Exhibit 10.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1.

CORPORATE OWNERSHIP / STRUCTURE OF THE ACQUISITION 

6

 

1.1

Particulars of the Company 

6

 

1.2

Partnership Capital of the Company 

6

 

1.3

Seller’s Accounts 

6

 

1.4

Signing Date; Effective Date 

7

2.

SALE AND PURCHASE AND TRANSFER OF THE PARTNERSHIP INTEREST AND OF THE SELLER'S LOAN AND PRIVATE ACCOUNTS 

7

 

2.1

Sale and Purchase of the Partnership Interest 

7

 

2.2

Sale and Purchase of the Seller's Loan and Private Accounts 

7

 

2.3

Transfer of Partnership Interest and of Seller's Loan and Private Accounts 

7

 

2.4

Approval of Shareholders 

8

3.

PURCHASE PRICE; SELLER'S LOAN AND PRIVATE ACCOUNTS PURCHASE PRICE; CONDITIONS OF PAYMENT; BANK GUARANTEE 

9

 

3.1

Purchase Price; Seller's Loan and Private Accounts Purchase Price 

9

 

3.2

Due Date; Seller's Account; Company's Account 

9

 

3.3

Default 

10

 

3.4

No Right to Set-Off or to Withhold 

10

 

3.5

Bank Guarantee and Assignment by way of Security 

10

4.

CANCELLED 

11

5.

SELLER’S GUARANTEES 

11

6.

COVENANTS 

12

 

6.1

Signing Covenants 

12

 

6.2

After-Signing Covenants 

12

 

6.3

Covenant not to Compete 

13

7.

GUARANTOR'S GUARANTEE 

14

8.

TAXES AND COSTS 

14

 

8.1

Taxes on Earnings 

14

 

8.2

Transfer Taxes 

14

 

8.3

Value Added Tax 

14

 

8.4

Costs and Fees 

14

9.

NOTICES 

14

 

9.1

Form of Notice 

14

 

9.2

Notices to Seller 

15

 

9.3

Notices to Purchaser 

15

 

9.4

Notices to Guarantor 

15

 

9.5

Change of Address 

16

 

9.6

Copies to Advisors 

16

10.

MISCELLANEOUS 

16

 

10.1

Governing Law 

16

 

10.2

Arbitration 

16

 

10.3

Business Day 

17

 

10.4

Amendments, Supplementations 

17

 

10.5

Language 

17

 

10.6

Headings 

17

 

10.7

Annexes 

17

 

10.8

Entire Agreement; Termination of Option Agreement; Replacement of SPA-A; Settlement 

17

 

10.9

Severability 

18

Annex 2.3(a)

Copy of the already signed filing of the assignment of the Partnership Interest with the Commercial Register

Annex 2.4

Copy of the already signed Shareholders’ approval resolution

Annex 3.5 (a)

Declaration of confirmation by Citizens Bank with regard to the Bank Guarantee

Annex 3.5 (b)

Bank Guarantee

Annex 6.1(a)

Amendment Agreement to the Sale and Purchase and Transfer Agreement between the Company (as seller) and the Seller (as purchaser) regarding the sale and purchase and transfer of a partnership interest in Devine GmbH & Co. KG

Annex 6.1(b)

Termination Agreement to the service agreement of the Seller as managing director of the General Partner between the General Partner, the Seller and the Company

Annex 6.1(c)

Termination Agreement to the Commission Agreement between the Seller and the Company relating to McAirlaids' potential purchase orders

Annex 6.1(d)

Resolution of the Company

Annex 6.1(e)

Resolution of the General Partner

 

(a)

one fixed partnership interest in the amount of EUR 660,000.00 (in words: six hundred sixty thousand Euros), corresponding to 22 per cent of the fixed partnership interests in the Partnership Capital, held by the Seller and

 

(b)

one fixed partnership interest in the amount of EUR 2,340,000.00 (in words: two million three hundred forty thousand Euros), corresponding to 78 per cent of the fixed partnership interests in the Partnership Capital, held by the Purchaser (hereinafter referred to as the "Purchaser's Partnership Interest").

