x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
51-0347683
|
(State or other jurisdiction of
incorporation or organization)
|
(I.R.S. Employer
Identification No.)
|
Large accelerated filer
|
¨
|
Accelerated filer
|
x
|
Non-accelerated filer
|
¨
|
Smaller Reporting Company
|
¨
|
Emerging Growth Company
|
¨
|
|
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Page
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Item 4.
Controls and Procedures
|
||
|
|||
|
Item 1.
Legal Proceedings
|
||
|
Item 1A.
Risk Factors
|
||
|
Item 6.
Exhibits
|
Item 1.
|
Condensed Consolidated Financial Statements
|
|
January 31,
2018 |
|
October 31,
2017 |
||||
|
|
||||||
|
(Unaudited)
|
|
|
||||
ASSETS
|
|
|
|
||||
Cash and cash equivalents
|
$
|
11,066
|
|
|
$
|
8,736
|
|
Investments in marketable securities
|
49
|
|
|
194
|
|
||
Accounts receivable, net
|
162,849
|
|
|
188,664
|
|
||
Related-party accounts receivable
|
1,049
|
|
|
759
|
|
||
Prepaid income taxes
|
509
|
|
|
338
|
|
||
Inventories, net
|
64,730
|
|
|
61,812
|
|
||
Prepaid expenses and other assets
|
41,306
|
|
|
34,018
|
|
||
Total current assets
|
281,558
|
|
|
294,521
|
|
||
Property, plant and equipment, net
|
274,047
|
|
|
266,891
|
|
||
Goodwill
|
28,337
|
|
|
27,859
|
|
||
Intangible assets, net
|
14,465
|
|
|
15,025
|
|
||
Deferred income taxes
|
6,509
|
|
|
6,338
|
|
||
Other assets
|
8,043
|
|
|
7,949
|
|
||
Total assets
|
$
|
612,959
|
|
|
$
|
618,583
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
||||
Current debt
|
$
|
1,630
|
|
|
$
|
2,027
|
|
Accounts payable
|
159,246
|
|
|
166,059
|
|
||
Other accrued expenses
|
37,659
|
|
|
46,171
|
|
||
Accrued income taxes
|
379
|
|
|
1,628
|
|
||
Total current liabilities
|
198,914
|
|
|
215,885
|
|
||
Long-term debt
|
182,416
|
|
|
181,065
|
|
||
Long-term benefit liabilities
|
21,208
|
|
|
21,106
|
|
||
Deferred income taxes
|
6,129
|
|
|
9,166
|
|
||
Interest rate swap agreement
|
943
|
|
|
2,088
|
|
||
Other liabilities
|
952
|
|
|
952
|
|
||
Total liabilities
|
410,562
|
|
|
430,262
|
|
||
Commitments and contingencies
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
||||
Preferred stock, $.01 per share; 5,000,000 shares authorized; no shares issued and outstanding at January 31, 2018 and October 31, 2017, respectively
|
—
|
|
|
—
|
|
||
Common stock, par value $.01 per share; 50,000,000 shares authorized; 23,347,545 and 23,121,957 shares issued and outstanding at January 31, 2018 and October 31, 2017, respectively
|
233
|
|
|
231
|
|
||
Paid-in capital
|
112,865
|
|
|
112,351
|
|
||
Retained earnings
|
122,834
|
|
|
117,976
|
|
||
Accumulated other comprehensive loss, net
|
(33,535
|
)
|
|
(42,237
|
)
|
||
Total stockholders’ equity
|
202,397
|
|
|
188,321
|
|
||
Total liabilities and stockholders’ equity
|
$
|
612,959
|
|
|
$
|
618,583
|
|
|
|
Three Months Ended January 31,
|
||||||
|
|
2018
|
|
2017
|
||||
Net revenues
|
|
$
|
247,666
|
|
|
$
|
247,938
|
|
Cost of sales
|
|
219,776
|
|
|
223,834
|
|
||
Gross profit
|
|
27,890
|
|
|
24,104
|
|
||
Selling, general & administrative expenses
|
|
21,240
|
|
|
20,170
|
|
||
Amortization of intangible assets
|
|
565
|
|
|
565
|
|
||
Asset impairment, net
|
|
—
|
|
|
41
|
|
||
Restructuring
|
|
1,514
|
|
|
—
|
|
||
Operating income
|
|
4,571
|
|
|
3,328
|
|
||
Interest expense
|
|
2,340
|
|
|
4,812
|
|
||
Interest income
|
|
(5
|
)
|
|
(2
|
)
|
||
Other expense, net
|
|
436
|
|
|
612
|
|
||
Income (loss) before income taxes
|
|
1,800
|
|
|
(2,094
|
)
|
||
Benefit for income taxes
|
|
(3,058
|
)
|
|
(76
|
)
|
||
Net income (loss)
|
|
$
|
4,858
|
|
|
$
|
(2,018
|
)
|
Income (loss) per share:
|
|
|
|
|
||||
Basic earnings (loss) per share
|
|
$
|
0.21
|
|
|
$
|
(0.11
|
)
|
Basic weighted average number of common shares
|
|
23,107
|
|
|
17,720
|
|
||
Diluted earnings (loss) per share
|
|
$
|
0.21
|
|
|
$
|
(0.11
|
)
|
Diluted weighted average number of common shares
|
|
23,287
|
|
|
17,720
|
|
|
|
|
|
Three Months Ended January 31,
|
||||||
|
|
|
|
2018
|
|
2017
|
||||
Net income (loss)
|
$
|
4,858
|
|
|
$
|
(2,018
|
)
|
|||
Other comprehensive income (loss)
|
|
|
|
|||||||
|
Defined benefit pension plans & other postretirement benefits
|
|
|
|
||||||
|
|
|
Amortization of net actuarial loss
|
328
|
|
|
377
|
|
||
|
|
|
Income tax provision
|
(107
|
)
|
|
(140
|
)
|
||
|
|
Total defined benefit pension plans & other post retirement benefits, net of tax
|
221
|
|
|
237
|
|
|||
|
Marketable securities
|
|
|
|
||||||
|
|
|
Unrealized gain (loss) on marketable securities
|
(144
|
)
|
|
176
|
|
||
|
|
|
Income tax benefit (provision)
|
37
|
|
|
(62
|
)
|
||
|
|
Total marketable securities, net of tax
|
(107
|
)
|
|
114
|
|
|||
|
Derivatives and hedging
|
|
|
|
||||||
|
|
|
Unrealized gain on interest rate swap agreements
|
866
|
|
|
1,446
|
|
||
|
|
|
Income tax provision
|
(341
|
)
|
|
(745
|
)
|
||
|
|
|
Reclassification adjustments for settlement of derivatives included in net income (loss)
|
280
|
|
|
418
|
|
||
|
|
Change in fair value of derivative instruments, net of tax
|
805
|
|
|
1,119
|
|
|||
|
Foreign currency translation adjustments
|
|
|
|
||||||
|
|
|
Foreign currency translation gain (loss)
|
7,783
|
|
|
(558
|
)
|
||
|
|
Unrealized gain (loss) on foreign currency translation
|
7,783
|
|
|
(558
|
)
|
|||
Comprehensive income (loss), net
|
$
|
13,560
|
|
|
$
|
(1,106
|
)
|
|
Three Months Ended January 31,
|
||||||
|
2018
|
|
2017
|
||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
||||
Net income (loss)
|
$
|
4,858
|
|
|
$
|
(2,018
|
)
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
10,117
|
|
|
9,718
|
|
||
Asset impairment, net
|
—
|
|
|
41
|
|
||
Amortization of deferred financing costs
|
309
|
|
|
832
|
|
||
Deferred income taxes
|
(3,551
|
)
|
|
(1,285
|
)
|
||
Stock-based compensation expense
|
516
|
|
|
397
|
|
||
(Gain) loss on sale of assets
|
(12
|
)
|
|
37
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Accounts receivable
|
32,313
|
|
|
15,448
|
|
||
Inventories
|
(671
|
)
|
|
(1,502
|
)
|
||
Prepaids and other assets
|
(6,044
|
)
|
|
2,008
|
|
||
Payables and other liabilities
|
(23,245
|
)
|
|
4,112
|
|
||
Accrued income taxes
|
(2,950
|
)
|
|
(1,164
|
)
|
||
Net cash provided by operating activities
|
11,640
|
|
|
26,624
|
|
||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
||||
Capital expenditures
|
(9,885
|
)
|
|
(9,077
|
)
|
||
Proceeds from sale of assets
|
—
|
|
|
4
|
|
||
Net cash used in investing activities
|
(9,885
|
)
|
|
(9,073
|
)
|
||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
||||
Payment of capital leases
|
(223
|
)
|
|
(208
|
)
|
||
Proceeds from long-term borrowings
|
46,900
|
|
|
33,200
|
|
||
Repayments of long-term borrowings
|
(45,370
|
)
|
|
(53,327
|
)
|
||
Payment of deferred financing costs
|
(57
|
)
|
|
(221
|
)
|
||
Net cash provided by (used in) financing activities
|
1,250
|
|
|
(20,556
|
)
|
||
Effect of foreign currency exchange rate fluctuations on cash
|
(675
|
)
|
|
329
|
|
||
Net increase (decrease) in cash and cash equivalents
|
2,330
|
|
|
(2,676
|
)
|
||
Cash and cash equivalents at beginning of period
|
8,736
|
|
|
8,696
|
|
||
Cash and cash equivalents at end of period
|
$
|
11,066
|
|
|
$
|
6,020
|
|
|
|
|
|
||||
Supplemental Cash Flow Information:
|
|
|
|
||||
Cash paid for interest
|
$
|
2,260
|
|
|
$
|
3,954
|
|
Cash paid for income taxes
|
$
|
1,593
|
|
|
$
|
924
|
|
|
|
|
|
||||
Non-cash Activities:
|
|
|
|
||||
Capital equipment included in accounts payable
|
$
|
3,398
|
|
|
$
|
2,251
|
|
Standard
|
Description
|
Effective Date
|
Effect on our financial statements and other significant matters
|
ASU 2018-02
Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income
|
This amendment allows a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act. The amendments eliminate the stranded tax effects resulting from the Tax Cuts and Job Act and will improve the usefulness of information reported to financial statement users.
|
November 1, 2019 with early adoption permitted.
|
We do not expect the adoption of these provisions to have a significant impact on the Company's condensed consolidated financial statements or financial statement disclosures.
|
ASU 2017-09
Compensation - Stock Compensation (Topic 718)
|
This amendment clarifies when a change to the terms or conditions of a share-based payment award must be accounted for as a modification. The new guidance requires modification accounting if the fair value, vesting condition or the classification of the award is not the same immediately before and after a change to the terms and conditions of the award. The amendment should be adopted on a prospective basis.
|
November 1, 2018 with early adoption permitted.
|
We do not expect the adoption of these provisions to have a significant impact on the Company's condensed consolidated financial statements as it is not our practice to change either the terms or conditions of share-based payment awards once they are granted.
|
ASU 2014-09
Revenue from Contracts with Customers
|
The amendments require companies to recognize revenue when there is a transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods and services. The amendments should be applied on either a full or modified retrospective basis, which clarifies existing accounting literature relating to how and when a company recognizes revenue. The FASB, through the issuance of ASU No. 2015-14, "
Revenue from Contracts with Customers,
" approved a one year delay of the effective date and permits two implementation approaches, one requiring retrospective application of the new standard with restatement of prior years and one requiring prospective application of the new standard with disclosure of results under old standards. During fiscal 2016, the FASB issued ASUs 2016-10, 2016-11 and 2016-12. Finally, ASU 2016-20 makes minor corrections or minor improvements to the Codification that are not expected to have a significant effect on current accounting practice or create a significant administrative cost to most entities.
|
November 1, 2018.
|
We are planning a bottom up approach to analyze the standard's impact on our revenues by looking at historical policies and practices and identifying the differences from applying the new standard to our revenue stream. While we have not yet identified any material changes in the timing of revenue recognition, our evaluation is ongoing and not complete. We have established a cross-functional coordinated team to implement the guidance related to the recognition of revenue from contracts with customers. We are in the process of assessing our customer contracts, identifying contractual provisions that may result in a change in the timing or the amount of revenue recognized in comparison with current guidance, as well as assessing the enhanced disclosure requirements of the new guidance. In addition, we have selected the modified retrospective approach but have not yet selected a transition date nor have we determined the effect of the standard to our condensed consolidated financial statements.
|
ASU 2016-02
Leases
|
This amendment requires lessees to recognize a lease liability and a right-of-use asset on the balance sheet and aligns many of the underlying principles of the new lessor model with those in Accounting Standards Codification Topic 606, Revenue from Contracts with Customers. The standard requires a modified retrospective transition for capital and operating leases existing at or entered into after the beginning of the earliest comparative period presented in the financial statements, but it does not require transition accounting for leases that expire prior to the date of initial adoption. In January 2018, the FASB issued an amendment to ASC Topic 842 which permits companies to elect an optional transition practical expedient to not evaluate existing land easements under the new standard if the land easements were not previously accounted for under existing lease guidance. In November 2017, the FASB voted to amend ASC Topic 842 to allow companies to elect not to restate their comparative periods in the period of adoption when transitioning to the standard. The amendment is expected to be finalized in the first quarter of 2018.
|
November 1, 2019 with early adoption permitted.
|
We are in the process of evaluating the impact of adoption of this standard on our financial statements and disclosures. We are in the beginning stages of developing a project plan with key stakeholders throughout the organization and gathering and analyzing detailed information on existing lease arrangements. This includes evaluating the available practical expedients, calculating the lease asset and liability balances associated with individual contractual arrangements and assessing the disclosure requirements. In addition, we continue to monitor FASB amendments to ASC Topic 842.
|
ASU 2016-01
Recognition and Measurement of Financial Assets and Financial Liabilities
|
This amendment addresses certain aspects of recognition, measurement, presentation and disclosure of financial instruments. Most prominent among the amendments is the requirement for changes in the fair value of the Company's equity investments, with certain exceptions, to be recognized through net income rather than other comprehensive income ("OCI"). The amendments should be applied by means of a cumulative-effect adjustment to the balance sheet in year of adoption.
|
November 1, 2018 with early adoption permitted.
|
We do not expect the adoption of these provisions to have a significant impact on the Company's condensed consolidated statement of financial position or financial statement disclosures.
|
Standard
|
Description
|
Adoption Date
|
Effect on our financial statements and other significant matters
|
ASU 2017-07
Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost
|
This amendment requires the presentation of the service cost component of net benefit cost to be in the same line item as other compensation costs arising from services rendered by the pertinent employees during the period. All other components of net benefit cost should be presented separately from the service cost component and outside of a subtotal of earnings from operations, or separately disclosed. The amendments should be adopted on a retrospective basis.
|
November 1, 2017.
|
Prior to the adoption of ASU 2017-07, pension costs were reported as cost of sales and selling, general and administrative expenses on the Company's condensed consolidated statements of income. As a result of the early adoption of ASU 2017-07, we reclassified $322 from cost of sales and selling, general and administrative expenses to other expense, net on the condensed consolidated statements of operations for the three months ended January 31, 2017.
|
ASU 2015-11
Inventory
|
This amendment simplifies the measurement of inventory by requiring inventory to be measured at the lower of cost and net realizable value. The amendment should be applied on a prospective basis.
|
November 1, 2017.
|
The adoption of these provisions did not have a significant impact on the Company's condensed consolidated statement of financial position or financial statement disclosures.
