EXHIBIT 2.1
STRICTLY CONFIDENTIAL
SHARE SALE AND PURCHASE AGREEMENT
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between
▇. ▇▇▇▇▇▇▇▇▇ Holding A/S,
EQT Scandinavia Ltd. as Investment Manager
and
York International Corporation
Between ▇. ▇▇▇▇▇▇▇▇▇ Holding A/S
(Reg. No. A/S 40.031)
Sankt ▇▇▇▇▇ ▇▇▇▇▇ ▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ K
Denmark
(hereinafter referred to as "▇▇▇▇▇▇▇▇▇")
EQT Scandinavia Ltd. as
the investment manager for a consortium of direct
investors listed in Schedule 1
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(hereinafter the direct investors are jointly referred
to as "EQT")
and York International Corporation
▇.▇. ▇▇▇ ▇▇▇▇-▇▇▇▇
▇▇▇▇, ▇▇ ▇▇▇ ▇▇▇▇▇-▇▇▇▇
(hereinafter referred to as "the Buyer")
(▇▇▇▇▇▇▇▇▇ and EQT are hereinafter jointly referred to as the "Sellers" and the
Sellers and the Buyer are hereinafter jointly referred to as the "Parties" or
individually a "Party".)
WITNESSETH, that
WHEREAS, ▇▇▇▇▇▇▇▇▇ is a public limited company incorporated under the laws of
Denmark with its shares listed at the Copenhagen Stock Exchange;
WHEREAS, EQT Scandinavia Ltd. is a public limited company incorporated under the
laws of Guernsey and who is acting as the investment manager for the direct
investors listed in Schedule 1 and who is the general partner of EQT Scandinavia
I Limited Partnership and of EQT Scandinavia I Limited Partnership II;
WHEREAS, the Sellers are the owners of the entire subscribed for and issued
share capital, equal to DKK 380,000,000 (Three hundred and eighty million Danish
Kroner), in Sabroe Refrigeration
A/S, a public limited company incorporated under the laws of Denmark;
WHEREAS, Sabroe Refrigeration A/S and its subsidiaries and associated companies
are engaged primarily in the production, marketing, sales and after sales
services of refrigeration equipment for industrial and marine purposes mainly;
WHEREAS, the Buyer is a public limited company incorporated under the laws of
the United States of America and is part of a group, the activities of which
include production, marketing, sales and after sales services of refrigeration
equipment for industrial and marine purposes and, consequently, has a profound
knowledge of the business activities conducted by Sabroe Refrigeration A/S and
its group and a similar knowledge of the current terms of the relevant markets
and the major competitors engaged in such markets;
WHEREAS, the Buyer has completed a due diligence review of Sabroe Refrigeration
A/S and its subsidiaries based on the Due Diligence Documentation (as defined
below) and the Buyer has participated in meetings with the management of Sabroe
Refrigeration A/S during which meetings the Buyer has received additional
information on Sabroe Refrigeration A/S and its subsidiaries;
WHEREAS, the Sellers wish to sell all their shares in Sabroe Refrigeration A/S
and the Buyer wishes to acquire these shares for the consideration, upon the
terms and subject to the conditions herein set forth;
NOW, THEREFORE, on the basis of the representations, warranties, covenants and
agreements contained in this Share Sale and Purchase Agreement, it is hereby
agreed as follows:
DEFINITIONS
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For the purposes of this Share Sale and Purchase Agreement, unless the context
otherwise requires, the term
"Accounting Principles" means the accounting principles stated in the
Consolidated 1998 Accounts;
"Agreement" means this Share Sale and Purchase Agreement including all the
Schedules hereto;
"Associated Companies" means the companies set forth in Schedule 2;
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"Buyer's Group Companies" means the Buyer, and any company or other legal entity
controlled - directly or indirectly - by the Buyer;
"Claims" shall have the meaning set forth in clause 8.2.1.
