|
-
|
Dipl.-Ing.
Hans Kilian SAUERESSIG Capital contribution of €660,000 (22
%)
|
|
-
|
Jakob
Heinreich SAUERESSIG Capital contribution of €300,000 (10
%)
|
|
-
|
Dipl.-Kfm.
Jörg Christian SAUERESSIG Capital contribution of €700,000 (23.33
%)
|
|
-
|
Karl-Wilhelm
SAUERESSIG Capital contribution of €340,000 (11.33
%)
|
|
-
|
Reinhart
ZECH VON HYMMEN Capital contribution of €1,000,000 (33.33
%)
|
|
1.
|
The
buyer hereby irrevocably offers to the seller - such offer also being
valid for his universal successors - to purchase the partnership interest
in Saueressig GmbH & Co. KG held by the seller with a capital
contribution of €660,000 (currently representing 22% of the total share
capital) as registered in the Commercial Register, or the substituting
interest, under company law, possibly made in its place (hereinafter also
the "participation in a limited partnership" or the "limited partner's
share").
|
|
2.
|
The
purchase offer according to § 1 shall be subject to the condition
precedent that the purchase and the assignment to the buyer of the limited
partner's shares in Saueressig GmbH & Co. KG held by Mr. Jakob
Heinreich SAUERESSIG, Mr. Jörg Christian SAUERESSIG (MBA), Mr.
Karl-Wilhelm SAUERESSIG and Mr. Reinhart ZECH von HYMMEN, according to
sales and purchase agreement concluded with today's date, are legally
effective, and the buyer, or his subsidiary within the meaning of § 8
Para. 1 of this Agreement, is entered into the Commercial Register as
limited partner.
|
|
3.
|
The
purchase offer as per § 1 can be accepted also pro rata as of the end of
each quarter-year (31.3.; 30.6.; 30.9.; 31.12.) however only as of
30.9.2010 at first. The acceptance of the offer is to be explained in
writing and must reach the buyer at the latest six months before the day
on which the transfer is to take
place.
|
|
4.
|
Notwithstanding
Para. 3 part 1, the offer as per Para. 1 can also be accepted to a
quarter-year ending before 30.9.2010
if,
|
|
a.
|
insofar
as the acceptance corresponds to at least 2.75% of the total limited
liability capital (this currently corresponds to 12.5 % of the seller's
limited partner share) and the acceptance of the offer encompasses, in
total, in the period up 30.9.2013 not more than 25% of the seller's
current limited partner share (this corresponds to 5.5 % of the total
current limited liability capital of the firm),
or
|
|
b.
|
a
shareholder in Matthews International Corporation, Two NorthShore Center,
PA 15212-5851, Pittsburgh, USA, holds more than 50% of all the shares in
this Company;
|
|
c.
|
Joseph
C. BARTOLACCI has ceased working as CEO or in a similar position of
responsibility for Matthews International Corporation, Two NorthShore
Center, PA 15212-5851, Pittsburgh, USA, for a period of at least 12
months; or
|
|
d.
|
The
buyer contravenes seriously and sustained the rights of the seller from
the shareholders agreement of the Saueressig GmbH + Co. KG,
especially
|
|
-
|
the
seller was not invited to a general meeting of members in which
resolutions were adopted;
|
|
-
|
the
buyer doesn’t meet the request of the seller to summon a shareholders’
meeting;
|
|
-
|
a
resolution on the change of the articles of association against the
seller's vote is to be made.
|
|
-
|
adoptions
of resolutions as per § 9 Para. 3 of the Partnership Agreement are
effected against the votes of the
seller;
|
|
-
|
a
general manager - with the exception of the seller himself - is appointed
or discharged against the votes of the
seller;
|
|
-
|
the
seller as general manager is discharged without having breached his duties
as general manager.
|
|
-
|
the
position of the partners is impaired in the sense of the Holzmueller
doctrine;
|
|
-
|
modification
of the partnership agreements of the subsidiaries of Saueressig GmbH + Co.