|
|
January 31, 2018
|
|
October 31, 2017
|
||||
Raw materials
|
$
|
25,467
|
|
|
$
|
23,389
|
|
Work-in-process
|
18,693
|
|
|
18,653
|
|
||
Finished goods
|
20,570
|
|
|
19,770
|
|
||
Total inventory
|
$
|
64,730
|
|
|
$
|
61,812
|
|
|
|
|
January 31, 2018
|
|
October 31, 2017
|
||||
Tooling (1)
|
|
$
|
19,732
|
|
|
$
|
13,629
|
|
|
Prepaid expenses and other assets
|
|
15,274
|
|
|
14,089
|
|
|||
Assets held for sale (2)
|
|
6,300
|
|
|
6,300
|
|
|||
|
Total
|
|
$
|
41,306
|
|
|
$
|
34,018
|
|
|
January 31,
2018 |
|
October 31,
2017 |
||||
Land and improvements
|
$
|
11,374
|
|
|
$
|
11,416
|
|
Buildings and improvements
|
120,395
|
|
|
124,406
|
|
||
Machinery and equipment
|
508,785
|
|
|
504,785
|
|
||
Furniture and fixtures
|
23,383
|
|
|
22,209
|
|
||
Construction in progress
|
46,794
|
|
|
40,356
|
|
||
Total, at cost
|
710,731
|
|
|
703,172
|
|
||
Less: Accumulated depreciation
|
436,684
|
|
|
436,281
|
|
||
Property, plant and equipment, net
|
$
|
274,047
|
|
|
$
|
266,891
|
|
|
January 31,
2018 |
|
October 31,
2017 |
||||
Leased Property:
|
|
|
|
||||
Machinery and equipment
|
$
|
7,394
|
|
|
$
|
7,099
|
|
Less: Accumulated depreciation
|
2,586
|
|
|
2,420
|
|
||
Leased property, net
|
$
|
4,808
|
|
|
$
|
4,679
|
|
Twelve Months Ended January 31,
|
|
||
2019
|
$
|
906
|
|
2020
|
541
|
|
|
2021
|
2,275
|
|
|
|
3,722
|
|
|
Plus amount representing interest ranging from 3.05% to 3.77%
|
358
|
|
|
Future minimum rental payments
|
$
|
4,080
|
|
Balance October 31, 2017
|
|
$
|
27,859
|
|
|
|
Foreign currency translation
|
|
478
|
|
|
Balance January 31, 2018
|
|
$
|
28,337
|
|
|
|
Customer Relationships
|
|
Developed Technology
|
|
Non-Compete
|
|
Trade Name
|
|
Trademark
|
|
Total
|
||||||||||||
Balance October 31, 2017
|
$
|
11,648
|
|
|
$
|
1,997
|
|
|
$
|
31
|
|
|
$
|
1,254
|
|
|
$
|
95
|
|
|
$
|
15,025
|
|
|
|
Amortization expense
|
(333
|
)
|
|
(193
|
)
|
|
(4
|
)
|
|
(31
|
)
|
|
(4
|
)
|
|
(565
|
)
|
||||||
|
Foreign currency translation
|
5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
||||||
Balance January 31, 2018
|
$
|
11,320
|
|
|
$
|
1,804
|
|
|
$
|
27
|
|
|
$
|
1,223
|
|
|
$
|
91
|
|
|
$
|
14,465
|
|
|
|
Weighted Average Useful Life (years)
|
|
Gross Carrying Value Net of Foreign Currency
|
|
Accumulated Amortization
|
|
Net
|
||||||
|
Customer relationships
|
13.2
|
|
17,574
|
|
|
$
|
(6,254
|
)
|
|
$
|
11,320
|
|
|
|
Developed technology
|
7.3
|
|
5,007
|
|
|
(3,203
|
)
|
|
1,804
|
|
|||
|
Non-compete
|
2.3
|
|
824
|
|
|
(797
|
)
|
|
27
|
|
|||
|
Trade Name
|
14.8
|
|
1,875
|
|
|
(652
|
)
|
|
1,223
|
|
|||
|
Trademark
|
10.0
|
|
166
|
|
|
(75
|
)
|
|
91
|
|
|||
|
|
|
|
$
|
25,446
|
|
|
$
|
(10,981
|
)
|
|
$
|
14,465
|
|
|
January 31,
2018 |
|
October 31, 2017
|
||||
Credit Agreement—interest rate of 3.97% at January 31, 2018 and 3.88% at October 31, 2017
|
$
|
179,600
|
|
|
$
|
178,200
|
|
Equipment security note
|
351
|
|
|
482
|
|
||
Capital lease obligations
|
3,722
|
|
|
3,760
|
|
||
Insurance broker financing agreement
|
373
|
|
|
650
|
|
||
Total debt
|
184,046
|
|
|
183,092
|
|
||
Less: Current debt
|
1,630
|
|
|
2,027
|
|
||
Total long-term debt
|
$
|
182,416
|
|
|
$
|
181,065
|
|
Twelve Months Ending January 31,
|
|
Credit Agreement
|
|
Equipment Security Note
|
|
Capital Lease Obligations
|
|
Other Debt
|
|
Total
|
||||||||||
2019
|
|
$
|
—
|
|
|
$
|
351
|
|
|
$
|
906
|
|
|
$
|
373
|
|
|
$
|
1,630
|
|
2020
|
|
—
|
|
|
—
|
|
|
541
|
|
|
—
|
|
|
541
|
|
|||||
2021
|
|
—
|
|
|
—
|
|
|
2,275
|
|
|
—
|
|
|
2,275
|
|
|||||
2022
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
2023
|
|
179,600
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
179,600
|
|
|||||
Total
|
|
$
|
179,600
|
|
|
$
|
351
|
|
|
$
|
3,722
|
|
|
$
|
373
|
|
|
$
|
184,046
|
|
|
Pension Benefits
|
|
Other Post-Retirement
Benefits
|
||||||||||||
|
Three Months Ended January 31,
|
|
Three Months Ended January 31,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Interest cost
|
$
|
792
|
|
|
$
|
821
|
|
|
$
|
3
|
|
|
$
|
3
|
|
Expected return on plan assets
|
(840
|
)
|
|
(864
|
)
|
|
—
|
|
|
—
|
|
||||
Amortization of net actuarial loss
|
328
|
|
|
377
|
|
|
2
|
|
|
3
|
|
||||
Net periodic cost
|
$
|
280
|
|
|
$
|
334
|
|
|
$
|
5
|
|
|
$
|
6
|
|
|
|
|
Pension and Post Retirement Plan Liability
|
|
Marketable Securities Adjustment
|
|
Interest Rate Swap Adjustment (1)
|
|
Foreign Currency Translation Adjustment
|
|
Accumulated Other Comprehensive Loss
|
||||||||||
Balance at October 31, 2017
|
|
$
|
(27,847
|
)
|
|
$
|
(2
|
)
|
|
$
|
(1,319
|
)
|
|
$
|
(13,069
|
)
|
|
$
|
(42,237
|
)
|
|
|
Other comprehensive income (loss)
|
|
—
|
|
|
(107
|
)
|
|
525
|
|
|
7,783
|
|
|
8,201
|
|
|||||
|
Amounts reclassified from accumulated other comprehensive loss, net of tax
|
|
221
|
|
|
—
|
|
|
280
|
|
|
—
|
|
|
501
|
|
|||||
|
Net current-period other comprehensive income (loss)
|
|
221
|
|
|
(107
|
)
|
|
805
|
|
|
7,783
|
|
|
8,702
|
|
|||||
Balance at January 31, 2018
|
|
$
|
(27,626
|
)
|
|
$
|
(109
|
)
|
|
$
|
(514
|
)
|
|
$
|
(5,286
|
)
|
|
$
|
(33,535
|
)
|
|
|
Stock Options
|
|
Restricted Stock
|
|
Restricted Stock Units
|
|||||||||||||||||||
Outstanding at:
|
|
Options
|
|
Weighted Average Exercise Price
|
|
Weighted Average Remaining Contractual Life
|
|
Restricted Shares
|
|
20 Day EMA
|
|
Weighted Average Remaining Contractual Life
|
|
Restricted Share Units
|
|
20 Day EMA
|
|
Weighted Average Remaining Contractual Life
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
November 1, 2016
|
|
90
|
|
|
$9.67
|
|
3.04
|
|
376
|
|
|
$6.40
|
|
1.83
|
|
22
|
|
|
$4.17
|
|
1.78
|
||||
Granted
|
|
—
|
|
|
—
|
|
|
|
|
213
|
|
|
7.07
|
|
|
|
|
21
|
|
|
7.06
|
|
|
|
|
Options exercised or restricted stock vested
|
|
—
|
|
|
—
|
|
|
|
|
(21
|
)
|
|
15.28
|
|
|
|
|
—
|
|
|
—
|
|
|
|
|
Forfeited or expired
|
|
(8
|
)
|
|
10.46
|
|
|
|
|
(2
|
)
|
|
13.22
|
|
|
|
|
—
|
|
|
—
|
|
|
|
|
January 31, 2017
|
|
82
|
|
|
$9.60
|
|
2.80
|
|
567
|
|
|
$11.19
|
|
2.08
|
|
43
|
|
|
$5.48
|
|
2.49
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
November 1, 2017
|
|
58
|
|
|
$8.16
|
|
2.53
|
|
441
|
|
|
$7.07
|
|
1.60
|
|
36
|
|
|
$7.69
|
|
1.82
|
||||
Granted
|
|
—
|
|
|
—
|
|
|
|
|
220
|
|
|
8.20
|
|
|
|
|
12
|
|
|
8.20
|
|
|
|
|
Options exercised or restricted stock vested
|
|
—
|
|
|
—
|
|
|
|
|
(88
|
)
|
|
8.48
|
|
|
|
|
(7
|
)
|
|
7.06
|
|
|
|
|
Forfeited or expired
|
|
—
|
|
|
—
|
|
|
|
|
(1
|
)
|
|
7.06
|
|
|
|
|
—
|
|
|
—
|
|
|
|
|
January 31, 2018
|
|
58
|
|
|
$8.16
|
|
2.27
|
|
572
|
|
|
$7.29
|
|
2.22
|
|
41
|
|
|
$7.94
|
|
1.89
|
|
|
Three Months Ended January 31,
|
||||||
|
|
2018
|
|
2017
|
||||
Restricted stock
|
|
$
|
480
|
|
|
$
|
375
|
|
Restricted stock units
|
|
36
|
|
|
22
|
|
||
Total
|
|
$
|
516
|
|
|
$
|
397
|
|
|
|
Asset (Liability)
|
|
Level 1
|
|
Level 2
|
|
Valuation Technique
|
||||||
October 31, 2017:
|
|
|
|
|
|
|
|
|
||||||
Interest Rate Swap Contracts
|
|
$
|
(2,088
|
)
|
|
$
|
—
|
|
|
$
|
(2,088
|
)
|
|
Income Approach
|
Marketable Securities
|
|
194
|
|
|
194
|
|
|
—
|
|
|
Market Approach
|
|||
January 31, 2018:
|
|
|
|
|
|
|
|
|
||||||
Interest Rate Swap Contracts
|
|
(943
|
)
|
|
—
|
|
|
(943
|
)
|
|
Income Approach
|
|||
Marketable Securities
|
|
$
|
49
|
|
|
$
|
49
|
|
|
$
|
—
|
|
|
Market Approach
|
|
|
January 31, 2018
|
||
Professional and legal costs
|
|
$
|
831
|
|
Employee costs
|
|
611
|
|
|
Other
|
|
72
|
|
|
|
|
$
|
1,514
|
|
|
Balance as of October 31, 2017
|
|
Restructuring Expense
|
|
Payments
|
|
Balance as of January 31, 2018
|
||||||||
Employee costs
|
65
|
|
|
611
|
|
|
265
|
|
|
411
|
|
||||
Legal and professional costs
|
270
|
|
|
831
|
|
|
900
|
|
|
201
|
|
||||
|
$
|
335
|
|
|
$
|
1,442
|
|
|
$
|
1,165
|
|
|
$
|
612
|
|
|
Three Months Ended January 31,
|
||||||
|
2018
|
|
2017
|
||||
Net income (loss) available to common stockholders
|
$
|
4,858
|
|
|
$
|
(2,018
|
)
|
Basic weighted average shares
|
23,107
|
|
|
17,720
|
|
||
Effect of dilutive securities:
|
|
|
|
||||
Restricted share units and stock options
(1)
|
180
|
|
|
—
|
|
||
Diluted weighted average shares
|
23,287
|
|
|
17,720
|
|
||
Basic income (loss) per share
|
$
|
0.21
|
|
|
$
|
(0.11
|
)
|
Diluted income (loss) per share
|
$
|
0.21
|
|
|
$
|
(0.11
|
)
|
|
Net Revenues
|
||||||
|
Three Months Ended January 31,
|
||||||
Geographic Region:
|
2018
|
|
2017
|
||||
United States
|
$
|
189,458
|
|
|
$
|
203,200
|
|
Europe
|
48,379
|
|
|
35,669
|
|
||
Rest of World
|
9,829
|
|
|
9,069
|
|
||
Total Company
|
$
|
247,666
|
|
|
$
|
247,938
|
|
|
Long-Lived Assets
|
||||||
Geographic Region:
|
January 31, 2018
|
|
October 31, 2017
|
||||
United States
|
$
|
236,978
|
|
|
$
|
235,663
|
|
Europe
|
56,903
|
|
|
53,569
|
|
||
Rest of World
|
22,968
|
|
|
20,543
|
|
||
Total Company
|
$
|
316,849
|
|
|
$
|
309,775
|
|
•
|
our ability to accomplish our strategic objectives;
|
•
|
our ability to obtain future sales;
|
•
|
changes in worldwide economic and political conditions, including adverse effects from terrorism or related hostilities;
|
•
|
costs related to legal and administrative matters;
|
•
|
our ability to realize cost savings expected to offset price concessions;
|
•
|
our ability to successfully integrate acquired businesses, including businesses located outside of the United States;
|
•
|
risks associated with doing business internationally, including economic, political and social instability, foreign currency exposure and the lack of acceptance of our products;
|
•
|
inefficiencies related to production and product launches that are greater than anticipated;
|
•
|
changes in technology and technological risks;
|
•
|
work stoppages and strikes at our facilities and that of our customers or suppliers;
|
•
|
our dependence on the automotive and heavy truck industries, which are highly cyclical;
|
•
|
the dependence of the automotive industry on consumer spending, which is subject to the impact of domestic and international economic conditions affecting car and light truck production;
|
•
|
regulations and policies regarding international trade;
|
•
|
financial and business downturns of our customers or vendors, including any production cutbacks or bankruptcies;
|
•
|
increases in the price of, or limitations on the availability of aluminum, magnesium or steel, our primary raw materials, or decreases in the price of scrap steel;
|
•
|
the successful launch and consumer acceptance of new vehicles for which we supply parts;
|
•
|
the impact on financial statements of any known or unknown accounting errors or irregularities; and the magnitude of any adjustments in restated financial statements of our operating results;
|
•
|
the occurrence of any event or condition that may be deemed a material adverse effect under our outstanding indebtedness or a decrease in customer demand which could cause a covenant default under our outstanding indebtedness;
|
•
|
pension plan funding requirements; and
|
•
|
other factors besides those listed here could also materially affect our business.
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
Production Volumes
|
Three Months Ended January 31,
|
||||
|
2018
|
|
2017
|
||
|
(Number of Vehicles in Thousands)
|
||||
Europe
|
5,768
|
|
|
5,258
|
|
North America
|
4,118
|
|
|
4,173
|
|
Total
|
9,886
|
|
|
9,431
|
|
|
|
|
|
||
Europe:
|
|
|
|
||
Increase from prior year
|
510
|
|
|
|
|
% Increase from prior year
|
9.7
|
%
|
|
|
|
North America
|
|
|
|
||
Decrease from prior year
|
(55
|
)
|
|
|
|
% Decrease from prior year
|
(1.3
|
)%
|
|
|
|
Total
|
|
|
|
||
Increase from prior year
|
455
|
|
|
|
|
% Increase from prior year
|
4.8
|
%
|
|
|
|
Three Months Ended January 31,
|
|
2018 vs. 2017
|
||||||||
|
2018
|
|
2017
|
|
change
|
||||||
Net cash provided by operating activities
|
$
|
11,640
|
|
|
$
|
26,624
|
|
|
$
|
(14,984
|
)
|
Net cash used in investing activities
|
$
|
(9,885
|
)
|
|
$
|
(9,073
|
)
|
|
$
|
(812
|
)
|
Net cash used in financing activities
|
$
|
1,250
|
|
|
$
|
(20,556
|
)
|
|
$
|
21,806
|
|
|
Three Months Ended January 31,
|
||||||
|
2018
|
|
2017
|
||||
Operational cash flow before changes in operating assets and liabilities
|
$
|
12,237
|
|
|
$
|
7,722
|
|
|
|
|
|
||||
Changes in operating assets and liabilities:
|
|
|
|
||||
Accounts receivable
|
32,313
|
|
|
15,448
|
|
||
Inventories
|
(671
|
)
|
|
(1,502
|
)
|
||
Prepaids and other assets
|
(6,044
|
)
|
|
2,008
|
|
||
Payables and other liabilities
|
(23,245
|
)
|
|
4,112
|
|
||
Accrued income taxes
|
(2,950
|
)
|
|
(1,164
|
)
|
||
Total change in operating assets and liabilities
|
$
|
(597
|
)
|
|
$
|
18,902
|
|
|
|
|
|
||||
Net cash provided by operating activities
|
$
|
11,640
|
|
|
$
|
26,624
|
|
•
|
Cash outflows from changes in operating assets and liabilities was
$597
for the
three months ended January 31,
2018
and cash inflows was
$18,902
for the
three months ended January 31,
2017
and was impacted by working capital initiatives.
|
•
|
Cash inflows from changes in accounts receivable for the
three months ended January 31,
2018
and
2017
, were
$32,313
and
$15,448
, respectively. The cash inflows were due to continuing efforts in collecting receivables and sales volume changes.
|
•
|
Cash outflows from changes in inventory for the
three months ended January 31,
2018
and
2017
were
$671
and
$1,502
, respectively. The decrease was primarily driven by a change in customer mix and delivery.
|
•
|
Cash outflows from changes in prepaids and other assets for the
three months ended January 31,
2018
was
$6,044
and cash inflows from changes in prepaids and other assets for the
three months ended January 31,
2017
was
$2,008
resulting from the timing of invoicing customer reimbursed tooling awards.
|
•
|
Cash outflows from changes in payables and other liabilities for the
three months ended January 31,
2018
was
$23,245
and cash inflows from changes in payables and other liabilities for the
three months ended January 31,
2017
was
$4,112
resulting from the matching of terms with our customers and vendors, offset partially by the timing of payments related to capital expenditures and customer funded tooling.
|
•
|
Cash outflows from changes in accrued income taxes for the
three months ended January 31,
2018
and
2017
were
$2,950
and
$1,164
, respectively. The changes were primarily because of the effect of deferred taxes.
|
Item 4.
|
Controls and Procedures
|
Item 6.
|
Exhibits
|
|
|
Incorporated By Reference
|
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Exhibit #
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Exhibit Description
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Form
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File Number
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Date of First Filing
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Exhibit Number
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Filed Herewith
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2.1
*†
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Sale and Purchase Agreement, dated February 1, 2018 between Shiloh Holdings Netherlands, B.V. and Brabant Alucast Services B.V, a limited liability company organized under the laws of the Netherlands (Oss).
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X
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2.2
*†
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Sale and Purchase Agreement, dated February 1, 2018 between Shiloh Holdings Netherlands, B.V. and Brabant Alucast Services B.V, a limited liability company organized under the laws of the Netherlands (Verres).
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X
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Principal Executive Officer’s Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
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X
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Principal Financial Officer’s Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
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X
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Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
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X
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101.INS
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XBRL Instance Document
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X
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101.SCH
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XBRL Taxonomy Extension Schema Document
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X
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101.CAL
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XBRL Taxonomy Extension Calculation Linkbase Document
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X
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101.LAB
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XBRL Taxonomy Extension Label Linkbase Document
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X
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101.PRE
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XBRL Taxonomy Extension Presentation Linkbase Document
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X
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101.DEF
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XBRL Taxonomy Extension Definition Linkbase Document
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X
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S
HILOH
I
NDUSTRIES
, I
NC
.
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By:
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/s/ W. Jay Potter
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W. Jay Potter
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Senior Vice President and Chief Financial Officer (Duly Authorized Officer and Principal Financial Officer)
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SALE AND PURCHASE AGREEMENT
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RELATING TO 100% OF THE SHARE CAPITAL
OF
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BRABANT ALUCAST THE NETHERLANDS SITE OSS B.V.
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1.
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Interpretation...................................................................................................................................... 3
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2.
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Sale, Purchase and Transfer of the Shares........................................................................................ 11
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3.
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Consideration for the Sale and Purchase of the Shares.................................................................... 11
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4.
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Conditions to Completion and other Preliminary Actions............................................................... 12
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5.
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Completion....................................................................................................................................... 13
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6.
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Seller Warranties.............................................................................................................................. 14
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7.
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Special Indemnities.......................................................................................................................... 15
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7.7
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Exclusive Remedy............................................................................................................................ 18
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8
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Limitation of Seller’s Liability......................................................................................................... 18
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9
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Purchaser’s Warranties and Undertakings........................................................................................ 22
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10
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Interim Management........................................................................................................................ 23
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11
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Non-Solicitation Undertaking........................................................................................................... 26
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12
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Confidentiality and Announcements................................................................................................. 26
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14
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Costs and Expenses........................................................................................................................... 29
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15
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Stamp Duty, Fees and Taxes............................................................................................................. 29
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16
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Grossing-up....................................................................................................................................... 29
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17
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VAT................................................................................................................................................... 30
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18
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Non- utilisation of Oss Tax Losses; Tax Returns; Further Assurance.............................................. 30
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19
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Effect of Completion......................................................................................................................... 31
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20
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Assignment....................................................................................................................................... 31
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21
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Payment............................................................................................................................................. 32
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22
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Notices.............................................................................................................................................. 32
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23
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Invalidity........................................................................................................................................... 33
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24
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Entire Agreement.............................................................................................................................. 33
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25
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Agreement Prevails........................................................................................................................... 34
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26
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Variation............................................................................................................................................ 34
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27
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No Waiver......................................................................................................................................... 34
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28
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Counterparts...................................................................................................................................... 34
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29
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Time of the Essence.......................................................................................................................... 34
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30
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Governing Law and Submission to Jurisdiction............................................................................... 34
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(1)
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BRABANT ALUCAST SERVICES B.V.
, a limited liability company (
een besloten vennootschap met beperkte aansprakelijkheid
) organized under the laws of the Netherlands, registered with the trade register of the Chambers of Commerce under file number 58268375, having its official seat in Oss, the Netherlands and its registered address at Rijnstraat 19, 5347 KL, Oss, The Netherlands, acting by its managing directors Brabant Alucast International B.V. (represented by Mr James Brundell and Mr J.W.P.C.M. Vorstenbosch (the “
Seller
”);
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(2)
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SHILOH HOLDINGS NETHERLANDS B.V.
, a limited liability company (
een besloten vennootschap met beperkte aansprakelijkheid
) organized under the laws of the Netherlands, registered with the trade register of the Chambers of Commerce under file number 60724064, having its official seat in Amsterdam, the Netherlands, and its principal place of business at Hoogoorddreef 15, 1101 BA Amsterdam, the Netherlands, acting by its managing directors K.M. Bednarz and Ms H.D. de Rijk (the “
Purchaser
”).
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(A)
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Brabant Alucast The Netherlands site Oss B.V. is a limited liability company (
een besloten vennootschap met beperkte aansprakelijkheid
) organized under the laws of the Netherlands, registered with the trade register of the Chambers of Commerce under file number 16034524, having its official seat in Oss, the Netherlands and its registered address at Rijnstraat 19, 5347 KL, Oss, The Netherlands and is engaged in the development and production of magnesium and aluminium high pressure die castings for interior components and body structural parts with high technical requirements (the “
Company
”).
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(B)
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At the date of this Agreement, the Seller holds the full legal and beneficial title to all issued and outstanding shares in the capital of the Company, consisting of 500 shares with a nominal value of EUR 450 each (the “
Shares
”).
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(C)
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The Seller intends to sell, and the Purchaser intends to purchase, the Shares, on the terms and subject to the conditions of this Agreement (the “
Transaction
”).
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(D)
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On 20 December 2017, the Seller entered into with the Purchaser's parent company, Shiloh Industries Inc., an exclusivity agreement by which they:
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(i)
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confirmed their intention, in principle, to enter into the Transaction and to set forth the basis for further and final negotiations of one or more definitive agreements, in accordance with the provisions of the non-binding term sheet attached thereto;
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(ii)
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agreed to be bound by certain exclusivity obligations in accordance with the terms thereof, in order to facilitate the negotiation of the above mentioned definitive agreements and the execution of the Transaction;
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(iii)
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agreed to cooperate in order to obtain, prior to the Signing Date: (1) comfort by certain competent authorities and other third parties as to the continuance of their relationships with the Company following Completion of the Transaction; and (2) the execution between the Purchaser and the Insurer of the W&I Insurance Policy effective upon consummation of the Completion subject to the payment of the relevant premium by the Purchaser.
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(E)
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Prior to the date hereof, comfort has been provided by certain key customers and suppliers (namely Bayerische Motoren Werke A.G. (BMW), General Motors LLC (GM), Jaguar Landrover Rover Ltd (JLR) and DAF Trucks NV (DAF)) that the existing contractual arrangements with the Company will continue following Completion at the same terms and conditions currently in force.
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(F)
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On the date hereof, the parties have entered into a share purchase agreement ((the “
Verres SPA
”) concerning the sale and purchase by the Purchaser of a EUR 50,000.00 quota representing a 100% interest in the capital of Brabant Alucast Italy Site Verres S.r.l. (“
Verres
”).
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(G)
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The Parties have complied with the provisions of the Social and Economic Council Merger Regulation for the protection of employees (
SER-Besluit Fusiegedragsregels 2015 ter bescherming van de belangen van werknemers
) and the Dutch Works Council Act (
Wet op de Ondernemingsraden
).
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1.
