Exhibit 10.1
MASTER JOINT VENTURE AGREEMENT
BY AND BETWEEN
EVERGREEN SOLAR, INC.
AND
Q - CELLS AG
January 14, 2005
TABLE OF CONTENTS
PAGE
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ARTICLE 1 Interpretation............................................................................................. 1
1.1 Definitions........................................................................................ 1
1.2 Headings and Other Interpretation.................................................................. 8
1.3 Relation to Articles of Association................................................................ 9
1.4 German Legal Terms................................................................................. 9
ARTICLE 2 Purpose of, Organization of and Contributions to VentureCo................................................. 9
2.1 Purpose of the Joint Venture....................................................................... 9
2.2 Capital Increase of VentureCo...................................................................... 10
2.3 Subscription to Shares, Payment of Subscription Price.............................................. 10
2.4 Additional Capital Contributions................................................................... 10
2.5 Covenants with Respect to the Organization of and the Contributions to VentureCo................... 11
ARTICLE 3 Management and Operation of VentureCo...................................................................... 12
3.1 Management and Supervision of VentureCo............................................................ 12
3.2 Accounting Matters; Basic Financial Inspection Rights.............................................. 12
3.3 Other Financial Matters............................................................................ 13
3.4 Government Investment Grants....................................................................... 13
3.5 ▇▇▇▇▇▇▇▇-▇▇▇▇▇ and Nasdaq Covenant................................................................. 14
3.6 Capacity Expansion and Additional Financing........................................................ 14
3.7 Directors.......................................................................................... 16
3.8 Indemnification.................................................................................... 16
ARTICLE 4 Restrictions on Transfer; Right of First Refusal for Sale of Shares........................................ 17
4.1 Restrictions on Transfer; Exceptions............................................................... 17
4.2 Right to Notice.................................................................................... 17
4.3 Exercise of Right of First Refusal................................................................. 17
4.4 Right to Sell to Third Party....................................................................... 17
4.5 Reinstatement of Right of First Refusal............................................................ 18
4.6 Change of Control.................................................................................. 18
4.7 Relation to Articles of Association................................................................ 18
ARTICLE 5 Term and Termination....................................................................................... 18
5.1 Term............................................................................................... 18
5.2 Termination Due to Second Capital Contribution Condition End Date Failure.......................... 18
5.3 Termination by mutual consent...................................................................... 19
5.4 Termination for Breach............................................................................. 20
5.5 Termination after January 1, 2012.................................................................. 23
5.6 Termination in Case of Sale and Transfer........................................................... 23
5.7 Post-Termination Covenants......................................................................... 23
ARTICLE 6 Closing Conditions......................................................................................... 24
6.1 Conditions to Obligations of E..................................................................... 24
6.2 Conditions to the Obligations of Q................................................................. 24
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ARTICLE 7 Warranties................................................................................................. 24
7.1 Warranties of Q.................................................................................... 24
7.2 Warranties of E.................................................................................... 26
ARTICLE 8 Liability and Limitations of Liability..................................................................... 28
8.1 Q Liability........................................................................................ 28
8.2 E Liability........................................................................................ 28
8.3 Definitions........................................................................................ 28
8.4 Determination of the Amount of Damage.............................................................. 28
8.5 Limitations of Liability for Breach of Warranties.................................................. 29
8.6 General Limitation of Liability.................................................................... 29
ARTICLE 9 Additional Agreements...................................................................................... 29
9.1 Marketing.......................................................................................... 29
9.2 Q Manufacturing Right of First Refusal............................................................. 30
9.3 Q Ribbon Technology Restriction.................................................................... 31
9.4 Cooperation to Pursue Tax Efficiencies............................................................. 32
9.5 Confidentiality.................................................................................... 32
9.6 Reasonable Efforts................................................................................. 33
9.7 Standstill......................................................................................... 33
9.8 Employee Matters................................................................................... 34
9.9 Covenant Regarding Service Agreements.............................................................. 34
ARTICLE 10 Miscellaneous............................................................................................. 35
10.1 Expenses........................................................................................... 35
10.2 Further Assurances................................................................................. 35
10.3 Notices............................................................................................ 35
10.4 Governing Law and Dispute Resolution............................................................... 36
10.5 Binding Effect..................................................................................... 36
10.6 Assignment......................................................................................... 36
10.7 No Third Party Beneficiaries....................................................................... 37
10.8 Foreign Corrupt Practices Act...................................................................... 37
10.9 Amendment, Waivers................................................................................. 37
10.10 Entire Agreement................................................................................... 37
10.11 No Joint Venture or Partnership.................................................................... 37
10.12 Language for Joint Venture and this Agreement...................................................... 38
10.13 Voting and other rights............................................................................ 38
10.14 Severability....................................................................................... 38
EXHIBITS
Exhibit A Articles of Association
Exhibit A-1 Certified German Translation of Articles of Association
Exhibit B E License Agreement
Exhibit C Q License Agreement
SCHEDULES
Schedule 3.6 [*]
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[*] This provision is the subject of a Confidential Treatment Request.
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MASTER JOINT VENTURE AGREEMENT
This Master Joint Venture Agreement (the "AGREEMENT") is made and entered
into as of the 14th day of January, 2005, by and between Evergreen Solar, Inc.,
a Delaware corporation with its principal executive offices located at ▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ("E") and Q-Cells AG, a stock
corporation organized under the laws of Germany with its principal executive
offices located at ▇▇▇▇▇▇▇▇▇▇▇. ▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ("Q"). Capitalized
terms used herein shall have the meaning ascribed to them in SECTION 1.1.
RECITALS
WHEREAS, E and Q are each engaged in the manufacture and distribution of
solar products;
WHEREAS, E has unique and proprietary string ribbon wafer manufacturing
technology that enables E to manufacture crystalline silicon wafers at reduced
costs, and unique and proprietary manufacturing technology that enables E to
efficiently process such wafers into photovoltaic cells and modules;
WHEREAS, Q has developed unique and proprietary technology for the
manufacture of high-performance, multi- and mono-crystalline silicon solar cells
based on wafers purchased from third parties, is currently engaged in the
commercial manufacture and sale of such cells and has proven capability to
rapidly expand its production capacity; and
WHEREAS, the Parties believe that it is in their mutual best interest to
establish an independent company, in which they would each invest, to own and
operate a facility in Germany to manufacture crystalline silicon wafers and
photovoltaic cells and modules incorporating such wafers based on the
combination of their respective technologies and expertise.
WHEREAS, prior to the date hereof, Q has acquired a limited liability
company (GmbH) with the corporate name TOPAS 107 V.V. GmbH, incorporated under
the laws of the Federal Republic of Germany whose registered office is at Berlin
(registered under HRB 94629 B at the local court - Amtsgericht - of
Berlin-Charlottenburg). Q shall cause this shelf-company to become VentureCo
("VENTURECO") which shall be named, if possible, "EverQ GmbH."
NOW, THEREFORE, in consideration of the mutual promises, covenants,
representations, warranties and indemnities made herein and of the mutual
benefits to be derived herefrom, and for other good and valuable consideration
(the receipt and adequacy of which are hereby acknowledged), the Parties hereto
agree as follows:
ARTICLE 1
INTERPRETATION
1.1 Definitions. For the purposes of this Agreement, capitalized terms
used herein shall have the respective meanings assigned thereto in this SECTION
1.1.
"ACQUISITION PROPOSAL" has the meaning assigned in SECTION 4.2.
"ACQUISITION PROPOSAL NOTICE" has the meaning assigned in SECTION
4.2.
"ACT" has the meaning assigned in SECTION 10.8.
"ACTION" means any claim, action, suit or arbitration, as well as
any inquiry, proceeding or investigation by or before any Governmental
Authority.
"ADDITIONAL CONTRIBUTIONS" has the meaning set forth in SECTION 2.4.
"AFFILIATE" means any Person directly or indirectly controlling or
controlled by, or under direct or indirect common control with, a Party at the
relevant time. For the purposes of this definition, "control" means the
beneficial ownership of more than fifty percent (50%) of the voting rights.
"AGGREGATE EQUITY FUNDING" means the E Equity Commitment plus the Q
Equity Commitment, in total EUR 44,176,707.00, less any Debt Financing.
"ALTERNATIVE FUNDING" means funding other than the Government
Investment Grant Approval and the Equity Commitments in an amount sufficient to
offset a Government Investment Grant Shortfall, whether in the form of funding
from one or more of the Parties, Third Parties, or from other local, state or
federal government or EU entities or otherwise, or any combination of the
foregoing.
"ALTERNATIVE VENTURE" means a [*].
"ANNUAL PLAN" shall mean an annual business and operations plan as
determined by the Supervisory Board.
"ARBITRATOR" has the meaning assigned in SECTION 5.4 (C)(II)(3).
"ARTICLES OF ASSOCIATION" means the Articles of Association
(Gesellschaftsvertrag) of VentureCo set forth as EXHIBIT A (a certified copy of
an German translation which is set forth in EXHIBIT A-1), together with any
amendments thereto approved by the Parties. Should there be a discrepancy
between the German and the English versions of the Articles, the English version
shall prevail and the Parties shall amend the German version of the Articles to
reflect the meaning of the English version.
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[*] This provision is the subject of a Confidential Treatment Request.
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"BANKRUPTCY EVENT" means, with respect to
(1) E:
a) such Party commencing a voluntary case or other
proceeding, or an involuntary case or other proceeding being commenced against
such Party and remaining undismissed and unstayed for a period of [*], in either
case seeking liquidation, reorganization or other relief with respect to such
Party or its debts under any applicable bankruptcy, reorganization, composition,
insolvency or other similar law now or hereafter in effect or seeking the
appointment of a trustee, receiver, liquidator, custodian or other similar
official of such Party or any substantial part of its property;
b) such Party consenting to any such relief or to the
appointment of or taking possession by any such official in an involuntary case
or other proceeding commenced against it;
c) such Party admitting in writing its inability to
pay its debts generally as they become due or generally failing to pay such
debts as they become due or becoming subject to disposition of a clearing-house
to suspend transactions; or
d) such Party making or consenting to any assignment
of any material portion of its assets for the benefit of creditors.
(2) Q:
a) such Party filing for insolvency, or an
involuntary filing for insolvency being commenced against such Party and
remaining undismissed and unstayed for a period of [*], or
b) such Party admitting in writing its inability to
pay its debts generally as they become due or generally failing to pay such
debts as they become due.
"BREACHING PARTY" has the meaning assigned in SECTION 5.4.
"BUSINESS DAY" means any day on which financial institutions are
generally open and available for business, and which is not otherwise a holiday,
in both the German state of Saxony-Anhalt and the US state of Massachusetts.
"CAPACITY EXPANSION" has the meaning assigned in SECTION 3.6.
"CELL" means a crystalline silicon material substrate that has been
processed to provide electrical output from incident sunlight.
"CHANGE OF CONTROL" means with respect to any entity, the
acquisition of such entity by another Person by means of any transaction or
series of related transactions (including, without limitation, any share
acquisition, sale of all or substantially all of the assets, reorganization,
merger or consolidation, but excluding any sale of shares for capital raising
purposes) other than a transaction or series of transactions in which the
holders of the voting securities of such entity outstanding immediately prior to
such transaction continue to retain
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[*] This provision is the subject of a Confidential Treatment Request.
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(either by such voting securities remaining outstanding or by such voting
securities being converted into voting securities of the surviving entity), as a
result of shares in such entity held by such holders prior to such transaction,
more than 50% of the total voting power represented by the voting securities of
such entity or such surviving entity outstanding immediately after such
transaction or series of transactions.
"CLOSING CONDITIONS" has the meaning assigned in SECTION 6.1 AND
6.2.
"CLOSING DATE" means the day on which fulfillment or waiver of all
Closing conditions has occurred (and which the Parties agree is the Signing
Date).
"CONCURRENT AGREEMENTS" means the Services Agreements and the
License Agreements.
"CONFIDENTIAL INFORMATION" has the meaning assigned in SECTION 9.5.
"DEBT FINANCING" means the amount of any debt financing incurred by
VentureCo to finance the operations and capital expenditures of VentureCo which
E and Q mutually agree should reduce the Equity Commitments.
"DIRECTOR" means a member of the Supervisory Board
(Aufsichtsratsmitglied) of VentureCo.
"DISCLOSING PARTY" has the meaning assigned in SECTION 9.5(A).
"DISTRIBUTION" means the transfer of cash or other property whether
by way of dividend or otherwise to one or more of the Shareholders, or the
purchase or redemption of Shares for cash or other property.
"E EQUITY COMMITMENT" means EUR 33,176,707.00, less the E Percentage
of any Debt Financing.