 

(a)

The Company keeps for the Seller the following accounts: a fixed capital account (Festkapitalkonto) and a reserve account (Rücklagenkonto) (hereinafter collectively referred to as the "Seller's Capital and Reserve Accounts") as well as a loan account (Darlehenskonto) for loans granted by the Seller to the Company and a private account (Privatkonto) as well as a separate loss carry forward account (Verlustvortragskonto) (hereinafter collectively referred to as the "Seller's Loan and Private Accounts"). The Seller's Loan and Private Accounts shall include the profits of the Company in the amount of EUR 770,000.00 pertaining to the Seller for the period October 1, 2010 until and including March 31, 2011.

 

(b)

The Seller's Capital and Reserve Accounts as of the Effective Date (as defined in Clause 1.4) shall be sold and transferred to the Purchaser together with the Partnership Interest as set forth in Clause 2.1 and Clause 2.3(a). The Seller's Loan and Private Accounts as of the Effective Date shall be sold and transferred to the Purchaser in accordance with Clause 2.2 and Clause 2.3(b).

 

(a)

Subject to the Transfer Conditions set forth in Clause 2.3(c), the Seller hereby transfers and assigns (abtreten), and the Purchaser hereby accepts the transfer and assignment, upon the terms and conditions of this Agreement, of the Partnership Interest in the Company with commercial effect (mit wirtschaftlicher Wirkung) as of the Effective Date.

 

Such assignment of the Partnership Interest to the Purchaser by way of singular succession (Sonderrechtsnachfolge) shall be, (i) as regards the internal relations between the Seller and the Purchaser, effective as of the Effective Date and (ii) with effect vis-à-vis any third party, effective with the registration of the Purchaser as sole limited partner of the Company in the Commercial Register. In view of the period between the date of payment of the Purchase Price and the Seller's Loan and Private Accounts Purchase Price by the Purchaser and the date of registration of the Purchaser as sole limited partner of the Company in the Commercial Register (hereinafter referred to as the "Interim Period"), the Seller shall hold the Partnership Interest for the Purchaser in trust (treuhänderisch) without any additional consideration. The Seller furthermore empowers (bevollmächtigt) the Purchaser to execute any and all rights pertaining to the Partnership Interest during the Interim Period. Apart from that, the Parties expressly agree that the Seller shall solely be entitled to execute his respective rights as limited partner of the Company as far as instructed by the Purchaser.

 

(b)

Subject to the Transfer Conditions set forth in Clause 2.3(c), the Seller hereby transfers and assigns (abtreten), and the Purchaser hereby accepts the transfer and assignment, upon the terms and conditions of this Agreement, any and all rights in the relation of the Company and the Seller reflected in and pertaining to the Seller's Loan and Private Accounts as of the Effective Date.

 

(c)

The transfer of the Partnership Interest and the transfer of the Seller's Loan and Private Accounts to the Purchaser shall be subject to the satisfaction of the following conditions precedent (hereinafter collectively referred to as the "Transfer Conditions"):

 

(i)

The payment of the Purchase Price and the Seller's Loan and Private Accounts Purchase Price by the Purchaser has been effected in accordance with Clauses 3.1 and 3.2.

 

(ii)

The assignment of the Partnership Interest in the Company to the Purchaser as set forth in Clause 2.3(a) has been recorded in the Commercial Register.

 

(d)

After the effectuation of the payment of the Purchase Price and the Seller's Loan and Private Accounts Purchase Price by the Purchaser in accordance with Clauses 3.1 and 3.2, the Seller is obliged to issue, together with the Purchaser, a joint confirmation of payment to the notary in order to enable the notary to forward the filing to the Commercial Register as set forth in Clause 2.3(a).