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Interpretation
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1.1
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In addition to the other terms defined elsewhere in this Agreement, the following terms shall have the meanings ascribed to them below for the purpose of this Agreement:
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(a)
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dividend or distribution (whether in cash or in kind, whether ordinary or extraordinary) or any payments in lieu of any dividend or distribution, either declared and/or paid or made;
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(b)
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redemption, repurchase, repayment or return of shares, or return of capital (whether by reduction of capital or otherwise and whether in cash or in kind);
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(c)
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consultant, advisory, management, monitoring, service, shareholder or other fees, charges or compensation of a similar nature, whether resolved or paid, including - but not limited to - any fees and/or expenses due in connection with the implementation of any transactions contemplated hereby;
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(d)
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payments to, or transaction of any kind with, the Seller, any member of the Seller’s Group and/or any of their respective Related Parties (including, without limitation, under any Intercompany Agreements);
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(e)
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waiver, deferral or release (whether conditional or not) of any amount, right, value, benefit or obligation owed or due to the Seller, any member of the Seller’s Group and/or any of their respective Related Parties;
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(f)
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amendment to the amount or timing of interest, principal or fees in respect of any indebtedness owed by the Seller, any member of the Seller’s Group and/or any of their respective Related Parties;
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(g)
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loans or gifts made to the Seller, any member of the Seller’s Group and/or any of their respective Related Parties;
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(h)
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liability or obligation (contingent or otherwise) of the Seller, any member of the Seller’s Group and/or any of their respective Related Parties assumed or discharged;
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(i)
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guarantees or incurrence of indebtedness to the benefit of the Seller, any member of the Seller’s Group and/or any of their respective Related Parties;
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(j)
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guarantee, indemnity or Encumbrance provided by, or over the assets of, the Company;
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(k)
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bonuses paid to the Company’s directors and/or employees in connection with the implementation of any transactions contemplated hereby;
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(l)
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any transfer taxes payable by the Company in connection with the transfer of the Rijnstraat Site from Brabant Alucast International B.V. to the Company in excess of the Outstanding RETT Amount funded by the Seller to the Company prior to Completion or, as the case may be, deducted from the Consideration in accordance with clause 3.3.2 (b); and
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(m)
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any Taxes resulting from a Leakage,
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(a)
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any payments expressly provided for under the terms of the Transaction Documents (including for the avoidance of doubt any amounts to be paid by the Company to Verres in respect of any Post Locked Box Date Lending or otherwise);
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(b)
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any payments to the extent specifically provided for in the Locked Box Accounts;
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(c)
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payment of the [*] Claim Settlement Amount;
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(d)
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any amounts incurred, paid or agreed to be paid or payable or liability, cost or expense incurred in connection with any matter undertaken at the written request of, or with the prior written consent of, the Purchaser;
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(e)
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any payments listed in Schedule 9;
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1.2
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In this Agreement, unless the context otherwise requires:
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(a)
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references to a “
party
” mean a party to this Agreement and shall include its permitted assignees (if any) and/or the successors in title to that part of its undertaking which includes this Agreement;
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(b)
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any reference to “
writing
” or “
written
” means any method of reproducing words in a legible and non‑transitory form (excluding, for the avoidance of doubt, email);
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(c)
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references to “
include
” or “
including
” are to be construed without limitation;
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(d)
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references to a “
person
” include any individual, company, partnership, joint venture, firm, association, trust, governmental or regulatory authority or other body or entity (whether or not having separate legal personality);
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(e)
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words in the singular include the plural and vice versa and a reference to any gender includes all other genders;
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(f)
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the table of contents and headings are inserted for convenience only and do not affect the construction of this Agreement;
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(g)
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references to Recitals, Clauses, paragraphs and Schedules (including any Annexes attached thereto) are (unless the context otherwise requires) to recitals, clauses and paragraphs of, and schedules (including any annexes attached thereto) to, this Agreement and all Recitals and Schedules (including any Annexes attached thereto) form an integral and substantial part of this Agreement;
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(h)
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references to any statute or statutory provision include a reference to that statute or statutory provision as amended, consolidated or replaced from time to time (whether before or after the date of this Agreement) and include any subordinate legislation made under the relevant statute or statutory provision;
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(i)
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where any representation or warranty contained in this Agreement (including but not limited to the Seller Warranties) is expressly qualified by reference to the “Seller’s Knowledge” or “as far as the Seller is aware” , this shall mean the knowledge, as of the date hereof and as of the Completion Date, of the Seller and/or the knowledge of any executive and/or senior manager and/or member of the board of directors of the Company and/or statutory auditors of the Seller and/or the Company, after due inquiry; and
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(j)
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in respect of any jurisdiction other than the Netherlands, a reference to any Dutch legal term shall be construed as a reference to the term or concept which most nearly corresponds to it in that jurisdiction. Where in this Agreement words are translated into the Dutch language, the Dutch translation shall prevail in any dispute as to the interpretation of such word.
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1.3
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The Purchaser shall be entitled to designate an Affiliate incorporated in a country being a member of the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the “
Designee
”) to purchase the Shares and carry-out the transactions contemplated hereby, in accordance with the following provisions:
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(a)
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such designation will be sufficiently made if notified in writing to the Seller, together with (i) full corporate details and address of the Designee for the purposes of Clause 22, and (ii) the written unconditional acceptance of the Designee, and, upon such acceptance, the Designee shall be considered together with the Purchaser as a Party of this Agreement for all purposes;
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(b)
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the designation pursuant hereto will be notified to the Seller no later than 3 (three) Business Days prior to the Completion Date;
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(a)
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the Designee shall be required to satisfy the reasonable ‘know your customer’ requirements of the Seller prior to the transfer of rights and obligations to the Designee described herein;
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(c)
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the Purchaser shall be jointly and severally liable with the Designee in respect of the payment of the Consideration pursuant to this Agreement and the timely and proper fulfilment of any obligation of the Purchaser arising from, or in connection with, this Agreement until the consummation of the Completion in accordance with the provisions of this Agreement;
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(d)
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subject to (e) below, upon occurrence of Completion (i) the Purchaser shall be automatically released for all purposes from any Purchaser’s obligations, (ii) the Purchaser shall not be considered anymore as a party to this Agreement, and (iii) any reference in this Agreement to the “Purchaser” will be construed and interpreted as an exclusive reference to the Designee except for any reference under Clauses 11 (
Non-solicitation undertaking
), 12 (
Confidentiality and Announcement
), 22 (
Notices
) and 30 (
Governing Law and Submission to Jurisdiction
), which shall be construed as a reference to both the persons having originally executed this Agreement as Purchaser and the Designee; and
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(e)
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in the event that the Designee fails to make any payment under this Agreement, the Seller shall be able to seek recourse against the Purchaser for such payment.
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2.
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Sale, Purchase and Transfer of the Shares
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2.1
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Upon the terms and subject to the conditions of this Agreement (including without limitation the Conditions Precedent set forth in Clause 4.1 below), and with effect from Completion and upon consummation thereof, the Seller hereby sells to the Purchaser and the Purchaser hereby purchases from the Seller, full title to, and full ownership of, the Shares, representing as at the Completion Date, 100% (one hundred percent) of the issued and outstanding share capital of the Company, together with all rights which are at the Completion Date attached to them (including, without limitation, the right to receive all dividends, distributions and interest declared, made, accrued or paid on or after the Completion Date).
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2.2
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On the Completion Date, the Seller shall transfer (
leveren
) the Shares, free and clear from any Encumbrances, to the Purchaser and the Purchaser shall accept the transfer of such Shares, all in accordance with Clause 5 and Schedule 10.
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2.3
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The Seller hereby waives any rights which may have been conferred on it under the Articles or otherwise as may affect the transactions contemplated by this Agreement (other than its rights pursuant to this Agreement) including, without limitation:
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(a)
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any rights of redemption, pre-emption, first refusal or transfer it may have with respect to the Shares (in whole or in part); and
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(b)
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any rights to acquire the Shares (in whole or in part).
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3.
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Consideration for the Sale and Purchase of the Shares
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3.1
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Consideration
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3.2
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Payment of the Consideration and Post Locked Box Date Lending Amount
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(a)
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an amount of EUR 1 (such amount the "
Share Consideration
") shall be credited to the Notary Account no later than 10.00 am CET on the Completion Date and with value on the Completion Date. The Notary shall hold the Share Consideration in escrow for the Purchaser until execution of the Deed of Transfer, whereafter the Notary shall hold the Share Consideration in escrow in accordance with the Notary Letter;
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(b)
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an amount equal to EUR 47,246,463
less
any Leakage and
less
any Outstanding RETT Amount notified under Clause 4.5 and which has not been funded by the Seller (or the relevant member of the Seller's Group) to the Company before Completion (the “
Intercompany Pay-Off Amount
”) shall be paid into
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(c)
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the Post Locked Box Date Lending Amount shall be paid into the Designated Account in repayment of all Post Locked Box Date Lending (and the payment of such amount into the Designated Account shall absolutely discharge the Company from any liability against any member of the Seller’s Group in connection with the Post Locked Box Date Lending); and
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3.3
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Discharge of the Purchaser
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4.
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Conditions to Completion and other Preliminary Actions
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4.1
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Conditions Precedent
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4.1.1
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the sale and purchase of the Shares pursuant to this Agreement and all other relevant transactions contemplated hereby, as well as by the Verres SPA, shall have been approved, cleared or granted an exemption by the German Antitrust Authority (the approvals, clearances and exemptions contemplated above are hereinafter collectively referred to as the “
Clearance
”);
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4.1.2
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(to the extent that such transfer has not occurred prior to the date hereof) full legal ownership of the real estate located at Rijnstraat 19, 5347 KL Oss, the Netherlands (the “
Rijnstraat Site
”) having been unconditionally transferred from Brabant Alucast International B.V. to the Company, free and clear from any Encumbrances; and
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4.1.3
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any and all conditions precedent set forth under the applicable provisions of the Verres SPA shall have been fulfilled.
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4.2
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The Clearance
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4.3
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Effects
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4.4
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Other Preliminary Actions
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(a)
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the termination by mutual consent and in the agreed terms of the Intercompany Agreements and the transfer to the Company of the full title and ownership of the Leased Equipment, free from any Encumbrances; and
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(b)
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the termination by mutual consent and in the agreed terms of the Management Services Agreements.
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4.5
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Information to be provided on the apportionment of the Intercompany Indebtedness, Leakage, Post-Locked Box Date Lending
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(i)
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details of the apportionment of the Intercompany Pay-Off Amount between Project Horizon Cooperatief U.A., Brabant Alucast International B.V. (it being acknowledged that such amounts will be settled via the Notary Account on the Completion Date in accordance with the terms of the Notary Letter; and
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(ii)
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the exact amount of Leakage from the Locked Box Date (not included) up to and including the Completion Date, provided that if the Seller fails to inform the Purchaser of any Leakage in accordance herewith, the Seller shall be liable to the Purchaser for such Leakage pursuant to Clause 7 below; and
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(iii)
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the Post Locked Box Date Lending Amount.
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4.6
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Intercompany Trading Balances
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5.
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Completion
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5.1
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Completion shall take place at the offices of the Notary at the Zuid-Hollandplein 22, 2596 AW The Hague, the Netherlands, at 10 a.m., on the 5
th
(fifth) Business Day following the date on which all the Conditions
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5.2
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At Completion and following receipt by the Notary of the Consideration the Seller and the Purchaser shall comply with their respective obligations set out in Schedule 10.
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5.3
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If the obligations of the Seller or the Purchaser under Schedule 10 are not complied with on the Completion Date in any material respect, the Purchaser (in the case of default by the Seller) or the Seller (in the case of a default by the Purchaser) shall be entitled (in addition to and without prejudice to all other rights and remedies available) by written notice to the Purchaser or the Seller, as the case may be:
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(a)
|
to defer Completion for a period of up to ten (10) Business Days (provided always that such date is prior to the Long Stop Date) so that the provisions of this Clause 5 shall apply to Completion as so deferred;
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(b)
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to require the parties to proceed to Completion as far as practicable, having regard to the defaults which have occurred; and
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(c)
|
subject to Completion having first been deferred for a period of at least ten (10) Business Days under Clause 5.3(a) and the parties having used reasonable endeavours to effect Completion during that period, to terminate this Agreement by notice in writing to the Purchaser or the Seller, as the case may be.
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5.4
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All amounts expressed to be payable to the Seller pursuant to any provision of this Agreement shall be paid (without set-off or deduction) to the Designated Account, and the receipt of each such amount in the Designated Account shall be an absolute discharge to the Purchaser of the obligation to pay such amount and the Purchaser shall not be concerned to see to the application of any such amount thereafter.
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5.5
|
The Notary is a partner of Bird & Bird LLP, the firm of the external legal advisors to the Purchaser. The Seller acknowledges that it is aware of the relevant provisions of the Ordinance Interdisciplinary Cooperation (
Verordening Interdisciplinaire Samenwerking
) and the articles 19 through 22 of the Professional Code of Conduct (
Verordening Beroeps- en Gedragsregels
) of the Royal Professional Organisation of Civil Law Notaries (
Koninklijke Notariële Beroepsorganisatie
). The Seller hereby acknowledges and agrees that the Notary may advise and act on behalf of the Purchaser with respect to this Agreement, and any agreements and/or any disputes related to or resulting from this Agreement.
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5.6
|
All actions and transactions constituting the Completion pursuant to this Agreement (including, without limitation, this Clause 5 and Schedule 10), as well as all actions and transactions constituting the Completion under the Verres SPA, shall be regarded as one single transaction so that, at the option of the party having interest in the performance of the relevant specific action or transaction, no action or transaction constituting the Completion shall be deemed to have taken place if and until all other actions and transactions constituting the Completion shall have been properly performed in accordance with the provisions of this Agreement and of the Verres SPA.
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6.
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Seller Warranties
|
6.1
|
Prior to the Signing Date, the Purchaser has conducted a due diligence review regarding the Company (the “
Due Diligence Review
”). In connection therewith, the Purchaser and its advisors have had access to the Disclosure Material.
|
6.2
|
The Seller makes to the Purchaser the Seller Warranties contained in Schedule 5, which are save as provided in Clause 6.4 below, true and accurate as of the date hereof and, save as provided in Clause 6.4 below, true and accurate as of the Bring-Down Date.
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6.3
|
The Seller and the Purchaser acknowledge that the Seller Warranties are completely autonomous promises and agree that the applicability of sections 7:17 and 7:20 up to an including 7:23 of the Dutch Civil Code is hereby
|
6.4
|
Each Seller Warranty is given subject to all facts, matters and information Disclosed (or deemed to be Disclosed) in the Disclosure Letter. For the avoidance of doubt: (i) information contained in the Disclosure Letter is required to meet the standard of Disclosure set out in Clause 1.1 of this Agreement in order to be considered to be considered Disclosed for the purposes of this Agreement; (ii) the Seller shall not be liable for any breach of any Seller Warranty to the extent that the facts, matters or circumstances which form the basis of such breach have been Disclosed and (iii) the contents of all other Schedules of this Agreement shall not be considered Disclosed for the purposes of this Agreement and therefore shall neither limit nor exclude the liability of the Seller.
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6.5
|
Each Seller Warranty shall be given on the Bring-Down Date subject to all facts, matters and information Disclosed in the Bring-Down Disclosure Letter and, accordingly, the Seller shall not be liable for any breach of any Seller Warranty to the extent that the facts, matters or circumstances which form the basis of such breach in respect of matters which occur following the execution of this Agreement are Disclosed in the Bring-Down Disclosure Letter and the Purchaser (acting reasonably) accepts in writing such additional Disclosure. It is acknowledged and agreed by the Seller that the only matters which may be validly Disclosed in the Bring-Down Disclosure Letter will be facts, matters or circumstances which occurred following the execution of this Agreement.
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6.6
|
If, between the Signing Date and the Completion Date, the Seller becomes aware of the occurrence - following the Signing Date - of any events or circumstances which may cause any of the Seller Warranties to become untrue or misleading, the Seller shall Disclose such matters to the Purchaser in writing as soon as reasonably practicable following the Seller becoming aware of any such events or circumstances.
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6.7
|
Unless expressly provided in this Agreement, each of the Seller Warranties shall be separate and independent and shall not be limited by reference to any other Seller Warranty, Clause, paragraph or other section of this Agreement.
|
6.8
|
It is further acknowledged and agreed by the Seller that the fraudulent or wilful concealment by any of Jamie Brundell, James McComasky, Hans Vorstenbosch, Ariana Lachello and Stefano Bruni at the date of this Agreement of any matter which occurred prior to execution of this Agreement which would or might reasonably be expected to result in a breach of Warranty and a Loss to the Company in excess of EUR 750,000 and of which the Purchaser becomes aware prior to the Completion Date shall entitle the Purchaser, on written notice to the Seller, to terminate this Agreement (as well as the Verres SPA) prior to Completion and effective as at the date of the termination notice, and the parties shall be fully released from any of their respective all obligations hereunder, except for any rights or obligations arising under Clauses 12, 14, 22 and 30 below, and in any event without prejudice to any right of, or remedy available to, either party in connection with the breach by the other party of any of its obligations hereunder occurred prior to the date of termination of this Agreement.
|
7.
|
Special Indemnities
|
7.1
|
The Seller shall indemnify and hold harmless the Purchaser on a EUR per EUR basis in respect of any and all Losses suffered by the Company and/or the Purchaser in connection with the following (the “
Special Indemnities
”):
|
(i)
|
any Leakage Claim, in respect of which the provisions of Clauses 7.2 and 7.3 below shall apply;
|
(ii)
|
any breach by the Seller of any Fundamental Warranties, in respect of which the provisions of Clause 7.4 below shall apply;
|
(iii)
|
the [*] Claim in respect of which the provisions of Clause 7.6 shall apply; and
|
(iv)
|
the [*] Claim in respect of which the provisions of Clause 7.5 shall apply;
|
7.2
|
Leakage Claims
|
7.3
|
Handling of Leakage Claims
|
7.3.1
|
Within and not later than 10 (ten) Business Days after the Purchaser becoming aware of the occurrence of such event, the Purchaser shall promptly give a Notice of Claim to the Seller, provided that - for the sake of clarity - failure of Purchaser to provide a timely Notice of Claim shall not reduce or otherwise impact the Seller’s liability for the Leakage Claim unless the Seller suffers direct prejudice as a result of such failure or delay and in such case, only to the extent of any such prejudice provided always that Notice of Claim is given within the Leakage Claim Period.
|
7.3.2
|
The Seller shall have the right to challenge in writing the Notice of Claim within 20 (twenty) Business Days from the receipt thereof, by giving the Purchaser a notice specifying the subject matter of the Seller’s disagreement and its reasons, together with all reasonable details thereto (a “
Notice of Disagreement
”), provided that, if the Seller fails to timely challenge such Notice of Claim within the term provided in this Paragraph any claims of the Purchaser contained therein shall be deemed expressly acknowledged and accepted by the Seller, and the Seller shall pay the Purchaser the amount specified in such Notice of Claim within, and no later than, the expiry of the 10th (tenth) Business Day period referred to in paragraph 7.3.1 above.
|
7.3.3
|
With respect to any Notice of Claim which is the subject of a Notice of Disagreement, during a period of 10 (ten) Business Days following receipt by the Purchaser of the Notice of Disagreement, the Seller and the Purchaser will attempt to resolve amicably and in good faith any differences that they may have with respect to any matters constituting the subject matter of such Notice, with a view to reaching an amicable agreement in respect of such matters. If, at the end of such period (or any mutually agreed upon extension thereof), the Seller and the Purchaser fail to reach agreement in writing with respect to all such matters, then all matters as to which agreement is not so reached (each a “
Leakage Dispute
”) may, thereafter, be submitted to the final determination of an independent appraiser to be jointly selected by the parties, or alternatively - failing the parties’ agreement - to be appointed by the then
Chairman of the Netherlands Institute of Chartered Accountants (
Nederlandse Beroepsorganisatie van Accountants
; NBA)
upon request by the most diligent party (the “
Expert
”).
|
7.3.4
|
The Expert (1) shall consider only the Leakage Disputes, (2) shall act promptly to resolve all such disputes, (3) shall comply with the applicable provisions of this Agreement, (4) shall be empowered to act as an arbitrator only to the extent strictly required to resolve the Leakage Disputes and (5) its determinations with respect thereto shall be final, conclusive and binding upon the Purchaser and the Seller in accordance with the provisions of paragraph 7.3.6 below and shall not be subject to appeal. Upon resolution by the Expert of all Leakage Disputes, the Expert shall prepare and deliver to the parties its determinations with respect to each Leakage Dispute.
|
7.3.5
|
Any Leakage Claims in respect of which no Notice of Disagreement shall have been notified by the Seller to the Purchaser in accordance with paragraph 7.3.2 or which shall have been amicably settled between the parties pursuant to paragraph 7.3.3 and/or determined pursuant to paragraph 7.3.5 preceding, shall be final, conclusive and binding upon the Purchaser and the Seller.
|
7.3.6.
|
Without prejudice to the provisions of paragraph 7.3.5, the settlement of determination of any Leakage Claim with regard to a particular item shall not be deemed or otherwise construed as limiting, reducing or adversely affecting the rights of the Purchaser under this Agreement in respect of any other Leakage Claim or other matter which is not the subject of such settlement or determination.
|
7.3.7
|
All fees and disbursements of the Expert due in connection with the provision of the services contemplated under this Clause 7.3 shall be equally shared between the Seller and the Purchaser or as may otherwise be determined by the Expert.
|
7.4
|
Fundamental Warranty Claims
|
(a)
|
the Seller’s obligations under this Clause 7.4 shall survive the expiry of the time limit provided above in respect of any breach, untruthfulness, incorrectness and/or inaccuracy of the Fundamental Warranties referred to therein where a Notice of Claim is given within such three (3) year period, provided further that the Seller shall have no liability for any Fundamental Warranty Claim for which Notice of a Claim is issued if legal proceedings in respect of such Fundamental Warranty Claim are not commenced within nine (9) months of the date of Notice of Claim;
|
(b)
|
the Seller’s aggregate liability pursuant to this Clause 7.4 shall not exceed the amount of the Consideration;
|
(c)
|
the provisions of Clauses 8.10 and 8.11 below shall apply
mutatis mutandis
to the handling of any related Claims between the parties.
|
7.5
|
[*] Claim
|
7.5.1
|
Notwithstanding anything to the contrary provided for herein (other than Clause 8.8), the Seller shall be liable and shall indemnify the Purchaser for a period of twelve (12) months from the Completion Date, on a EUR per EUR basis, in respect of any Losses (up to the amount of the [*] Claim Cap) suffered by the Company and/or the Purchaser in connection with the [*] Claim.
|
7.5.2
|
In the event that the Company or the Purchaser receives any claim from [*] regarding the subject matter of the [*] Claim within the twelve (12) month period referenced in Clause 7.5.1 above, the Seller shall be entitled to assume (at the Seller’s expense) sole conduct of the [*] Claim, provided however that (i) the Seller shall inform the Purchaser of any meeting, development and material information with regard to the [*] Claim (allowing a representative of the Purchaser or the Company to attend such meetings as an observer) and (ii) in case of court proceedings brought by [*] against the Company, this latter shall be entitled to appoint (at its
|
7.5.3
|
The Purchaser undertakes that it shall not (and, from the Completion Date, shall procure that the Company does not) take any action which would or might reasonably be expected to frustrate, delay or increase the liability of the Company in respect of the [*] Claim.
|
7.5.4
|
The Purchaser shall (and, from the Completion Date, shall procure that the Company shall) keep the existence of the indemnification provisions detailed in Clause 7.5.1 above strictly confidential and shall not disclose to [*], its affiliates or any of its or their officers, employees, agents, consultants or advisers that such indemnification has been given.
|
7.6
|
[*] Claim
|
7.6.1
|
Notwithstanding anything to the contrary provided for herein (other than Clause 8.8), the Seller shall be liable and shall indemnify the Purchaser for a period of twelve (12) months from the Completion Date, on a EUR per EUR basis, in respect of any Losses (up to the amount of the [*] Claim Cap) suffered by the Company and/or the Purchaser in connection with the [*] Claim.