"EU" means European Union.
"E FIRST REFUSAL NOTICE" has the meaning assigned in SECTION 9.2(B).
"ELECTION NOTICE" has the meaning assigned in SECTION 4.3.
"E LICENSE AGREEMENT" means the License & Technology Transfer
Agreement between E and VentureCo as set forth in EXHIBIT B.
"E PERCENTAGE" means 75.1%, subject to adjustment as provided in
SECTION 2.4, 3.6 AND 5.4 (L).
"E SERVICES AGREEMENT" means the Master Outsourced Services
Agreement by and between E and VentureCo, to be entered into within thirty (30)
days of the Signing Date.
"EQUITY COMMITMENTS" MEANS THE E EQUITY COMMITMENT AND THE Q EQUITY
COMMITMENT.
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"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
"FAIR MARKET VALUE" has the meaning assigned in SECTION 5.4(C).
"FREE CASH" means, as of any date of determination, the amount of
liquid net assets held in cash and other liquid, short-term investment
instruments in excess of the amount which is sufficient to fund the operations
and investments of VentureCo for the following [*] period according to
VentureCo's then-current budget projections.
"GOVERNMENT INVESTMENT GRANT APPROVAL" means that the grant
authority of the state of Saxony-Anhalt (Investitionsbank Sachsen-Anhalt) has
issued in writing an approval of GA grants (Zuwendungsbescheid uber GA-Mittel)
which, together with the investment allowance (Investitionszulage) VentureCo is
entitled to, amounts to at least EUR 24,000,000.00. The approval of GA grants
may be subject to customary conditions and obligations.
"GOVERNMENT INVESTMENT GRANT" means GA-grants (GA-Mittel; Mittel aus
dem Programm "Gemeinschaftsaufgabe Aufbau Neue Laender")
"GOVERNMENT INVESTMENT GRANT SHORTFALL" means the amount by which a
Government Investment Grant Approval which, together with the investment
allowance (Investitionszulage) VentureCo is entitled to, amounts to less than
EUR 24,000,000.00.
"GOVERNMENTAL AUTHORITY" means any US or German, federal, national,
supranational, state, provincial, municipal, local, or similar government,
governmental, regulatory or administrative authority, agency or commission or
any court, tribunal, or judicial or arbitral body.
"GOVERNMENTAL ORDER" means any order, writ, judgment, injunction,
decree, stipulation, determination or award entered by or with any Governmental
Authority.
"GRANT IMPUNITY NOTICE" has the meaning assigned in SECTION 3.6
(C)(I).
"INDEMNIFIABLE CLAIMS" has the meaning assigned in SECTION 8.3.
"INDEMNIFIED PARTY" has the meaning assigned in SECTION 8.3.
"INDEMNIFYING PARTY" has the meaning assigned in SECTION 8.3.
"INITIAL CAPACITY" has the meaning assigned in SECTION 3.6 (A).
"INITIAL CAPITAL CONTRIBUTION" has the meaning assigned in SECTION
2.4.
"KNOWLEDGE" shall mean, with respect to a Party, the actual
knowledge of its officers and the members of the Board of Directors or
Supervisory Board of such Party, provided that such persons shall have made
reasonable inquiry of those employees and consultants, as the case may be, whom
such officers or members of the Board of Directors or the Supervisory Board
reasonably believe would have actual knowledge of the matters represented.
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[*] This provision is the subject of a Confidential Treatment Request.
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"LAW" means any US or German, federal, national, supranational,
state, provincial, municipal, local or similar statute, law, ordinance,
regulation, rule, code, order, requirement or rule of law.
"LIABILITIES" means any and all indebtedness or other liabilities
and obligations, whether accrued or fixed, absolute or contingent, matured or
unmatured or determined or determinable, including those arising under any Law,
Action, Governmental Order and those arising under any contract, agreement,
arrangement, commitment or undertaking.
"LICENSE AGREEMENTS" means the E License Agreement and the Q License
Agreement.
"MANAGEMENT BOARD" shall mean the Management Board of Directors
(Geschaeftsfuerung) of VentureCo.
"MATERIAL BREACH" has the meaning assigned in SECTION 5.4.
"MODULE" means an assembly of multiple, electrically connected
Cells.
"NEGOTIATION PERIOD" has the meaning assigned in SECTION 4.3
"NON-SELLING PARTY" has the meaning assigned in SECTION 4.2.
"PARTIES" means the parties to this Agreement, from time to time,
and a "PARTY" shall mean either E or Q, as applicable.
"PERCENTAGE INTERESTS" means the E Percentage and the Q Percentage.
"PERSON" means any natural person, firm, partnership, association,
corporation, company, trust, business trust, governmental authority or other
entity.
"Q CONFIRMATION NOTICE" has the meaning assigned in SECTION 9.2(B).
"Q EQUITY COMMITMENT" means EUR 11,000,000.00, less the Q Percentage
of any Debt Financing.
"Q LICENSE AGREEMENT" means the License & Technology Transfer
Agreement between Q and VentureCo as set forth in EXHIBIT C.
"Q PERCENTAGE" means 24.9%, subject to adjustment as provided in
SECTION 2.4, 3.6 AND 5.4 (L).
"Q PREFERENTIAL OFFER" has the meaning assigned in SECTION 3.6 (C).
[*]
"Q SERVICES AGREEMENT" means the Master Outsourced Services
Agreement between Q and VentureCo, to be entered into within thirty (30) days of
the Signing Date.
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[*] This provision is the subject of a Confidential Treatment Request.
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"RECAPITALIZATION" means any stock dividend, stock split,
combination of shares, reorganization, recapitalization, reclassification or
other similar event.
"RECEIVING PARTY" has the meaning assigned in SECTION 9.5(A).
"RIBBON TECHNOLOGY" means a technique in which a thin sheet of
silicon, typically polycrystalline silicon, is grown directly from molten
silicon. The sheet is generally grown in a vertical orientation without the use
of foreign substrate on which the silicon is formed, although some processes
grow the silicon in a horizontal direction and can use a substrate on which the
silicon is formed.
"SALE PERIOD" has the meaning assigned in SECTION 4.4.
"SECOND CAPITAL CONTRIBUTION" has the meaning assigned in SECTION
2.4 (B).
"SECOND CAPITAL CONTRIBUTION CONDITIONS" has the meaning assigned in
SECTION 2.4 (B).
"SECOND CAPITAL CONTRIBUTION DATE" has the meaning assigned in
SECTION 2.4 (B).
"SECOND CAPITAL CONTRIBUTION CONDITION END DATE" means September 30,
2005 or such other later date as the Parties may mutually agree.
"SECOND CAPITAL CONTRIBUTION CONDITION END DATE FAILURE" means the
failure of the Parties to satisfy the Second Capital Contribution Conditions
prior to September 30, 2005.
"SECURITIES ACT" means the Securities Act of 1934, as amended.
"SELLING PARTY" has the meaning assigned in SECTION 4.2.
"SERVICES AGREEMENTS" means the E Services Agreement and the Q
Services Agreement.
"SHAREHOLDER" means each of E and Q and their respective Affiliates.
"SHARES" means shares of VentureCo equity securities or securities
convertible or exchangeable into VentureCo equity securities.
"SIGNING DATE" means the date hereof.
"STRING RIBBON TECHNOLOGY" means [*].
"SUBJECT SHARES" has the meaning assigned in SECTION 4.2.
"SUBSCRIPTION PRICE" has the meaning assigned in SECTION 2.3.
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[*] This provision is the subject of a Confidential Treatment Request.
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"SUPERVISORY BOARD" means the Supervisory Board of Directors
(Aufsichtsrat) of VentureCo.
"TAX" or, collectively, "TAXES" means any and all German, United
States, provincial, state, local and other taxes, assessments and other
governmental charges, duties, impositions and liabilities, including taxes based
upon or measured by gross receipts, income, profits, sales, use and occupation,
and value added, ad valorem, transfer, franchise, withholding, payroll,
recapture, employment, excise and property taxes, together with all interest,
penalties and additions imposed with respect to such amounts, and any
obligations with respect to such amounts arising as a result of being a member
of an affiliated, consolidated, combined or unitary group for any period or
under any agreements or arrangements with any other Person and including any
liability for taxes of a predecessor or transferor entity.
"TERMINATING PARTY" has the meanings assigned in ARTICLE 5, as
applicable.
"TERMINATION CALL RIGHT" has the meanings assigned in SECTION 5.4
(D) AND SECTION 5.5 (B), as applicable.
"TERMINATION SECURITIES" has the meaning assigned in SECTION 5.4(C).
"THIRD CAPITAL CONTRIBUTION DATE" has the meaning assigned in
SECTION 2.4 (C).
"THIRD CAPITAL CONTRIBUTION" has the meaning assigned in SECTION 2.4
(C).
"THIRD PARTY" means a Person who is not a Party and who is not an
Affiliate of a Party.
"TRANSFER" has the meaning assigned in SECTION 4.1.
"UNFUNDED PARTY" has the meaning assigned in SECTION 5.2.
"US GAAP" means the generally accepted accounting principles in the
United States.
"VENTURECO" has the meaning assigned in the RECITALS.
"WAFER" means a crystalline silicon material substrate that is
intended to but has not yet been made into a Cell.
"5% SHAREHOLDERS" has the meaning assigned in SECTION 3.6 (C)(IV).
1.2 Headings and Other Interpretation. In this Agreement (a) headings
are for convenience of reference only and shall not affect the interpretation of
the provisions of this Agreement except to the extent that the context otherwise
requires; (b) words importing the singular shall include the plural and vice
versa; (c) words denoting individuals shall include any form of entity and vice
versa; (d) words denoting any gender shall include all genders; (e) where any
act, matter or thing is required by this Agreement to be performed or carried
out on a certain day and that day is not a Business Day then that act, matter or
thing shall be carried out or performed on the next following Business Day; (f)
unless specified otherwise, any reference
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herein to any Article, Section, clause, sub-article, sub-clause, Appendix or
Exhibit shall be deemed to be a reference to an Article, Section, clause,
sub-article, sub-clause, Appendix or Exhibit of this Agreement; (g) any
reference to any agreement, document or instrument shall refer to such
agreement, document or instrument as amended, modified, supplemented, or
novated; and (h) the words "include," "including" and the derivations thereof
shall not be limiting.
1.3 Relation to Articles of Association. In the event that this
Agreement and the Articles of Association of VentureCo should differ in one or
several aspects, in the internal relation between E and Q this Agreement shall
supersede the Articles of Association as far as this is legally admissible. E
and Q hereby undertake that they shall cooperate with respect to the adjustment
of VentureCo's Articles of Association in accordance with this Agreement. The
Parties shall whenever necessary exercise all voting and other rights and powers
available to them to procure the alteration of the Articles of Association to
the extent necessary to permit VentureCo and its affairs to be carried out as
provided in this Agreement. For the avoidance of doubt, the Articles of
Association of VentureCo do not conflict and are not to be treated as
conflicting with any provision of this Agreement by which the Parties agree to
procure that anything be or be not done. Subject as aforesaid, the Parties
hereby undertake to each other to observe and perform the provisions of the
Articles of Association of the Company.
1.4 German Legal Terms. In case of doubt of the meaning of German legal
terms, the German words written in brackets and italics shall be definitive.
ARTICLE 2
PURPOSE OF, ORGANIZATION OF AND CONTRIBUTIONS TO VENTURECO
2.1 Purpose of the Joint Venture. The purpose of VentureCo shall be the
manufacturing and marketing of String Ribbon based photovoltaic products.
VentureCo shall, in principle, be a manufacturing company designed to exploit
the combined strengths of E and Q. The parties intend that VentureCo shall:
(a) manufacture Wafers using E's String Ribbon Technology;
(b) process such Wafers into Cells using a fabrication process
that combines each Parties' Cell manufacturing technologies;
(c) assemble Cells into Modules;
(d) conduct specific manufacturing and product technology-oriented
development work required to optimize its activities;
(e) conduct all other activities necessary to the manufacture,
test and sale of such solar products with an initial focus on the manufacture,
sale and distribution of Modules; and
(f) in connection with the foregoing activities, subcontract or
outsource to E and/or Q those functions that E and/or Q is able to perform more
efficiently than the VentureCo.