 

(a)

The purchase price to be paid by the Purchaser for the Partnership Interest as sold and purchased in accordance with Clause 2.1 shall be equal to

 

(b)

The purchase price to be paid by the Purchaser for the Seller's Loan and Private Accounts as sold and purchased in accordance with Clause 2.2 shall be equal to

 

(a)

On April 22, 2011, 00:00 German Time (hereinafter referred to as the "Due Date"), the Purchase Price and the Seller's Loans and Private Accounts Purchase Price shall become due and payable and the Purchaser shall pay the Purchase Price as follows:

 

(i)

EUR 19,141,511.00 (in words: nineteen million one hundred forty one thousand five hundred eleven Euros) to the following bank account of the Seller (hereinafter referred to as "Seller's Account"):

 

(ii)

EUR 1,416,235.20 (in words: one million four hundred sixteen thousand two hundred thirty five point twenty Euros) - to fulfil Seller's payment obligations vis-à-vis the Company under Clause 3 of the Sale and Purchase and Transfer Agreement between the Company (as seller) and the Seller (as purchaser) regarding the sale and purchase and transfer of a partnership interest in Devine GmbH & Co. KG attached to SPA-A as Annex 6.1 (a) in the amended version attached hereto as Annex 6.1 (a) - to the following bank account of the Company (hereinafter referred to as "Company's Account"):

 

(b)

On Due Date the Seller's Loan and Private Accounts Purchase Price shall become due and payable and the Purchaser shall pay the Seller's Loan and Private Accounts Purchase Price to the Seller’s Account named in Clause 3.2 (a) (i).

 

(c)

The Seller shall notify the Purchaser without undue delay ("unverzüglich") of the receipt of the full payment pursuant to Clause 3.2 (a) (i). The Company shall notify the Seller and the Purchaser without undue delay ("unverzüglich") of the receipt of full payment pursuant to Clause 3.2 (a) (ii).

 

(d)

All payments owed by one of the Parties under this Agreement shall be paid by way of irrevocable wire transfer – to be credited on the same day – free of any costs and fees.

 

(a)

The Parties agree that the Bank Guarantee provided by the Guarantor to the Seller under the Option Agreement and under the SPA-A in amended form shall also serve for the benefit of the Seller as security for the timely and duly fulfilment of the payment of the Purchase Price and the Seller’s Loan and Private Accounts Purchase Price in accordance with Clauses 3.1 and 3.2 of this SPA-B. The issuing bank, Citizens Bank of Pennsylvania, has declared its confirmation in this respect and the Guarantor has delivered the original of the declaration of confirmation to the Seller on the Signing Date; a copy is attached hereto as Annex 3.5(a).

 

(b)

The Guarantor shall ensure that the Bank Guarantee remains effective until the payment of the Purchase Price and the Seller's Loan and Private Accounts Purchase Price is effected in accordance with Clauses 3.1 and 3.2 above. After the Bank Guarantee having become ineffective or after the Seller has received full payment of the Purchase Price and the Sellers' Loan and Private Accounts Purchase Price in accordance with Clauses 3.1 and 3.2 of this Agreement, the Seller shall return the original of the Bank Guarantee attached hereto as a copy as Annex 3.5 (b) and the original of the declaration of confirmation attached hereto as a copy as Annex 3.5 (a) without undue delay (unverzüglich) – upon consultation - to Dr. Tomas STERKENBURGH, Karl-Heinz ROLVERING or Markus PENNEKAMP or - if these persons are not available - to the legal advisors of the Purchaser in their office in Cologne (address as set forth under Clause 9.3 of this Agreement). If the Seller neglects to return the original of the Bank Guarantee and the original of the declaration of confirmation attached hereto as copy as Annexes 3.5 (b) and 3.5 (a) within three Business Days after having received full payment of the Purchase Price and the Seller's Loan and Private Accounts Purchase Price in accordance with this Clause 3.5 (b), the Seller shall be obliged to pay a contractual fine to the Purchaser in the amount of EUR 1,000.00 per day starting from the fourth Business Day of having received full payment of the Purchase Price and the Seller's Loan and Private Accounts Purchase Price until the day of the return of the original of the Bank Guarantee and the original of the declaration of confirmation to Dr. Tomas STERKENBURGH, Karl-Heinz ROLVERING or Markus PENNEKAMP or - if these persons are not available - to the legal advisors of the Purchaser in their office in Cologne.

