any other
Loan Documents, in its capacity as Swing Line Bank. All references
in this Agreement to "Lenders" or "the Lenders" shall refer to all
Lenders, unless expressly stated to refer to "Required Lenders."
6. Replacement Schedule 4.1 (Pricing Matrix) to the Credit Agreement set
forth on Attachment 1 shall replace in its entirety, the existing Schedule
4.1 to the Credit Agreement. Replacement Schedules 6.6A and 6.6B to the
Credit Agreement (relating to the Significant Subsidiaries and set forth
on Attachment 2) shall replace in their entirety the existing Schedule
6.6A and 6.6B and Replacement Schedule 8.3 (set forth on Attachment 3)
shall replace in its entirety existing Schedule 8.3. New Schedules 8.13
and 8.14 are added to the Credit Agreement in the form of Attachments 4
and 5, respectively. New Exhibit K is hereby added to the Credit Agreement
in the form of Attachment 6.
7. The Company has requested that the requisite Lenders consent to the BCc
Acquisition and to the changes in capital structure identified on
Attachment 7. The Agent and the requisite Lenders hereby consent to the
BCc Acquisition and to the changes in capital structure identified on
Attachment 7 substantially on the terms and conditions set forth in the
BCc Share Purchase Agreement and otherwise as set forth in this Second
Amendment, provided that the following conditions are satisfied or waived
on the date of the BCc Acquisition:
(a) the BCc Acquisition Documents shall be in form and substance
reasonably satisfactory to the Agent and the requisite Lenders and
each of the BCc Acquisition Documents shall have been duly
authorized, executed and delivered by each of the parties thereto
and shall be in full force and effect;
(b) no term or provision of the BCc Acquisition Documents shall have
been modified, and no condition to consummation of the BCc
Acquisition shall have been waived, in either case in a manner
materially detrimental to the Company, by any of the parties
thereto;
12
(c) the Company shall have in all material respects done and performed
such acts and observed such covenants which each is required to do
or perform under the BCc Acquisition Documents in order to
consummate the BCc Acquisition; and
(d) no Default or Event of Default shall have occurred and be
continuing.
If the BCc Acquisition has not been consummated prior to January 31, 2003
(or such later date approved by the Required Lenders) this Consent shall
expire and be of no further force and effect.
8. This Second Amendment shall become effective (according to the terms
hereof) on the date confirmed in a written notice to the Borrowers and the
Lenders from the Agent (such date, the "Second Amendment Effective Date")
that the following conditions have been fully satisfied by the Borrowers,
which date shall occur on or before December 31, 2002 (the "Conditions"):
(a) Agent shall have received counterpart originals of this Second
Amendment, duly executed and delivered by each of the Borrowers, and
the requisite Lenders, and of acknowledgments and reaffirmations of
the Guarantors, in each case in form reasonably satisfactory to
Agent and the Lenders;
(b) Agent shall have received from each of the Borrowers and each of the
Guarantors a certification (i) that all necessary actions have been
taken by such parties to authorize execution and delivery of this
Second Amendment (and any acknowledgments and reaffirmations),
supported by such resolutions or other evidence of corporate
authority or action as reasonably required by Agent and that no
consents or other authorizations of any third parties are required
in connection therewith; and (ii) that, after giving effect to this
Second Amendment, no Default or Event of Default has occurred and is
continuing on the proposed effective date of the Second Amendment;
(c) To the extent aggregate Advances of the Revolving Credit (and the
undrawn amount of any Letters of Credit) and the Swing Line
outstanding on such date exceed the Revolving Credit Aggregate
Commitment (as reduced by the Second Amendment), the Company or any
Permitted Borrower, as applicable, shall prepay the amount of such
Advances in accordance with the terms set forth in Credit Agreement
(including any breakage costs assessed under Section 11.1 of the
Credit Agreement), such prepayment to be distributed to the Lenders
based on the Percentages in effect on the Second Amendment Effective
Date, accompanied by any breakage costs, as aforesaid;
(d) Agent shall have received from Company and each of the Domestic
Guarantors (as of the Second Amendment Effective Date) counterpart
13
originals of a Security Agreement covering all tangible and
intangible personal property (excluding real estate and fixtures)
substantially in the form of the Security Agreement previously in
effect (prior to the First Amendment) under the Credit Agreement;
provided, however, the Company and the Domestic Guarantors shall be
required to deliver Schedule I (Intellectual Property) to the
Security Agreement and any other items or documentation relating to
the Intellectual Property owned by such Persons on or before
December 23, 2002; and
(e) Company shall have paid to Agent, an amendment and consent fee in
the amount of 0.20% of the aggregate amount of the Revolving Credit
Aggregate Commitment (after giving effect to reduction thereof under
the Second Amendment), for distribution to those Lenders (based on
the applicable Percentages in effect on the Second Amendment
Effective Date) which executed and delivered this Second Amendment
on or before December 11, 2002, and, to the extent applicable, shall
have selected new Interest Periods for the Advances to be
outstanding on the First Amendment Effective Date in compliance with
Sections 2.3 and 2.5(c) of the Credit Agreement.