"Closing" shall have the meaning set forth in Section 4;
"Closing Date" means June 15, 1999 or such later date agreed upon between the
Parties pursuant to clause 4.1;
"Company" means Sabroe Refrigeration A/S, Reg. No. A/S 225.531 with the Danish
Commerce and Companies Agency, with its registered address at Christian X's ▇▇▇
▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇;
"Consolidated 1998 Accounts" means the audited annual accounts of the Company
and the group accounts as per December 31, 1998 enclosed as Schedule 3 to this
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Agreement and as approved by an ordinary meeting of shareholders held on March
12, 1999;
"Control" means the direct or indirect possession of more than 50 percent of the
ownership interest or the voting rights of a legal entity or the right to
appoint or remove the majority of the members of the board of directors or the
similar management level of a legal entity;
"Cost of Equity Adjustment" means 5 percent per annum calculated as 360 days;
"Due Diligence Documentation" means the documentation set forth in Schedule 4;
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"Group" means the Company, the Subsidiaries and the Associated Companies;
"Group Company" means the Company or any Subsidiary or Associated Company;
"Knowledge" means
1. with respect to the Sellers the actual knowledge of any of the Sellers'
respective officers and directors set forth in Schedule 5 (Section 1) after
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having made due inquiries of the persons listed in Schedule 5 (Section 2),
and
2. with respect to the Buyer the actual knowledge of any of the officers and
directors of the Buyer involved in this transaction as well as of their
legal and financial advisors;
"Loss" means a documented loss, claim, liability, cost or expense recoverable
under the laws of Denmark;
"Management" means the persons listed in Schedule 6;
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"Management Subscription Rights" means the right of the Management according to
the convertible loans to subscribe for new shares in the Company on the terms
set forth in Schedule 7 and the creditor's rights pertaining to the convertible
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loans referred to in the said Schedule;
"Management Subscription Rights Consideration" means any amount to be paid at or
prior to Closing by the Company as set forth in clause 1.2
"Purchase Price" means the amount in Danish Kroner referred to in clause 2.1.;
"Shares" means all of the shares issued by the Company, equal to nominal DKK
380,000,000 (Three hundred and eighty million Danish Kroner).
"Shareholders' End of March Adjustment" means the amount in Danish Kroner
determined pursuant to the principles of calculation and dispute resolution
mechanism set forth in Schedule 8;
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"Subsidiaries" means the companies listed in Schedule 9;
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"Taxes" means all taxes, including VAT and other levies, duties, charges, stamps
and imposts of whatever nature imposed by a tax authority,
1. Purchase and sale of the Shares etc.
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1.1 Upon the terms and subject to the conditions of this Agreement, the
Sellers shall sell the Shares and shall undertake that the Management
sells the Management Subscription Rights to the Buyer and the Buyer
shall purchase the Shares from the Sellers and the Management
Subscription Rights from the Management, all with effect from Closing.
1.2 The Company shall offer each member of the Management to acquire such
member's part of the Management Subscription Rights at Closing in
consideration of a cash payment to be made by the Company equal to the
part of the Purchase Price attributable to each member's part of the
Management Subscription Rights. The Consideration payable by the Company
shall equal the consideration which should have been paid by the Buyer
in respect of such Management Subscription Rights if the Buyer had
acquired these.
2. Purchase Price
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2.1 The total consideration payable by the Buyer in favour of the Sellers
for the assignment in ownership of the Shares and to the Management for
the assignment in ownership of the Management Subscription Rights, if
any, shall be the aggregate amount in Danish Kroner of
(1) the consolidated net equity as per December 31, 1998 pursuant to
the Consolidated 1998 Accounts, equal to DKK 722,755,000 (seven
hundred twentytwo million seven hundred fiftyfive thousand Danish
Kroner),
(2) an amount in Danish Kroner equal to 2,127,245,000 (two billion one
hundred twentyseven million two hundred fortyfive thousand),
adjusted for
(3) the Shareholders' End of March Adjustment, less
(4) the amount in Danish Kroner payable by the Company to the
Management as additional consideration (in excess of the DKK
50,000,000 already settled) for the warrants purchased by the
Company prior to the end of December 31, 1998.