 

(c)

The Parties agree that the Purchaser's Partnership Interest assigned by way of security (Sicherungsabtretung) to the Seller in accordance with the Option Agreement (hereinafter - together with the confirmation relating thereto - referred to as "Assignment by way of Security") shall now serve for the benefit of the Seller as additional security for the timely and duly fulfilment of the payment of the Purchase Price and the Seller's Loan and Private Accounts Purchase Price in accordance with Clauses 3.1 and 3.2 of this Agreement. For reasons of precaution, the Purchaser hereby confirms this Assignment by way of Security. Thus, the Purchaser hereby transfers and assigns and the Seller hereby accepts the transfer and assignment of the Purchaser's Partnership Interest by way of security with immediate effect.

 

(d)

If the Purchase Price and the Seller's Loan and Private Accounts Purchase Price are not timely and fully paid by the Purchaser in accordance with Clauses 3.1 and 3.2, the Seller shall be entitled firstly to draw on the Bank Guarantee after prior written notification, and in case the Bank Guarantee is insufficient for the satisfaction of Seller's claims pursuant to Clause 3, the Seller shall be entitled to sell the Purchaser's Partnership Interest assigned to the Seller by way of security pursuant to Clause 3.5 (c) without holding on (freihändig) or to utilize it otherwise, whereas the Purchaser shall be entitled to any excess proceeds resulting out of this utilization. Up to this date the Purchaser shall be entitled to exercise any and all rights and obligations pertaining to the Purchaser's Partnership Interest. In particular, without limitation, the Purchaser shall be entitled to participate in all profits and losses pertaining to the Purchaser's Partnership Interest.

 

(e)

The Parties agree that the Assignment by way of Security shall be terminated on the date on which the payment of the Purchase Price and the Seller's Loan and Private Accounts Purchase Price is effected in accordance with Clauses 3.1 and 3.2 above. The Seller hereby reassigns to the Purchaser, and the Purchaser hereby accepts the reassignment of the Purchaser's Partnership Interest together with any and all rights pertaining thereto to the Purchaser under the precondition that the Purchase Price and the Seller's Loan and Private Accounts Purchase Price have been fully paid in accordance with Clauses 3.1 and 3.2 above.

 

(a)

The Seller hereby guarantees to the Purchaser by way of an independent promise of guarantee pursuant to Clause 311 para. 1 BGB (selbständiges Garantieversprechen im Sinne des § 311 Abs. 1 BGB) that the statements in Clause 1 hereof regarding the Partnership Interest and the Seller’s accounts are complete and correct. The Partnership Interest has been validly issued, is fully paid-up, has not been reduced by losses or withdrawals and is 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 subparticipations, other options, voting agreements or other third-party rights effecting the assignment of the Partnership Interest.

 

(b)

Furthermore the Seller hereby guarantees to the Purchaser by way of an independent promise of guarantee pursuant to Clause 311 para. 1 BGB (selbständiges Garantieversprechen im Sinne des § 311 Abs. 1 BGB) that on the Effective Date the Seller's Loan and Private Accounts total at least an amount of EUR 1,233,345.00 provided however that the profit share in the amount of EUR 770,000.00 pertaining to the Seller for the period October 1, 2010 until and including March 31, 2011 has been added to and the amount of EUR 170,000.00 pursuant to 6.2 (b) of this Agreement has been deducted from the Seller's Loan and Private Accounts in accordance with the shareholder resolution attached hereto as Annex 6.1 (d). Starting from Signing Date the Seller is not entitled to any further withdrawals from the Seller's Loan and Private Accounts.

 

(c)

The Purchaser shall not be entitled to further warranty rights.

 

(a)

The amendment agreement concerning the sale and purchase and transfer agreement between the Company (as seller) and the Seller (as purchaser) regarding the sale and purchase and transfer of a partnership interest in Devine GmbH & Co. KG, attached hereto as Annex 6.1(a),

 

(b)

the termination agreement to the managing director agreement of the Seller as managing director of the General Partner between the General Partner, the Seller and the Company, attached hereto as Annex 6.1(b), and

 

(c)

the termination agreement to the commission agreement between the Seller and the Company relating to McAirlaids' potential purchase orders, attached hereto as Annex 6.1(c).