9. Each of Company, the Permitted Borrowers and the Guarantors hereby
represents and warrants that, after giving effect to the amendments
contained herein, (a) execution and delivery of this Second Amendment and
the performance by each of Company and the Permitted Borrowers of their
respective obligations under the Credit Agreement as amended hereby
(herein, as so amended, the "Amended Credit Agreement") are within such
undersigned's corporate powers, have been duly authorized, are not in
contravention of law or the terms of its articles of incorporation or
bylaws or other organic documents of the parties thereto, as applicable,
and except as have been previously obtained do not require the consent or
approval, material to the amendments contemplated in the Amended Credit
Agreement, of any governmental body, agency or authority, and the Amended
Credit Agreement, will constitute the valid and binding obligations of
such undersigned parties enforceable in accordance with its terms, except
as enforcement thereof may be limited by applicable bankruptcy,
reorganization, insolvency, moratorium, ERISA or similar laws affecting
the enforcement of creditors' rights generally and by general principles
of equity (whether enforcement is sought in a proceeding in equity or at
law); (b) the continuing representations and warranties set forth in
Sections 6.1 through 6.20, inclusive, of the Amended Credit Agreement are
true and correct in all material respects on and as of the date hereof;
and (c) each of the foregoing representations and warranties (whether
expressly set forth or incorporated by reference) are and shall remain
continuing representations and warranties until the termination or
expiration of the Amended Credit Agreement.
10. Except as specifically set forth above, this Second Amendment shall not be
deemed to amend or alter in any respect the terms and conditions of the
Credit Agreement (including without limitation all conditions and
requirements for Advances and any financial covenants) or any of the other
Loan Documents, or to constitute a waiver or release by any of the Lenders
or the Agent of any right, remedy, Default or Event of Default under the
Credit Agreement or any of the other Loan Documents, except to the extent
specifically set forth above.
14
Furthermore, this Second Amendment shall not affect in any manner
whatsoever any rights or remedies of the Lenders or the Agent with respect
to any other non-compliance by the Borrowers with the Credit Agreement or
the other Loan Documents, whether in the nature of a Default or Event of
Default, and whether now in existence or subsequently arising, and shall
not apply to any other transaction.
11. Unless otherwise defined to the contrary herein, all capitalized terms
used in this Second Amendment shall have the meanings set forth in the
Credit Agreement.
12. This Second Amendment shall be a contract made under and governed by the
internal laws of the State of Michigan, and may be executed in counterpart
in accordance with Section 13.10 of the Credit Agreement.
* * *
[Signatures follow on succeeding pages]
15
IN WITNESS WHEREOF, Company, the Permitted Borrowers, the Lenders and
Agent have each caused this Second Amendment to be executed by their respective
duly authorized officers or agents, as applicable, all as of the date first set
forth above.