KG against the explicitly expressed wish of the
seller.
|
|
5.
|
If
the purchase offer is accepted pursuant to Para. 3 or Para. 4, the buyer
and the seller shall be obligated to declare the assignment of the
respective limited partner's share, with effect to the end of the relevant
quarter-year, subject to a suspensory condition through entry of the
change in the limited partner in the Commercial Register. The assignment
has to- if necessary pro rata - include the total limited partner's
accounts (capital accounts, loan accounts, private
accounts).
|
|
§
2
|
|
Purchase
price (put option)
|
|
1.
|
As
purchase price the seller shall receive an amount to the value of the part
of the company value, within the meaning of clause 3, which corresponds to
the share of the participating interest to be assigned as according to §1
Para. 5 relative to the total limited liability capital of Saueressig GmbH
& Co. KG, for the total limited partner's share of 22 % held by the
seller, but at least € 17,443,328 ("purchase price's lower limit") and at
most € 31,443,328 ("purchase price' upper limit"). Should the sale take
place pro-rata, then the purchase price’s lower limit and the purchase
price’s upper limit shall be applicable corresponding to the amount of the
assigned share.
|
|
2.
|
The
purchase price’s upper limit shall not apply
if
|
|
-
|
the
purchase price according to Para. 1 exceeds the purchase price's upper
limit by more than 17.5% and is based on the patents named in Annex 1 to
this Agreement or those developed by the seller in the future,
or
|
|
-
|
the
buyer resells the shares acquired from the seller at a higher price to a
third person within twelve months of the assignment according to § 1 Para
5. Applicable as purchase price’s upper limit then is the value
corresponding to the purchase price obtained by the
buyer.
|
|
3.
|
The
value of the Company is taken as ten times ("multiplied by a factor of
ten") the average EBIT for Saueressig GmbH & Co. KG in keeping with
paragraph 5, (i), minus the consolidated liabilities of Saueressig GmbH
& Co. KG as defined in Enclosure 3.2 (B) of the sales an purchase
agreement, at the time the assignment takes effect, exceeding the sum of
€10,000,000 as well as (ii) increased by the liquid means (cash) as
defined in the Enclosure 3.2 (C) of the sales and purchase agreement, and
(iii) minus the further sum of €1,556,672. If the mean EBIT of Saueressig
GmbH & Co. KG is less than €10,000,000, the factor of ten shall be
replaced with a factor of nine.
|
|
4.
|
The
basis for the calculation of the value of the Company is the average EBIT
for the two business years that ended before or on the key assignment date
in accordance with § 1 Para. 5 (in the case of an assignment as at
30.9.2015, the balance sheets as at 30.9.2014 and 30.9.2015 shall form the
basis, and for assignment as at 31.3.2011 the balance sheets for 30.9.2009
and 30.9.2010, whereby it is assumed that Saueressig GmbH & Co. KG
changes its business year to the period 1.10 to 30.9 after the acquisition
pursuant to § 1 Para. 2.
|
|
5.
|
EBIT
is the operative result from standard business operations shown in the
consolidated financial statements for Saueressig GmbH & Co. KG
pursuant to § 275 Para. 2 No. 14 German Commercial Code (HGB), plus
interest and similar expenses pursuant to § 275 Para. 2 No. 13
HGB.
|
|
6.
|
Should
the assignment of the limited partner's share fall before 30.9.2013, the
purchase price, except in the cases of § 1 Para. 4, amounts for the total
limited partner's share of the seller (22% of the total limited liability
capital), notwithstanding Para. 1, to €
14,826,829.
|
|
7.
|
In
addition to the purchase price, the seller shall receive an amount to the
level of his money-drawing interest on its member loan accounts and
private accounts at the time of the assignment according to § 1 Para. 5.