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2.2 Capital Increase of VentureCo. On the Signing Date, subject to the
requirements of this Article 2, Q shall immediately after the signing of this
Agreement resolve an increase of the share capital (Stammkapital) of VentureCo
from EUR 25,000.00 by EUR 225,000.00 to EUR 250,000.00 by issuing new shares by
way of a capital increase in cash ("CAPITAL INCREASE"). The shareholder
resolution shall provide that : (i) E shall have the right to subscribe to a new
share in the nominal amount of EUR 187,750.00 and (ii) Q shall have the right to
subscribe to a new share in the nominal amount of EUR 37,250.00, bringing the
total of Q's shares in VentureCo to EUR 62,250.00. The new shares shall be
entitled to participate in the distribution of profits of VentureCo, if any, as
of the beginning of the business year 2005 of VentureCo.
2.3 Subscription to Shares, Payment of Subscription Price. Subject to
the condition precedent that the Closing Conditions laid down in ARTICLE 6 are
met, (i) E and Q shall on the Signing Date subscribe to their respective new
shares at nominal value ("SUBSCRIPTION PRICE") and (ii) the Subscription Price
for the new shares shall be paid by E and Q respectively in EUR by wire transfer
of immediately available funds on the Closing Date to a special account of
VentureCo with respect to the Capital Increase (Kapitalerhoehungssonderkonto),
provided by VentureCo to E and Q. E and Q shall cause VentureCo to maintain the
funds received on such special account until the Capital Increase has been
registered with the commercial register of VentureCo.
2.4 Additional Capital Contributions. In addition to the Subscription
Price and subject to the condition precedent that the Closing Conditions laid
down in ARTICLE 6 are met, E and Q shall make further contributions (andere
Zuzahlungen) to the capital reserves of VentureCo (sonstige Ruecklagen; pursuant
to Section 272 para. 2 no. 4 German Commercial Code, Handelsgesetzbuch)
("ADDITIONAL CONTRIBUTIONS"). Subject to the provisions contained in this
Agreement, the payment of the Additional Contributions will be effected by E and
Q in accordance with the following provisions:
(a) Initial Capital Contribution. On the Closing Date (or if not
possible on the Closing Date, on the next Business Day after the Closing Date),
E and Q shall contribute an aggregate of EUR 1,750,000.00, of which EUR
1,314,250.00 shall be contributed by E and EUR 435,750.00 shall be contributed
by Q (the "INITIAL CAPITAL CONTRIBUTION").
(b) Second Capital Contribution.
(i) Upon the date that is five (5) Business Days following
the achievement of the Second Capital Contribution Conditions (the "SECOND
CAPITAL CONTRIBUTION DATE"), E and Q shall (subject to SECTION 2.5 (C))
contribute an amount equal to one-half (50%) of their respective Equity
Commitments, less the Subscription Price, and, in the case of Q, less EUR
25,000, and less the Initial Capital Contributions made by them, respectively,
prior to such date (the "SECOND CAPITAL CONTRIBUTION"), i.e., in the case of E,
EUR 15,086,353.50, and, in the case of Q, EUR 5,002,000.00.
(ii) For the purposes of this Agreement, "SECOND CAPITAL
CONTRIBUTION CONDITIONS" means (A) receipt by VentureCo of the Government
Investment Grant Approval and (B) the financial ability of E and Q to fund to
VentureCo their respective Second Capital Contributions.
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(iii) If there is a Government Investment Grant Shortfall,
condition (A) in SECTION 2.4 (B)(II) is deemed met if and only if the Parties
obtain a written agreement with respect to obtaining Alternative Funding.
(iv) For the avoidance of doubt, the Parties are not
obligated to contribute funds in excess of their respective Equity Commitment;
provided, however, that one or more of the Parties may contribute additional
funds (in addition to its Equity Commitment) in satisfaction of the Alternative
Funding; provided further that the Parties shall first use reasonable best
efforts to obtain such Alternative Funding from one or more Third Parties (but
not competitors of either Party, in the reasonable good-faith determination of
the Parties), local, state or federal or EU entities (or any combination
thereof) and if the Parties fail to obtain such Alternative Funding from such
Persons within sixty (60) days of the date of the Government Investment Grant
Approval, then VentureCo shall offer to the Parties pro rata to their
shareholdings the right to provide to VentureCo the Alternative Funding. If the
Alternative Funding is provided in the form of equity, the subscription price
(including all further contributions (andere Zuzahlungen) to the capital
reserves of VentureCo (sonstige Ruecklagen; pursuant to Section 272 para. 2 no.
4 German Commercial Code, Handelsgesetzbuch)) per 1% of VentureCo may not be
below the subscription price (including all Additional Contributions) per 1% of
VentureCo as provided for by this Agreement. If one of the Parties does not
exercise the corresponding subscription rights in full within thirty (30) days
of the date that such subscription rights were offered to such Party, the
remainder of the subscription rights shall be offered to the 5% Shareholders (as
defined in SECTION 3.6(C)(IV)) of such Party. If such 5% Shareholders do not
exercise the corresponding subscription rights, in full, within thirty (30) days
of the date that such subscription rights were offered to such 5% Shareholders,
the remainder of the subscription rights shall be offered to the other Party.
The Percentage Interests shall be appropriately and correspondingly adjusted in
connection with any purchase by a Party of VentureCo equity securities pursuant
to this SECTION 2.4(B)(IV). For the avoidance of doubt, SECTION 3.6(C)shall not
apply to any purchase of VentureCo securities pursuant to this SECTION
2.4(B)(IV).
(v) If the Second Capital Contribution Conditions are not
met by the Second Capital Contribution Condition End Date, Section 5.2 shall
apply.
(c) Third Capital Contribution. No later than 120 days (unless
otherwise agreed between the Parties) following the Second Capital Contribution
Date (the "THIRD CAPITAL CONTRIBUTION DATE"), E and Q shall contribute their
respective Equity Commitments minus their respective equity payments previously
contributed pursuant to this ARTICLE 2 (the "THIRD CAPITAL CONTRIBUTION").
Calculation Examples: If there is no Debt Financing, E shall contribute EUR
16,588,353.50 and Q shall contribute EUR 5,500,000.00 under this SECTION 2.4.
(C). If the Debt Financing amounts to EUR 2,000,000.00, the contributions under
this SECTION 2.4. (C) shall be reduced, in the case of E, by EUR 1,502,000.00
and, in the case of Q, by EUR 498,000.00.
2.5 Covenants with Respect to the Organization of and the Contributions
to VentureCo.
(a) Notwithstanding the foregoing, E and Q shall make and they
shall cause VentureCo to make all necessary and appropriate statements and do
all necessary and appropriate acts to effectuate the Additional Contributions,
including approving any required capital increase in VentureCo and adopting any
required amendments to the Articles of Association. In
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particular, E and Q shall cause VentureCo to file for registration of any
required capital increase and the adoption of amended Articles of Association
immediately after the respective Subscription Prices have been paid to a special
account of VentureCo (Kapitalerhoehungssonderkonto).
(b) Each Additional Capital Contribution shall be paid in EUR by
wire transfer of immediately available funds to a special account of VentureCo
designated to E and Q by VentureCo in writing.
(c) The Parties shall use reasonable best efforts to obtain the
Government Investment Grant Approval as soon as reasonably practicable following
the Closing Date, including, but not limited to, making changes to the overall
structure of the joint venture, this Agreement, the shareholdings in VentureCo,
the Articles of Association and the Concurrent Agreements in order to ensure
that the maximum amount of Government Investment Grants available for small and
medium size enterprises will be secured by VentureCo; and to obtain the funds
necessary to fund to VentureCo the amounts specified in SECTION 2.4 (B) AND 2.4
(C) when due. In the event of a Government Investment Grant Shortfall, (i)
neither Party shall be obliged to contribute further capital or funds to
VentureCo unless and until they have obtained Alternative Funding prior to the
Second Capital Contribution Condition End Date; and (ii) the Parties shall
cooperate and use their respective reasonable best efforts to obtain such
Alternative Funding, as soon as practicable but in any event prior to the Second
Capital Contribution End Date.
ARTICLE 3
MANAGEMENT AND OPERATION OF VENTURECO
3.1 Management and Supervision of VentureCo . The Parties shall cause
VentureCo to be managed and supervised in accordance with the provisions of the
Articles of Association. In particular, unless otherwise specifically agreed to
by the Parties, the Parties shall cause specific duties and powers of the
Supervisory Board to be as set forth in the Articles of Association. Subject to
Section 1.3, the Parties shall not take any action in contravention of the
Articles of Association.
3.2 Accounting Matters; Basic Financial Inspection Rights.
(a) Basic Accounting Matters. (i) The Parties shall cause
VentureCo to (i) establish its annual accounts and report its annual results in
accordance with the applicable corporate laws of the Federal Republic of
Germany, aiming at the optimization of tax benefits of the Shareholders and (ii)
make adjustments to its accounts to reflect its financial position and results
of operations in accordance with both U.S. GAAP and IFRS.
(ii) The Parties shall cause VentureCo to keep books and
records reflecting all its respective transactions, complete and accurate in all
material respects.
(iii) The Parties shall cause the fiscal year of VentureCo to
commence on January 1 and end on December 31.
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(b) Basic Financial Information. The Parties shall cause VentureCo
to furnish the following reports to each of E and Q:
(i) As soon as practicable after the end of each fiscal year
of VentureCo, and in any event within sixty (60) days after the end of each
fiscal year of VentureCo, an audited consolidated balance sheet of VentureCo as
at the end of such fiscal year, and consolidated statements of income and cash
flows of VentureCo for such year, prepared in accordance with German GAAP (HGB),
US GAAP and IFRS consistently applied.
(ii) As soon as practicable after the end of the first,
second and third quarterly accounting periods in each fiscal year of VentureCo,
and in any event within thirty (30) days after the end of the first, second, and
third quarterly accounting periods in each fiscal year of VentureCo, an
unaudited consolidated balance sheet of VentureCo as of the end of each such
quarterly period, and unaudited consolidated statements of income and cash flows
of VentureCo for such period, prepared in accordance with German GAAP (HGB), US
GAAP and IFRS consistently applied, subject to changes resulting from normal
year-end audit adjustments.
(iii) Such other information relating to the financial
condition, business, prospects or corporate affairs of VentureCo as E or Q may
from time to time reasonably request.
(c) Basic Financial Inspection Rights. During the regular office
hours of VentureCo, and upon twenty-four (24) hours' notice to VentureCo, E and
Q shall have (i) full access to all properties, books of account and records of
VentureCo, and (ii) the right to make copies from such books and records at
their own expense. Notwithstanding the foregoing, each Party will be entitled to
any inspection rights granted under German law.
3.3 Other Financial Matters.
(a) Annual Plan. The Parties shall cause the Management Board of
VentureCo to prepare, and the Supervisory Board to consider and approve, an
Annual Plan with respect to each fiscal year of VentureCo no later than thirty
(30) days prior to the commencement of each fiscal year; provided, however, that
the initial Annual Plan shall be presented, considered and approved as promptly
as practicable after the Signing Date but in no event later than March 31, 2005
and shall cover the period from the Signing Date until the end of 2005.
(b) Dividend Policy. The shareholders' meeting may declare and pay
Distributions with the approval of a majority of the votes; provided, however,
the Parties shall take all actions necessary to cause VentureCo to require
unanimous approval of the shareholders prior to any Distribution (i) declared at
any time that Free Cash does not exist, (ii) if such Distribution shall cause
Free Cash not to exist immediately following such Distribution, or (iii) other
than in a manner proportionate to the respective ownership interests of the
equity securities of VentureCo regardless of whether Free Cash exists.
3.4 Government Investment Grants. The Parties shall cause VentureCo to:
(a) use reasonable best efforts to cooperate with E and Q and take all such
actions as may be necessary or appropriate in conjunction with enabling
VentureCo to qualify for the Government Investment Grants; (b) use reasonable
best efforts to obtain the Government Investment Grants; (c) to the extent
practicable, arrange for the attendance of one or more representatives of both E
and Q to
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attend any meeting with any governmental agency or other Person or body
pertaining to the Governmental Investment Grants; (d) provide both E and Q with
copies of any written correspondence (including English translations thereof)
from any governmental agency or other body pertaining to the Government
Investment Grants within two (2) Business Days of receipt thereof; and (e)
provide both E and Q with copies of any proposed correspondence (including
English translations thereof) to any governmental agency or other body
pertaining to the Government Investment Grant no less than five (5) Business
Days prior to the mail or delivery of such correspondence to such governmental
agency or other body and use reasonable best efforts to incorporate the comments
of both E and Q into such correspondence prior to such mail or delivery.