|
7.6.2
|
In the event that the Company or the Purchaser receives any claim from [*] regarding the subject matter of the [*] Claim within the twelve (12) month period referenced in Clause 7.6.1 above, the Seller shall be entitled to assume (at the Seller’s expense) sole conduct of the [*] Claim and shall keep the Purchaser informed of any developments and material information with regard to the [*] Claim.
|
7.6.3
|
The Purchaser undertakes that it shall not (and, from the Completion Date, shall procure that the Company does not) take any action which would or might reasonably be expected to frustrate, delay or increase the liability of the Company in respect of the [*] Claim.
|
7.6.4
|
The Purchaser shall (and, from the Completion Date, shall procure that the Company shall) keep the existence of the indemnification provisions detailed in Clause 7.6.1 above strictly confidential and shall not disclose to [*], its affiliates or any of its or their officers, employees, agents, consultants or advisers that such indemnification has been given.
|
7.7
|
Exclusive Remedy
|
8
|
Limitation of Seller’s Liability
|
8.1
|
W&I Insurance Policy
|
(a)
|
the Seller shall only be directly liable towards the Purchaser with regard to the Special Indemnities;
|
(b)
|
other than the residual liability provided under Clause 8.2 below, with regard to the Insured Warranties, the Seller shall not have any liability towards the Purchaser, or the Purchaser be entitled to any actions against the Seller, in each case in respect of any Claim, irrespective of whether a Loss would be covered by the W&I Insurance Policy (and, if executed, the Environment Insurance Policy), except in case such Claim (i) is based on fraud (
fraude
), or fraudulent or wilful concealment on behalf of the Seller or any member of the Seller’s Group and their respective Related Parties; and
|
(c)
|
except as otherwise provided under this Agreement (including Clause 7.1 above), the Purchaser’s sole recourse for any breach by the Seller of the Insured Warranties shall be against the W&I Insurance Policy (and/or, if executed, the Environment Insurance Policy) in accordance with its terms, whether or not the W&I Insurance Policy (and/or, if executed, the Environment Insurance Policy) is actually effected by the Purchaser or remain in existence. Any failure by the Purchaser to effect the W&I Insurance Policy (and/or, if executed, the Environment Insurance Policy) or to maintain any of them, or any waiver or termination of that polic(y)(ies) at any time, shall not operate to increase the liability of the Seller.
|
8.2
|
Seller’s Residual Liability
|
(a)
|
the Seller’s obligations under this Clause 8.2 shall survive the expiry of the time limit provided above in respect of any breach, untruthfulness, incorrectness and/or inaccuracy of the Insured Warranties where a Notice of Claim is given to the Seller prior to the expiry of such twelve (12) month period (it being understood that, in respect of contingent liabilities, the Purchaser shall be entitled to specify the amount claimed also after the expiry of the time limits set forth herein);
|
(b)
|
the Seller’s aggregate liability pursuant to this Clause 8.2 shall not exceed EUR 472,464;
|
(c)
|
the Purchaser shall have immediate right of recourse against the Seller in accordance with Clauses 8.11 and 8.12 below, without need to exhaust the claim procedure in accordance with the W&I Insurance Policy or the Environment Insurance Policy.
|
8.3
|
Monetary Limitations: De Minimis and Threshold
|
(a)
|
where the amount due in connection with any single occurrence giving rise to a Loss pursuant thereto does not exceed EUR 47,246 (forty seven thousand two hundred and forty six Euros) (the “
De Minimis
”), unless the single occurrence giving rise to a Loss is part of a series of occurrences of the same kind arising out of the same or similar set of facts exceeding, in aggregate, EUR 47,246 (forty seven thousand two hundred and forty six Euros); or
|
(b)
|
the aggregate of all amounts that would otherwise be due in respect of breaches of Insured Warranties does not exceed EUR 472,464 (the “
Threshold
”), provided that, if said threshold is exceeded, the Seller shall be liable for the entire amount due pursuant to Clause 7.1 above (and not only the amount exceeding the Threshold).
|
8.4
|
Time Limitations
|
(a)
|
in respect of any actual or alleged breach, untruthfulness, incorrectness and/or inaccuracy of the Insured Warranties (other than the Insured Warranties referred to in paragraph (b) below) no later than 24 (twenty-four) months after the Completion Date; or
|
(b)
|
in respect of any actual or alleged breach, untruthfulness, incorrectness and/or inaccuracy of the Insured Warranties referred to in paragraphs 11 (
Environmental Matters
), 14 (
Permits
), 15 (
Insolvency
), 18 (
Employees, Agents and Consultants
), 22 (
Tax
) of Schedule 5 no later than the 60
th
(sixtieth) Business Day after the expiry of the statute of limitation applicable to the situations constituting the subject matter of such Insured Warranties or giving rise to the payment obligation,
|
(i)
|
the Seller’s liability in respect of any breach, untruthfulness, incorrectness and/or inaccuracy of any Insured Warranty shall expire on the date which is twelve (12) months after the Completion Date save in respect of any matter in respect of which a Notice of Claim has been given prior to such date (subject always to Clause 8.6(e)); and
|
(ii)
|
in respect of contingent liabilities, the Purchaser shall be entitled to specify the amount claimed also after the expiry of the time limits set out in this Clause 8.4.
|
8.5
|
Other Compensation
|
8.6
|
General Exclusions
|
(a)
|
the Claim or the events giving rise to the Claim would not have arisen but for an act, omission or transaction of the Purchaser’s Group, otherwise than in the ordinary course of trading of the Group as at presently carried on, or which would not have arisen but for any claim, election or surrender or disclaimer made or omitted to be made or notice or consent given or omitted to be given by the Purchaser’s Group under the provisions of any statutes relating to Tax;
|
(b)
|
the Claim occurs or is increased as a result of:
|
(i)
|
any change in the accounting principles or practices of the Purchaser introduced or having effect after the Completion Date; or
|
(ii)
|
any increase in the rates of Tax made after the Completion Date; or
|
(iii)
|
any change in Law or regulation or in the interpretation or administration of any Authority, in each case, not actually in force at the Completion Date; or
|
(c)
|
the Claim is for Tax which arises in respect of the ordinary course of business of the Company after the Completion Date;
|
(d)
|
the Claim relates to a claim or liability for Tax and would not have arisen but for any winding-up or cessation after Completion of any business or trade carried on by the Purchaser’s Group;
|
(e )
|
legal proceedings in respect of any Claim are not commenced within six (6) months of the date of Notice of Claim.
|
8.7
|
Provisions in the Locked Box Accounts - Contingent Assets
|
8.8
|
No Double Recovery
|
8.9
|
Fraud (
fraude
) or gross negligence (
grove nalatigheid
)
|
8.10
|
Handling of Claims
|
8.10.1
|
Within and not later than 30 (thirty) Business Days after the Purchaser becoming aware of the occurrence of such event, the Purchaser shall give to the Seller a Notice of Claim, and shall provide all reasonable particulars thereof, including (i) the nature of the Claim, (ii) the amount of Losses constituting the subject matter of the Claim hereunder (to the extent known or reasonably computable at the date of such notice), and (iii) the provision(s) of this Agreement on the basis of which such amount is claimed. The Notice of Claim shall also specify whether it arises from a claim by a person (including, for the avoidance of doubt, any notice by any public Authority of any actual or alleged infringement of any Law) against the Purchaser or the Company (a “
Third Party Claim
”) or whether the Notice of Claim is asserted directly by the Purchaser (a “
Direct Claim
”). For sake of clarity, the failure of Purchaser to provide a timely Notice of Claim pursuant to this Agreement shall not reduce or otherwise impact the Seller’s liability for such Claim unless the Seller suffers direct, material prejudice as a result of such failure or delay and in such case, only to the extent of any such prejudice.
|
8.10.2
|
The Seller shall have the right to challenge in writing the Notice of Claim within 30 (thirty) Business Days from the receipt thereof, specifying the subject matter of the Seller’s disagreement and its reasons, together with all reasonable details thereto, provided that, if the Seller fails to timely challenge such Notice of Claim within the term provided in this Paragraph, without prejudice to any other right or remedy of the Purchaser, any claims of the Purchaser contained therein shall be deemed expressly acknowledged and accepted by the Seller, and the Seller shall pay the Purchaser the amount specified in such Notice of Claim within, and no later than, the tenth (10
th
) Business Day following the expiry of the 30 Business Day period referred to above.
|
8.10.3
|
With respect to any Notice of Claim, during a period of 20 (twenty) Business Days following the notice by the Seller under the preceding paragraph 8.10.2, the Seller and the Purchaser will attempt to resolve amicably and in good faith any differences that they may have with respect to any matters constituting the subject matter of such notice, with a view to reaching an amicable agreement in respect of such matters. If, at the end of such period (or any mutually agreed upon extension thereof), the Seller and the Purchaser fail to reach agreement in writing with respect to all such matters, then all matters as to which agreement is not so reached may, thereafter, be submitted to arbitration pursuant to Clause 30.2.
|
8.11
|
Handling of Third Party Claims
|
8.11.1
|
The Seller shall have the right to participate, and, to the maximum extent permitted by Law, join, at its own expenses, through counsel appointed in its name and on its behalf (which counsel shall be reasonably satisfactory to the Purchaser), in the defense of any Third Party Claim asserted or initiated against the Company and/or the Purchaser constituting the subject matter of a Notice of Claim. The Seller will cooperate with the Purchaser in the preparation for and the prosecution of the defense of such claim, action, suit or proceeding, including making available evidences within the control of the Seller;
|
8.11.2
|
to the extent that the Seller has accepted in writing to indemnify the Purchaser in relation to a Notice of Claim relating to a Third Party Claim, the Purchaser shall not, and shall cause the Company (as applicable) not to, make or accept any settlement of any claim, action, suit or proceeding asserted or initiated against the Purchaser, and/or the Company constituting the subject matter of such Notice of Claim or, as the case may be, having resulted from any such claim, action, suit or proceeding, without the Seller’s prior written consent, which consent shall not be unreasonably withheld or delayed; and
|
8.11.3
|
to the extent that the Seller has accepted in writing to indemnify the Purchaser in relation to a Notice of Claim relating to a Third Party Claim, and if a firm offer is made to the Company or the Purchaser to settle any matter giving rise to the Seller’s liability under Clause 7 that the Seller, but not the Purchaser, is willing to accept, the Purchaser and/or the Company (as the case may be) shall be free not to enter into such settlement and to commence or continue litigation, at its/their own expense, but the Seller’s liability under Clause 7 shall be limited to the amount of the proposed settlement, except to the extent such settlement contained non-financial obligations to which the Purchaser reasonably objected, in which case no such limitation of Seller’s liability shall apply.
|
9
|
Purchaser’s Warranties and Undertakings
|
9.1
|
The Purchaser warrants to the Seller that the statements set out below are true and accurate as at the date of this Agreement:
|
(a)
|
the Purchaser is a company validly existing and duly incorporated under the Laws of its jurisdiction of incorporation;
|
(b)
|
the Purchaser has the full legal right, power and authority to execute, deliver and perform the Transaction Documents to which it is a party (the “
Purchaser’s Completion Documents
”);
|
(c)
|
the Purchaser’s Completion Documents will, when executed by the Purchaser, constitute lawful, valid and binding obligations of the Purchaser in accordance with their respective terms;
|
(d)
|
the Purchaser is acting as principal and not as agent or broker for any other person and no other person than the Purchaser will be interested in the Shares;
|
(e)
|
it is not insolvent or unable to pay its debts within the meaning of the insolvency legislation applicable to it nor has it entered into any winding-up, liquidation or analogous procedure;
|
(f)
|
the Purchaser has available cash and/or ‘certain funds’ commitments or facilities enabling the Purchaser to perform its obligations hereunder;
|
(g)
|
neither the execution and delivery of this Agreement by the Purchaser nor the performance by the Purchaser of the Transaction and its obligations hereunder violates any provision of the by-laws of the Purchaser or, as far as the Purchaser is aware, any law or judgement applicable to the Purchaser;
|
(h)
|
as far as the Purchaser is aware, save for the Clearance, no filing or registration with, no notice to and no permit, authorization, consent or approval of any third party or any Authority is necessary for the consummation by the Purchaser of the Transaction.
|
10
|
Interim Management
|
10.1
|
Undertaking of the Seller
|
(a)
|
make any substantial change in the nature or organization of its business;
|
(b)
|
discontinue or cease to operate all or a material part of its business;
|
(c)
|
amend its Articles, or pass any resolution that is inconsistent with their provisions;
|
(d)
|
create, allot or issue any share capital or loan capital;
|
(e)
|
create, issue or grant any option or right to subscribe for, any share capital, premium, reserves or loan capital;
|
(f)
|
repay, redeem or reduce any share capital;
|
(g)
|
purchase, sell, transfer, encumber, license (as licensor or licensee) or otherwise acquire or dispose (whether by one transaction or by a series of transactions) of any tangible or intangible assets, business or undertakings having a unit value in excess of EUR 25,000 (twenty five thousand) or, anyway in aggregate in excess of EUR 150,000 (one hundred fifty thousand);
|
(h)
|
acquire, dispose of (in any form and manner), or Encumber, any participations in the equity of other companies or acquire, dispose of, or lease (as lessor or lessee) any asset, business or going concern thereof;
|
(i)
|
enter into, amend, or terminate any agreement involving expenditure of any kind by the Company in excess of EUR 25,000 (twenty five thousand) per annum (except for orders of raw materials, packaging materials, transportation or logistic services or other inputs in the ordinary course of business), or having a duration extending 3 (three) months beyond the Completion Date;
|
(j)
|
enter into, amend or terminate any agreements with suppliers and/or customers in such a way as to result in a material detriment to the Company;
|
(k)
|
make or incur any new capital expenditure in excess of the aggregate amount of EUR 50,000 (fifty thousand), except for those which should be required to assure the ordinary functioning of the production activity of the Company or for those detailed in the business plan of the Company;
|
(l)
|
enter into any new loan or incur any other new bank indebtedness (other than by bank overdraft, or similar facility in the ordinary course of business and within the limits subsisting at the date hereof) or incur any other indebtedness, in each case in excess of EUR 25,000;
|
(m)
|
utilize existing credit facilities for amounts which are in excess of the aggregate amount of EUR 50,000 (fifty thousand); or amend, cancel or cause the acceleration of, any credit facilities, loans, financing agreements or other outstanding bank indebtedness;
|
(n)
|
make any loan (other than the granting of any trade credit in the ordinary course of business) to any person;
|
(o)
|
give any guaranty of, or undertake any indemnity or enter into any other arrangement to secure, the obligations of third parties, or incur liability, financial or other obligations (whether accrued, contingent or otherwise) to guarantee or secure obligations of third parties;
|
(p)
|
amend, to any material extent, any of the terms on which goods, facilities or services having a value in excess of EUR 25,000 (twenty five thousand) are supplied;
|
(q)
|
change its accounting reference date, accounting methods, principles, practices or policies;
|
(r)
|
make any amendment to the terms and conditions of employment (including, without limitation, remuneration, pension entitlements and other benefits) of any Employee (other than increases required by Law or by the applicable collective bargaining which the Seller shall notify to the Purchaser as soon as reasonably possible);
|
(s)
|
provide or agree to provide any gratuitous payment or benefit to any Employee or Consultant;
|
(t)
|
hire any employee, or take any steps, directly or indirectly, to terminate the contract of employment of any Employee whose annual salary exceeds EUR 50,000 (fifty thousand), or induce or attempt to induce any such employee to terminate his/her employment, other than for reasons which qualify as urgent cause (‘
dringende reden’
) within the meaning of articles 7:677/678 of the Dutch Civil Code or for a justified objective or subjective reason, or amend in any material respect (other than as required by law) the terms and conditions of employment of any such Employee;
|
(u)
|
waive, settle, accept, or make acquiescence to, any outstanding claim, whether active or passive, exceeding EUR 50,000 (fifty thousand) per claim;
|
(v)
|
enter into, amend or terminate any agreement, arrangement or obligation (legally enforceable or not) (i) between the Company and any director of the Company or its Related Parties are a party to, and/or (ii) which may trigger (contractually or otherwise) any Company’s obligation or liability to any Related Party;
|
(w)
|
materially delay the payment of any amount due to their suppliers in a way which is not consistent with past practice or solicit or agree to the extension of the payment terms applicable to any suppliers pursuant to the ordinary commercial practice of the Company;
|
(x)
|
declare, make or pay any dividend or other distribution;
|
(y)
|
make any payment to acquire parts in replacement of items required to be replaced in connection with the Machine Fire in circumstances where the loss assessment experts appointed by the Company and the Company’s insurer in connection with the Machine Fire have not recommended the making of such payment;
|
(z)
|
make or change any Tax election, amend any Tax return or take any Tax position on any Tax return, apply for or obtain any Tax ruling or make any settlement that may give rise to an increase of any Tax liability of the Company outside the ordinary course of business and deviating from past practice;
|
(aa)
|
change its residence for tax purposes or establish any branch, agency, permanent establishment or other taxable presence in any jurisdiction outside the jurisdiction of incorporation; and/or
|
(bb)
|
make any payments and/or exercise any of its rights and/or fulfil any of its obligations under the Intercompany Agreements and/or under any other agreements with any member of the Seller’s Group; and/or
|
(cc)
|
agree, undertake, or commit to do any of the foregoing.
|
10.2
|
Notwithstanding anything to the contrary in Clause 10.1, the Seller and the Company shall not be prevented from undertaking, be required to obtain the Purchaser’s consent in relation to, or incur any liability towards the Purchaser as a result of effecting any of the following prior to the Completion Date:
|
(a)
|
the fulfilment of any obligations as required by applicable Law;
|
(b)
|
the implementation of any transaction or the taking of any action permitted or provided for under any Transaction Document in accordance with its terms;
|
(c)
|
any Post Locked Box Date Lending up to EUR 600,000 provided that in any event the relevant funding shall not occur after the sixth (6
th
) Business Day prior to the Completion Date;
|
(d)
|
implementation of any matter set out in the Steps Paper in accordance with the terms of the Steps Paper;
|
(e)
|
any matter reasonably undertaken in an emergency or disaster evident situation with the intention of minimising any adverse effect on the Company.
|
10.3
|
Right to Access
|
10.4
|
Positive Undertakings
|
(a)
|
The Seller shall and shall procure that all companies of the Seller's Group shall, as soon as reasonably practicable and in any event within six (6) month of the Completion, discontinue and remove any reference (in its websites, marketing materials and any other communication medium) to the Company and Verres wherever the same are used.
|
(b)
|
The Seller agrees that it shall, during the Interim Period, diligently pursue the process for the insurance claim in relation to the machine fire at the Rijnstraat Site on 29 November 217 (the “
Machine Fire
”) and to keep the Purchaser informed of all material developments with regard to such insurance claim.
|
(c)
|
The Seller shall procure that as soon as reasonably possible after Completion Brabant Alucast International B.V.:
|
(a)
|
withdraws the statement of joint and several liability (
hoofdelijke aansprakelijkheid
) issued under Section 2:403 DCC (the “
403-statement
”) in relation to the Company; and
|
(b)
|
takes the actions set out in Section 2:404(3)(b) and (c) DCC to terminate the residual liability under the 403-statement as referred to in Section 2:404(2) DCC.
|
(d)
|
The Purchaser shall, at its own cost and expense, provide all assistance reasonably requested by the Seller to ensure that the residual liability under the 403-statement is terminated as soon as reasonably possible, including by:
|
(a)
|
demonstrating that the Company, directly or indirectly (e.g. through a 403-statement issued by the Purchaser, if any), offers sufficient recourse after Completion; and/or
|
(b)
|
granting such alternative security to any creditor of the Company as may reasonably be requested pursuant to Section 2:404(4) DCC.
|
(e)
|
The Seller acknowledges and agrees that nothing in this Clause 10.4(d) and/or Clause 13.5 limits or excludes the right of the Purchaser to make a claim against the Seller under this Agreement (including the Seller Warranties), should such a right of the Purchaser exist under the circumstances and in accordance with the terms of this Agreement. The Seller furthermore acknowledges and agrees that the disclosure of the 403-Statement in the Disclosure Letter shall not operate as an exclusion of liability for claims the absence of which has been warranted under the Seller Warranties.
|
11
|
Non-Solicitation Undertaking
|
11.1
|
The Purchaser hereby agrees and covenants that, without the prior written consent of the Seller, for a period of 2 (two) years after the Completion Date, it shall not, directly or indirectly:
|
(i)
|
solicit for employment, hire or otherwise retain any senior or key director, officer or employee of the Seller and/or any member of the Seller's Group operating under the "
Brabant Alucast
" name (other than the Company and Verres) except as set forth in Part A of Schedule 14;
|
(ii)
|
solicit business in relation to certain parts set forth in the purchase orders listed for each party in Part B of Schedule 14 (the “
Restricted Contracts
”), provided for the sake of clarity that Purchaser shall be entitled to freely pursue any relationship with the relevant customers other than in relation to the Restricted Contracts.
|
11.2
|
The Seller hereby agrees and covenants that, without the prior written consent of the Purchaser, for a period of 2 (two) years after the Completion Date, it shall not, directly or indirectly:
|
(i)
|
solicit for employment, hire or otherwise retain any senior or key director, officer or employee of the Purchaser and/or any member of the Purchaser's Group (including, for the avoidance of doubt (the Company and Verres);
|
(ii)
|
solicit business similar to the business of the Company, which, for the avoidance of doubt, shall not mean the business of Seller provided for in the Restricted Contracts.
|
11.3
|
The Seller agree that the obligations of the Purchaser or the relevant member of the Purchaser Group under the Purchaser Order Agreements, the Subcontracting Agreement and/or the Transitional Services Agreement shall not qualify as a breach of any obligation under this Clause 11.