Should the assignment take place as per § 1 Para 4 pro-rata, then the
corresponding pro-rata credit balance is to be
credited.
|
|
8.
|
The
purchase price and the payment according to Para. 7 shall be due on the
day on which the assignment of the limited partner's share shall become
effective (§ 1 Para. 5) and shall be payable to the value of purchase
price's lower limit (Para. 1) or the fixed purchase price (Para. 6) with
due date furthermore at the latest 3 months after due date but at the
earliest with entry of the change in limited partner in the Commercial
Register.
|
|
9.
|
The
purchase price and the payment according to Para. 7 is to be charged
interest on from the day of due date of the purchase price at 2 percentage
points above the base rate valid on due date of the European Central Bank
or at an interest rate replacing this. The interest payments shall be due
and payable with the purchase
price.
|
|
10.
|
If
there is no agreement on the amount of the purchase price between the
buyer and the seller at the latest up to when purchase price is payable,
this shall be determined with binding effect for the parties by an audit
company with international experience as an arbitrator. Should the parties
not agree on an arbitrator, this person shall be determined by the
Wirtschaftsprüfer e.V., Düsseldorf on request by the buyer or seller . The
costs for the arbitrator and Institut der Wirtschaftsprüfer e.V.,
Düsseldorf shall be borne by the buyer and the seller based on the ratio
between the prevailing and the defeated. The arbitrator shall determine
the purchase price when in doubt on the basis of the balancing methods
used by the firm up to 2007.
|
|
11.
|
Subsequent
changes of the balance sheets which underlie the purchase price
calculation - perhaps due to a tax audit - have no influence on the
purchase price.
|
|
§
3
|
|
Sale
offer (call option)
|
|
1.
|
The
seller hereby irrevocably offers to sell to the buyer - such offer also
being valid for its universal successors - his partnership interest in
Saueressig GmbH & Co. KG with a capital contribution of €660,000
(currently representing 22% of the total partnership capital) as
registered in the Commercial Register. The seller shall impose this
obligation on any singular successor, subject to the proviso that the
latter in turn imposes the obligation on its singular
successor.
|
|
2.
|
If
the buyer declares that he accepts the sale offer in accordance with Para.
1, the buyer and the seller shall be obliged to declare the assignment in
accordance with § 1 Para. 5. The acceptance shall be based on § 1
paragraph 3 with the proviso that the offer can be accepted only for all
shares and on 30 September 2013 at the
earliest.
|
|
3.
|
§ 1
paragraph 2 shall apply fort his offer mutatis
mutandis.
|
|
§
4
|
|
Purchase
price (call option)
|
|
In
the event of the call option being exercised in accordance with § 3, § 2
shall apply mutatis mutandis for the purchase
price.
|
|
§
5
|
|
Securities
|
|
1.
|
As
security for the claims for payment of the purchase price from the
exercise of the call or put option, the buyer shall provide an absolute
suretyship of €8,500,000 and hereby assigns the share in Saueressig GmbH
&Co KG that it acquired through the Sale and Purchase Agreement to the
seller, who hereby accepts the
assignment.
|
|
2.
|
If
the buyer fails to meet its obligations under the terms of this Agreement,
the seller shall be entitled, following prior written notice. in first
step to satisfy his claims from the absolute suretyship and if this
doesn’t lead to total satisfaction, in second step to sell the company
shares on the free market or otherwise to utilize the company shares;
exaggerated proceeds shall be due to the buyer. Until such time, the buyer
itself shall be entitled to exercise all rights and obligations from the
Company share. In particular, the buyer shall be entitled to participate
in the profit and loss from the share until such time as the security
right is exercised.
|
|
3.
|
The
security assignment shall end on payment of the purchase price in
accordance with § 2 or § 4 of this Agreement or with setting up an
additional primary bank security for € 8,900,00. Once the purchase price
has been paid in full, the share in Saueressig GmbH & Co KG shall be
deemed assigned to buyer. The surety document is to be granted in
reverse.
|
|
§
6
|
|
Warranties
- Compensation
|
|
1.
|
The
seller warrants to the buyer in the form of an independent guarantee
pursuant to § 311 Para. 1 German Civil Code (BGB) that the partnership
interest in Saueressig GmbH & Co. KG held by the seller with a capital
contribution of €660,000 (22%) is legally justified, fully paid up, not
reduced by losses or withdrawals, and not encumbered by any obligatory or
in rem third-party rights. In particular, there are no rights of
pre-emption, rights of use, trust relationships, typical or atypical
sub-participations, other options, voting arrangements, or other
third-party rights affecting the purchase of the
share.