3.5 ▇▇▇▇▇▇▇▇-▇▇▇▇▇ and Nasdaq Covenant. The Parties shall cause
VentureCo to perform such acts as E shall request as reasonably necessary or
advisable to permit E to comply with all Laws and regulations applicable to U.S.
companies in general and U.S publicly reporting companies, in particular,
including but not limited to: (i) the Exchange Act and the Securities Act and
the rules of the SEC promulgated thereunder; (ii) the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002
and the rules and regulations of the SEC promulgated thereunder; (iii) the
Nasdaq Marketplace Rules. Without limiting the foregoing, the Parties shall
cause VentureCo to establish, maintain, adhere to and enforce a system of
internal accounting controls which are effective in providing assurance
regarding the reliability of financial reporting and the preparation of
financial statements in accordance with US GAAP.
3.6 Capacity Expansion and Additional Financing.
(a) It is the intent of the Parties that VentureCo shall have an
initial capacity to manufacture 30MW per year (the "INITIAL CAPACITY"). The
Parties shall use reasonable best efforts to cause VentureCo to achieve the
Initial Capacity as soon as practicable. It is also the intent of the Parties
that VentureCo shall in the long-term, if economically viable, expand its
manufacturing capacity to 120 MW (the "CAPACITY EXPANSION"). Without limiting
the foregoing, each of the Parties shall, and shall cause VentureCo to, approve
the Capacity Expansion, if economically viable, and commence substantial
activities in furtherance of the Capacity Expansion within [*] of the Closing
Date.
(b) In the event that at least one Director designated to the
Supervisory Board by a Party fails to approve a Capacity Expansion following a
determination by at least a majority of the Supervisory Board that the Capacity
Expansion is in the best interest of VentureCo, the Parties shall negotiate in
good faith a resolution of the dispute pertaining to the Capacity Expansion.
(c) Additional Financing. If, be it in relation to a Capacity
Expansion or otherwise, VentureCo requests in writing from both E and Q
additional financing in addition to the Aggregate Equity Funding or Alternative
Funding (an "ADDITIONAL FINANCING"), and the Shareholders approve the
corresponding capital increase in accordance with the Articles of Association
(an "ADDITIONAL FINANCING REQUEST"), the following shall apply:
(i) If it is possible under the applicable grant
regulations, as demonstrated by a written confirmation of the relevant grant
authority (the "GRANT IMPUNITY NOTICE"), that Q increases its ownership interest
in VentureCo to 50%, without such increase of
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Q's ownership interest in VentureCo possibly resulting in an application for
Government Investment Grants being turned down, in part or in full, or
Government Investment Grants already obtained being reclaimed, in part or in
full, by the competent authorities, then Q shall be offered in writing to
provide such amount of an Additional Financing to enable it to increase its
ownership interest in VentureCo to a level equal to (but not in excess of) the
percentage then held by E (the "Q PREFERENTIAL OFFER"). Unless otherwise agreed
to by the Parties, the price per EUR 2,500.00 nominal amount (as appropriately
adjusted for Recapitalizations) of VentureCo equity share (Stammeinlage)
purchased by Q in any financing transaction to be completed in accordance with
the terms of this SECTION 3.6(C)(I) shall be [*].
(ii) Within 90 days of receipt of the Grant Impunity Notice
and the Q Preferential Offer, Q shall be entitled to accept the Q Preferential
Offer by subscribing, in the form required by German law, to such number of
shares in VentureCo [*] as is needed for Q to obtain an ownership interest of
50% in VentureCo. If, within 90 days of receipt of the Grant Impunity Notice and
the Q Preferential Offer, Q has not accepted the Q Preferential Offer, then Q's
right to increase its ownership in VentureCo to 50% [*] shall terminate.
(iii) If at the time of an Additional Financing request the
Grant Impunity Notice cannot be obtained, the Parties shall enter into
discussions as to whether Q can participate in the Additional Financing to the
extent necessary to enable it to increase its ownership in VentureCo to 50%, as
provided herein, in a manner other than by share subscription.
(iv) Any capital increase of VentureCo [*] that is not the Q
Preferential Offer) shall be offered to the Parties pro rata to their
shareholdings. If one of the Parties does not exercise the corresponding
subscription rights in full within thirty (30) days of the date that such
subscription rights were offered to such Party, the remainder of the
subscription rights shall be offered to the shareholders of such Party who hold
at least 5% in the equity of such Party or 1% financial investors who are also
represented on the Board of such Party (or one or more entities affiliated with
such shareholders, the "5% SHAREHOLDERS"). If such 5% Shareholders do not
exercise the corresponding subscription rights in full within thirty (30) days
of the date that such subscription rights were offered to such 5% Shareholders,
the remainder of the subscription rights shall be offered to the other Party.
Should the Parties (together), along with the 5% Shareholders not fully
subscribe to the full amount of the capital increase, the subscription rights to
the remainder of the capital increase shall then be offered to third party
financial investors, but not to competitors of either Party (in the reasonable
good-faith determination by the Parties). The Percentage Interests shall
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be appropriately and correspondingly adjusted in connection with any
subscription by a Party of VentureCo equity securities pursuant to this SECTION
3.6(C)(IV).
(v) Without limiting the foregoing, if the Additional
Financing is of an amount that is insufficient to enable Q to increase its
ownership in VentureCo to 50%, as provided herein, and Q participates in such
Additional Financing to the full extent possible , then in connection with any
subsequent Additional Financing the Parties shall cause Q to be offered, in
writing, to provide such amount of the Additional Financing to enable Q to
increase its ownership in VentureCo to 50% (in accordance with the terms herein)
until such time as Q's ownership in VentureCo reaches 50%.
(vi) Except as otherwise specifically set forth in this
Agreement, the nature and material terms of any and all financing activities by
VentureCo (including the selection of lenders, if any) shall be determined by
the Supervisory Board and/or pursuant to a resolution adopted at a shareholder
meeting, as applicable under German law.
(d) No Additional Obligation. No Shareholder shall be required to
provide loan financing, equity contributions or any form of guarantee or credit
support for repayment for any funding obtained by VentureCo, above their
respective Equity Commitment. For the avoidance of doubt, the rules laid down in
SECTION 3.6 (C) do not oblige the Parties to provide additional funding to
VentureCo.
3.7 Directors. The Parties shall take all actions necessary to establish
the initial number of Directors designated to the Supervisory Board of VentureCo
at three (3) and cause E to have the right to nominate and appoint two (2)
Directors and Q to have the right to nominate and appoint one (1) Director. Each
Party shall cause each Director appointed by it to perform his duties as a
Director fully in compliance with the terms of this Agreement and the Articles
of Association. None of the Parties shall be excused from the performance of
this Agreement on account of the failure to control such Director nominated and
appointed by it. In any event of a change of the size or composition of the
Supervisory Board, the Parties shall take all actions necessary, including any
amendments of the Articles of Association, as far as legally admissible, to
ensure that E retains the right to appoint and revoke the majority of the
members of the Supervisory Board. Notwithstanding the foregoing, in the event
that Q shall obtain an ownership interest in VentureCo equal to that of E, the
Parties shall take all actions necessary, including an amendment of the Articles
of Association, to establish the number of Directors of VentureCo at five (5)
and for E to have the right to appoint two (2) Directors, and Q to have the
right to appoint two (2) Directors and Q and E to have the right to appoint one
(1) Director subject to the mutual approval of E and Q.
3.8 Indemnification. To the fullest extent permitted by German law, E
and Q shall cause VentureCo to indemnify and hold harmless each Director
designated to the Supervisory Board nominated by E and Q from all losses,
liabilities, costs and expenses arising out of or relating to such Director's
actions in connection with any action taken within their authority and in their
capacity as a Director, except to the extent that such losses, liabilities,
costs or expenses are caused by such Director's fraud, bad faith or willful
misconduct, and except to the extent that such Director's actions comprised or
caused breach of this Agreement by the Party who appointed that Director.
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ARTICLE 4
RESTRICTIONS ON TRANSFER; RIGHT OF FIRST REFUSAL FOR SALE OF SHARES
4.1 Restrictions on Transfer; Exceptions. Each of the Parties agrees
that it shall not, either directly or indirectly, sell, transfer or dispose of
("TRANSFER") any Shares during the term of this Agreement, without complying
with the terms of this ARTICLE 4; provided, however, that the foregoing
restrictions shall not apply to Transfers of shares or other equity interests of
VentureCo (i) by either Party to any Affiliate of such Party or (ii) from any
Affiliate of such Party to such Party or to any Affiliate of such Party,
provided always that the transferring Party remains, and the transferee of such
transferred Shares or equity interests agrees in the appropriate form to be,
bound by the terms of this Agreement to the same extent that the original
Parties are bound thereby. For the avoidance of doubt, a Change of Control in a
Party does not trigger the other Party's right of first refusal under this
SECTION 4.1.
4.2 Right to Notice. Other than those Transfers excepted under SECTION
4.1, prior to either Party proposing to Transfer any portion of the Shares held
by such Party (the "SUBJECT SHARES") to a Third Party (an "ACQUISITION
PROPOSAL"), the proposed transferring Party (the "SELLING PARTY") shall provide
to the other Party (the "NON-SELLING PARTY") written notice of the Acquisition
Proposal, which notice shall include a reasonable description of all material
terms and conditions of or related to the Acquisition Proposal (the "ACQUISITION
PROPOSAL NOTICE").
4.3 Exercise of Right of First Refusal. Following receipt of the
Acquisition Proposal Notice by the Non-Selling Party, the Non-Selling Party
shall have [*] to provide written notice to the Selling Party (the "ELECTION
NOTICE") that it intends to elect to exercise its right of first refusal. After
delivery of the Election Notice to the Selling Party, the Parties agree to
negotiate in good faith the terms and conditions under which the Non-Selling
Party would acquire all (but not less than all) of the Subject Shares at issue,
and the Non-Selling Party shall have a right of first refusal to purchase all
(but not less than all) of the Subject Shares on terms that:
(i) are reasonably equivalent to the terms set forth in the
Acquisition Proposal Notice, provided that the Non-Selling Party shall not have
any obligation to agree to any terms which are unique to such Third Party, or
(ii) are reasonably acceptable to the Selling Party.
The Parties agree that such good-faith negotiations will continue until the
earlier of (i) [*] from the date of delivery of the Election Notice or (ii) such
negotiations are terminated earlier by agreement between the Parties (the
"NEGOTIATION PERIOD"), during which period appropriate representatives of each
Party shall, in good faith, make themselves available to meet. During the
Negotiation Period, the Non-Selling Party shall be permitted to conduct
appropriate due diligence. Delivery of the Election Notice shall not obligate
the Non-Selling Party to purchase the Subject Shares, but shall be delivered in
good faith.
4.4 Right to Sell to Third Party. Subject to compliance with the
provisions hereof, including SECTION 4.3 and SECTION 4.5, if (i) the Non-Selling
Party fails to deliver an Election Notice within the time required, (ii) the
Non-Selling Party fails to acquire the Subject Shares
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before the end of the Negotiation Period and such failure to acquire is not due
to the unreasonable delay of the Selling Party or (iii) such negotiations are
terminated earlier by agreement between the Parties (the earlier to occur is
referred to herein as the "LAPSE DATE"), then the Selling Party shall have the
right to enter into a transaction with a Third Party to sell the Subject Shares
at a price and on terms no more favorable than as set forth in the Acquisition
Proposal Notice, provided that such Third Party acquires the Subject Shares
within [*] of the Lapse Date (the "SALE PERIOD").
4.5 Reinstatement of Right of First Refusal. In the event that the Third
Party fails to acquire the Subject Shares within Sale Period as described in
SECTION 4.4, the Selling Party shall not thereafter Transfer any shares without
first again offering such securities to the Non-Selling Party in the manner
provided in this ARTICLE 4.
4.6 Change of Control. The Parties agree that the provisions of this
ARTICLE 4 shall not apply to, and shall in no way restrict, either Parties'
right or ability to engage in a Change of Control.
4.7 Relation to Articles of Association. The procedure laid down in
SECTIONS 4.2 THROUGH 4.5 above also applies to the offer to the minority
shareholders contemplated in Section 5.4, sentence 2, of the Articles of
Association. This ARTICLE 4 does not alter any provision or provisions contained
in the Articles of Association restricting the transfer of shares. However, the
Parties shall exercise all voting and other rights available to them to ensure
the implementation of the foregoing provisions of this ARTICLE 4 and any
provisions contained in the Articles of Association restricting transfers of
shares are waived or suspended, if applicable, to allow such sales and purchases
to proceed as provided above.
ARTICLE 5
TERM AND TERMINATION
5.1 Term. The term of this Agreement shall commence on the date hereof
and shall continue and remain in full force and effect, until this Agreement is
terminated in accordance with this ARTICLE 5.
5.2 Termination Due to Second Capital Contribution Condition End Date
Failure.