2.2 The part of the Purchase Price paid by the Buyer in favour of any of the
members of the Management selling their Management Subscription Rights
to the Buyer shall be distributed between these members in proportion to
their ownership interests in the Management Subscription Rights acquired
by the Buyer.
3. Conditions precedent
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3.1 Closing is conditional upon each and every of the following conditions
precedent having been satisfied (or waived by the relevant Party):
3.1.1 Conditions precedent which may be waived by the Buyer
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1. The Sellers shall have performed and complied in all material
respects with their obligations under this Agreement on and before
Closing so that the transactions contemplated by this Agreement
are not in any material respect adversely affected.
2. No litigation, proceeding or action shall have been instituted
against any Party, seeking to restrain or prohibit the
consummation of the transactions contemplated herein.
3. All approvals, authorisations and consents by public authorities
required by applicable EU or national law shall have been
obtained, cf. clauses 3.2 - 3.4.
4. The Purchase Price shall have been finally determined as set
forth in Schedule 8.
5. All activities conducted by the Company or any Subsidiary through
any branch in Cuba shall have been disposed of or otherwise
brought to an end. Such activities involve the contracting of
three employees and an agency agreement.
3.1.2 Conditions precedent which may be waived by the Sellers
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1. The Buyer shall have performed and complied in all material
respects with all of its obligations under this Agreement on and
before Closing so that the transactions contemplated by this
Agreement are not in any material respect adversely affected.
2. No litigation, proceeding or action shall have been instituted
against any Party, seeking to restrain or prohibit the
consummation of the transactions contemplated herein.
3. All approvals, authorisations and consents by public authorities
required by applicable EU or national law shall have been
obtained, cf. clauses 3.2 - 3.4.
4. The Purchase Price shall have been finally determined as set forth
in Schedule 8.
3.2 Each Party shall use its best efforts to cause that the conditions
precedent are satisfied on or prior to July 1st 1999 or such later date
as the Parties may subsequently agree upon. In particular, the Parties
agree to promptly effect all necessary notifications to relevant anti-
trust and other public authorities, including the European Commission,
and to effect all other submissions and rendering of information
requested or required by such authorities with a view to obtaining all
approvals requisite for the consummation of the transactions
contemplated by this Agreement.
The Parties shall in common co-ordinate the proper and timely fulfilment
of all notification requirements to be observed as a consequence of this
Agreement. To this effect the legal advisors of the Sellers shall, at
their request, have access (including by way of copies) to all
information necessary for such notifications as well as to the
notifications actually made and any correspondence etc. arising
therefrom.Furthermore, at their request, the legal advisors of the
Sellers shall have the right to participate in any and all meetings with
relevant authorities.
3.3 If the conditions precedent set forth in clauses 3.1.1 (3) and 3.1.2 (3)
have not been satisfied (or waived) on August 1st, 1999 at the latest, or
such other date as the Parties may subsequently agree upon, the Sellers
may at any time thereafter terminate this Agreement with immediate
effect. In case of such termination neither of the Parties shall have any
liability towards the other unless the reason for the conditions
precedent not being satisfied is a consequence of the Buyer being in
breach of any of its obligations under this Agreement.
3.4 If one or more of the approvals, authorisations and consents referred to
in clauses 3.1.1 (3) and 3.1.2 (3) which in any material respect may have
an adverse affect on the Group are not granted or are granted subject to
undertakings, obligations or conditions which in a material respect may
adversely affect the value of the Group, the Buyer may terminate this
Agreement with immediate effect by written notice to the Sellers. In case
of such termination neither of the Parties shall have any liability
towards the other, unless the reason for the condition precedent not
being satisfied is a consequence of any of the Parties being in breach of
any of their obligations under this Agreement.
If one or more of the approvals, authorisations and consents referred to
in clauses 3.1.1 (3) and 3.1.2 (3) are not granted, but this does not in
any material re-
spect adversely affect the value of the Group, the Parties shall arrange
for the Group to take such actions, including by way of disposing of any
assets, as are necessary to obtain such consents or to avoid having to
obtain such consents.