COMPANY: AGENT:
VISHAY INTERTECHNOLOGY, INC. COMERICA BANK, As Agent
By:__________________________________ By:______________________________
Its: Executive Vice President, Its: Vice President
Chief Financial Officer and One Detroit Center
Director 500 Woodward Avenue
63 Lincoln Highway Detroit, Michigan 48226
Malvern, Pennsylvania 19355 Attention: Corporate Finance
PERMITTED BORROWERS:
VISHAY EUROPE GmbH
By:_________________________________
Its:________________________________
VISHAY ELECTRONIC GmbH
By:_________________________________
Its:________________________________
PAMELA VERWALTUNGSGESELLSCHAFT mbH
By:_________________________________
Its:________________________________
16
COMERICA BANK, individually
and as Issuing Bank
By:__________________________________
Its:_________________________________
17
BANK OF AMERICA N.A., individually
and as Swing Line Bank
By:__________________________________
Its:_________________________________
18
FLEET NATIONAL BANK
By:__________________________________
Its:_________________________________
19
BANK HAPOALIM B.M.,
NEW YORK BRANCH
By:__________________________________
Its:_________________________________
By:__________________________________
Its:_________________________________
20
BANK LEUMI USA
By:__________________________________
Its:_________________________________
21
WESTDEUTSCHE LANDESBANK
GIROZENTRALE, NEW YORK
BRANCH
By:__________________________________
Its:_________________________________
22
ABN AMRO BANK NV
By:__________________________________
Its:_________________________________
By:__________________________________
Its:_________________________________
23
BARCLAYS BANK PLC
By:__________________________________
Its:_________________________________
24
WACHOVIA BANK, N.A.
By:__________________________________
Its:_________________________________
25
THE CHASE MANHATTAN BANK
By:__________________________________
Its:_________________________________
26
THE BANK OF TOKYO-MITSUBISHI,
LTD. NEW YORK BRANCH
By:__________________________________
Its:_________________________________
27
KEYBANK NATIONAL ASSOCIATION
By:__________________________________
Its:_________________________________
28
SANPAOLO IMI SPA, formerly known as
Istituto Bancario San Paolo Di Torino,
S.p.A.
By:__________________________________
Its:_________________________________
29
SOCIETE GENERALE, NEW YORK
BRANCH
By:__________________________________
Its:_________________________________
30
ISRAEL DISCOUNT BANK
By:__________________________________
Its:_________________________________
31
THE BANK OF NEW YORK
By:__________________________________
Its:_________________________________
32
REPLACEMENT SCHEDULE 4.1
PRICING MATRIX
Applicable Margin Grid
Vishay Intertechnology, Inc.
Amended and Restated Long Term Revolving Credit Facility
- --------------------------------------------------------------------------------
Basis for Pricing LEVEL I LEVEL II LEVEL III** LEVEL IV
- --------------------------------------------------------------------------------
Leverage Ratio 2.00:1.0 2.00:1.0 2.50:1.0 3.00:1.0
but but
2.50:1.0 3.00:1.0
- --------------------------------------------------------------------------------
Revolving Credit Facility 0.30% 0.45% .625% .625%
Fee
- --------------------------------------------------------------------------------
Eurocurrency-based Margin 1.20% 1.30% 1.625% 2.25%
- --------------------------------------------------------------------------------
Prime-based Rate Margin 0.0% 0.0% 0.0% 0.0%
- --------------------------------------------------------------------------------
Letter of Credit Fee 1.20% 1.30% 1.625% 2.25%
(exclusive of facing fee)
- --------------------------------------------------------------------------------
** Level III pricing shall be in effect until the delivery of the financial
statements and Covenant Compliance Report for the quarter ending December
31, 2002 required to be delivered under Section 7.3 hereof, after which
time the pricing grid shall govern.
33
EXHIBIT K
NEW LENDER ADDENDUM
NEW LENDER ADDENDUM, dated ___________, to the Amended and Restated Vishay
Intertechnology, Inc. Long Term Revolving Credit Agreement dated as of June 1,
1999 (as otherwise amended or modified from time to time, the "Credit
Agreement"), among Vishay Intertechnology, Inc. ("Company"), the Permitted
Borrowers parties thereto, each of the financial institutions parties thereto
(collectively, the "Banks") and Comerica Bank, as Agent for the Banks.