 

(d)

the resolution of the Company, attached hereto as Annex 6.1(d).

 

(e)

the resolution of the General Partner, attached hereto as Annex 6.1(e).

 

(a)

Between the Signing Date and the Effective Date, the Purchaser and the Guarantor shall refrain from and they have to ensure that the Company refrains from any measures in order to manipulate the profits of the Company and/or the distribution of the profits amongst the shareholders of the Company to Seller's disadvantage.

 

(b)

As to be agreed on in the Company's resolution attached hereto as Annex 6.1 (d), the Seller shall be entitled,in his function as shareholder of the Company, to reward certain employees of the Company with bonus payments in the total gross amount of EUR 170,000.00 (in words: one hundred seventy thousand Euros) (hereinafter referred to as "Bonus Payment Amount") prior to the Effective Date. For this purpose, the Seller and the Purchaser shall agree in the Company's resolution attached hereto as Annex 6.1 (d) that the Seller and the Purchaser instruct the Company prior to March 31, 2011 to pay on the Seller's behalf and on his account bonus payments to certain employees already nominated by the Seller in Annex A to the Company's resolution attached hereto as Annex 6.1 (d) by withdrawing the Bonus Payment Amount from his Seller's Loan and Private Accounts with effect to March 31, 2011. The Purchaser herewith explicitly and irrevocably grants his consent to this employee reward procedure.

 

(c)

The Purchaser, the Company and the General Partner shall use their best efforts that the Seller will be withdrawn as managing director in all subsidiaries and participations of the Company.

 

(a)

For the Seller, the statutory prohibition of competition pursuant to Section 112 subsection 1 of the German Commercial Code (Handelsgesetzbuch (HGB)) shall apply correspondingly, with the addition that the Seller may not act either independently or dependently or in an advisory capacity, not even occasionally or indirectly, outside of the Company and/or its subsidiaries (Tochtergesellschaften) in their fields of activity as of the Signing Date, no matter whether or not these activities will be continued thereafter. Likewise, holding an equity interest in competitive businesses - except for participations in form of stock and convertibles - also as silent partner or subpartner shall be inadmissible. The territorial scope of application of this prohibition of competition comprises the European Union and EFTA.

 

(b)

The Seller is obligated to observe the non-competition clause pursuant to Clause 6.3(a) until September 30, 2013.

 

(c)

The Seller hereby irrevocably declares that he waives any compensation payments which may arise for his benefit due to his retirement as a limited partner from the Company or due to his retirement from the management of the Company or of a Company's affiliate. The Parties agree that the postcontractual prohibition of competition set forth in this Clause 6.3 shall be compensated by the Purchase Price to be paid under this Agreement.

 

(d)

Notwithstanding the generality of Clause 6.3(a), the Seller shall be entitled to be engaged in the business of Devine GmbH & Co. KG as limited partner or its legal successor, as managing director of Devine Verwaltungs-GmbH (its general partner) or its legal successor and representative of Devine GmbH & Co. KG or its legal successor, provided however, neither the Seller nor Devine Verwaltungs-GmbH nor Devine GmbH & Co. KG nor their respective legal successors nor an affiliate of these companies compete with the Company and/or its subsidiaries in their fields of activity as of the Signing Date in terms of Clauses 6.3(a) and 6.3(b). For the avoidance of doubt, the Parties agree that the engagement of the Seller in the following businesses shall not be deemed a competitive business of the Company and/or its subsidiaries in terms of Clauses 6.3(a) and 6.3(b): the production and processing of tools or components with free-form surfaces, their distribution and marketing, separately or together with shaped or grained foils as well as all other steps required for their manufacture or sale.

 

(a)

All taxes on earnings (Ertragsteuern) which result from this Agreement and its execution shall be borne by those persons at which these taxes statutorily arise.