If any of such approvals, authorisations and consents are granted subject
to undertakings, obligations or conditions which do not in any material
respect adversely affect the value of the Group, the Buyer shall accept
such undertakings, obligations and conditions and the Parties shall
without undue delay arrange for their fulfilment.
4. Closing
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4.1 Closing shall be held at the offices of Kromann & ▇▇▇▇▇▇, 14,
Raadhuspladsen, DK-1550 Copenhagen V, Denmark on June 15, 1999 at 2 p.m.
Danish time or, if all the conditions precedent have not been satisfied
(or waived by the relevant Party), by a date within 5 business days after
the conditions precedent have been satisfied, unless this Agreement has
been terminated as set forth herein.
4.2 At Closing the Sellers shall deliver, or shall cause to be delivered, to
the Buyer, the following documents and material:
1. The original share certificates pertaining to the Shares duly
endorsed in the name of the Buyer.
2. The original convertible bonds and a statement duly signed by the
Management according to which statement the Management Subscription
Rights are transferred in ownership to the Buyer and/or the Company
and the members of the Management accept that the amount payable by
the Buyer and/or the Company in consideration thereof is paid with
discharging effect as set forth in this Agreement.
3. The Company's up-to-date, complete and original register of
shareholders with the Buyer duly registered as the sole shareholder.
4. The Company's up-to-date, complete and original minute book,
including minutes of general meetings, meetings of the board of
directors and audit minutes. The minute book shall include duly
signed minutes of a meeting of the Company's board of directors, at
which meeting the board of directors shall have granted their
consent to the transfer in ownership of the Shares to the Buyer such
as required in article 4.7 of the Company's articles of association.
5. A letter of resignation signed by those members of the boards of
directors of the Company and of the Subsidiaries as will be notified
by the Buyer to the Sellers not later than 14 days before Closing.
The resignation shall be effective as of Closing.
6. A letter of resignation signed by those statutory auditors of the
Company and of the Subsidiaries as will be notified by the Buyer to
the Sellers not later than 14 days before Closing. The resignation
shall be effective as of Closing.
4.3 At Closing the Buyer shall:
1. Pay by wire transfer DKK 400,000,000 (four hundred million Danish
Kroner) in cash into an Escrow Account (hereinafter referred to as
the "Escrow Account") with Den Danske Bank Aktieselskab or another
Danish bank agreed upon between the Parties (hereinafter referred to
as the "Escrow Agent") subject to the terms of the Escrow Agreement
attached hereto as Schedule 10 (and subject to any amendments which
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may be required by the Escrow Agent) as security for any Claim
caused by a breach of any of the Sellers' representations and
warranties in Section 5.
2. Pay in favour of the Sellers the Purchase Price with addition of the
Cost of Equity Adjustment (calculated from April 1, 1999 until and
including the Closing Date), less the amount deposited in the Escrow
Account as set forth in clause 4.3 (1) and less the Management
Subscription Rights Consideration, in cash in Danish Kroner by wire
transfer to two bank accounts, one of which will be designated by
each of the Sellers prior to Closing. Such amount shall be divided
equally between ▇▇▇▇▇▇▇▇▇ and EQT and one half of such amount shall
be paid to each of the two bank accounts.
4.4 Except where amounts have been paid to the Buyer in accordance with 4.4
(1) or shall remain in the Escrow Account in accordance with 4.4 (2), the
principal of the Escrow Amount shall be released in favour of the Sellers
as follows:
Release Date Release Amounts
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July 1, 2000 DKK 300,000,000
July 1, 2001 DKK 25,000,000
July 1, 2002 DKK 25,000,000
July 1, 2003 DKK 25,000,000
July 1, 2004 DKK 25,000,000
(1) From the Escrow Account shall be released in favour of the Buyer
amounts in respect of Claims raised and settled (either amicably or
through arbitration as set forth in clause 9.11) between the
Parties.