W I T N E S S E T H:
WHEREAS, the Credit Agreement provides in Section 2.17 thereof that a
financial institution, although not originally a party thereto, may become a
party to the Credit Agreement with the consent of the Company and the Agent by
executing and delivering to the Agent a New Lender Addendum to the Credit
Agreement in substantially the form of this new lender addendum; and
WHEREAS, the undersigned New Lender was not an original party to the
Credit Agreement but now desires to become a party thereto;
NOW, THEREFORE, the New Lender hereby agrees as follows:
The New Lender hereby confirms that it has received a copy of the Credit
Agreement and the exhibits and schedules referred to therein, and all other Loan
Documents which it considers necessary, together with copies of the other
documents which were required to be delivered under the Credit Agreement as a
condition to the making of the loans thereunder. The New Lender acknowledges and
agrees that it: (a) has made and will continue to make such inquiries and has
taken and will take such care on its own behalf as would have been the case had
its commitment been granted and its loans been made directly by such New Lender
to the Company without the intervention of the Agent or any other Lender; and
(b) has made and will continue to make, independently and without reliance upon
the Agent or any other Lender, and based on such documents and information as it
has deemed appropriate, its own credit analysis and decisions relating to the
Credit Agreement. The New Lender further acknowledges and agrees that the Agent
has not made any representations or warranties about the creditworthiness of the
Company or any other party to the Credit Agreement or any other of the Loan
Documents, or with respect to the legality, validity, sufficiency or
enforceability of the Credit Agreement, or any other of the Loan Documents.
New Lender represents and warrants that it is a Person to which
assignments are permitted pursuant to Sections 13.8(c) of the Credit Agreement.
Except as otherwise provided in the Credit Agreement, effective as of the
Effective Date (as defined below):
(a) the New Lender (i) shall be deemed automatically to have
become a party to the Credit Agreement and the other Loan
Documents, and to have all the rights and obligations of a
party to the Credit Agreement and the other Loan Documents, as
if it were an original signatory; and (ii) agrees to be bound
by the terms and conditions set forth in the Credit Agreement
and the other Loan Documents as if it were an original
signatory thereto; and
(b) the New Lender shall be a Lender and its Percentage of the Revolving
Credit (and its risk participation in Letters of Credit) shall be as
set forth in the attached revised Exhibit D (Percentages); provided
any fees paid prior to the Effective Date, including any Letter of
Credit Fees, shall not be recalculated, redistributed or reallocated
by Company, Agent or the Banks.
As used herein, the term "Effective Date" means the date on which all of
the following have occurred or have been completed, as reasonably determined by
the Agent:
(1) the Company shall have paid to the Agent all interest, fees
(including the Revolving Credit Facility Fee) and other amounts, if
any, accrued to the Effective Date for which reimbursement is then
owing under the Credit Agreement;
(2) New Lender shall have remitted to the Agent funds in an amount equal
to its Percentage of all Advances of the Revolving Credit
outstanding as of the Effective Date; and
(3) the Company shall have executed and delivered to the Agent for the
New Lender, new Revolving Credit Notes payable to such New Lender in
the face amount of such New Lender's Percentage of the Revolving
Credit Aggregate Commitment (after giving effect to this New Lender
Addendum, and any other New Lender Addendum executed concurrently
herewith).
The Agent shall notify the New Lender, along with Company, of the
Effective Date. The New Lender shall deliver herewith to the Agent
administrative details with respect to the funding and distribution of Advances
(and Letters of Credit) as requested by Agent.
Terms defined in the Credit Agreement and not otherwise defined herein
shall have their defined meanings when used herein.
2
IN WITNESS WHEREOF, the undersigned has caused this New Lender Addendum to
be executed and delivered by a duly authorized officer on the date first above
written.
[NEW LENDER]
By_________________________________
Title:
Accepted this ______ day of _______, ____.
VISHAY INTERTECHNOLOGY, INC.
By_________________________________
Title:
Accepted this ______ day of _______, ____.