(a) Either Party (for the purposes of this Section 5.2(a), the
"TERMINATING PARTY") may terminate this Agreement upon thirty (30) days' prior
written notice provided to the other Party if, by the Second Capital
Contribution Condition End Date, there is a Government Investment Grant
Shortfall, and the Parties or VentureCo have not obtained a written agreement
for the provision of Alternative Funding; provided that a Party may not
terminate this Agreement pursuant to this SECTION 5.2 if the Government
Investment Grant Shortfall or the failure of the Parties or VentureCo to obtain
Alternative Funding was due to such Party's Material Breach.
(b) In the event of a termination under Section 5.2 (a) and
subject to Section 5.2(e) below,
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(i) the Parties shall cause VentureCo to be liquidated and
wound up in accordance with German law and the Articles of Association;
(ii) the Parties shall cause the Concurrent Agreements to be
terminated; and
(iii) any additional claims for damages shall be excluded.
(c) Either Party (for purposes of SECTION 5.2 (C) AND (D), the
"TERMINATING PARTY") may terminate this Agreement upon thirty (30) days' prior
written notice provided to the other Party if the other Party (the "UNFUNDED
PARTY") lacks the financial ability to fund to VentureCo its Second Capital
Contribution, demonstrates so to the Terminating Party in writing, and thereby
fails to pay its Second Capital Contribution when due.
(d) In the event of a termination under Section 5.2 (c) and
subject to Section 5.2(e) below,
(i) the Parties shall cause VentureCo to be liquidated and
wound up in accordance with German law and the Articles of Association;
(ii) the Parties shall cause the Concurrent Agreements to be
terminated;
(iii) the Unfunded Party shall reimburse the Terminating Party
for all of its out-of-pocket costs incurred in connection with the negotiation,
preparation and execution of this Agreement and the implementation of the
transactions contemplated thereby, including and without limitation, travel
expenses and reasonable fees and expenses paid to advisors, and
(iv) any additional claims for damages etc. shall be
excluded.
(e) This SECTION 5.2 does not limit either Party's right to
terminate this Agreement for Material Breach under SECTION 5.4.
(f) Promptly upon receiving notice by a Terminating Party of its
exercise of its rights pursuant to SECTION 5.2, the Parties shall take such
actions, and cause their respective Affiliates to take such actions, as may be
necessary to enable the Terminating Party to consummate its rights.
5.3 Termination by mutual consent.
(a) This Agreement may be terminated by mutual written consent of
the Parties.
(b) In the event of termination pursuant to SECTION 5.3(A), the
consequences of Termination shall be agreed between the Parties in writing,
unless the form of a notarial deed is required under German law.
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5.4 Termination for Breach
(a) A Party (for purposes of this SECTION 5.4, the "TERMINATING
PARTY") may terminate this Agreement upon [*] prior written notice provided to
the other Party (the "BREACHING PARTY") if the Breaching Party commits a
Material Breach of this Agreement or if the Breaching Party becomes subject to a
Bankruptcy Event.
(i) If the Breaching Party commits a Material Breach of this
Agreement, and if
(1) the Material Breach is incurable, the termination
must be made in writing not later than [*] after the Terminating Party learns
about the Material Breach.
(2) the Material Breach is curable, the Terminating
Party has to request such cure in writing, not later than [*] after it learns
about the Material Breach, granting the Breaching Party a cure period of another
[*]. If the Terminating Party fails to cure such Material Breach within the [*],
the termination must be made in writing not later than [*] after the expiry of
the cure period.
(3) For the purposes of this SECTION 5.4, "MATERIAL
BREACH" is defined as (A) a material breach of this Agreement or any of the
Concurrent Agreements that has had, or is reasonable likely to have, a material
adverse effect on the financial performance or business prospects of VentureCo,
either in the short-term or the long-term; provided that (B) a Material Breach
shall include without limitation the failure of the Breaching Party to comply
with its obligation to pay all or any portion of its Equity Commitment or
perform its other obligations in accordance with ARTICLE 2.
(ii) If the Breaching Party becomes subject to a Bankruptcy
Event, the termination must be made in writing not later than [*] after the
Terminating Party learns about the Bankruptcy Event.
(b) Within a period of [*] after it has terminated this Agreement,
the Terminating Party is entitled to start a process to determine the Fair
Market Value by indicating so to the other Party in writing (the "VALUATION
REQUEST"). The Valuation Request may be combined with the termination notice.
(c) The "FAIR MARKET VALUE" shall be the fair market value for [*]
("TERMINATION SECURITIES") and shall be determined as follows:
(i) If the Termination Securities are publicly traded on a
national stock market or exchange, the Fair Market Value shall be deemed [*].
(ii) If there is no active public market for the Termination
Securities, the value shall be the Fair Market Value thereof as determined by
good faith negotiation between
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the Parties. If such negotiation fails to determine the Fair Market Value within
[*] after the date of the Valuation Request, the Fair Market Value shall be
determined as follows:
(1) Each Party shall each retain at its expense an
independent third party investment bank or M&A advisor with expertise valuing
companies such as VentureCo.
(2) Subject to execution of customary confidentiality
agreements by the independent third-party firms, VentureCo shall provide or be
caused to provide to each firm all material information, including any material
changes in such information, reasonably necessary to value VentureCo or
reasonably requested by the firms. [*]
(3) Within [*] after the Valuation Request pursuant to
SECTION 5.4(B) above, each Party shall submit a final valuation proposal,
prepared in writing with a supporting analysis by its retained third-party firm,
to the other Party and the other Party's third party firm and to the
"ARBITRATOR." The "ARBITRATOR" shall be a Person with expertise in valuing
companies in the photovoltaic industry, shall not have a material business
relationship with either Party or VentureCo and shall be reasonably acceptable
to both Parties. If the Parties agree upon a single Arbitrator, the decision of
such Arbitrator shall be final and binding on the Parties. If the Parties have
not agreed on a single Arbitrator, the Parties will each select an Arbitrator
satisfying the criteria set forth herein and the selected Arbitrators will
select a third. In that case, the decision of a majority of the Arbitrators will
control and shall be final and binding on both Parties. In either case, the
arbitrator shall submit his decision to the Parties in writing within [*] after
receiving the two final valuation proposals.
(4) If one Party does not submit in a timely manner a
final valuation proposal, then the valuation proposal of the other Party shall
be used to establish the Fair Market Value.
(d) If this Agreement is terminated pursuant to SECTION 5.4 (A),
the Terminating Party, notwithstanding any other remedy that it may have
pursuant to this Agreement or otherwise under German law, may, within a period
of [*] following decision of the Arbitrator pursuant to SECTION 5.4 (C) (II)
(3), purchase all the Shares legally or beneficially owned by the Breaching
Party for a cash amount equal to [*] (the "TERMINATION CALL RIGHT"). The
Termination Call Right must be exercised in writing or in the from required
under German law (notarial deed if VentureCo still is a Limited Liability
Company (GmbH)) and delivered to the Breaching Party.
(e) The Terminating Party shall have the right to assign its
rights and interests with respect to its Termination Call Right to a Third
Party, provided that (i) the Breaching Party is provided prior written notice of
such assignment and (ii) such Third-Party assignee is not a competitor of the
breaching Party in the reasonable, good-faith determination of the Breaching
Party. Any attempted assignment by the Terminating Party of its Termination Call
Right in contravention of the provisions of this SECTION 5.4(E) shall be void
and unenforceable.
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(f) The closing of any purchase and sale of Termination Securities
shall take place at the office of VentureCo within [*] of the exercise of the
Termination Call Right. At such closing, the aggregate purchase price for such
purchase and sale shall be paid in cash or other immediately available funds in
exchange for the Termination Securities to be sold.
(g) Promptly upon receiving notice by a Terminating Party of its
exercise of its rights pursuant to SECTION 5.4(A), the Breaching Party shall
take such actions, and cause its Affiliates to take such actions, as may be
necessary to enable the Terminating Party to consummate its rights.
(h) Continuation of Business. Subject to SECTION 5.4 (I), during
any period in which a Party has the right to purchase or is purchasing the
Securities of the other Party pursuant to this SECTION 5.4, VentureCo shall
continue its business in the ordinary course. The Parties and VentureCo shall
use their reasonable best efforts to maintain and preserve the business of
VentureCo pending the consummation of such purchase.
(i) In each case of termination according to SECTION 5.4 (A), each
Party shall have the right to demand that both Parties hold a Shareholders'
meeting of VentureCo without undue delay and vote in favor of the dissolution
and winding up of VentureCo in accordance with applicable law and the Articles
of Association, if the Non-Breaching Party either (i) waives its rights under
SECTION 5.4(D) AND (E) in writing or (ii) has not exercised such rights within
the three-month period specified in SECTION 5.4(D), unless (iii) the
Non-Breaching Party has offered to sell its Shares to the Breaching Party, the
Breaching Party has elected to purchase the Shares of the Non-Breaching Party at
[*], and demonstrated to the Non-Breaching Party's satisfaction that it can
complete and provide payment for the shares within [*] of such offer.
(j) If the applicable Termination Call Right is exercised, the
Parties shall cause the License Agreements to remain in full force and effect
and the Service Agreements to be terminated. The Parties shall cause the
Concurrent Agreements to be terminated if the Parties proceed to dissolution of
VentureCo, as provided in (i) above (on the effective date of dissolution).
(k) In the event of any termination of this Agreement pursuant to
this SECTION 5.4, this Agreement shall cease to have further force or effect and
no Party shall have any liability to any other Party in respect to this
Agreement, provided that termination of this Agreement for any reason shall not
release any Party from any liability or obligation which has already accrued as
of the effective date of such termination, and shall not constitute a waiver or
release of, or otherwise be deemed to prejudice or adversely affect, any rights,
remedies or claims, whether for damages or otherwise, which a Party may have
hereunder, at law, equity or otherwise or which may arise out of or in
connection with such termination.
(l) Without limiting any other remedies that may be available to
the non-Breaching Party under this Agreement (but, for the avoidance of doubt,
not under SECTION 5.4. (A) THROUGH (K)) or under German law, in the event of a
Material Breach pursuant to SECTION 5.4(A)(I)(3)(B) in lieu of terminating this
Agreement as provided in this SECTION 5.4, the Non-Breaching Party may, after
the expiration of any cure period applicable with respect to such Material
Breach, upon written notice to VentureCo and the Breaching Party, cause the
Percentage
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Interest of the Breaching Party to be reduced to reflect the relative capital
contributions of the Parties actually contributed under SECTION 2.3 THROUGH 2.4,
in which case the Shares held by the Parties shall be correspondingly adjusted
to reflect the Percentage Interests, as adjusted pursuant to this SECTION
5.4(L). The Breaching Party is obliged, to the extent required to obtain the
result contemplated by this SECTION 5.4(L), to split its share(s) in VentureCo
and transfer such share(s) or split share(s), by way of a notarial deed, to the
other Party free of charge.
5.5 Termination after January 1, 2012
(a) Either Party may terminate this Agreement with six months
written notice to the other Party anytime time following January 1, 2012.
(b) If this Agreement is terminated pursuant to SECTION 5.5 (A)
by:
(i) E as the Terminating Party, Q may purchase E's
Percentage Interest in VentureCo [*] (the "Q TERMINATION CALL RIGHT"); or
(ii) Q as the Terminating Party, E may purchase Q's
Percentage Interest in VentureCo [*] (the "E TERMINATION CALL RIGHT").
(C) SECTION 5.4 (B) THROUGH (K) shall apply correspondingly,
provided, however, that the period to exercise the Termination Call Right is
extended to one hundred and eighty (180) days following decision of the
Arbitrator pursuant to SECTION 5.4. (C) (II) (3).
5.6 Termination in Case of Sale and Transfer. This Agreement and the
Service Agreements, but, unless otherwise agreed in writing, not the License
Agreements, shall terminate automatically, or, in the case of the Service
Agreements, shall be caused by the Parties to be terminated, upon the closing of
the purchase by a Party or its Affiliates of all the Shares beneficially owned
by the other Party and its Affiliates.
5.7 Post-Termination Covenants.
(a) Employee Issues. Each Party shall negotiate in good faith an
agreement providing that employees of the other Party working for VentureCo
(either on a part-time or full-time basis) shall be made available full-time to
VentureCo for such period as is reasonably required up to three months to effect
an orderly transition following the termination of this Agreement. The Parties
shall use their reasonable best efforts to make all such employees available on
this basis.