(2) If at any Release Date any unsettled Claims exists, an amount
corresponding to such unsettled Claims shall remain in the Escrow
Account until the date at which such Claims are settled (either
amicably or through arbitration as set forth in clause 9.11) between
the Parties.
4.5 ▇▇▇▇▇▇▇▇▇ and EQT undertake to use the proceeds referred to in clause 4.3
(2) to settle any and all fees and expenses payable to ▇▇▇▇▇▇ ▇▇▇▇ Bank
A/S in respect of services rendered in connection with the IPO prepared
and to their advisors incurred in connection with negotiating, delivering
and consummating this Agreement.
4.6 The Buyer warrants that the amount referred to in 2.1 (4) and the
Management Subscription Rights Consideration shall be effectively settled
by the Company.
5. Representations and warranties of the Sellers
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5.1 Effective as of the execution of this Agreement (and with respect to
clauses 5.1.2 (Authority) effective also as of Closing and clauses 5.1.3
(Title to shares) and 5.1.4 (Title to Management Subscription Rights)
effective only as of Closing) the Sellers - unless otherwise specifically
stated herein - on a pro rata basis in proportion to their ownership
interests in the Shares make the following representations and warranties
to the Buyer:
5.1.1 Organisation and qualification
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a) Each of the Company, the Subsidiaries and the Associated Companies is
a corporation or a limited liability company duly organised, validly
existing and in good standing under the laws of its jurisdiction of
incorporation, with all requisite corporate power and authority to
own, operate and lease its assets and to carry on its business as it
is now being conducted.
5.1.2 Authority
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a) Each of the Sellers represents and warrants with respect to itself,
that it has full corporate power and authority to execute and deliver
this Agreement and to consummate the transactions contemplated
hereby.
b) Each of the Sellers represents and warrants with respect to itself,
that its execution and delivery of this Agreement and the
consummation by it of the transactions contemplated hereby have, to
the extent legally required or required by corporate governance, been
duly authorised by its board of directors, and this Agreement
constitutes a valid and binding obligation enforceable against it in
accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency or other similar laws
which affect the enforcement of creditors' rights in general.
c) Each of the Sellers represents and warrants with respect to itself,
that there are no actions, claims or other proceedings or
investigations pending or threatened against or involving the
Sellers, which, individually or in the aggregate, prevent the Sellers
from consummating the transactions contemplated by this Agreement or
affect the validity or enforceability of this Agreement.
5.1.3 Title to the Shares
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a) Each of the Sellers represents and warrants with respect to itself,
that it is the legal and beneficial owner of the part of the Shares
attributable to it as set forth in Schedule 11 and is capable at
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Closing of transferring the title to the relevant part of the Shares
to the Buyer free and clear of any lien, claim, charge, option or
other encumbrance.
5.1.4 Title to the Management Subscription Rights
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a) The Sellers are capable at Closing of having the title to the
Management Subscription Rights transferred to the Buyer and/or the
Company free and clear of any lien, claim, charge, option or other
encumbrance.
5.1.5 Capitalisation
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a) The Shares have all been properly and validly issued and are fully
paid.
b) With exception of the Management Subscription Rights the Company and
the Subsidiaries have not issued any debt convertible into shares nor
have the Company or the Subsidiaries issued any warrants or any other
instruments entitling any third party to acquire or subscribe for
shares in the Company or any of the Subsidiaries.
5.1.6 Subsidiaries and Associated Companies
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a) The Company is, directly or indirectly, the legal and beneficial owner
of the shares in the Subsidiaries and the Associated Companies to the
extent set forth in Schedules 2 and 9 and such shares are free and
clear of any lien, claim, charge, option or other encumbrance.
b) Neither the Company nor any Subsidiary has agreed to acquire any
direct or indirect ownership in any other companies.
c) None of the Subsidiaries or the Associated Companies have been
dissolved or declared bankrupt and no resolution to dissolve any of
these companies have been adopted by any Subsidiary or, to the
Knowledge of the Seller, by any Associated Company.