|
12
|
Confidentiality and Announcements
|
12.1
|
Announcements
|
12.2
|
Confidentiality
|
(i)
|
each of the parties shall treat as strictly confidential and not disclose or use any information received or obtained as a result of entering into any Transaction Document which relates to:
|
(A)
|
the existence or the provisions of any Transaction Documents; or
|
(B)
|
the negotiations relating to any Transaction Documents;
|
(ii)
|
the Seller shall, and shall procure that each member of the Seller’s Group shall, following Completion, treat as strictly confidential and not disclose or use any information relating to the business, financial or other affairs (including future plans and targets) of the Company, the Purchaser and/or any member of the Purchaser Group; and
|
(iii)
|
the Purchaser shall, and shall procure that each member of the Purchaser’s Group shall, treat as strictly confidential and not disclose or use any information relating to the business, financial or other affairs (including future plans and targets) of the Seller or the Seller’s Group (provided that, for the purposes hereof, the Company shall not be deemed as belonging to such Group).
|
(i)
|
the disclosure or use is required to vest the full benefit of this Agreement in a party;
|
(ii)
|
the information is or becomes publicly available (other than by breach of this Agreement);
|
(iii)
|
the disclosing party has obtained prior written approval from the other party to the disclosure or use;
|
(iv)
|
the information is independently developed after Completion other than on the basis of any Confidential Information;
|
(v)
|
the disclosure or use is required by Law, any governmental or regulatory body or any recognised stock exchange on which the shares of any party or any member of the Seller’s Group or the Purchaser’s Group are listed (including where this is required as part of any actual or potential offering, placing and/or sale of securities of that party or any member of the Seller’s Group or the Purchaser’s Group);
|
(vi)
|
the disclosure or use is required for the purpose of any judicial or arbitral proceedings arising out of any Transaction Document;
|
(vii)
|
the disclosure is made to a Tax Authority in connection with the Tax affairs of the disclosing party;
|
(viii)
|
the disclosure is made to any member of the Seller’s Group or any actual or prospective limited partner of any member of the Seller’s Group provided such person undertakes to comply with the provisions hereof in respect of such information as if it were a party to this Agreement;
|
(ix)
|
the disclosure is made by the Purchaser to any member of the Purchaser’s Group provided such person undertakes to comply with the provisions hereof in respect of such information as if it were a party to this Agreement and that the disclosing party remains liable for any breach of the confidentiality obligations set out herein by such person;
|
(x)
|
the disclosure is made to professional advisers or actual or potential debt or equity financiers of any party or of any member of the Seller’s Group on a need to know basis provided that such persons undertake to comply with the provisions hereof in respect of such information as if it were a party to this Agreement and that the disclosing party remains liable for any breach of the confidentiality obligations set out herein by such person; or
|
(xi)
|
the disclosure is made on a confidential basis to potential purchasers of all or part of the Seller’s Group or the Purchaser’s Group or to their professional advisers or actual or potential financiers provided
|
13.
|
Purchaser’s Undertakings
|
13.1
|
The Purchaser shall at its own cost procure that the Company shall as soon as reasonably practicable and in any event within:
|
(a)
|
six (6) months of the Completion Date in respect of signage;
|
(b)
|
six (6) months of the Completion Date in respect of stationery (including letterheads and business cards); and
|
(c)
|
twelve (12) months of the Completion Date in respect of any other matters,
|
13.2
|
Subject to Clause 13.1, the Purchaser expressly acknowledges and agrees that:
|
(a)
|
all intellectual property rights (including, for the avoidance of doubt, the domain name ‘brabantalucast.com’) in and to the “
Brabant Alucast
” name and the Group Trade Marks are owned by, belong to and vest with the Seller’s Group;
|
(b)
|
all new materials produced by the Company after Completion shall not refer to, use or include the “
Brabant Alucast
” name or the Group Trade Marks;
|
(c)
|
the “
Brabant Alucast
” name and the Group Trade Marks shall not be used in any manner that creates, purports to create, or might reasonably be considered to be intended to create legal obligations on the part of any member of the Seller’s Group;
|
(d)
|
the Purchaser shall not, and shall procure that the Company shall not, knowingly do, or fail to do, anything which act or omission is likely to damage the validity or goodwill of the “
Brabant Alucast
” name or the Group Trade Marks; and
|
(e)
|
the rights granted in Clause 13.1 are personal to the Purchaser and the Company, which shall have no right to assign or grant sub-licences of such rights.
|
13.3
|
The Purchaser shall indemnify and hold harmless the Seller from and against any and all Losses suffered by it as a result of the use by the Company of the “
Brabant Alucast
” name or the Group Trade Marks after the expiry of the Relevant Period set forth in Clause 13.1.
|
13.4
|
As soon as practicable following Completion, the Purchaser shall, as required by the Company or the Seller (at the sole cost of the Purchaser), enter into such guarantees, surety letters, letters of credit or indemnities as
|
13.5
|
The Purchaser shall indemnify and hold harmless the Seller or the concerned member of the Seller’s Group from and against any and all Losses suffered by either of them after Completion in connection with any guarantees, surety letters, letters of credit or indemnities listed in the Guarantees Schedule. Each member of the Seller’s Group identified in the Guarantees Schedule may enforce the terms of this Clause 13.5.
|
13.6
|
While the provisions set out in Clause 13 are considered by the parties to be fair and reasonable in the circumstances, it is agreed that if any of them should be judged to be void or ineffective for any reason, but it would be treated as valid and effective if part of the wording was deleted, they shall apply with such modifications as necessary to make them valid and effective.
|
14
|
Costs and Expenses
|
15
|
Stamp Duty, Fees and Taxes
|
|
The Purchaser shall bear the cost of all stamp duty, notarial fees and all registration and transfer Taxes payable in connection with the sale and purchase of the Shares. The Purchaser shall be responsible for arranging the payment of such stamp duty and all other such fees and Taxes, including fulfilling any administrative or reporting obligation in connection with such payment. The Purchaser shall indemnify the Seller and all members of the Seller’s Group against any Losses suffered as a result of the Purchaser failing to comply with its obligations under this Clause 15.
|
16
|
Grossing-up
|
16.1
|
Unless as otherwise required by applicable Law or agreed upon between the parties, all sums payable under this Agreement shall be paid free and clear of all deductions, withholdings, set-offs or counterclaims whatsoever. If any deductions or withholdings are required by Law, the payor shall be obliged to pay to the recipient such sum as will after such deduction or withholding has been made leave the recipient with the same amount as it would have been entitled to receive in the absence of any such requirement to make a deduction or withholding, provided that if either party to this Agreement shall have assigned or novated or declared a trust in respect of the benefit in whole or in part of this Agreement or shall have changed its tax residence or the permanent establishment to which the rights under this Agreement are allocated then the liability of the other party under this Clause 16 shall be limited to that (if any) which it would have been had no such assignment, novation, declaration of trust or change taken place.
|
16.2
|
The recipient or expected recipient of a payment under this Agreement shall claim from the appropriate Tax Authority any exemption, rate reduction, refund, credit or similar benefit (including pursuant to any relevant double tax treaty) to which it is entitled in respect of any deduction or withholding in respect of which a payment has been or would otherwise be required to be made pursuant to Clause 16.1 and, for such purposes, shall, within any applicable time limits, submit any claims, notices, returns or applications and send a copy of them to the payor.
|
16.3
|
If the recipient of a payment made under this Agreement receives a credit for or refund of any Tax payable by it or similar benefit by reason of any deduction or withholding for or on account of Tax then it shall reimburse to the payor such part of such additional amounts paid pursuant to Clause 16.1 above as the recipient of the
|
17
|
VAT
|
18
|
Non- utilisation of Oss Tax Losses; Tax Returns; Further Assurance
|
18.1
|
The Parties have agreed that any and all Tax losses available within the Dutch CIT fiscal unity (
fiscale eenheid
) of which the Company forms part and which relate to the operating losses incurred by the Company in the period up to Completion (the "
Oss Tax Losses
") shall belong to the Company and that therefore, neither the Seller nor any of its Affiliates (other than the Company) can and/or shall carry forward these Oss Tax Losses or otherwise claim any Tax benefits relating to these Oss Tax Losses). In this respect, the Seller agrees that it shall (and shall ensure that any other company (other than the Company) forming part of the Dutch CIT fiscal unity (each such company (and its successors) a "
Dutch Fiscal Unity Company
") shall):
|
(a)
|
not, for as long as the Oss Tax Losses can be carried forward under applicable Tax Law or otherwise use (or allow any other Dutch Fiscal Unity Company) to carry forward or use) all or part of the Oss Tax Losses for the purpose of offsetting income of the Seller or any other Dutch Fiscal Unity Company against (part of) the Oss Tax Losses;
|
(b)
|
before submitting any Tax Return that relates to the CIT Fiscal Unity for the fiscal years 2017 and 2018 in relation to corporate income tax, provide such Tax Return in draft form to the Purchaser as soon as possible but no later than 15 (fifteen) Business Days prior to the due date for filing thereof, in order to enable the Purchaser to verify that no portion of the Oss Tax Losses is used for the purpose of offsetting income of the Seller or any other Dutch Fiscal Unity Company;
|
(c)
|
co-operate with the filing of a joint request as set out in Section 15af(2) of the Dutch corporate income tax act (
Wet op de vennootschapsbelasting 1969
) to allow the allocation of the Oss Tax Losses to the Company (the “
Request
”);
|
(d)
|
revise the draft Tax Return to reflect all reasonable comments and suggestions made by the Purchaser if and to the extent relating to the operations of the Company within the CIT Fiscal Unity; and
|
(e)
|
only submit the Tax Return to the Tax Authorities upon receipt of the written consent of the Purchaser (which consent shall not be unreasonably withheld or delayed); and
|
(f)
|
only submit the Tax Return for 2018 together with the Company, which Tax Return shall include the specific request that all Oss Tax Losses are transferred to the Company.
|
18.2
|
The Parties acknowledge that the CIT Fiscal Unity Dissolution Date shall be the Completion Date. As soon as reasonable practicable after the Completion Date, the Seller shall provide the Purchaser with (i) an opening balance sheet for Dutch corporate income tax purposes of the Company as from the day following the CIT Fiscal Unity Dissolution Date and (ii) explanatory notes thereto.
|
18.3
|
The Seller shall prepare and file, or procure the preparation and filing of, all Tax Returns in respect of the Company in a manner and on a basis consistent with past practice, unless otherwise required by Law, to the extent that these (a) are required to be filed on or before the Completion Date or (b) relate to the CIT Fiscal Unity.
|
18.4
|
Subject to Completion, the Purchaser shall prepare and file, or procure the preparation and filing of, all Tax Returns in respect of the Company not covered by Clause 18.3 in a manner and on a basis consistent with past practice, unless otherwise required by Law. With respect to any Tax Return which relates to any period starting prior to the Locked Box Date or may result in a claim for breach of the Seller Warranties included in paragraph
|
(a)
|
send to the Seller for review a copy of such draft Tax Return at least 15 (fifteen) Business Days prior to the due date for filing thereof;
|
(b)
|
provide the Seller with such further information and assistance as they may reasonably require in order to review such draft Tax Return;
|
(c)
|
accept and process all reasonable, timely received comments the Seller may have in respect of such draft Tax Return; and
|
(d)
|
only file such Tax Return after prior written consent from the Seller (which consent shall not be unreasonably withheld or delayed).
|
18.5
|
The Purchaser shall procure that no member of the Purchaser’s Group shall, without the prior written consent of the Seller, amend, refile, withdraw or otherwise modify, or cause or permit to be amended, refiled, withdrawn or otherwise modified, any Tax Return filed by the Seller or the Company in respect of any taxable year or period starting on or before the Locked Box Date.
|
18.6
|
The Parties shall provide each other with such information and assistance as they (or any other member of their respective Groups) may reasonably require to comply with their respective obligations to prepare and file (or procure the preparation and filing of) Tax Returns.
|
18.7
|
The Seller and the Purchaser each undertakes that it shall during the period of 6 months following the Completion Date execute and deliver all such instruments and other documents and take all such actions (to the extent within its power) as the Purchaser or the Seller (as applicable) may reasonably require in order to give effect to the terms of this Agreement.
|
18.8
|
Subject in any event to Clause 12, following Completion, subject to such information being held confidentially in accordance with Clause 12 (and as if the two year time limitation on such confidentiality obligations commenced at the date on which such information is provided to the Seller), if requested by the Seller, the Purchaser shall grant the Seller (and any concerned member of the Seller’s Group) reasonable access (including the right to take copies at the Seller’s expense but subject to the Purchaser’s prior written consent) to the Books and Records of the Company which are reasonably required by the Seller or such other member of the Seller’s Group for the purpose of dealing with its Tax and accounting affairs (including such information as is reasonably required by the Seller in order to negotiate, refute, settle, compromise or otherwise deal with any claim, investigation, reporting requirement or enquiry by any competent legal or regulatory authority, Tax Authority and, to the extent necessary, to assist in the defence of the [*] Claim or the [*] Claim.
|
19
|
Effect of Completion
|
20
|
Assignment
|
(a)
|
the Seller may assign (in whole or in part) the benefit of this Agreement to any other member of the Seller’s Group (provided that such assignment shall not release the Seller from any of its obligations under this Agreement); and
|
(b)
|
the Purchaser may assign its rights and obligations under this Agreement to the Designee in accordance with Clause 1.3,
|
21
|
Payment
|
21.1
|
Any payments pursuant to this Agreement shall be effected by crediting for same day value the account specified by the Seller or the Purchaser (as the case may be) on behalf of the party entitled to the payment (reasonably in advance and in sufficient details to enable payment by telegraphic or other electronic means to be effected) on or before the due date for payment.
|
21.2
|
Payment of a sum in accordance with this Clause 21 shall constitute a payment in full of the sum payable and shall be a good discharge to the payer (and those on whose behalf such payment is made) of the payer’s obligation to make such payment and the payer (and those on whose behalf such payment is made) shall not be obliged to see to the application of the payment as between those on whose behalf the payment is received.
|
21.3
|
Any amount payable by the Seller to, or at the discretion of, the Purchaser under this Agreement shall, so far as possible, be deemed to be a reduction of the Consideration.
|
21.4
|
If any sum required to be paid by any party under this Agreement (or any Transaction Document) is not paid when it is due, such amount shall bear interest at the rate of three per cent (3%) per annum over the base EURIBOR lending rate of European Central Bank from time to time, calculated on a daily basis for the period from the relevant due date for payment up to and including the date of actual payment.
|
22
|
Notices
|
22.1
|
Any notice, demand or other communication to be given or made under or in connection with this Agreement (a “
Notice
”) shall be:
|
(a)
|
in writing in the English language;
|
(b)
|
signed by or on behalf of the party giving it; and
|
(c)
|
delivered personally by hand or by courier using an internationally recognised courier company, or by telefax.
|
22.2
|
A Notice to the Seller shall be sent to the following address, or such other person or address as the Seller may notify to the other parties from time to time:
|
22.3
|
In the absence of evidence of earlier receipt, any Notice served in accordance with Clause 22,2 shall be deemed given:
|
(a)
|
in the case of personal delivery by hand, at the time of delivery;
|
(b)
|
in the case of delivery by an internationally recognised courier company, on the date and at the time of signature of the courier’s delivery receipt; and
|
(c)
|
in the case of delivery by telefax, upon issuance by the fax machine of a positive transmission report.
|
22.4
|
For the purposes of this Clause 22:
|
(a)
|
all times are to be read as local time in the place of deemed receipt; and
|
(b)
|
if deemed receipt under this Clause 22 is not within business hours (meaning 9.00 am to 5.30 pm on a Business Day in the place of receipt), the Notice is deemed to have been received when business next starts in the place of receipt.
|
22.5
|
To prove delivery, it is sufficient to prove that, if sent by pre-paid first-class post or airmail, the envelope containing the Notice or other communication was properly addressed and posted.
|
22.6
|
The parties hereby designate their respective addresses for the giving of notice, as set forth in Clause 22.3, as their respective domiciles at which service of process may be made in any arbitration, legal action or proceeding arising hereunder.
|
22.7
|
Notice shall not be validly given if sent by email.
|
23
|
Invalidity
|
23.1
|
If any provision in this Agreement is or becomes illegal, void, invalid or unenforceable, in whole or in part, under the Law of any jurisdiction the provision shall apply with whatever deletion or modification is necessary so that the provision is legal, valid and enforceable and gives effect to the commercial intention of the parties.
|
23.2
|
To the extent it is not possible to delete or modify the provision, in whole or in part, under Clause 23.1 then such provision or part of it shall, to the extent that it is illegal, invalid or unenforceable, be deemed to be severed from this Agreement. The remaining provisions will, subject to any deletion or modification made under C Clause 23.1 not be affected, remain in full force in that jurisdiction and all provisions shall continue in full force in any other jurisdiction.
|
24
|
Entire Agreement
|
25
|
Agreement Prevails
|
26
|
Variation
|
27
|
No Waiver
|
27.1
|
No failure or delay by any party (or time or indulgence given) in exercising any remedy, right, power or privilege under or in relation to this Agreement shall operate as a waiver of the same, nor shall any single or partial exercise of any remedy, right, power or privilege preclude any other or further exercise of the same or the exercise of any other remedy, right, power or privilege.
|
27.2
|
No waiver by any party of any requirement, term, provision or condition of this Agreement, or of any remedy or right under this Agreement, and no consent granted under this Agreement, shall have effect unless in writing and signed by or on behalf of the waiving or consenting party and then only in the instance and for the purpose for which it is given.
|
7.2
|
Each party waives its right to rescind (
ontbinden
), nullify (
wernetigd
) or suspend (
opgeschort
) this Agreement, in whole or in part, on the basis of section 6:265 of the Dutch Civil Code to request a competent court to amend this Agreement on the basis of section 6:230(2) of the Dutch Civil Code. Furthermore, a party in error (
dwaling
) shall bear the risk of that error in making this Agreement.
|
28
|
Counterparts
|
29
|
Time of the Essence
|
30
|
Governing Law and Submission to Jurisdiction
|
30.1
|
This Agreement (and the other Transaction Documents which are not expressed to be governed by another Law) and any dispute, controversy, proceedings or claim of whatever nature arising out of or in any way in connection with it or its subject matter or formation (including non-contractual disputes or claims) shall be governed by and shall be construed in accordance with Dutch law.
|
30.2
|
Any dispute between the Parties hereto arising under or in connection with this Agreement or further agreements resulting from this Agreement, including all disputed claims for breach by any party of any representation, warranty, undertaking or covenant under this Agreement (a "
Dispute"
), shall be finally resolved by arbitration in accordance with the rules of the Netherlands Arbitration Institute in Amsterdam (the "
Rules"
), provided always that the Parties have the right to submit any such dispute in summary proceedings to the district court in Amsterdam and the right to obtain seizure. The arbitrator, who shall be appointed in accordance with the Rules, shall decide according to the rules of the law. The arbitral tribunal shall consist of one arbitrator. The arbitral proceedings shall be conducted in the English language. The place of arbitration shall be Amsterdam, the Netherlands.
|
Signed for and on behalf of
BRABANT ALUCAST SERVICES B.V.
by
|
|
/s/ Jamie Brundell
|
|
|
Name: Jamie Brundell
Title: CEO
|
|
|
/s/ Hans Vorstenbosch
|
|
|
Name: Hans Vorstenbosch
Title: Managing Director
|
Signed for and on behalf of
SHILOH HOLDINGS NETHERLANDS B.V.
, by
|
|
/s/ H. D. de Rijk
|
|
|
Name: H. D. de Rijk
Title: managing director A
|
|
|
/s/ Kenton M. Bednarz
|
|
|
Name: Kenton. M. Bednarz
Title: managing director B
|
relating to a 100% interest in the capital of
|
Brabant Alucast Italy Site Verres S.r.l.
|
1.
|
Interpretation...................................................................................................................................
2
|
2.
|
Sale and Purchase............................................................................................................................
9
|
3.
|
Consideration for the Sale and Purchase of the Quota................................................................
9
|
4.
|
Conditions to Completion and other Preliminary Actions.........................................................
12
|
5
|
Completion......................................................................................................................................
14
|
6
|
Seller Warranties............................................................................................................................
15
|
7
|
Special Indemnities........................................................................................................................
16
|
8
|
Limitation of Seller’s Liability......................................................................................................
18
|
9
|
Purchaser’s Warranties and Undertakings.................................................................................
22
|
10
|
Interim Management.....................................................................................................................
22
|
11
|
Non-Solicitation Undertaking.......................................................................................................
25
|
12
|
Confidentiality and Announcements............................................................................................
25
|
13
|
Purchaser’s Undertakings.............................................................................................................
27
|
14
|
Costs and Expenses........................................................................................................................
28
|
15
|
Stamp Duty, Fees and Taxes..........................................................................................................
28
|
16
|
Grossing-up.....................................................................................................................................
28
|
17
|
VAT...................................................................................................................................................
29
|
18
|
Further Assurance..........................................................................................................................
29
|
19
|
Effect of Completion.......................................................................................................................
29
|
20
|
Assignment......................................................................................................................................
29
|
21
|
Payment...........................................................................................................................................
30
|
22
|
Notices..............................................................................................................................................
30
|
23
|
Invalidity..........................................................................................................................................
31
|
24
|
Entire Agreement............................................................................................................................
32
|
25
|
Agreement Prevails.........................................................................................................................
32
|
26
|
Variation..........................................................................................................................................
32
|
27
|
No Waiver........................................................................................................................................
32
|
28
|
Counterparts...................................................................................................................................
32
|
29
|
Time of the Essence........................................................................................................................
32
|
30
|
Governing Law and Submission to Jurisdiction.........................................................................
32
|
a.
|
BRABANT ALUCAST SERVICES B.V.
, an entity incorporated under the Laws of The Netherlands, registered under number 58268375, whose registered office is at Rijnstraat 19, 5347 KL, Oss, The Netherlands, acting by its managing directors Brabant Alucast International B.V. (represented by Mr J.W.P.C.M. Vorstenbosch and Mr J.K. Brundell), Mr J.W.P.C.M. Vorstenbosch and Mr J.K. Brundell, duly empowered for the purposes hereof pursuant to a resolution of the managing directors, dated on or around the date hereof, a copy of which is attached as Schedule 1 (the “
Seller
”); and
|
b.
|
SHILOH HOLDINGS NETHERLANDS B.V.