|
|
2.
|
The
seller warrants to the buyer in the form of an independent guarantee
pursuant to § 311 Para. 1 German Civil Code (BGB) that the Articles of
Association of Saueressig GmbH & Co. KG of 27 September 2004 attached
as Annex 2 herewith are the currently valid version of the Articles of
Association of Saueressig GmbH & Co. KG. If there are any changes to
the Articles of Association of Saueressig GmbH & Co. KG (except § 12
Para. 4) before the effective date of the assignment of the partnership
interests of Jakob Heinreich SAUERESSIG, Dipl.-Kfm. Jörg Christian
SAUERESSIG, Karl-Wilhelm SAUERESSIG and Reinhart ZECH von HYMMEN to the
buyer, or if provisions in the Articles of Association of 27 September
2004 should be formally invalid, the seller shall exercise his shareholder
rights in Saueressig GmbH & Co. KG to ensure that the Articles of
Association revert to the status of 27.9.2004 in respect of individual or
all provisions, at the buyer's
discretion.
|
|
3.
|
The
buyer shall not be entitled to further warranty
claims
|
|
4.
|
For
the duration of two years calculated from the point in time at which he
retired from the company as limited partner, the seller obligates himself
to observe the restraint clause in keeping with § 5 paragraphs (2) and (3)
of the partnership agreement which the parties have agreed upon on 25th
February 2008.
|
|
The
seller undertakes to declare irrevocably that he renounces any
compensation payments which may accrue for his benefit on account of the
retirement as a limited partner from Saueressig GmbH & Co. KG or by
the retirement from the management of Saueressig GmbH & Co. KG or from
a company rendered in Annex 1.3 and 1.4 of the company purchase contract
on the basis of a subsequent restraint clause. The parties are in
agreement that the subsequently agreed restraint clause is compensated by
the purchase price to the paid on the basis of this
contract.
|
|
§
7
|
|
Costs
and taxes
|
|
1.
|
The
profit taxes (e.g. income tax, trade tax, corporate tax) payable from the
exercise of the options shall be borne by the person or company for whom
the taxes legally accrue. If profit tax is payable from the exercise of
the option right at the level of Saueressig GmbH & Co KG, the seller
shall repay such taxes to the
Company.
|
|
2.
|
Should
with the conclusion and implementation of this Agreement real estate
transfer tax arise, this shall be borne by the buyer. The parties shall
each bear half of any other costs or taxes arising from the conclusion and
execution of this Agreement. Each party shall individually bear the costs
for consulting services.
|
|
3.
|
Should
any services provided in connection with this Agreement be subject to and
charged VAT, the remuneration to be paid under the terms of this Agreement
shall be increased by the legal amount of
VAT.
|
|
1.
|
All
of the rights and duties set out in this Agreement apply in turn for the
relevant legal successor(s) to the contracting parties, unless a different
arrangement has been made in this Agreement. The buyer has in addition the
right to assign at any time the total rights and duties from this
Agreement to another company in which the buyer is directly or indirectly
participated up to more than 75% (subsidiary). The buyer or his successor
in title shall be entitled to transfer the shares in Saueressig GmbH + Co.
KG to a subsidiary.
|
|
2.
|
Should
the legal form of Saueressig GmbH & Co KG change or it is merged onto
another legal holder, or the size of the limited liability capital of the
seller is changed, then the above agreements made shall apply for the new
or changed shares correspondingly.
|
|
3.
|
Changes
and additions to the present Agreement may only be made in writing, and,
where required, they shall be notarized. All declarations that are to be
made in accordance with the terms of the present Agreement shall be made
in writing.
|
|
4.
|
The
seller on the one hand, and the buyer on the other, each appoint for the
other party the person named below with registered address in Germany, who
shall be entitled at all times to make and accept any declarations for the
party in question pursuant to or in connection with the present Agreement.