5.1.7 Accounts
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a) The Consolidated 1998 Accounts have been prepared in accordance with
the accounting provisions of the Danish Company Accounts Act
("Arsregnskabsloven") and with the Accounting Principles applied on a
consistent basis as set forth in such accounts.
b) The Consolidated 1998 Accounts give a true and fair view ("retvisende"
as defined in the Danish Company Accounts Act) of the group's (as
defined in such accounts) assets and liabilities, financial position
and profit for 1998.
c) The Company can collect the receivable included in the Consolidated
1998 Accounts with respect to Fincantieri equal to DKK 87,081,000.
d) Pension liabilities for employees employed as of December 31, 1998 by
the Company and any Subsidiary are either fully funded or provided for
in the Consolidated 1998 Accounts and any unfunded liabilities with
respect to such employees have been computed and accounted for on an
actuarial basis.
5.1.8 Adequacy of assets
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a) The assets, to which the Company and each Subsidiary have a good and
marketable title, or a valid leasehold interest in, include all assets
necessary for the conduct of the Company's and each Subsidiary's
businesses as conducted during 1998 and as presently conducted and
include substantially all of those assets actually used in the conduct
of the businesses in the period from January 1, 1998 up to the date
hereof except as disposed of in the ordinary course of business.
5.1.9 Tax
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a) All Tax returns required to be filed by the Company and each
Subsidiary and, to the Knowledge of the Sellers, by each Associated
Company have in all material respects been duly filed within
applicable time limits pursuant to applicable laws.
b) Neither the Company nor any Subsidiary are involved in a dispute in
relation to Tax involving a claim made in excess of DKK 2,000,000 for
the Company and its Subsidiaries taken as a whole. To the
Knowledge of the Sellers no such dispute is threatened against the
Company or any Subsidiary.
c) Sabroe do Brazil is under no obligation with respect to Tax claims in
respect of any Tax liability of its former subsidiary Sabroe
Tupinequim Technica.
5.1.10 Real estate and environmental issues
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a) Except for any real estate which may have been disposed of in the
course of normal business, the Company and each Subsidiary have good
and marketable title to, or a valid leasehold interest in, the real
estate reflected in the Consolidated 1998 Accounts.
b) The Company and the Subsidiaries have in all material respects
conducted their business in compliance with relevant environmental
laws and environmental licenses.
c) Neither the Company nor any of the Subsidiaries are engaged in any
dispute with a public authority relating to environmental laws
involving a claim, including claims for investments to be made, in
excess of DKK 2,000,000 and to the Knowledge of the Sellers no such
dispute is threatened.
d) There are no unusual or onerous liens or encumbrances restricting in
any material respect the business of the Company and the Subsidiaries
(on a consolidated basis) as it is now being conducted.
5.1.11 Intellectual property rights
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a) The Company and the Subsidiaries, and, to the Knowledge of the
Sellers, the Associated Companies hold valid title or license to use
all patents, designs, tradenames, trademarks and know-how necessary
for the Group to carry out its business in all material respects as
done hitherto.
b) Neither the Company nor any of the Subsidiaries are engaged in any
dispute in which any third party has claimed that any of these
companies infringe the intellectual property rights of the third party
and in which dispute the third party has claimed an amount in excess
of DKK 2,000,000 or which in any material respect may adversely affect
the business of the Group. To the Knowledge of the Sellers no such
dispute is pending or threatened.
5.1.12 Employees
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a) All employment contracts with the employees of the Company and of the
Subsidiaries and, to the Knowledge of the Sellers, the Associated
Companies have been entered into in the best interest of the relevant
companies.
b) The employees of the Company and of the Subsidiaries and, to the
Knowledge of the Sellers, the Associated Companies have been employed
on terms and conditions which in all material respects are consistent
with normal practices in the relevant labour markets.
c) No employee of the Company or any Subsidiary (with an annual salary in
excess of DKK 500,000 payable in cash (excepting ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇))
has been granted a notice period in excess of 12 months or any
severance payments (other than required by law). All managing
directors of such companies have undertaken non-compete clauses.
d) The operations of the Company and the Subsidiaries are in all
material respects in compliance with health and safety
regulations required by law.