 

(b)

As far as taxes on earnings, in particular, but not limited to, trade income tax (Gewerbeertragsteuer) resulting from any and all sales and/or transfers of partnership interests in the Company by the Seller to the Purchaser on the level of the Company, the Seller shall reimburse the amount corresponding to these taxes on earnings to the Company. The profit share in the amount of EUR 770,000.00 pertaining to the Seller for the period October 1, 2010 until March 31, 2011 pursuant to Clause 1.3 of this Agreement has already been reduced by trade income tax; the Seller is not obliged under this Clause 8.1 to reimburse the trade income tax pertaining to this amount to the Company.

 

(c)

Claims of the Purchaser under this Clause 8.1 shall be time-barred six months after the final and binding assessment of the relevant taxes.

 

(a)

The receipt of copies of Notices by the Parties’ advisors shall not constitute or substitute the receipt of such Notices by the Parties themselves.

 

(b)

Any Notice shall be deemed received by a Party regardless of whether any copy of such Notice has been sent to or received by an advisor of such Party, irrespective of whether the delivery of such copy was mandated by this Agreement.

 

(a)

Any dispute, disagreement, controversy or claim arising out of or in connection with this Agreement or its Annexes or the transactions contemplated hereby or thereby shall be finally and exclusively settled in accordance with the Rules of Arbitration of the German Institution of Arbitration e.V. (Deutsche Institution für Schiedsgerichtswesen, DIS) without recourse to the ordinary courts of law. The arbitral tribunal shall consist of three (3) arbitrators. The arbitration shall take place in Duesseldorf. The arbitration shall be conducted in English or German and written evidence (Beweismittel) may be submitted in English or German.

 

(b)

In the event that applicable mandatory law requires any matter arising out of or in connection with this Agreement and its implementation to be decided by an ordinary court of law, the competent courts in Duesseldorf shall have the exclusive jurisdiction.

 

(a)

This Agreement is written in the English language (except that Annexes may be partly in the German language). Terms to which a German translation has been added shall be interpreted throughout this Agreement in the meaning assigned to them by the German translation.

 

(b)

Any reference made in this Agreement to any types of companies or participations, proceedings, authorities or other bodies, rights, institutions, regulations or legal relationships (hereinafter collectively referred to as the "Legal Terms") under German law shall extend to any corresponding or identical Legal Terms under foreign law to the extent that relevant facts and circumstances must be assessed under such foreign law. Where no corresponding or identical Legal Terms under foreign law exist, such Legal Terms shall be introduced as - functionally - come closest to the Legal Terms under German law.

 

(a)

This Agreement constitutes the full understanding of the Parties and the complete and exclusive statements of the terms and conditions of the Parties’ agreements relating to the subject matter hereof and supersedes any and all prior agreements and understandings, whether written or oral, that may exist between the Parties with respect to the subject matter of this Agreement. Side agreements to this Agreement do not exist.

 

(b)

Clause 10.8 (b) of the SPA-A shall remain unaffected by this Agreement.

 

(c)

The Parties agree that the SPA-A shall completely be replaced by this Agreement with effect as of Signing Date unless explicitely otherwise provided for herein. All and any claims and rights that may have arisen out of SPA-A until Signing Date, shall be determined in future only in accordance with this Agreement.

 

(d)

Clause 10.8 (c) of this Agreement does not apply to the Annexes referred to in the SPA-A unless otherwise stipulated in this Agreement.

 

(e)

By full payment of the Purchase Price and of the Seller’s Loan and Private Accounts Purchase Price to the Seller in accordance with Clauses 3.1 and 3.2 of this Agreement all and any - known or unknown - claims for whatever legal reason of the Seller against the Purchaser, the Guarantor, the Company or the General Partner and any - known or unknown - claims for whatever legal reason of the Purchaser, the Guarantor, the Company or the General Partner against the Seller shall be waived and become void. Sentence 1 does not apply to

 

(i)

any claims pursuant to this Agreement and any claims pursuant to the agreements and resolutions referred to in Clause 6.1;

 

(ii)

any claims that are caused by intentionally committed criminal actions ("vorsätzlich begangene Straftat"). Criminal actions by means of this Agreement are offences pursuant to Art. 12 para 2 of the German Criminal Code (StBG, "Vergehen") and felonies pursuant to Art. 12 para 1 of the German Criminal Code ("Verbrechen").