This authorization shall apply until the end of the 14th day after the
party in question has notified the other party of the appointment of a
different representative with registered address in Germany, and
exercising the same rights. A change of address for the representative
shall be binding for the other party only 14 days after it has been
informed of the said change.
|
|
Authorized
receiving agent for the seller:
|
|
Mr.
Kilian SAUERESSIG
|
|
Lünten
Nork 123
|
|
D-48691
Vreden
|
|
Germany
|
|
Fax:
+49 (2564) 12 420
|
|
With
copy to:
|
|
Allen
& Overy LLP
|
|
Thomas
AUSTMANN
|
|
Rheinisches
Palais
|
|
Breite
Strasse 27
|
|
D-40213
Düsseldorf
|
|
Germany
|
|
Fax:
+49 (211) 28 06 7601
|
|
_____________________________________________
|
|
Authorized
receiving agent for the buyer:
|
|
Matthews
International Corporation
|
|
Brain
D. WALTERS, Esq. (Legal Counsel)
|
|
Two
NorthShore Center
|
|
Pittsburgh
|
|
Pennsylvania
15222
|
|
USA
|
|
Fax:
001 (412) 442-8290
|
|
With
copy to:
|
|
Streck
Mack Schwedhelm
|
|
Dr.
Heinz-Willi KAMPS
|
|
Wilhelm-Schlombs-Allee
7-11
|
|
D-50858
Köln (Junkersdorf)
|
|
Germany
|
|
Fax:
+49 (221) 49 29 299
|
|
_____________________________________________
|
|
5.
|
In
derogation of § 10 Para. 3 of the Sale and Purchase Agreement, the parties
agree that
|
|
a.
|
the
seller can withdraw his credit balance amount, shown in the consolidated
accounts of Saueressig GmbH & Co. KG on 31.12.2007, on his partner
loan and private accounts after the expiry of fourteen days after the
entry into force of the conditions as per §1 Para. 2 and the buyer funds
the company with the necessary liquidity for this,
and
|
|
b.
|
from
the business year 2008 onwards, 55% of the profit shall be credited to the
loan accounts and only 45% to the private accounts of the partners. If a
partner proves that the personal income tax (without trade tax) resulting
from his stake in Saueressig GmbH & Co. KG is higher than the amount
which was credited to his private account, then a correspondingly higher
percentage rate is to be credited to the private account in respect of all
partners.
|
|
6.
|
The
seller shall be obligated on request of the seller to implement jointly
with the buyer a US federal income tax coordination according to Treasury
Regulation 301.7701-1 which permits the buyer to classify Saueressig GmbH
& Co KG, according to its choice of taxation according to US federal
law, either as an incorporated or unincorporated firm that is not subject
to corporation tax. The buyer shall release the seller from any
disadvantages which ensue for the
seller.
|
|
§
9
|
|
Severability
clause
|
|
1.
|
The
provisions of this Agreement shall apply mutatis mutandis in the event of
a change in the legal status of Saueressig GmbH & Co. KG. Should any
arrangement affecting Saueressig GmbH & Co. KG or its general partner
conflict with the application of the provisions set out in this Agreement,
the buyer and the seller shall find a new provision that matches the sense
and intent of the original
provision.
|
|
2.
|
If
any part of this Agreement should be or prove invalid or illegal, the
invalid or illegal provision shall be replaced by a suitable replacement
reflecting the spirit of this Agreement, one that the contracting parties
might be assumed to have agreed had they been aware of the omission. The
invalidity or illegality shall be without prejudice to the remaining
provisions in this Agreement.
|
|
3.
|
The
present Agreement is subject to German
law.
|
|
4.
|
Any
disputes between the parties in connection with the present document shall
be finally decided by an arbitration court excluding the jurisdiction of
the courts. The arbitration court shall also decide on claims that have
been set off in this context. The language of the arbitration process
shall be German, and the venue for the arbitration process Düsseldorf. In
all other instances, Articles 1025 ff. German Code of Civil Procedure
(ZPO) shall apply.
|