(b) Return of Confidential Information. Upon the termination of
this Agreement, each Party, at its own cost, shall promptly return to the
Disclosing Party any and all documents and materials constituting or containing
Confidential Information of the Disclosing Party which are in its possession or
control, or at its option, shall destroy such documents and materials and
certify such destruction in writing to the Disclosing Party.
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(c) Survival of Rights and Obligations. The rights and obligations
of the Parties under Sections 3.8, 5, 7, 8, 9.3, 9.5, 9.6, 9.7 and 10 shall
survive any termination of this Agreement.
ARTICLE 6
CLOSING CONDITIONS
6.1 Conditions to Obligations of E. The obligation of E to fulfill its
obligations under SECTION 2.3 AND 2.4 shall be subject to the satisfaction of
each of the following conditions, any of which may be waived, in writing,
exclusively by E:
(a) Execution of License Agreement. Q shall have executed and
delivered to E the Q License Agreement.
(b) Articles of Association. Q shall have voted to amend the
Articles of Association in accordance with the form set forth in EXHIBIT A-1.
(c) Managing Board composition. ▇▇▇▇▇ ▇▇▇▇▇ shall have been
appointed as the CEO of VentureCo.
(d) Supervisory Board Composition. The authorized size of the
Supervisory Board of VentureCo shall have been established at three (3)
positions and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ and Dr. ▇▇▇▇▇ ▇▇▇▇▇▇ shall have been appointed to
the Supervisory Board.
(e) Legal Opinion. E shall have received an opinion addressed to
E, dated the Signing Date, of ▇▇▇ ▇▇▇▇▇ Rechtsanwaelte, in form and substance
reasonably satisfactory to E.
6.2 Conditions to the Obligations of Q. The obligation of Q to fulfill
its obligations under SECTION 2.3 AND 2.4 shall be subject to the satisfaction
of each of the following conditions, any of which may be waived, in writing,
exclusively by Q:
(a) Execution of License Agreement. E shall have executed and
delivered to Q the E License Agreement.
(b) Legal Opinion. Q shall have received an opinion addressed to
Q, dated the Signing Date, of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, Professional
Corporation, in a form and substance reasonably satisfactory to Q.
ARTICLE 7
WARRANTIES
7.1 Warranties of Q. Q hereby warrants in the form of an independent no
fault guarantee (rechtlich selbstaendiges verschuldensunabhaengiges
Garantieversprechen) within the
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meaning of Sec. 311 paragraph (1) German Civil Code (Buergerliches Gesetzbuch)
to E as follows:
(a) Organization, Authority and Qualification. Q is a corporation
or other organization duly organized, validly existing and in good standing
under the laws of Germany. Q has all necessary power and authority to enter into
this Agreement and the License Agreements to which it is a party, to carry out
its obligations hereunder and thereunder and to consummate the transactions
contemplated hereby and thereby. Q is duly licensed or qualified to do business
in Germany. The execution and delivery by Q of this Agreement and the License
Agreements to which it is a party, the performance by Q of its obligations
hereunder and thereunder and the consummation by Q of the transactions
contemplated hereby and thereby have been duly authorized by all requisite
action on the part of Q, and no other corporate proceedings on the part of Q or
any of its Affiliates are required in connection therewith. This Agreement has
been, and upon its execution, each of the other License Agreements to which Q is
a party, will be, duly executed and validly delivered by Q, and (assuming, if
applicable, due authorization, execution and delivery by each of the other
Parties hereto and thereto) this Agreement constitutes and, upon its execution,
each of the other License Agreements to which Q is a party, shall constitute, a
legal, valid and binding obligation of Q, enforceable against Q in accordance
with its terms.
(b) No Conflict. The execution, delivery and performance by Q of
this Agreement and the License Agreements to which it is a party do not and will
not (a) violate or conflict with any provision of its Articles of Association,
by-laws or similar organizational documents, or (b) conflict with or violate in
any material respect any German law or Governmental Order applicable to Q or any
of its assets, properties or business.
(c) Consents and Approvals. The execution, delivery and
performance by Q of this Agreement and the License Agreements to which it is a
party do not and will not require any consent, approval, authorization or other
order of, action by, filing with or notification to, any Governmental Authority
or other Third Party.
(d) Absence of Litigation. There is no legal or regulatory action
pending or, to the knowledge of Q, threatened against Q that seeks to restrain
or enjoin or otherwise challenge the legality, validity or enforceability of
this Agreement or the Q License Agreement.
(e) Compliance with Laws; Permits. To the extent required to
execute and consummate this Agreement and the Concurrent Agreements or except as
would not materially impair Q's ability to perform its obligations hereunder and
thereunder:
(i) Q is not in conflict in any material respect with, in
material default under, or in material violation of, any Laws or Governmental
Orders applicable to Q's business, or by which Q believes it is reasonably
likely to be bound or affected. There is no material judgment, injunction, order
or decree that is binding upon Q which has, or would reasonably be expected to
have, the effect of prohibiting or materially impairing the conduct of VentureCo
as currently contemplated to be conducted following the Closing Date.
(ii) Q and its Affiliates currently hold all material
permits, licenses, authorizations, certificates, exemptions, registrations and
approvals of Governmental Authorities (collectively, "PERMITS") necessary or
proper for the current operation of its business, such
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Permits are in full force and effect, and no suspension, cancellation or
non-renewal of any such Permit is pending or, to the knowledge of the Q Parties,
threatened.
(f) Intellectual Property. To the extent required to execute and
consummate this Agreement and the Concurrent Agreements or except as would not
materially impair Q's ability to perform its obligations hereunder and
thereunder, no contracts, licenses or agreements to which Q is a party
(including, without limitation, this Agreement and the Q License Agreement and
the transactions contemplated herein and therein) or, to the knowledge of Q, by
operation of law, will:
(i) Result in VentureCo or E being bound by, or subject to,
any non-compete, exclusivity restriction or other restriction on the operation
or scope of its businesses; or
(ii) Result in VentureCo or E being obligated to pay any
royalties or other amounts to any Third Party.
(iii) Grant to any Third-Party
any right to or with respect to any Intellectual Property owned by, or licensed
to, VentureCo or E.
(g) No Undisclosed Liabilities. Q has no Liabilities which,
individually or in the aggregate, could be reasonably expected to impair,
prevent or delay Q from performing any of its obligations under this Agreement.
(h) During the period beginning on November 30, 2004 and ending on
the Signing Date, Q has not suffered or been affected by any event (or events)
that has had or is reasonably likely to have a material adverse effect on the
financial performance or business prospects of Q, either in the short-term or
the long-term.
(i) Q has provided to E a true, correct and complete copy of the
Government Grant Application, in the form in which it was initially submitted to
the State of Saxony-Anhalt.
7.2 Warranties of E. E hereby warrants in the form of an independent no
fault guarantee (rechtlich selbstaendiges verschuldensunabhaengiges
Garantieversprechen) within the meaning of Sec. 311 paragraph (1) German Civil
Code (Buergerliches Gesetzbuch) to Q as follows:
(a) Organization, Authority and Qualification. E is a corporation
or other organization duly organized, validly existing and in good standing
under the laws of its jurisdiction of incorporation or organization. E has all
necessary power and authority to enter into this Agreement and the License
Agreements to which it is a party, to carry out its obligations hereunder and
thereunder and to consummate the transactions contemplated hereby and thereby.
The execution and delivery by E of this Agreement and the License Agreements to
which it is a party, the performance by E of its obligations hereunder and
thereunder and the consummation by E of the transactions contemplated hereby and
thereby have been duly authorized by all requisite action on the part of E, and
no other corporate proceedings on the part of E or any of its Affiliates is
required in connection therewith. This Agreement has been, and upon its
execution, each of the other License Agreements to which E is a party will be,
duly executed and validly delivered by E, and (assuming, if applicable, due
authorization, execution and delivery by each of
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the other Parties hereto and thereto) this Agreement constitutes and, upon its
execution, each of the other License Agreements to which it is a party shall
constitute, a legal, valid and binding obligation of E, enforceable against E in
accordance with its terms.
(b) No Conflict. The execution, delivery and performance by E of
this Agreement and the License Agreements to which it is a party do not and will
not (a) violate or conflict with any provision of its certificate of
incorporation or by-laws or similar organizational documents, or(b) conflict
with or violate in any material respect any Law or Governmental Order applicable
to E or any of its assets, properties or business.
(c) Consents and Approvals. The execution, delivery and
performance by E of this Agreement and the License Agreements to which it is a
party do not and will not require any consent, approval, authorization or other
order of, action by, filing with or notification to, any Governmental Authority
or other Third Party, where failure to obtain such consent, approval,
authorization, order or action, or to make such filing or notification, would
not, individually or in the aggregate, reasonably be expected to prevent or
materially delay E from performing any of its material obligations under this
Agreement or the License Agreements to which it is a party.
(d) Absence of Litigation. There is no legal or regulatory action
pending or, to the knowledge of E, threatened against E that seeks to restrain
or enjoin or otherwise challenge the legality, validity or enforceability of
this Agreement or the E License Agreement.
(e) Compliance with Laws; Permits. To the extent required to
execute and consummate this Agreement and the Concurrent Agreements or except as
would not materially impair E's ability to perform its obligation hereunder and
thereunder:
(i) E is not in conflict in any material respect, in
material default under or in material violation of, any Laws or Governmental
Orders applicable to E's business or by which E believes it is reasonably likely
to be bound or subject. There is no material judgment, injunction, order or
decree that is binding upon E which has, or would reasonably be expected to
have, the effect of prohibiting or materially impairing the conduct of VentureCo
as currently contemplated to be conducted following the Closing Date.
(ii) E and its Affiliates currently hold all material Permits
necessary or proper for the operation of its business as currently conducted,
such Permits are in full force and effect, and no suspension, cancellation or
non-renewal of any such Permit is pending or, to its knowledge, threatened.
(f) Intellectual Property. To the extent required to execute and
consummate this Agreement and the Concurrent Agreements or except as would not
materially impair E's ability to perform its obligation hereunder and
thereunder, no contracts, licenses or agreements to which E is a party
(including without limitation this Agreement and the E License Agreement and the
transactions contemplated herein or therein) or, to the knowledge of E, by
operation of law, will:
(i) Result in VentureCo or Q being bound by, or subject to,
any non-compete, exclusivity restriction or other restriction on the operation
or scope of its businesses; or
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(ii) Result in VentureCo or Q being obligated to pay any
royalties or other amounts to any Third Party.
(iii) Grant to any Third-Party any right to or with respect to
any Intellectual Property owned by, or licensed to, VentureCo or Q.
(g) No Undisclosed Liabilities. E has no Liabilities which,
individually or in the aggregate, could be reasonably expected to impair,
prevent or delay E from performing any of its obligations under this Agreement.
(h) During the period beginning on September 30, 2004 and ending
on the Signing Date, E has not suffered or been affected by any event (or
events) that has had or is reasonably likely to have a material adverse effect
on the financial performance or business prospects of E, either in the
short-term or the long-term.
ARTICLE 8
LIABILITY AND LIMITATIONS OF LIABILITY
8.1 Q Liability. In the event of a breach of any of the Warranties given
by Q in Section 7.1 or in the Q License Agreement, E and VentureCo, each
individually, shall have the right to request in writing that Q puts VentureCo
in the position that it would have been in, had there been no breach of
Warranty. If, within eight weeks of such a request, Q has not complied with the
request, or if such remedy is impossible, Q shall indemnify VentureCo in cash.
If VentureCo has become insolvent as a result of such breach, or in the case and
to the extent that E has suffered a damage in excess or outside of the loss in
value of E's holding in VentureCo, E shall have the right to request in writing
that Q indemnifies E in cash. For the avoidance of doubt: Q will not be
obligated to double compensate the same loss to E and VentureCo.
8.2 E Liability. In the event of a breach of any of the Warranties given
by E in Section 7.2 or in the E License Agreement, Q and VentureCo, each
individually, shall have the right to request in writing that E puts VentureCo
in the position that it would have been in, had there been no breach of
Warranty. If, within eight weeks of such a request, E has not complied with the
request, or if such remedy is impossible, E shall indemnify VentureCo in cash.
If VentureCo has become insolvent as a result of such breach, or in the case and
to the extent that Q has suffered a damage in excess or outside of the loss in
value of Q's holding in VentureCo, Q shall have the right to request in writing
that E indemnifies Q in cash. For the avoidance of doubt: E will not be
obligated to double compensate the same loss to Q and VentureCo.
8.3 Definitions. All of the claims described in SECTIONS 8.1 and 8.2
above shall be referred to as the "INDEMNIFIABLE CLAIMS." Any party seeking such
indemnification is hereafter referred to as an "INDEMNIFIED PARTY" and the party
against whom such indemnity is sought shall hereafter be referred to as the
"INDEMNIFYING PARTY."