, a limited liability company organized under the Laws of The Netherlands, registered with the trade register of the Chambers of Commerce under file number 60724064, having its official seat in Amsterdam, The Netherlands, and its principal place of business at Hoogoorddreef 15, 1101 BA Amsterdam, The Netherlands, acting by its directors, Mr
Kenton Michael Bednarz and Ms. Helena Dorinda de Rijk, duly empowered for the purposes hereof pursuant to the articles of association and a resolution of the board of managing directors, dated 29 January 2018, a copy of which is attached as Schedule 2 (the “
Purchaser
”).
|
(A)
|
Brabant Alucast Italy Site Verres S.r.l., is a limited liability company, incorporated and validly existing under the Laws of Italy, with a stated paid-in capital of EUR 50,000.00 (fifty thousand/00), whose registered office is at Via Glair, 41, 11029, Verres (Aosta, Italy) registered with the Register of Enterprises of Aosta under number 09709790019, engaged in the development and production of magnesium and aluminium high pressure die castings for interior components and body structural parts with high technical requirements (the “
Company
”).
|
(B)
|
At the date of this Agreement, the Seller holds the full, free and marketable title to a EUR 50,000.00 quota representing a 100% interest in the Company’s capital (the “
Quota
”).
|
(C)
|
The Seller intends to sell, and the Purchaser intends to purchase, the Quota, on the terms and subject to the conditions of this Agreement (the “
Transaction
”).
|
(D)
|
On 20 December 2017, the Seller entered into with the Purchaser’s parent company, Shiloh Industries Inc., an exclusivity agreement by which they:
|
(i)
|
confirmed their intention, in principle, to enter into the Transaction and to set forth the basis for further and final negotiations of one or more definitive agreements, in accordance with the provisions of the non-binding term sheet attached thereto;
|
(ii)
|
agreed to be bound by certain exclusivity obligations in accordance with the terms thereof, in order to facilitate the negotiation of the above mentioned definitive agreements and the execution of the Transaction;
|
(iii)
|
agreed to cooperate in order to obtain, prior to the Signing Date: (1) comfort by certain competent authorities and other third parties as to the continuance of their relationships with the Company following Completion of the Transaction; and (2) the execution between the Purchaser and the Insurer of the W&I Insurance Policy effective upon consummation of the Completion subject to the payment of the relevant premium by the Purchaser.
|
(E)
|
On 20 December 2017, the
Regione Autonoma Valle d’Aosta
confirmed to the Company its intention, in principle, to continue in the existing contractual relationship under the Deed of Building Lease following its expiry in 2025.
|
(F)
|
Prior to the date hereof comfort has been provided by certain key customers and suppliers (namely Jaguar
|
(G)
|
On the date hereof, the parties have entered into a share purchase agreement (the “
Oss SPA
”) concerning the sale and purchase by the Purchaser of the entire share capital of Brabant Alucast The Netherlands Site Oss B.V. (“
Oss
”).
|
1.
|
Interpretation
|
1.1
|
In addition to the other terms defined elsewhere in this Agreement, the following terms shall have the meanings ascribed to them below for the purpose of this Agreement:
|
(a)
|
dividend or distribution (whether in cash or in kind, whether ordinary or extraordinary) or any payments in lieu of any dividend or distribution, either declared and/or paid or made;
|
(b)
|
redemption, repurchase, repayment or return of the quota, or return of capital (whether by reduction of capital or otherwise and whether in cash or in kind);
|
(c)
|
consultant, advisory, management, monitoring, service, quotaholder or other fees, charges or compensation of a similar nature, whether resolved or paid, including - but not limited to - any fees and/or expenses due in connection with the implementation of any transactions contemplated hereby;
|
(d)
|
payments to, or transaction of any kind with the Seller, any member of the Seller’s Group and/or any of their respective Related Parties (including, without limitation, under any Intercompany Agreements);
|
(e)
|
waiver, deferral or release (whether conditional or not) of any amount, right, value, benefit or obligation owed or due to the Seller, any member of the Seller’s Group and/or any of their respective Related Parties;
|
(f)
|
amendment to the amount or timing of interest, principal or fees in respect of any indebtedness owed by the Seller, any member of the Seller’s Group and/or any of their respective Related Parties;
|
(g)
|
loans or gifts made to the Seller, any member of the Seller’s Group and/or any of their respective Related Parties;
|
(h)
|
liability or obligation (contingent or otherwise) of the Seller, any member of the Seller’s Group and/or any of their respective Related Parties assumed or discharged;
|
(i)
|
guarantees or incurrence of indebtedness to the benefit of the Seller, any member of the Seller’s Group and/or any of their respective Related Parties;
|
(j)
|
guarantee, indemnity or Encumbrance provided by, or over the assets of, the Company;
|
(k)
|
bonuses paid to the Company’s directors and/or employees in connection with the implementation of any transactions contemplated hereby;
|
(l)
|
payment of the WHT Amount; and
|
(m)
|
any Taxes resulting from a Leakage,
|
(i)
|
any payments expressly provided for under the terms of the Transaction Documents (including for the avoidance of doubt any amounts to be paid by the Company to Oss in respect of any Post Locked Box Date Lending or otherwise);
|
(ii)
|
any payments to the extent specifically provided for in the Locked Box Accounts;
|
(iii)
|
any amounts incurred, paid or agreed to be paid or payable or liability, cost or expense incurred in connection with any matter undertaken at the written request of, or with the prior written consent of, the Purchaser;
|
(iv)
|
any payments listed in Schedule 10;
|
1.2
|
In this Agreement, unless the context otherwise requires:
|
(a)
|
references to a “
party
” mean a party to this Agreement and shall include its permitted assignees (if any) and/or the successors in title to that part of its undertaking which includes this Agreement;
|
(b)
|
any reference to “
writing
” or “
written
” means any method of reproducing words in a legible and non‑transitory form (excluding, for the avoidance of doubt, email);
|
(c)
|
references to “
include
” or “
including
” are to be construed without limitation;
|
(d)
|
references to a “
person
” include any individual, company, partnership, joint venture, firm, association, trust, governmental or regulatory authority or other body or entity (whether or not having separate legal personality);
|
(e)
|
words in the singular include the plural and vice versa and a reference to any gender includes all other genders;
|
(f)
|
the table of contents and headings are inserted for convenience only and do not affect the construction of this Agreement;
|
(g)
|
references to Recitals, Clauses, paragraphs and Schedules (including any Annexes attached thereto) are (unless the context otherwise requires) to recitals, clauses and paragraphs of, and schedules (including any annexes attached thereto) to, this Agreement and all Recitals and Schedules (including any Annexes attached thereto) form an integral and substantial part of this Agreement;
|
(h)
|
references to any statute or statutory provision include a reference to that statute or statutory provision as amended, consolidated or replaced from time to time (whether before or after the date of this Agreement) and include any subordinate legislation made under the relevant statute or statutory provision;
|
(i)
|
where any representation or warranty contained in this Agreement (including but not limited to the Seller Warranties) is expressly qualified by reference to the “Seller’s Knowledge” or “as far as the Seller is aware”, this shall mean the knowledge, as of the date hereof and as of the Completion Date, of the Seller and/or the knowledge of any executive and/or senior manager and/or member of the board of directors and/or statutory auditors of the Seller and/or the Company, after due inquiry; and
|
(j)
|
save as otherwise expressly provided, any reference in this Agreement to an obligation of a party to procure or cause that another person complies with an obligation shall be construed as a “
promessa dell’obbligazione o del fatto del terzo
” under article 1381 of the Code.
|
1.3
|
The Purchaser shall be entitled to designate an Affiliate incorporated in a country being a member of the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the “
Designee
”) to purchase the Quota and carry-out the transactions contemplated hereby, in accordance with the following provisions:
|
(a)
|
anything in article 1403 of the Code to the contrary notwithstanding, such designation will be sufficiently made if notified in writing to the Seller, together with (i) full corporate details and address of the Designee for the purposes of Clause 22, and (ii) the written unconditional acceptance of the Designee, and, upon such acceptance, the Designee shall be considered together with the Purchaser as a party of this Agreement for all purposes;
|
(b)
|
the designation pursuant hereto will be notified to the Seller no later than 3 (three) Business Days prior to the Completion Date;
|
(c)
|
the Designee shall be required to satisfy the reasonable ‘know your customer’ requirements of the Seller prior to the transfer of rights and obligations to the Designee described herein;
|
(d)
|
the Purchaser shall be jointly and severally liable with the Designee in respect of the payment of the Consideration pursuant to this Agreement and the timely and proper fulfilment of any obligation of the Purchaser arising from, or in connection with, this Agreement until the consummation of the Completion in accordance with the provisions of this Agreement;
|
(e)
|
subject to (f) below, upon occurrence of Completion (i) the Purchaser shall be automatically released for all purposes from any Purchaser’s obligations, (ii) the Purchaser shall not be considered anymore as a party to this Agreement, and (iii) any reference in this Agreement to the “Purchaser” will be construed and interpreted as an exclusive reference to the Designee except for any reference under Clauses 11 (
Non-solicitation undertaking
), 12 (
Confidentiality and Announcement
), 22 (
Notices
) and 30 (
Governing Law and Submission to Jurisdiction
), which shall be construed as a reference to both the persons having originally executed this Agreement as Purchaser and the Designee;
|
(f)
|
in the event that the Designee fails to make any payment under this Agreement, the Seller shall be able to seek recourse against the Purchaser for such payment.
|
2.
|
Sale and Purchase
|
2.1
|
Upon the terms and subject to the conditions of this Agreement (including without limitation the Conditions Precedent set forth in Clause 4.1 below), and with effect from Completion and upon consummation thereof, the Seller agrees to sell and the Purchaser agrees to purchase, full title to, and full ownership of, the Quota, representing as at such date, 100% (one hundred percent) of the resolved upon, subscribed for and paid-in stock capital of the Company, together with all rights which are at the Completion Date attached to it (including, without limitation, the right to receive all dividends, distributions and interest declared, made, accrued or paid on or after the Completion Date), and the Quota shall be sold by the Seller free from all Encumbrances, on the terms of this Agreement.
|
2.2
|
The Seller hereby waives any rights which may have been conferred on it under the Articles or otherwise as may affect the transactions contemplated by this Agreement (other than its rights pursuant to this Agreement) including, without limitation:
|
(a)
|
any rights of redemption, pre-emption, first refusal or transfer it may have with respect to the Quota (in whole or in part); and
|
(b)
|
any rights to acquire the Quota (in whole or in part).
|
3.
|
Consideration for the Sale and Purchase of the Quota
|
3.1
|
Consideration
|
3.2
|
Payment of the Consideration
|
(a)
|
an amount equal to EUR 1,500,000
less
(if the [*] Claim is finally settled prior to the Completion Date) the Net [*] Claim Payment Amount, shall be paid to the Seller for the sale and purchase of the Quota (the “
Quota Consideration
”). If: (a) the [*] Claim has been finally settled prior to the Completion Date, the Quota Consideration shall be paid into the Designated Account; or (ii) if the [*] Claim has not been finally settled prior to the Completion Date, the Quota Consideration shall be paid into the Escrow Account; and
|
(b)
|
an amount equal to EUR 4,202,536
less
|
i.
|
any Leakage notified under Clause 4.6; and
|
ii.
|
the WHT Amount (to the extent such amount is not included in the Leakage notification),
|
(c)
|
the Post-Locked Box Date Lending Amount shall be paid into the Designated Account in repayment of all Post-Locked Box Date Lending (and the payment of such amount into the Designated Account shall absolutely discharge the Company for any liability against any member of the Seller’s Group in connection with the Post-Locked Box Date Lending).
|
3.3
|
Discharge of the Purchaser
|
3.4
|
[*] Escrow
|
3.5
|
Conduct of the [*] Claim
|
(i)
|
for a period of six (6) months following the Completion Date, the Seller (duly represented, to such purpose, solely by Mr. Jamie Brundell) shall: (x) diligently pursue and seek to resolve the [*] Claim as soon as practicable following the Completion Date; and (y) use all reasonable endeavours to ensure that a final settlement agreement is entered into between the Company and [*] in settlement of all liabilities of the Company in respect of the [*] Claim (such settlement agreement to be on terms reasonably acceptable to the Purchaser, it being acknowledged that a financial settlement of the [*] Claim for an amount less than or equal to the [*] Escrow Amount without any other obligations or liabilities being assumed by the Company will be considered to be acceptable to the Purchaser);
|
(ii)
|
if the [*] Claim has not been resolved within the six (6) month period following the Completion Date referred to in (i) above, the Purchaser shall be entitled (at the Purchaser’s expense) to assume conduct of the [*] Claim;
|
(iii)
|
if the [*] Claim has not been resolved by the end of the Escrow Period and [*] has, on or prior to the end of the Escrow Period, commenced a lawsuit against the Company before any competent judicial or arbitral Authority in connection with the [*] Claim, such lawsuit shall be deemed to be subject to the procedures governing Third Party Claims as set out in Clause 8.11 of this Agreement; and
|
(iv)
|
if the [*] Claim has not been resolved by the end of the Escrow Period and [*] has, on or prior to the end of the Escrow Period, debited the Company and/or applied any other price reductions towards the Company in relation to the [*] Claim (and/or otherwise notified the Company and/or the Purchaser in writing of its intention to do so), the Seller shall have the right (at its sole cost) to continue to pursue [*] in order to settle or otherwise resolve the [*] Claim. The Purchaser shall cooperate (and shall procure that the Company cooperates) with the Seller’s reasonable requests in respect of such continuation.
|
(b)
|
The Purchaser undertakes that it shall not (and, from the Completion Date, shall procure that the Company does not) take any action which would or might reasonably be expected to frustrate, delay or increase the liability of the Company in respect of the [*] Claim.
|
(c)
|
The Seller undertakes to diligently pursue settlement of the [*] Claim within the period referred to in (a) (i) above and shall not take any action to frustrate or delay settlement of the [*] Claim (save where a delay in settlement is required to protect the bona fide interests of the Seller in minimising any liability of the Company or the Seller in connection with the [*] Claim).
|
(d)
|
The Seller shall promptly inform the Purchaser of any developments or material information in respect of the [*] Claim and shall reasonably consult with the Purchaser regarding the status and conduct of negotiations with [*].
|
(e)
|
No settlement agreement with [*] shall be entered into without the prior written consent of the Purchaser (not to be unreasonably denied or delayed).
|
(f)
|
The Purchaser shall (and, from the Completion Date, shall procure that the Company shall) keep the existence of the [*] Escrow Agreement strictly confidential and shall not disclose to [*], its affiliates or any of its or their officers, employees, agents, consultants or advisers that amounts have been put into escrow in connection with the [*] Claim or the quantum of such amount.
|
3.6
|
Enforcement of the [*] Escrow
|
(a)
|
in the circumstances referred to under (i) above, upon the Purchaser’s first demand, the Escrow Agent shall procure the payment out of the [*] Escrow Account to the Purchaser (or to the Company, as the Purchaser may require) of the amount necessary for the fulfilment by the Company of all its payment obligations arising under, or in connection with, any settlement agreement executed between the Company and [*] (including the amount of any reasonable attorney’s fees and expenses possibly borne by the Company and/or the Purchaser in connection therewith);
|
(b)
|
in the circumstances referred to under (ii) above, upon the Purchaser’s first demand, the Escrow Agent shall procure payment out of the [*] Escrow Amount to the Company in an amount equal to any documented debit or price reduction applied by [*] (the “
[*]
Debit Claim Amount
”), provided that, following such payment, the Seller shall be entitled, at its sole discretion, to continue to pursue [*] in order to settle or otherwise determine the [*] Claim. In the event that such resolution or settlement of the [*] Claim results in a financial settlement for an amount lower than the [*] Debit Claim Amount then the Purchaser shall promptly (and in any event within five (5) Business Days of receipt of funds from [*]) pay to the Seller an amount equal to the difference between the [*] Debit Claim Amount and the amount for which the [*] Claim was determined or settled (as applicable);
|
(c)
|
in the circumstances referred to under (iii) above, the Escrow Agent shall hold the [*] Escrow Amount until the [*] Claim will be finally determined by the competent judicial or arbitral Authority, or otherwise settled between [*] and the Company before the issue of the relevant judgement; upon either the determination by such Authority of the [*] Claim or, alternatively, the prior settlement between the parties thereto, the Escrow Agent shall pay to the Purchaser (or to the Company, as the Purchaser may require) from the [*] Escrow Account, a sum equal to any amounts that the Company will be required to pay, as so determined or settled (including the amount of any reasonable attorney’s fees and expenses borne by the Company and/or the Purchaser in connection therewith);
|
(d)
|
once the [*] Claim will have been settled or otherwise determined pursuant to paragraphs (a), (b) or (c) above and subject to the payments to be made by the Escrow Agent to the Purchaser and/or the Company thereunder (including, if applicable, any interest accrued on the relevant portion of the [*] Escrow Amount), the Escrow Agent shall repay to the Seller any remaining balance on the [*] Escrow Account (including, if applicable, any interest accrued on such balance of the [*] Escrow Amount);
|
(e)
|
for the purposes of Clauses 3.4, 3.5 and 3.6 and of the [*] Escrow Agreement, “settlement” shall mean a binding agreement in writing duly signed by both the Company and [*] pursuant to which the Company will be entirely and definitively released from any obligations and/or liabilities towards [*] in connection with the [*] Claim and a “determination” shall mean a judgment rendered by any judicial or arbitral Authority finally settling all disputes, claims, rights and obligations of [*] and the Company in connection with the [*] Claim and “settle”, “settled” and “determined” shall be construed accordingly.
|
4.
|
Conditions to Completion and other Preliminary Actions
|
4.1
|
Conditions Precedent
|
4.1.1
|
the sale and purchase of the Quota pursuant to this Agreement and all other relevant transactions contemplated hereby, as well as by the Oss SPA, shall have been approved, cleared or granted an exemption by the German Antitrust Authority (the approvals, clearances and exemptions contemplated above are hereinafter collectively referred to as the “
Clearance
”);
|
4.1.2
|
any and all conditions precedent set forth under the applicable provisions of the Oss SPA shall have been fulfilled.
|
4.2
|
The Clearance
|
4.3
|
Effects
|
4.4
|
Other Preliminary Actions
|
(i)
|
the termination by mutual consent and in the agreed terms of the Intercompany Agreements and the transfer to the Company of the full title and ownership of any equipment leased to the Company thereunder, free from any Encumbrances; and
|
(ii)
|
the termination by mutual consent and in the agreed terms of the Management Services Agreements.
|
4.5
|
Optional Termination of the Factoring Agreement
|
4.6
|
Information to be provided on the apportionment of the Intercompany Pay-Off Amount, Leakage, Post-Locked Box Date Lending
|
(i)
|
the Post-Locked Box Date Lending Amount;
|
(ii)
|
details of the apportionment of the Intercompany Pay-Off Amount between Brabant Alucast International B.V., the Seller and Brabant Alucast Germany Site Wendlingen GmbH and bank account details into which the relevant proportion of the Intercompany Pay-Off Amount payable to each such entity should be paid; and
|
(iii)
|
the exact amount of Leakage from the Locked Box Date (not included) up to and including the Completion Date, provided that if the Seller fails to inform the Purchaser of any Leakage in accordance herewith, the Seller shall be liable to the Purchaser for such Leakage pursuant to Clause 7 below.
|
5
|
Completion
|
5.1
|
Completion shall take place at the offices of Studio Legale Bird & Bird, in Milan, at 10 a.m., on the 5
th
(fifth) Business Day following the date on which all the Conditions Precedent set forth in Clause 4.1 shall have been fulfilled (the “
Completion Date
”), or at such other place, date and time as the parties may hereafter agree in writing.
|
5.2
|
At Completion the Seller and the Purchaser shall comply with their respective obligations set out in Schedule 11.
|
5.3
|
If the obligations of the Seller or the Purchaser under Schedule 11 are not complied with on the Completion Date in any material respect, the Purchaser (in the case of default by the Seller) or the Seller (in the case of a default by the Purchaser) shall be entitled (in addition to and without prejudice to all other rights and remedies available) by written notice to the Purchaser or the Seller, as the case may be:
|
(a)
|
to defer Completion for a period of up to ten (10) Business Days (provided always that such date is prior to the Long Stop Date) so that the provisions of this Clause 5 shall apply to Completion as so deferred;
|
(b)
|
to require the parties to proceed to Completion as far as practicable, having regard to the defaults which have occurred; and
|
(c)
|
subject to Completion having first been deferred for a period of at least ten (10) Business Days under Clause 5.3(a) and the parties having used reasonable endeavours to effect Completion during that period, to terminate this Agreement by notice in writing to the Purchaser or the Seller, as the case may be.
|
5.4
|
All amounts expressed to be payable to the Seller pursuant to any provision of this Agreement shall be paid (without set-off or deduction) to the Designated Account, and the receipt of each such amount in the Designated Account shall be an absolute discharge to the Purchaser of the obligation to pay such amount and the Purchaser shall not be concerned to see to the application of any such amount thereafter.
|
5.5
|
All actions and transactions constituting the Completion pursuant to this Agreement (including, without limitation, this Clause 5 and Schedule 11), as well as all actions and transactions constituting the Completion under the Oss SPA, shall be regarded as one single transaction so that, at the option of the party having interest in the performance of the relevant specific action or transaction, no action or transaction constituting the Completion shall be deemed to have taken place if and until all other actions and transactions constituting the
|
6
|
Seller Warranties
|
6.1
|
Prior to the Signing Date, the Purchaser has conducted a due diligence review regarding the Company (the “
Due Diligence Review
”). In connection therewith, the Purchaser and its advisors have had access to the Disclosure Material.
|
6.2
|
The Seller makes to the Purchaser the Seller Warranties contained in Schedule 6, which are, save as provided in Clause 6.4 below, true and accurate as of the date hereof and, save as provided in Clause 6.4 below, true and accurate as of the Bring-Down Date.