COMERICA BANK, as Agent
By_________________________________
Title:
3
Exhibit 99.1
NEWS RELEASE
Contact: Richard N. Grubb, Executive
Vice President and Chief
Financial Officer or
Robert A. Freece
Senior Vice President
610/644-1300
FOR IMMEDIATE RELEASE
VISHAY CLOSES ACQUISITION OF BCcomponents
MALVERN, PENNSYLVANIA - December 16, 2002 - Vishay Intertechnology, Inc.
(NYSE:VSH) announced today that it had completed the acquisition of BCcomponents
Holdings B.V., a leading manufacturer of passive components with operations in
Europe, India and the Far East. The product lines of BCcomponents include linear
and non-linear resistors; ceramic, film and aluminum electrolytic capacitors;
and switches and trimming potentiometers. BCcomponents had annual sales in 2001
of approximately $320 million.
Vishay acquired the outstanding shares of BCcomponents in exchange for ten-year
warrants to acquire 7,000,000 shares of Vishay common stock at an exercise price
of $20.00 per share and ten-year warrants to acquire 1,823,529 shares of Vishay
common stock at an exercise price of $30.30 per share.
In the transaction, outstanding obligations of BCcomponents, including
indebtedness and transaction fees and expenses, in the amount of approximately
$224 million were paid or assumed. Also, $105 million in principal amount of
BCcomponents' mezzanine indebtedness and certain other securities of
BCcomponents were exchanged for $105 million principal amount of floating rate
unsecured loan notes of Vishay due 2102. The Vishay notes bear interest at LIBOR
plus 1.5% through December 31, 2006 and at LIBOR thereafter. The notes are
subject to a put and call agreement under which the holders may at any time put
the notes to Vishay in exchange for 6,176,471 shares of Vishay common stock in
the aggregate, and Vishay may call the notes in exchange for cash or for shares
of its common stock after 15 years from the date of issuance. Vishay has granted
registration rights for the warrants and the shares of common stock issuable in
respect of the warrants and the notes.
Vishay obtained the cash required for the transaction with cash of Vishay on
hand, cash of BCcomponents and borrowings under Vishay's long term revolving
bank credit facility. At the same time, the aggregate commitment under this
facility was reduced from $660 million to $500 million, subject to increase
under certain circumstances.
Commenting on the transaction, Dr. Felix Zandman, Chairman and CEO of Vishay,
stated: "We are pleased that the acquisition closed smoothly and on schedule,
and we expect to quickly begin integrating the operations of BCcomponents with
our passive component business in Europe and elsewhere around the world. As we
said when we first announced the transaction, the acquisition of BCcomponents
gives us an
- MORE -
extensive portfolio of new products, complements our MLCC and tantalum capacitor
lines, offers meaningful opportunities for synergies and cost savings and
enhances our position in passive components generally. We are therefore very
excited about the opportunities presented by this acquisition, which is our
first major acquisition in the passive area in ten years."
Vishay, a Fortune 1,000 Company listed on the NYSE, is one of the world's
largest manufacturers of discrete semiconductors (diodes, rectifiers,
transistors, optoelectronics, and selected ICs) and passive electronic
components (resistors, capacitors, inductors, and transducers). The Company's
components can be found in products manufactured in a very broad range of
industries worldwide. Vishay is headquartered in Malvern, Pennsylvania, and has
plants in fourteen countries employing over 20,000 people. Vishay can be found
on the Internet at http://www.vishay.com.
This release contains statements concerning the expected benefits of the
BCcomponents transaction. These forward-looking statements are within the safe
harbor provisions of the Private Securities Litigation Reform Act of 1995. They
are based on current expectations and are subject to certain risks,
uncertainties and assumptions. Factors that could cause results to differ from
the Company's expectations include those that affect Vishay's passive components
business and its businesses generally. With regard to factors affecting Vishay's
businesses generally, please see the Company's Report on Form 10-K for the year
ended December 31, 2001 that has been filed with the Securities and Exchange
Commission. The Company undertakes no obligation to publicly update or revise
any forward-looking statements, whether as a result of new information, future
events or otherwise.
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