8.4 Determination of the Amount of Damage.
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(a) For the purpose of this ARTICLE 8, the damage shall consist of
the amount necessary to cure any event or set of facts causing such Warranty to
be breached or the loss in value of VentureCo caused by such breach, whichever
amount is higher.
(b) In case of dispute, the amount of such damage (but for the
avoidance of doubt, not the existence of a breach) shall be determined by an
expert arbitrator ("Schiedsgutachter"). The expert arbitrator shall be a partner
of an internationally recognized accounting firm. If the Parties cannot agree on
the selection of such expert arbitrator within two weeks after receipt of a
request to appoint such arbitrator, the appointment shall be made by the
President of the Chamber of Industry and Commerce of Berlin. The decision of
such arbitrator shall be final and binding on the Parties and VentureCo. The
costs of such arbitrator shall be borne by the Indemnifying Party and
Indemnified Party respectively in proportion to their relative success according
to the determination delivered by the expert arbitrator who shall also determine
such proportion.
8.5 Limitations of Liability for Breach of Warranties.
(a) Each Indemnifying Party shall (in all cases) only be liable
for breach of Warranties under Section 7.1 or 7.2 to an Indemnified Party in
respect of a claim if the aggregate amount of all claims for which the relevant
Indemnifying Party would otherwise be liable under this Agreement to the
relevant Indemnified Party exceeds EUR 100,000.00 (in which case, however, the
relevant Indemnified Party shall be entitled to claim the total amount of such
claims and not merely the excess above said EUR 100,000.00).
(b) All claims for breach of Warranties are limited in time until
(verjaehren am) December 31, 2007; in the case that a warranty relating to
Intellectual Property is breached, including, without limitation, warranties
under the License Agreements, the period of limitation (Verjaehrungsfrist)
expires one year after the termination of this Agreement.
8.6 GENERAL LIMITATION OF LIABILITY. EACH PARTY SHALL (IN ALL CASES)
ONLY BE LIABLE TO THE OTHER PARTY OR VENTURECO TO THE EXTENT THAT THE AGGREGATE
AMOUNT OF ITS LIABILITY FOR ALL CLAIMS OF WHATSOEVER NATURE MADE UNDER THIS
AGREEMENT AND THE LICENSE AGREEMENTS IS LIMITED TO EUR 15 MILLION, PROVIDED,
HOWEVER, THAT THE LIMITATIONS SET FORTH IN THIS SECTION 8.6 SHALL NOT APPLY IN
THE CASE OF FRAUD OR WILLFUL INTENT.
ARTICLE 9
ADDITIONAL AGREEMENTS
9.1 Marketing.
(a) VentureCo shall always have the right to directly market its
output of Wafers, Cells, and Modules.
(b) If VentureCo determines to market, distribute or sell Cells,
Wafers or Modules, as the case may be, via intermediaries, distribution
partners, sales agents or the like, it
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shall invite third parties to declare their interest to participate in such
marketing activities. In such a procedure, the Parties shall be entitled to
declare their interest as well. VentureCo shall negotiate with all the
interested parties in good faith for not less than ninety (90) days, and upon
mutual agreement, the negotiation period may be continued as long as necessary
or productive. The final decision shall be subject to approval by the
Supervisory Board.
(c) If any marketing agreement is entered into with Q or E
(individually, the "RECIPIENT PARTY"), the Parties shall take all actions to
cause the pricing of VentureCo's output to be based on an arms-length transfer
price to provide a reasonable margin for both VentureCo and the Recipient Party,
taking into account the Recipient Party's anticipated marketing and distribution
costs as well as anticipated market prices.
9.2 Q Manufacturing Right of First Refusal.
(a) During the term of this Agreement, whenever E or Affiliates
(and references to E in this section 9.2 are deemed to include E Affiliates)
wishes to form an Alternative Venture, E will first offer Q a right of first
refusal with respect to participation in such Alternative Venture pursuant to
the provisions of SECTION 9.2(B) AND (C).
(b) In the event that E determines to pursue the formation of an
Alternative Venture, E shall deliver written notice to Q, offering Q the right
of first refusal to participate in any such Alternative Venture, which notice
shall refer to this section of this Agreement and, subject to Q entering into a
confidentiality agreement reasonably satisfactory to E with respect to the
existence of the notice and the subject matter thereof, provide a description of
the general framework of the Alternative Venture, including without limitation
the proposed purpose and business objectives of the Alternative Venture and the
contributions proposed to be required of the parties to the Alternative Venture
(the "E FIRST REFUSAL NOTICE"). Upon the receipt of E First Refusal Notice, Q
shall have [*] to confirm in writing to E that it wishes to commence
negotiations relating thereto (the "Q CONFIRMATION NOTICE"). Upon E's receipt of
the Q Confirmation Notice, E and Q shall commence negotiations in good faith
regarding the terms and conditions of an agreement concerning the Alternative
Venture. The parties will negotiate in good faith for not less than [*], and
upon mutual agreement, the negotiation period may be continued as long as
necessary or productive.
(c) If the parties execute a definitive agreement concerning the
Alternative Venture, then the parties will be bound by such agreement. If a
definitive agreement is not executed within [*] after the initial [*]
negotiation period, then either party, upon written notice to the other, may end
negotiations. Upon the end of negotiations (or, alternatively, if Q did not
provide the Q Confirmation Notice within [*] after receipt of the E First
Refusal Notice), the applicable right of first refusal shall have no further
effect and, without limiting the foregoing, E may enter into an Alternative
Venture with a Third Party within the parameters of the general framework set
forth in the E First Refusal Notice. The final conditions may not be materially
more favorable to the Third Party, taken as a whole, than the last conditions
offered to Q (and if in fact more favorable, Q may elect to enter into that
Alternative Venture on those terms in lieu of the Third Party). The final
agreement with the Third Party is to be submitted promptly to a person nominated
by Q bound by a professional duty of secrecy (Berufsverschwiegenheit).
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(d) For the avoidance of doubt: During the term of this Agreement,
whenever E wishes to form one or more additional Alternative Ventures after an E
First Refusal Notice has been provided, the procedure pursuant to the provisions
of SECTION 9.2(B) THROUGH (C) shall be repeated.
9.3 Q Ribbon Technology Restriction.
(a) During the term of this Agreement, and for a period of two (2)
years after its expiration or termination, Q shall not, directly or indirectly,
engage in a Ribbon Technology Activity (defined below) other than through
VentureCo and/or an Alternative Venture according to SECTION 9.2.
(b) Subject to SECTION 9.3(C) below, "RIBBON TECHNOLOGY ACTIVITY"
shall mean, [*].
(c) [*]
(d) The covenants contained in SECTION 9.3(A) shall be construed
as a series of separate covenants, one for each county, city, state and country
of the geographic scope. Except for geographic coverage, each such separate
covenant shall be deemed identical in terms to the covenant contained in SECTION
9.3(A). If, in any judicial proceeding, a court refuses to enforce any of such
separate covenants (or any part thereof), then such unenforceable covenant (or
such part) shall be eliminated from this Agreement to the extent necessary to
permit the remaining
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separate covenants (or portions thereof) to be enforced. In the event that the
provisions of this SECTION 9.3 are deemed to exceed the time, geographic or
scope limitations permitted by applicable law, then such provisions shall be
reformed to the maximum time, geographic or scope limitations, as the case may
be, permitted by applicable laws.
(e) Each Party agrees that if it breaches any provision of this
SECTION 9.3, the other Party shall be entitled to, in addition to any other
right or remedy otherwise available to it, an injunction from a German court
restraining such breach or threatened breach and to seek specific performance of
any such provision of this SECTION 9.3.
9.4 Cooperation to Pursue Tax Efficiencies. For so long as both Parties
beneficially own any Shares, the Parties shall and shall cause their Affiliates
to assist each other and VentureCo to pursue any and all tax efficiencies
available to:
(a) VentureCo in the operation of its business; and
(b) the other Party as a shareholder of VentureCo; provided that
neither Party shall be required to expend any monies or incur any cost or
liability in connection therewith. Without limiting the foregoing, the Parties
acknowledge that E intends to pursue tax efficiencies with respect to its
ownership of and contributions to VentureCo within the six month period
following the Closing Date, and Q agrees to cooperate with E in the achievement
of those efficiencies, including by amending this Agreement or any of the
Concurrent Agreements, so long as any action taken with respect to the
achievement of E's tax efficiencies neither alters the fundamental agreements of
the Parties or otherwise adversely affects Q or VentureCo. Without limiting the
foregoing, the Parties expressly agree that at the discretion of E, the Parties
shall cause VentureCo to make an election under Treas. Reg. Section 1.7701-3(c)
to be treated as a partnership for U.S. federal income tax purposes and no Party
shall take any action inconsistent with such election, so long as such election
neither alters the fundamental agreements of the Parties or otherwise adversely
affects Q or VentureCo.
9.5 Confidentiality.
(a) Definition. "CONFIDENTIAL INFORMATION" means any information:
(i) disclosed by one Party (the "DISCLOSING PARTY") to any other Party (the
"RECEIVING PARTY"), which, if in written, graphic, machine-readable or other
tangible form is marked as "CONFIDENTIAL" or "PROPRIETARY", or which, if
disclosed orally or by demonstration, is identified at the time of initial
disclosure as confidential and reduced to writing and marked "CONFIDENTIAL"
within thirty (30) days of such disclosure; or (ii) which is otherwise referred
to as Confidential Information under this Agreement or any License Agreement.
(b) Confidential Information and Exclusions. Notwithstanding
SECTION 9.5(A) (Definition) above, Confidential Information shall exclude
information that: (i) was independently developed by the Receiving Party without
using any of the Disclosing Party's Confidential Information; (ii) becomes known
to the Receiving Party, without restriction, from a source other than the
Disclosing Party that had a right to disclose it; (iii) was in the public domain
at the time it was disclosed or becomes in the public domain through no act or
omission of the Receiving Party; or (iv) was rightfully known to the Receiving
Party, without restriction, at the time of disclosure.
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(c) Confidentiality Obligation. The Receiving Party shall treat as
confidential all of the Disclosing Party's Confidential Information and shall
not use such Confidential Information except as expressly permitted under this
Agreement or a License Agreement or in connection with VentureCo's activities.
Without limiting the foregoing, the Receiving Party shall use at least the same
degree of care that it uses to prevent the disclosure of its own confidential
information of like importance, but in no event with less than reasonable care,
to prevent the disclosure of the Disclosing Party's Confidential Information,
subject to SECTION 9.5(D) (Legal Disclosure) below.
(d) Legal Disclosure. Notwithstanding anything herein to the
contrary, a Receiving Party has the right to disclose Confidential Information
without the prior written consent of the Disclosing Party: (i) as required by
any court or other Governmental Authority, or by Nasdaq; (ii) as otherwise
required by law, or (iii) as advisable or required in connection with any
government or regulatory filings, including without limitation, filings with the
SEC. If a Receiving Party believes that it will be compelled by a court or other
authority to disclose Confidential Information of the Disclosing Party, it shall
give the Disclosing Party prompt written notice so that the Disclosing Party may
take steps to oppose such disclosure.
(e) Remedies. If a Party breaches any of its obligations under
this SECTION 9.6, the other Party shall be entitled to seek equitable relief to
protect its interest therein, including injunctive relief, as well as money
damages.
(f) General Knowledge. The Receiving Party shall have no
obligation to limit or restrict the assignment of its employees or consultants
as a result of their having had access to the Disclosing Party's Confidential
Information. The restrictions regarding Confidential Information shall not be
construed to limit any Party's right to independently develop or acquire
products, processes or concepts without use of the other Party's Confidential
Information, even if similar. Furthermore, notwithstanding the restrictions
regarding Confidential Information, the Receiving Party shall be free to use for
any purpose the general knowledge resulting from access to work with or exposure
to the Disclosing Party's Confidential Information, provided that the Receiving
Party shall maintain the confidentiality of the Confidential Information as
provided herein. The term "GENERAL KNOWLEDGE" means information in non-tangible
form which may be retained by persons who have had access to Disclosing Party's
Confidential Information, including ideas, concepts, know-how or techniques
contained therein.
9.6 Reasonable Efforts. Subject to the terms and conditions provided in
this Agreement, Q and E shall each use commercially reasonable efforts to take
promptly, or cause to be taken, all actions, and to do promptly, or cause to be
done, all things necessary, proper or advisable under applicable Laws and
regulations to consummate and make effective the transactions contemplated
hereby, to obtain all necessary waivers, consents and approvals and to effect
all necessary registrations and filings and to remove any injunctions or other
impediments or delays, legal or otherwise, in order to consummate and make
effective the transactions contemplated by this Agreement for the purpose of
securing to the other the benefits contemplated by this Agreement.