|
6.3
|
The Seller and the Purchaser acknowledge that the Seller Warranties are completely autonomous promises and substitute, without being subject to, in any respect, the discipline of the warranties of the seller provided for by the Code. As a particular consequence,
inter alia
, the Seller shall be liable for any Loss arising due to a breach of any of the Seller Warranties (subject to the limitations of liability set out in this Agreement) pursuant to the terms and conditions provided for in this Agreement (including, without limitation, this Clause 6 and Clauses 7 and 8 below), without being subject to or limited by, under any respects or circumstances, articles 1495 and 1497 of the Code, it being understood that the validity and enforceability of such obligation in strict compliance with the provisions hereof constitutes an essential and determining factor of the Purchaser’s consent to purchase the Quota on the terms and conditions set out in this Agreement.
|
6.4
|
Each Seller Warranty is given subject to all facts, matters and information Disclosed (or deemed to be Disclosed) in the Disclosure Letter. For the avoidance of doubt: (i) information contained in the Disclosure Letter is required to meet the standard of Disclosure set out in Clause 1.1 of this Agreement in order to be considered to be considered Disclosed for the purposes of this Agreement; (ii) the Seller shall not be liable for any breach of any Seller Warranty to the extent that the facts, matters or circumstances which form the basis of such breach have been Disclosed and (iii) the contents of all other Schedules of this Agreement shall not be considered Disclosed for the purposes of this Agreement and therefore shall neither limit nor exclude the liability of the Seller.
|
6.5
|
Each Seller Warranty shall be given on the Bring-Down Date subject to all facts, matters and information Disclosed in the Bring-Down Disclosure Letter and, accordingly, the Seller shall not be liable for any breach of any Seller Warranty to the extent that the facts, matters or circumstances which form the basis of such breach in respect of matters which occur following the execution of this Agreement are Disclosed in the Bring-Down Disclosure Letter and the Purchaser (acting reasonably) accepts in writing such additional Disclosure. It is acknowledged and agreed by the Seller that the only matters which may be validly Disclosed in the Bring-Down Disclosure Letter will be facts, matters or circumstances which occurred following the execution of this Agreement
|
6.6
|
If, between the Signing Date and the Completion Date, the Seller becomes aware of the occurrence - following the Signing Date - of any events or circumstances which may cause any of the Seller Warranties to become untrue or misleading, the Seller shall Disclose such matters to the Purchaser in writing as soon as reasonably practicable following the Seller becoming aware of any such events or circumstances.
|
6.7
|
Unless expressly provided in this Agreement, each of the Seller Warranties shall be separate and independent and shall not be limited by reference to any other Seller Warranty, Clause, paragraph or other section of this Agreement.
|
6.8
|
It is further acknowledged and agreed by the Seller that the fraudulent or wilful concealment by any one of Jamie Brundell, James McComasky, Hans Vorstenbosch, Ariana Lachello and Stefano Bruni at the date of this Agreement of any matter which occurred prior to execution of this Agreement and which would or might reasonably be expected to result in a breach of Warranty and Loss to the Company in excess of EUR 500,000 and of which the Purchaser becomes aware prior to the Completion Date shall entitle the Purchaser, on written
|
7
|
Special Indemnities
|
7.1
|
The Seller shall indemnify and hold harmless the Purchaser on a EUR per EUR basis in respect of any and all Losses suffered by the Company and/or the Purchaser in connection with the following (the “
Special Indemnities
”):
|
(i)
|
any Leakage Claim, in respect of which the provisions of Clauses 7.2 and 7.3 below shall apply;
|
(ii)
|
the [*] Claim in respect of which the provisions of Clause 7.5 will apply;
|
(iii)
|
any breach by the Seller of any Fundamental Warranties, in respect of which the provisions of Clause 7.4 below shall apply;
|
7.2
|
Leakage Claims
|
7.3
|
Handling of Leakage Claims
|
7.3.1
|
Within and not later than 10 (ten) Business Days after the Purchaser becoming aware of the occurrence of such event, the Purchaser shall promptly give a Notice of Claim to the Seller, provided that - for the sake of clarity - failure of Purchaser to provide a timely Notice of Claim shall not reduce or otherwise impact the Seller’s liability for the Leakage Claim unless the Seller suffers direct prejudice as a result of such failure or delay and in such case, only to the extent of any such prejudice provided always that Notice of Claim is given within the Leakage Claim Period.
|
7.3.2
|
The Seller shall have the right to challenge in writing the Notice of Claim within 20 (twenty) Business Days from the receipt thereof, by giving the Purchaser a notice specifying the subject matter of the Seller’s disagreement and its reasons, together with all reasonable details thereto (a “
Notice of Disagreement
”), provided that, if the Seller fails to timely challenge such Notice of Claim within the term provided in this Paragraph any claims of the Purchaser contained therein shall be deemed expressly acknowledged and accepted by the Seller, and the Seller shall pay the Purchaser the amount specified
|
7.3.3
|
With respect to any Notice of Claim which is the subject of a Notice of Disagreement, during a period of 10 (ten) Business Days following receipt by the Purchaser of the Notice of Disagreement, the Seller and the Purchaser will attempt to resolve amicably and in good faith any differences that they may have with respect to any matters constituting the subject matter of such Notice, with a view to reaching an amicable agreement in respect of such matters. If, at the end of such period (or any mutually agreed upon extension thereof), the Seller and the Purchaser fail to reach agreement in writing with respect to all such matters, then all matters as to which agreement is not so reached (each a “
Leakage Dispute
”) may, thereafter, be submitted to the final determination of an independent appraiser to be jointly selected by the parties, or alternatively - failing the parties’ agreement - to be appointed by the then President of the Order of Chartered Accountants and Auditors of Milan (Italy) (
Ordine dei Dottori Commercialisti e Revisori Contabili
)
upon request by the most diligent party (the “
Expert
”).
|
7.3.4
|
The Expert (1) shall consider only the Leakage Disputes, (2) shall act promptly to resolve all such disputes, (3) shall comply with the applicable provisions of this Agreement, (4) shall be empowered to act as an arbitrator only to the extent strictly required to resolve the Leakage Disputes and (5) its determinations with respect thereto shall be final, conclusive and binding upon the Purchaser and the Seller in accordance with the provisions of paragraph 7.3.6 below and shall not be subject to appeal. Upon resolution by the Expert of all Leakage Disputes, the Expert shall prepare and deliver to the parties its determinations with respect to each Leakage Dispute.
|
7.3.5
|
Any Leakage Claims in respect of which no Notice of Disagreement shall have been notified by the Seller to the Purchaser in accordance with paragraph 7.3.2 or which shall have been amicably settled between the parties pursuant to paragraph 7.3.3 and/or determined pursuant to paragraph 7.3.5 preceding, shall be final, conclusive and binding upon the Purchaser and the Seller.
|
7.3.6.
|
Without prejudice to the provisions of paragraph 7.3.5, the settlement of determination of any Leakage Claim with regard to a particular item shall not be deemed or otherwise construed as limiting, reducing or adversely affecting the rights of the Purchaser under this Agreement in respect of any other Leakage Claim or other matter which is not the subject of such settlement or determination.
|
7.3.7
|
All fees and disbursements of the Expert due in connection with the provision of the services contemplated under this Clause 7.3 shall be equally shared between the Seller and the Purchaser or as may otherwise be determined by the Expert.
|
7.4
|
Fundamental Warranty Claims
|
(a)
|
the Seller’s obligations under this Clause 7.4 shall survive the expiry of the time limit provided above in respect of any breach, untruthfulness, incorrectness and/or inaccuracy of the Fundamental Warranties referred to therein where a Notice of Claim is given within such three (3) year period, provided further that the Seller shall have no liability for any Fundamental Warranty Claim for which a Notice of Claim is issued if legal proceedings in respect of such Fundamental Warranty Claim are not commenced within twelve (12) months of the date of Notice of Claim;
|
(b)
|
the Seller’s aggregate liability pursuant to this Clause 7.4 shall not exceed the amount of the Consideration;
|
(c)
|
the provisions of Clauses 8.10 and 8.11 below shall apply
mutatis mutandis
to the handling of any related Claims between the parties.
|
7.5
|
[*] Claim
|
7.5.1
|
Notwithstanding anything to the contrary provided for herein (other than Clause 8.8), the Seller shall be liable and shall indemnify the Purchaser for a period of twelve (12) months from the Completion Date, on a EUR per EUR basis, in respect of any Losses (up to the amount of the [*] Claim Cap) suffered by the Company and/or the Purchaser in connection with the [*] Claim.
|
7.5.2
|
In the event that the Company or the Purchaser receives any claim from [*] regarding the subject matter of the [*] Claim within the twelve (12) month period referenced in Clause 7.5.1 above, the Seller shall be entitled to assume (at the Seller’s expense) sole conduct of the [*] Claim, provided however that (i) the Seller shall inform the Purchaser of any meeting, development and material information with regard to the [*] Claim (allowing a representative of the Purchaser or the Company to attend such meetings as an observer) and (ii) in case of court proceedings brought by [*] against the Company, the latter shall be entitled to appoint (at its expense) legal counsel of its choosing to defend the claim, it being understood that to the extent permitted by the Law
the Seller shall retain the primary conduct of any derivative and principal [*] Claim.
|
7.5.3
|
The Purchaser undertakes that it shall not (and, from the Completion Date, shall procure that the Company does not) take any action which would or might reasonably be expected to frustrate, delay or increase the liability of the Company in respect of the [*] Claim.
|
7.5.4
|
The Purchaser shall (and, from the Completion Date, shall procure that the Company shall) keep the existence of the indemnification provisions detailed in Clause 7.5.1 above strictly confidential and shall not disclose to [*], its affiliates or any of its or their officers, employees, agents, consultants or advisers that such indemnification has been given.
|
7.6
|
Exclusive Remedy
|
8
|
Limitation of Seller’s Liability
|
8.1
|
W&I Insurance Policy
|
(a)
|
the Seller shall only be directly liable towards the Purchaser with regard to the Special Indemnities;
|
(b)
|
other than the residual liability provided under Clause 8.2 below, with regard to the Insured Warranties, the Seller shall not have any liability towards the Purchaser, or the Purchaser be entitled to any actions against the Seller, in each case in respect of any Claim, irrespective of whether a Loss would be covered by the W&I Insurance Policy (and, if executed, the Environment Insurance Policy), except in case
|
(c)
|
except as otherwise provided under this Agreement (including Clause 7.1 above), the Purchaser’s sole recourse for any breach by the Seller of the Insured Warranties shall be against the W&I Insurance Policy (and/or, if executed, the Environment Insurance Policy) in accordance with its terms, whether or not the W&I Insurance Policy (and/or, if executed, the Environment Insurance Policy) is actually effected by the Purchaser or remain in existence. Any failure by the Purchaser to effect the W&I Insurance Policy (and/or, if executed, the Environment Insurance Policy) or to maintain any of them, or any waiver or termination of that policy(ies) at any time, shall not operate to increase the liability of the Seller.
|
8.2
|
Seller’s Residual Liability
|
(a)
|
the Seller’s obligations under this Clause 8.2 shall survive the expiry of the time limit provided above in respect of any breach, untruthfulness, incorrectness and/or inaccuracy of the Insured Warranties where a Notice of Claim is given to the Seller prior to the expiry of such twelve (12) month period (it being understood that, in respect of contingent liabilities, the Purchaser shall be entitled to specify the amount claimed also after the expiry of the time limits set forth herein);
|
(b)
|
the Seller’s aggregate liability pursuant to this Clause 8.2 shall not exceed EUR 57,025;
|
(c)
|
the Purchaser shall have immediate right of recourse against the Seller in accordance with Clauses 8.11 and 8.12 below, without need to exhaust the claim procedure in accordance with the W&I Insurance Policy or the Environment Insurance Policy.
|
8.3
|
Monetary Limitations: De Minimis and Threshold
|
(a)
|
where the amount due in connection with any single occurrence giving rise to a Loss pursuant thereto does not exceed EUR 5,702 (the “
De Minimis
”), unless the single occurrence giving rise to a Loss is part of a series of occurrences of the same kind arising out of the same or similar set of facts exceeding, in aggregate, EUR 5,702; or
|
(b)
|
the aggregate of all amounts that would otherwise be due in respect of breaches of Insured Warranties (other than the Leakage Warranty) does not exceed EUR 57,025 (the “
Threshold
”), provided that, if said threshold is exceeded, the Seller shall be liable for the entire amount of the Losses attributable to such breaches (and not only the amount exceeding the Threshold).
|
8.4
|
Time Limitations
|
(a)
|
in respect of any actual or alleged breach, untruthfulness, incorrectness and/or inaccuracy of the Insured Warranties (other than the Insured Warranties referred to in paragraph (b) below) no later than 24 (twenty-four) months after the Completion Date; or
|
(b)
|
in respect of any actual or alleged breach, untruthfulness, incorrectness and/or inaccuracy of the Insured Warranties referred to in paragraphs 11 (
Environmental Matters
), 14 (
Permits
), 15 (
Insolvency
), 18 (
Employees, Agents and Consultants
), 22 (
Tax
) of Schedule 6 no later than the 60
th
(sixtieth) Business
|
(i)
|
the Seller’s liability in respect of any breach, untruthfulness, incorrectness and/or inaccuracy of any Insured Warranty shall expire on the date which is twelve (12) months after the Completion Date save in respect of any matter in respect of which a Notice of Claim has been given prior to such date (subject always to clause 8.6(e)); and
|
(ii)
|
in respect of contingent liabilities, the Purchaser shall be entitled to specify the amount claimed also after the expiry of the time limits set out in this Clause 8.4.
|
8.5
|
Other Compensation
|
8.6
|
General Exclusions
|
(a)
|
the Claim or the events giving rise to the Claim would not have arisen but for an act, omission or transaction of the Purchaser’s Group, or which would not have arisen but for any claim, election or surrender or disclaimer made or omitted to be made or notice or consent given or omitted to be given by the Purchaser’s Group under the provisions of any statutes relating to Tax;
|
(b)
|
the Claim occurs or is increased as a result of:
|
(i)
|
any change in the accounting principles or practices of the Purchaser introduced or having effect after the Completion Date; or
|
(ii)
|
any increase in the rates of Tax made after the Completion Date; or
|
(iii)
|
any change in Law or regulation or in the interpretation or administration of any Authority, in each case, not actually in force at the Completion Date; or
|
(c)
|
the Claim is for Tax which arises in respect of the ordinary course of business of the Company after the Completion Date; or
|
(d)
|
the Claim relates to a claim or liability for Tax and would not have arisen but for any winding-up or cessation after Completion of any business or trade carried on by the Purchaser’s Group.
|
(e)
|
legal proceedings in respect of any Claim are not commenced within six (6) months of the date of Notice of Claim.
|
8.7
|
Provisions in the Locked Box Accounts - Contingent Assets
|
8.8
|
No Double Recovery
|
8.9
|
Fraud (
dolo
) or gross negligence (
colpa grave
)
|
8.10
|
Handling of Claims
|
8.10.1
|
Within and not later than 30 (thirty) Business Days after the Purchaser becoming aware of the occurrence of such event, the Purchaser shall give to the Seller a Notice of Claim, and shall provide all reasonable particulars thereof, including (i) the nature of the Claim, (ii) the amount of Losses constituting the subject matter of the Claim hereunder (to the extent known or reasonably computable at the date of such notice), and (iii) the provision(s) of this Agreement on the basis of which such amount is claimed. The Notice of Claim shall also specify whether it arises from a claim by a person (including, for the avoidance of doubt, any notice by any public Authority of any actual or alleged infringement of any Law) against the Purchaser or the Company (a “
Third Party Claim
”) or whether the Notice of Claim is asserted directly by the Purchaser (a “
Direct Claim
”). For sake of clarity, the failure of Purchaser to provide a timely Notice of Claim pursuant to this Agreement shall not reduce or otherwise impact the Seller’s liability for such Claim unless the Seller suffers direct, material prejudice as a result of such failure or delay and in such case, only to the extent of any such prejudice.
|
8.10.2
|
The Seller shall have the right to challenge in writing the Notice of Claim within 30 (thirty) Business Days from the receipt thereof, specifying the subject matter of the Seller’s disagreement and its reasons, together with all reasonable details thereto, provided that, if the Seller fails to timely challenge such Notice of Claim within the term provided in this Paragraph, without prejudice to any other right or remedy of the Purchaser, any claims of the Purchaser contained therein shall be deemed expressly acknowledged and accepted by the Seller, and the Seller shall pay the Purchaser the amount specified in such Notice of Claim within, and no later than, the tenth (10
th
) Business Day following the expiry of the 30 Business Day period referred to above.
|
8.10.3
|
With respect to any Notice of Claim, during a period of 20 (twenty) Business Days following the notice by the Seller under the preceding paragraph 8.10.2, the Seller and the Purchaser will attempt to resolve amicably and in good faith any differences that they may have with respect to any matters constituting the subject matter of such notice, with a view to reaching an amicable agreement in respect of such matters. If, at the end of such period (or any mutually agreed upon extension thereof), the Seller and the Purchaser fail to reach agreement in writing with respect to all such matters, then all matters as to which agreement is not so reached may, thereafter, be submitted to arbitration pursuant to Clause 30.2.
|
8.11
|
Handling of Third Party Claims
|
8.11.1
|
The Seller shall have the right to participate, and, to the maximum extent permitted by Law, join, at its own expenses, through counsel appointed in its name and on its behalf (which counsel shall be reasonably satisfactory to the Purchaser), in the defense of any Third Party Claim asserted or initiated against the Company and/or the Purchaser constituting the subject matter of a Notice of Claim. The Seller will cooperate with the Purchaser in the preparation for and the prosecution of the defense of such claim, action, suit or proceeding, including making available evidences within the control of the Seller;
|
8.11.2
|
to the extent that the Seller has accepted in writing to indemnify the Purchaser in relation to a Notice of Claim relating to a Third Party Claim, the Purchaser shall not, and shall cause the Company (as
|
8.11.3
|
to the extent that the Seller has accepted in writing to indemnify the Purchaser in relation to a Notice of Claim relating to a Third Party Claim, and if a firm offer is made to the Company or the Purchaser to settle any matter giving rise to the Seller’s liability under Clause 7 that the Seller, but not the Purchaser, is willing to accept, the Purchaser and/or the Company (as the case may be) shall be free not to enter into such settlement and to commence or continue litigation, at its/their own expense, but the Seller’s liability under Clause 7 shall be limited to the amount of the proposed settlement, except to the extent such settlement contained non-financial obligations to which the Purchaser reasonably objected, in which case no such limitation of Seller’s liability shall apply.
|
9
|
Purchaser’s Warranties and Undertakings
|
9.1
|
The Purchaser warrants to the Seller that the statements set out below are true and accurate as at the date of this Agreement:
|
(a)
|
the Purchaser is a company validly existing, duly incorporated and in good standing under the Laws of its jurisdiction of incorporation;
|
(b)
|
the Purchaser has the full legal right, power and authority to execute, deliver and perform the Transaction Documents to which it is a party (the “
Purchaser’s Completion Documents
”);
|
(c)
|
the Purchaser’s Completion Documents will, when executed by the Purchaser, constitute lawful, valid and binding obligations of the Purchaser in accordance with their respective terms;
|
(d)
|
the Purchaser is acting as principal and not as agent or broker for any other person and no other person than the Purchaser will be interested in the Quota;
|
(e)
|
it is not insolvent or unable to pay its debts within the meaning of the insolvency legislation applicable to it nor has it entered into any winding-up, liquidation or analogous procedure;
|
(f)
|
the Purchaser has available cash and/or ‘certain funds’ commitments or facilities enabling the Purchaser to perform its obligations hereunder;
|
(g)
|
neither the execution and delivery of this Agreement by the Purchaser nor the performance by the Purchaser of the Transaction and its obligations hereunder violates any provision of the by-laws of the Purchaser or, as far as the Purchaser is aware, any law or judgement applicable to the Purchaser;
|
(h)
|
as far as the Purchaser is aware, save for the Clearance, no filing or registration with, no notice to and no permit, authorization, consent or approval of any third party or any Authority is necessary for the consummation by the Purchaser of the Transaction.