9.7 Standstill. For a period commencing with the date hereof and ending
on the second anniversary of such date, neither Q nor any of its agents shall,
without the prior written consent of E or its board of directors: acquire, offer
to acquire, or agree to acquire, directly or
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indirectly, by purchase or otherwise, any voting securities or direct or
indirect rights to acquire any voting securities of E or any subsidiary thereof,
or of any successor to or person in control of E, or any assets of E or any
subsidiary or division thereof or of any such successor or controlling person;
make, or in any way participate, directly or indirectly, in any "solicitation"
of "proxies" to vote (as such terms are used in the rules of the Securities and
Exchange Commission ("SEC")), or seek to advise or influence any person or
entity with respect to the voting of any voting securities of E; make any public
announcement with respect to, or submit a proposal for, or offer of (with or
without conditions) any extraordinary transaction involving E or any of its
securities or assets; form, join or in any way participate in a "group" as
defined in Section 13(d)(3) of the Exchange Act, in connection with any of the
foregoing; otherwise act or seek to control or influence the management, Board
of Directors or policies of E; take any action that could reasonably be expected
to require E to make a public announcement regarding the possibility of any of
the events described in this SECTION 9.7; or request E or any of its agents,
directly or indirectly, to amend or waive any provision of this SECTION 9.7. The
restrictions in this SECTION 9.7 shall apply, mutatis mutandis, to E and its
agents regarding any transactions in any voting securities of Q.
9.8 Employee Matters. Pursuant to the Services Agreements, to be entered
into within 30 days of the Signing Date, the Parties intend to provide certain
infrastructure, management, operational, technology support, engineering,
development and other services to VentureCo. In addition, the Parties intend to
use commercially reasonable efforts to hire and retain employees for VentureCo.
The Parties shall cause the employees and agents of VentureCo to abide by E's,
and, whenever applicable, Q's, public company policies, including without
limitation E's, and, whenever applicable, Q's, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ policy and obtain
a written acknowledgement from each such employee and agent acknowledging that
such employee or agent is subject to such policies.
9.9 Covenant Regarding Service Agreements. The Parties shall, and shall
cause VentureCo to enter into the applicable Services Agreements within thirty
(30) days following the Singing Date. The services provided by E and Q,
respectively, pursuant to the Services Agreements (i) shall be provided by E and
Q to VentureCo on a market-rate or cost-plus basis, and (ii) shall include, but
not be limited to the following services: general advice regarding management
issues in connection with the establishment and expansion of VentureCo;
assistance with respect to Government Investment Grant application process;
assistance with required German permit applications; assistance with German
management staff selection and recruitment process; assistance with tax issues;
advice regarding corporate and organizational structure considerations; advice
and support regarding the VentureCo financing activities; management of the
initial site selection process; advice and assistance in VentureCo and
administrative matters, making, where appropriate, the Parties' suppliers
available to VentureCo and advising VentureCo staff in this respect; advice and
support in connection with the transfer of the Parties' technology to VentureCo;
technology support; design and engineering support; local infrastructure
purchasing; and human resources management and recruitment support. The Services
Agreement shall provide that the provision of services by the Parties prior to
the execution and delivery of the Services Agreement shall be deemed to have
been provided on the terms and conditions of the Services Agreement as if the
Services Agreements were entered into on the Closing Date.
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ARTICLE 10
MISCELLANEOUS
10.1 Expenses. Except as specifically provided for in this Agreement,
each of the Parties shall bear its respective expenses, costs and fees
(including attorneys' fees) in connection with the transactions contemplated
hereby, including the preparation, execution and delivery of this Agreement and
the Concurrent Agreements and compliance herewith and therewith, whether or not
the transactions contemplated hereby or thereby shall be consummated; SECTION
5.2 shall remain unaffected. However, the costs related to notarization and
registration of the capital increase and amendments of the Articles of
Association shall be borne by VentureCo.
10.2 Further Assurances. If, at any time after the Closing Date, any
further action is necessary or desirable to carry out the purposes of this
Agreement or to vest VentureCo with full right, title and possession to all
assets, property, rights, privileges, powers and franchises contemplated by this
Agreement, each Party will and will cause its Affiliates to take all such lawful
and necessary action, so long as such action is consistent with this Agreement.
10.3 Notices. All notices, requests, demands, waivers and other
communications required or permitted to be given under this Agreement shall be
in writing and shall be deemed to have been duly given if (a) delivered
personally, (b) sent by next-day or overnight mail or delivery or (c) sent by
facsimile, as follows:
As to E, Inc.: Evergreen Solar, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
with a copy to: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇,
Professional Corporation
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇'▇▇▇▇▇▇
Phone: ▇ ▇▇▇ ▇▇▇-▇▇▇▇
Fax: ▇ ▇▇▇ ▇▇▇-▇▇▇▇
With a copy to: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇(▇▇▇▇)▇ ▇▇
▇-▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Phone: ▇▇▇▇ ▇▇ ▇▇▇▇▇▇ ▇
Fax: ▇▇▇▇ ▇▇ ▇▇▇▇▇▇ ▇▇
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As to Q AG: Q-Cells AG
▇▇▇▇▇▇▇▇▇▇▇. ▇▇
▇-▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Phone: ▇▇▇-▇▇ ▇▇-▇▇ 8-60
Fax: ▇▇▇-▇▇ ▇▇-▇▇ 8-777
with a copy to: ▇▇▇ ▇▇▇▇▇ Rechtsanwaelte
▇▇▇▇▇▇▇▇▇▇. ▇▇
▇-▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇
Phone: +49-30-31 51 90 0
Fax: +49-30-31 51 90 90
or, in each case, at such other address as may be specified in writing to
the other parties hereto.
All such notices, requests, demands, waivers and other communications
shall be deemed to have been received (w) if by personal delivery on the day
delivered, (x) if by next-day or overnight mail or delivery, on the day
delivered, or (y) if by facsimile, on the day on which such facsimile was sent;
provided that the Party providing notice pursuant to facsimile shall have
received a confirmation of receipt of such facsimile transmission.
10.4 Governing Law and Dispute Resolution.
(a) This Agreement shall be construed in accordance with and
governed by the laws of the Federal Republic of Germany.
(b) All disputes arising in connection with this Agreement or its
validity or any agreement provided herein which cannot be resolved by mutual
agreement of the Parties shall be finally settled in accordance with the
Arbitration Rules of the German Institution of Arbitration e.V. (DIS) without
recourse to the ordinary courts of law (except for challenges to the validity of
shareholder resolutions which shall be submitted to the competent courts). The
place of arbitration is Berlin, Germany. The arbitral tribunal consists of three
arbitrators. The arbitrators must be capable of being appointed a judge in
accordance with the relevant German legal rules. The substantive law of the
Federal Republic of Germany is applicable to the dispute. The language of the
arbitral proceedings is English.
10.5 Binding Effect. This Agreement shall be binding upon and inure to
the benefit of the Parties hereto and their respective heirs, successors and
permitted assigns.
10.6 Assignment. Other than as expressly otherwise provided herein, this
Agreement shall not be assignable or otherwise transferable by any Party hereto
without the prior written consent of all the other parties hereto, and any
purported assignment or other transfer without such consent shall be void and
unenforceable; provided, however, that any Party may assign this Agreement:
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(a) to any of its Affiliates so long as it will be made at the
same time as a transfer of its Shares to such Affiliate specifically permitted
by this Agreement;
(b) in connection with the sale by a Party of all of the Shares
beneficially owned by such Party as specifically provided by this Agreement,
including by way of the Change of Control of such Party.
(c) For the avoidance of doubt, neither Party shall be obligated
to obtain the consent of the other Party (under this Section 10.6) solely by
virtue of a Change of Control of such Party.
10.7 No Third Party Beneficiaries. Except as specifically provided by
this Agreement, nothing in this Agreement shall confer any rights upon any Third
Party.
10.8 Foreign Corrupt Practices Act.
(a) The Parties recognize that the United States Foreign Corrupt
Practices Act of 1977 (the "ACT") shall be applicable to VentureCo, its
Affiliates and its designated directors, officers and personnel in VentureCo,
even if VentureCo does not conduct any business in the United States of America.
The Parties recognize that the Act prohibits the payment or giving of anything
of value either directly or indirectly to a government official for the purpose
of influencing an act or decision in his or her official capacity, or for the
purpose of inducing him or her to use his or her influence with his or her
government to assist a company in obtaining or retaining business for or with,
or directing business to, any Person.
(b) Each Party shall each use its reasonable best efforts to
ensure that no part of VentureCo capital or other funds will be accepted or used
by the Company for any purpose, nor will it take any action, which would
constitute a violation of any law of the various jurisdictions in which it
conducts business or of the Act.
Should E or Q ever receive, directly or indirectly, a request that any of
them believes will or might constitute a violation of the Act, it shall
immediately notify the Supervisory Board of VentureCo.
10.9 Amendment, Waivers. No amendment, modification or discharge of this
Agreement, and no waiver hereunder, shall be valid or binding unless set forth
in writing and duly executed by each of E and Q.
10.10 Entire Agreement. This Agreement constitutes the entire agreement
and supersedes all prior agreements and understandings both written and oral,
between or among any of the Parties with respect to the subject matter hereof.
10.11 No Joint Venture or Partnership. Notwithstanding anything contained
in this Agreement or the Concurrent Agreements to the contrary, including the
use of the terms "joint venture", "VentureCo" and similar terms, nothing
contained in this Agreement or the Concurrent Agreements is intended to, or
shall be deemed to, create a partnership or joint venture relationship among the
Parties or any of their Affiliates for any purpose, including tax purposes.
Neither of the Parties nor any of the Affiliates will take a position contrary
to the foregoing.
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10.12 Language for Joint Venture and this Agreement. All agendas, notices,
other documentation relating to (i) VentureCo's interaction with the Parties,
(ii) documentation provided to the Parties and (iii) interaction between the
Shareholders, including without limitation this Agreement, meetings of the
Supervisory Board and the Shareholders of VentureCo, and VentureCo's financial
statements, shall be prepared in and entered into the English language. In the
event of any dispute concerning the construction or meaning of this Agreement,
the text of the Agreement as written in the English language shall prevail over
any translation of this Agreement that may have been or will be made.
10.13 Voting and other rights. Each of the Parties shall join with the
other Party in exercising all voting rights and other rights and powers of
control as are respectively available to them in relation to VentureCo and their
beneficial shareholdings therein under the Articles of Association for the time
being in force and shall each take or refrain from taking all other appropriate
action within their respective powers so as to procure that at all times during
the subsistence of this Agreement all provisions concerning the structure and
organisation of VentureCo and the regulation by the Parties of its affairs set
out in this Agreement are duly observed and given full force and effect and all
actions required of the Parties are carried out in a timely manner. Without
prejudice to the generality of the foregoing each Party shall procure that
(subject to their fiduciary duties) each of the directors appointed by the
Parties, as provided herein, shall execute and do all acts and things and give
and confer all such powers and authorities as they would have been required to
execute, do, give and/or confer had they been a Party hereto and had consented
in the same terms as the Party which appointed them.
10.14 Severability. In the event that any term, condition or provision of
this Agreement is held to be or become invalid or be a violation of any
applicable Law, statute or regulation, the same shall be deemed to be deleted
from this Agreement and shall be of no force and effect and the Agreement shall
remain in full force and effect as if such term, condition or provision had not
originally been contained in this Agreement. The validity and enforceability of
the other provisions shall not be affected thereby. In such case or in the event
that this Agreement should have a gap, the Parties hereto shall agree on a valid
and enforceable provision completing this Agreement, coming as close as possible
to the economic intentions of the Parties. In the event of a partial invalidity
(Teilnichtigkeit) the Parties agree that this Agreement shall remain in force
without the invalid part. This shall also apply if parts of this Agreement are
partially invalid (teilnichtig).
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The above Deed and the attached Schedule 3.6 were read in the presence of the
notary to the persons appearing, approved by them and signed by them and the
notary in their own hands as follows:
Signed: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Signed: Ch. ▇. ▇▇▇▇▇▇
Signed: ▇. ▇▇▇▇▇▇▇▇
Signed: ▇. ▇▇▇▇▇▇▇▇, Notar
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SCHEDULE 3.6 TO DEED NUMBER 7 OF THE ROLL OF DEEDS FOR 2005
[*]
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[*] This provision is the subject of a Confidential Treatment Request.
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