|
10
|
Interim Management
|
10.1
|
Undertaking of the Seller
|
(a)
|
make any substantial change in the nature or organization of its business;
|
(b)
|
discontinue or cease to operate all or a material part of its business;
|
(c)
|
amend its Articles, or pass any resolution that is inconsistent with their provisions;
|
(d)
|
create, allot or issue any share capital or loan capital;
|
(e)
|
create, issue or grant any option or right to subscribe for, any share capital, premium, reserves or loan capital;
|
(f)
|
repay, redeem or reduce any share capital;
|
(g)
|
purchase, sell, transfer, encumber, license (as licensor or licensee) or otherwise acquire or dispose (whether by one transaction or by a series of transactions) of any tangible or intangible assets, business or undertakings having a unit value in excess of EUR 25,000 (twenty five thousand) or, anyway in aggregate in excess of EUR 150,000 (one hundred fifty thousand);
|
(h)
|
acquire, dispose of (in any form and manner), or Encumber, any participations in the equity of other companies or acquire, dispose of, or lease (as lessor or lessee) any asset, business (“
azienda
”) or going concern thereof (“
ramo di azienda
”);
|
(i)
|
enter into, amend, or terminate any agreement involving expenditure of any kind by the Company in excess of EUR 25,000 (twenty five thousand) per annum (except for orders of raw materials, packaging materials, transportation or logistic services or other inputs in the ordinary course of business), or having a duration extending 3 (three) months beyond the Completion Date;
|
(j)
|
enter into, amend or terminate any agreements with suppliers and/or customers in such a way as to result in a material detriment to the Company;
|
(k)
|
make or incur any new capital expenditure in excess of the aggregate amount of EUR 50,000 (fifty thousand), except for those which should be required to assure the ordinary functioning of the production activity of the Company or for those detailed in the business plan of the Company;
|
(l)
|
enter into any new loan or incur any other new bank indebtedness (other than by bank overdraft, the Factoring Agreement or similar facility in the ordinary course of business and within the limits subsisting at the date hereof) or incur any other indebtedness, in each case in excess of EUR 25,000 (twenty five thousand);
|
(m)
|
other than the use of the facilities under the Factoring Agreement consistent with past practice, utilize existing credit facilities for amounts which are in excess of the aggregate amount of EUR 50,000 (fifty thousand); or amend, cancel or cause the acceleration of, any credit facilities, loans, financing agreements or other outstanding bank indebtedness;
|
(n)
|
make any loan (other than the granting of any trade credit in the ordinary course of business) to any person;
|
(o)
|
give any guaranty of, or undertake any indemnity or enter into any other arrangement to secure, the obligations of third parties, or incur liability, financial or other obligations (whether accrued, contingent or otherwise) to guarantee or secure obligations of third parties;
|
(p)
|
amend, to any material extent, any of the terms on which goods, facilities or services having a value in excess of EUR 25,000 (twenty five thousand) are supplied;
|
(q)
|
change its accounting reference date, accounting methods, principles, practices or policies;
|
(r)
|
make any amendment to the terms and conditions of employment (including, without limitation, remuneration, pension entitlements and other benefits) of any Employee (other than increases required by Law or by the applicable collective bargaining which the Seller shall notify to the Purchaser as soon as reasonably possible);
|
(s)
|
provide or agree to provide any gratuitous payment or benefit to any Employee or Consultant;
|
(t)
|
hire any employee, or take any steps, directly or indirectly, to terminate the contract of employment of any Employee whose annual salary exceeds EUR 50,000 (fifty thousand), or induce or attempt to induce any such employee to terminate his/her employment, other than for cause pursuant to article 2119 of the Code or for a justified objective or subjective reason, or amend in any material respect (other than as required by law) the terms and conditions of employment of any such Employee;
|
(u)
|
waive, settle, accept, or make acquiescence to, any outstanding claim, whether active or passive, exceeding EUR 50,000 (fifty thousand) per claim;
|
(v)
|
enter into, amend or terminate any agreement, arrangement or obligation (legally enforceable or not) (i) between the Company and any director of the Company or its Related Parties are a party to, and/or (ii) which may trigger (contractually or otherwise) any Company’s obligation or liability to any Related Person;
|
(w)
|
materially delay the payment of any amount due to their suppliers in a way which is not consistent with past practice or solicit or agree to the extension of the payment terms applicable to any suppliers pursuant to the ordinary commercial practice of the Company;
|
(x)
|
declare, make or pay any dividend or other distribution;
|
(y)
|
make or change any Tax election, amend any Tax return or take any Tax position on any Tax return, apply for or obtain any Tax ruling or make any settlement that may give rise to an increase of any Tax liability of the Company outside the ordinary course of business and deviating from past practice;
|
(z)
|
change its residence for tax purposes or establish any branch, agency, permanent establishment or other taxable presence in any jurisdiction outside the jurisdiction of incorporation; and/or
|
(aa)
|
make any payments and/or exercise any of its rights and/or fulfil any of its obligations under the Intercompany Agreements and/or under any other agreements with any member of the Seller’s Group; and/or
|
(bb)
|
agree, undertake, or commit to do any of the foregoing.
|
10.2
|
Notwithstanding anything to the contrary in Clause 10.1, the Seller and the Company shall not be prevented from undertaking, be required to obtain the Purchaser’s consent in relation to, or incur any liability towards the Purchaser as a result of effecting any of the following prior to the Completion Date:
|
(a)
|
the fulfilment of any obligations as required by applicable Law;
|
(b)
|
the implementation of any transaction or the taking of any action permitted or provided for under any Transaction Document in accordance with its terms;
|
(c)
|
any Post Locked Box Date Lending up to EUR 600,000, provided that in any event the relevant funding shall not occur after the sixth (6th) Business Day prior to Completion Date;
|
(d)
|
the implementation of any matter set out in the Steps Paper in accordance with the terms of the Steps Paper; or
|
(e)
|
any matter reasonably undertaken in an emergency or disaster evident situation with the intention of minimising any adverse effect on the Company.
|
10.3
|
Right to Access
|
10.4
|
Marketing materials
|
11
|
Non-Solicitation Undertaking
|
11.1
|
The Purchaser hereby agrees and covenants that, without the prior written consent of the Seller, for a period of 2 (two) years after the Completion Date, it shall not, directly or indirectly:
|
(i)
|
solicit for employment, hire or otherwise retain any senior or key director, officer or employee of the Seller and/or any member of the Seller’s Group operating under the “
Brabant Alucast
” name (other than the Company and Oss) except as set forth in Part A of Schedule 17;
|
(ii)
|
solicit business in relation to certain parts set forth in the purchase orders listed for each party in Part B of Schedule 17 (the “
Restricted Contracts
”), provided for the sake of clarity that Purchaser shall be entitled to freely pursue any relationship with the relevant customers other than in relation to the Restricted Contracts.
|
11.2
|
The Seller hereby agrees and covenants that, without the prior written consent of the Purchaser, for a period of 2 (two) years after the Completion Date, it shall not, directly or indirectly:
|
(i)
|
solicit for employment, hire or otherwise retain any senior or key director, officer or employee of the Purchaser and/or any member of the Purchaser’s Group (including, for the avoidance of doubt (the Company and Oss);
|
(ii)
|
solicit business similar to the business of the Company, which, for the avoidance of doubt, shall not mean the business of Seller provided for in the Restricted Contracts.
|
11.3
|
The Seller agrees that the obligations of the Purchaser or the relevant member of the Purchaser's Group under the Purchase Order Agreements, the Subcontracting Agreement and/or the Transitional Services Agreement shall not qualify as a breach of any obligation under this Clause 11.
|
12
|
Confidentiality and Announcements
|
12.1
|
Announcements
|
12.2
|
Confidentiality
|
(i)
|
each of the parties shall treat as strictly confidential and not disclose or use any information received or obtained as a result of entering into any Transaction Document which relates to:
|
(A)
|
the existence or the provisions of any Transaction Documents; or
|
(B)
|
the negotiations relating to any Transaction Documents;
|
(ii)
|
the Seller shall, and shall procure that each member of the Seller’s Group shall, following Completion, treat as strictly confidential and not disclose or use any information relating to the business, financial or other affairs (including future plans and targets) of the Company, the Purchaser and/or any member of the Purchaser Group; and
|
(iii)
|
the Purchaser shall, and shall procure that each member of the Purchaser’s Group shall, treat as strictly confidential and not disclose or use any information relating to the business, financial or other affairs (including future plans and targets) of the Seller or the Seller’s Group (provided that, for the purposes hereof, the Company shall not be deemed as belonging to such Group).
|
(i)
|
the disclosure or use is required to vest the full benefit of this Agreement in a party;
|
(ii)
|
the information is or becomes publicly available (other than by breach of this Agreement);
|
(iii)
|
the disclosing party has obtained prior written approval from the other party to the disclosure or use;
|
(iv)
|
the information is independently developed after Completion other than on the basis of any Confidential Information;
|
(v)
|
the disclosure or use is required by Law, any governmental or regulatory body or any recognised stock exchange on which the shares of any party or any member of the Seller’s Group or the Purchaser’s Group are listed (including where this is required as part of any actual or potential offering, placing and/or sale of securities of that party or any member of the Seller’s Group or the Purchaser’s Group);
|
(vi)
|
the disclosure or use is required for the purpose of any judicial or arbitral proceedings arising out of any Transaction Document;
|
(vii)
|
the disclosure is made to a Tax Authority in connection with the Tax affairs of the disclosing party;
|
(viii)
|
the disclosure is made to any member of the Seller’s Group or any actual or prospective limited partner of any member of the Seller’s Group provided such person undertakes to comply with the provisions hereof in respect of such information as if it were a party to this Agreement;
|
(ix)
|
the disclosure is made by the Purchaser to any member of the Purchaser’s Group provided such person undertakes to comply with the provisions hereof in respect of such information as if it were a party to this Agreement and that the disclosing party remains liable for any breach of the confidentiality
|
(x)
|
the disclosure is made to professional advisers or actual or potential debt or equity financiers of any party or of any member of the Seller’s Group on a need to know basis provided that such persons undertake to comply with the provisions hereof in respect of such information as if it were a party to this Agreement and that the disclosing party remains liable for any breach of the confidentiality obligations set out herein by such person; or
|
(xi)
|
the disclosure is made on a confidential basis to potential purchasers of all or part of the Seller’s Group or the Purchaser’s Group or to their professional advisers or actual or potential financiers provided that any such persons need to know the information for the purposes of considering, evaluating, advising on or furthering the potential purchase and the disclosing party remains liable for any breach of the confidentiality obligations set out herein by such person,
|
13
|
Purchaser’s Undertakings
|
13.1
|
The Purchaser shall at its own cost procure that the Company shall as soon as reasonably practicable and in any event within:
|
(a)
|
six (6) months of the Completion Date in respect of signage;
|
(b)
|
six (6) months of the Completion Date in respect of stationery (including letterheads and business cards); and
|
(c)
|
twelve (12) months of the Completion Date in respect of any other matters,
|
13.2
|
Subject to Clause 13.1, the Purchaser expressly acknowledges and agrees that:
|
(a)
|
all intellectual property rights (including, for the avoidance of doubt, the domain name ‘brabant alucast.com’ in and to the “
Brabant Alucast
” name and the Group Trade Marks are owned by, belong to and vest with the Seller’s Group;
|
(b)
|
all new materials produced by the Company after Completion shall not refer to, use or include the “
Brabant Alucast
” name or the Group Trade Marks;
|
(c)
|
the “
Brabant Alucast
” name and the Group Trade Marks shall not be used in any manner that creates, purports to create, or might reasonably be considered to be intended to create legal obligations on the part of any member of the Seller’s Group;
|
(d)
|
the Purchaser shall not, and shall procure that the Company shall not, knowingly do, or fail to do, anything which act or omission is likely to damage the validity or goodwill of the “
Brabant Alucast
” name or the Group Trade Marks; and
|
(e)
|
the rights granted in Clause 13.1 are personal to the Purchaser and the Company, which shall have no right to assign or grant sub-licences of such rights.
|
13.3
|
The Purchaser shall indemnify and hold harmless the Seller from and against any and all Losses suffered by it as a result of the use by the Company of the “
Brabant Alucast
” name or the Group Trade Marks after the expiry of the Relevant Period set forth in Clause 13.1.
|
13.4
|
As soon as practicable following Completion, the Purchaser shall, as required by the Company or the Seller (at the sole cost of the Purchaser), enter into such guarantees, surety letters, letters of credit or indemnities as necessary in order for the Seller (or any member of the Seller’s Group) to be released from (or - if such release proves to be impossible - counter-guaranteed in respect of) any obligations arising from the guarantees, surety letters, letters of credit or indemnities currently given by the Seller (or any member of the Seller’s Group) in favour of the Company, as they are listed in Schedule 18 (the “
Guarantees Schedule”
).
|
13.5
|
The Purchaser shall indemnify and hold harmless the Seller or the concerned member of the Seller’s Group from and against any and all Losses suffered by either of them after Completion in connection with any guarantees, surety letters, letters of credit or indemnities listed in the Guarantees Schedule. Each member of the Seller’s Group identified in the Guarantees Schedule may enforce the terms of this Clause 13.5.
|
13.6
|
While the provisions set out in Clause 13 are considered by the parties to be fair and reasonable in the circumstances, it is agreed that if any of them should be judged to be void or ineffective for any reason, but it would be treated as valid and effective if part of the wording was deleted, they shall apply with such modifications as necessary to make them valid and effective.
|
14
|
Costs and Expenses
|
15
|
Stamp Duty, Fees and Taxes
|
16
|
Grossing-up
|
16.1
|
Unless as otherwise required by applicable Law or agreed upon between the parties, all sums payable under this Agreement shall be paid free and clear of all deductions, withholdings, set-offs or counterclaims whatsoever. If any deductions or withholdings are required by Law, the payor shall be obliged to pay to the recipient such sum as will after such deduction or withholding has been made leave the recipient with the same amount as it would have been entitled to receive in the absence of any such requirement to make a deduction or withholding, provided that if either party to this Agreement shall have assigned or novated or declared a trust in respect of the benefit in whole or in part of this Agreement or shall have changed its tax residence or the permanent establishment to which the rights under this Agreement are allocated then the liability of the other party under
|
16.2
|
The recipient or expected recipient of a payment under this Agreement shall claim from the appropriate Tax Authority any exemption, rate reduction, refund, credit or similar benefit (including pursuant to any relevant double tax treaty) to which it is entitled in respect of any deduction or withholding in respect of which a payment has been or would otherwise be required to be made pursuant to Clause 16.1 and, for such purposes, shall, within any applicable time limits, submit any claims, notices, returns or applications and send a copy of them to the payor.
|
16.3
|
If the recipient of a payment made under this Agreement receives a credit for or refund of any Tax payable by it or similar benefit by reason of any deduction or withholding for or on account of Tax then it shall reimburse to the payor such part of such additional amounts paid pursuant to Clause 16.1 above as the recipient of the payment certifies to the payor will leave it (after such reimbursement) in no better and no worse position than would have arisen if the payor had not been required to make such deduction or withholding.
|
17
|
VAT
|
18
|
Further Assurance
|
18.1
|
The Seller and the Purchaser each undertakes that it shall during the period of 6 months following the Completion Date execute and deliver all such instruments and other documents and take all such actions (to the extent within its power) as the Purchaser or the Seller (as applicable) may reasonably require in order to give effect to the terms of this Agreement.
|
18.2
|
Subject in any event to Clause 12, following Completion, subject to such information being held confidentially in accordance with Clause 12 (and as if the two year time limitation on such confidentiality obligations commenced at the date on which such information is provided to the Seller), if requested by the Seller, the Purchaser shall grant the Seller (and any concerned member of the Seller’s Group) reasonable access (including the right to take copies at the Seller’s expense but subject to the Purchaser’s prior written consent) to the Books and Records of the Company which are reasonably required by the Seller or such other member of the Seller’s Group for the purpose of dealing with its Tax and accounting affairs (including such information as is reasonably required by the Seller in order to negotiate, refute, settle, compromise or otherwise deal with any claim, investigation, reporting requirement or enquiry by any competent legal or regulatory authority, Tax Authority and, to the extent necessary, to assist in the defence of the [*] Claim or the [*] Claim.
|
19
|
Effect of Completion
|
20
|
Assignment
|
(a)
|
the Seller may assign (in whole or in part) the benefit of this Agreement to any other member of the Seller’s Group (provided that such assignment shall not release the Seller from any of its obligations under this Agreement); and
|
(b)
|
the Purchaser may assign its rights and obligations under this Agreement to the Designee in accordance with Clause 1.3,
|
21
|
Payment
|
21.1
|
Any payments pursuant to this Agreement shall be effected by crediting for same day value the account specified by the Seller or the Purchaser (as the case may be) on behalf of the party entitled to the payment (reasonably in advance and in sufficient details to enable payment by telegraphic or other electronic means to be effected) on or before the due date for payment.
|
21.2
|
Payment of a sum in accordance with this Clause 21 shall constitute a payment in full of the sum payable and shall be a good discharge to the payer (and those on whose behalf such payment is made) of the payer’s obligation to make such payment and the payer (and those on whose behalf such payment is made) shall not be obliged to see to the application of the payment as between those on whose behalf the payment is received.
|
21.3
|
Any amount payable by the Seller to, or at the discretion of, the Purchaser under this Agreement shall, so far as possible, be deemed to be a reduction of the Consideration. For the avoidance of doubt, any amount paid by the Escrow Agent to the Purchaser in relation to the [*] Claim shall be intended as a reduction of the Consideration.
|
21.4
|
If any sum required to be paid by any party under this Agreement (or any Transaction Document) is not paid when it is due, such amount shall bear interest at the rate of three per cent (3%) per annum over the base EURIBOR lending rate of European Central Bank from time to time, calculated on a daily basis for the period from the relevant due date for payment up to and including the date of actual payment.
|
22
|
Notices
|
22.1
|
Any notice, demand or other communication to be given or made under or in connection with this Agreement (a “
Notice
”) shall be:
|
(a)
|
in writing in the English language;
|
(b)
|
signed by or on behalf of the party giving it; and
|
(c)
|
delivered personally by hand or by courier using an internationally recognised courier company, or by telefax.
|
22.2
|
A Notice to the Seller shall be sent to the following address, or such other person or address as the Seller may notify to the other parties from time to time:
|
22.3
|
A Notice to the Purchaser shall be sent to the following address, or such other person or address as the Purchaser may notify to the other party from time to time:
|
22.4
|
In the absence of evidence of earlier receipt, any Notice served in accordance with Clause 22.1 shall be deemed given:
|
(a)
|
in the case of personal delivery by hand, at the time of delivery;
|
(b)
|
in the case of delivery by an internationally recognised courier company, on the date and at the time of signature of the courier’s delivery receipt; and
|
(c)
|
in the case of delivery by telefax, upon issuance by the fax machine of a positive transmission report.
|
22.5
|
For the purposes of this Clause 22:
|
(a)
|
all times are to be read as local time in the place of deemed receipt; and
|
(b)
|
if deemed receipt under this Clause 22 is not within business hours (meaning 9.00 am to 5.30 pm on a Business Day in the place of receipt), the Notice is deemed to have been received when business next starts in the place of receipt.
|
22.6
|
To prove delivery, it is sufficient to prove that, if sent by pre-paid first-class post or airmail, the envelope containing the Notice or other communication was properly addressed and posted.
|
22.7
|
The parties hereby designate their respective addresses for the giving of notice, as set forth in Clause 22.3, as their respective domiciles at which service of process may be made in any arbitration, legal action or proceeding arising hereunder.
|
22.8
|
Notice shall not be validly given if sent by email.
|
23
|
Invalidity
|
23.1
|
If any provision in this Agreement is or becomes illegal, void, invalid or unenforceable, in whole or in part, under the Law of any jurisdiction the provision shall apply with whatever deletion or modification is necessary so that the provision is legal, valid and enforceable and gives effect to the commercial intention of the parties.
|
23.2
|
To the extent it is not possible to delete or modify the provision, in whole or in part, under Clause 23.1 then such provision or part of it shall, to the extent that it is illegal, invalid or unenforceable, be deemed to be severed from this Agreement. The remaining provisions will, subject to any deletion or modification made under Clause 23.1, not be affected, remain in full force in that jurisdiction and all provisions shall continue in full force in any other jurisdiction.
|
24
|
Entire Agreement
|
25
|
Agreement Prevails
|
26
|
Variation
|
27
|
No Waiver
|
27.1
|
No failure or delay by any party (or time or indulgence given) in exercising any remedy, right, power or privilege under or in relation to this Agreement shall operate as a waiver of the same, nor shall any single or partial exercise of any remedy, right, power or privilege preclude any other or further exercise of the same or the exercise of any other remedy, right, power or privilege.
|
27.2
|
No waiver by any party of any requirement, term, provision or condition of this Agreement, or of any remedy or right under this Agreement, and no consent granted under this Agreement, shall have effect unless in writing and signed by or on behalf of the waiving or consenting party and then only in the instance and for the purpose for which it is given.
|
28
|
Counterparts
|
29
|
Time of the Essence
|
30
|
Governing Law and Submission to Jurisdiction
|
30.1
|
This Agreement (and the other Transaction Documents which are not expressed to be governed by another Law) and any dispute, controversy, proceedings or claim of whatever nature arising out of or in any way in connection with it or its subject matter or formation (including non-contractual disputes or claims) shall be governed by and shall be construed in accordance with Italian law.
|
30.2
|
Any dispute arising out of or in connection with the provisions of this Agreement (including, for the sake of clarity, in connection with the Special Indemnities or in connection with the Transfer Instrument) shall be finally settled under the International Arbitration Rules of the Chamber of National and International Arbitration of Milan by three arbitrators appointed in accordance with the said Rules. The venue of arbitration shall be in Milan, Italy. The language of arbitration shall be English.
|
30.3
|
Without prejudice to the above, any legal proceedings howsoever connected with this Agreement that cannot be submitted to arbitration shall be subject to the exclusive jurisdiction of the Court of Milan, Italy.
|
Signed for and on behalf of
SHILOH HOLDINGS NETHERLANDS B.V.
, by
|
|
/s/ H. D. de Rijk
|
|
|
Authorised Signatory H. D. de Rijk
|
|
|
/s/ Kenton M. Bednarz
|
|
|
Authorised Signatory Kenton M Bednarz
|
Signed for and on behalf of
BRABANT ALUCAST SERVICES B.V.
by
|
|
/s/ Jamie Brundell
|
|
|
Name: Jamie Brundell
Title: CEO
|
|
|
/s/ Hans Vorstenbosch
|
|
|
Name: Hans Vorstenbosch
Title: Managing Director
|
Signed for and on behalf of
SHILOH HOLDINGS NETHERLANDS B.V.
, by
|
|
/s/ H. D. de Rijk
|
|
|
Name: H. D. de Rijk
Title: managing director A
|
|
|
/s/ Kenton M. Bednarz
|
|
|
Name: K. M. Bednarz
Title: managing director B
|
1.
|
I have reviewed this
quarterly
report on Form
10-Q
of Shiloh Industries, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statement for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
/s/ Ramzi Hermiz
|
Ramzi Hermiz
President and Chief Executive Officer
|
1.
|
I have reviewed this
quarterly
report on Form
10-Q
of Shiloh Industries, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statement for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
/s/ W. Jay Potter
|
|
W. Jay Potter
Senior Vice President and Chief Financial Officer
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods expressed in the Report.
|
/s/ Ramzi Hermiz
|
|
Ramzi Hermiz
President and Chief Executive Officer
|
|
/s/ W. Jay Potter
|
W. Jay Potter
Senior Vice President and Chief Financial Officer
|