5.1.13 Insurance
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a) The insurance policies taken out by the Company and its
Subsidiaries as set forth in Schedule 12 are in effect.
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b) There are no outstanding individual claims in excess of DKK
2,000,000 under any of the said insurance policies where the
insurer has rejected to cover the claim made.
5.1.14 Litigation
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a) Neither the Company nor any of the Subsidiaries are engaged in
any litigation or arbitration involving a statement of claim in
excess of DKK 2,000,000 or which may have a similar material
adverse affect on the position of the Group and to the Knowledge
of the Sellers no such litigation or arbitration is pending or
threatened. Adequate provisions (in the aggregate) have been made
in the Consolidated 1998 Accounts with respect to such pending
litigation.
5.1.15 Change of ownership
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a) The execution and delivery of this Agreement and the consummation
of the transactions contemplated hereby will not
1. allow any third party to terminate, rescind or in any other
way break off or modify any material contractual
relationship with the Company or any Subsidiary,
2. entitle any director, manager or employee of the Company or
any Subsidiary to receive any termination or severance
payment, or
3. violate, conflict with or result in a violation or breach of
the terms, conditions or provisions of any material
agreement executed by the Company or any Subsidiary.
5.1.16 Competition law
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a) The Company and the Subsidiaries have in all material respects
conducted their business in compliance with applicable
competition laws.
5.1.17 Disclosures
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a) To the Knowledge of the Sellers the following information has in
a fair manner been disclosed to the Buyer in the Due Diligence
Documentation:
1. All loan agreements and similar financial arrangements to
which the Company or any Subsidiary is a party involving a
payment obligation in excess of DKK 5,000,000.
2. All written agreements by way of which the Company and the
Subsidiaries since May 1st, 1996 have acquired or disposed
of any ownership interest in any legal entity or business.
3. Samples of collective labour agreements and pension
arrangements (other than as required by law) entered into by
the Company or the Subsidiaries and which are still in
effect.
5.1.18 Conduct of Businesses after January 1, 1999
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a) Since January 1, 1999 the businesses of the Company, each
Subsidiary, and to the Knowledge of the Sellers of each
Associated Company
1. have been conducted only in the ordinary course, without any
interruption or alteration in nature, scope or manner and
consistent with past practices;
2. have not suffered any change or condition which, in any case
or in the aggregate, has had a material adverse effect upon
the Group's condition (financial or otherwise), assets,
liabilities, businesses, operations or prospects.
6. Representations and warranties of the Buyer
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6.1 Effective as of the execution of this Agreement and as of Closing the
Buyer represents and warrants the following to the Sellers:
6.1.1 Organisation and qualification
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a) The Buyer is a company duly organised, validly existing and in
good standing under the laws of its jurisdiction of incorporation
with all requisite corporate power and authority to own, operate
and lease its assets and to carry on its business as it is now
being conducted.
6.1.2 Authority
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a) The Buyer has full corporate power and all necessary authority to
execute and deliver this Agreement and to consummate the
transactions contemplated hereby.
b) The execution and delivery of this Agreement and the consummation
of the transactions contemplated hereby have, to the extent
legally required or required by corporate governance, been duly
authorised by the Buyer's board of directors and no other
corporate proceedings on the part of the Buyer are necessary to
authorise this Agreement or to consummate the transactions
contemplated hereby. This Agreement constitutes a valid and
binding obligation of the Buyer enforceable against the Buyer in
accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency or other similar
laws which affect the enforcement of creditors' rights in
general.
c) There are no actions, claims or other proceedings or
investigations pending or threatened against or involving the
Buyer, which, individually or in the aggregate, prevent the Buyer
from consummating the transactions contemplated by this Agreement
or affect the validity or enforceability of this Agreement.
7. Additional covenants
--------------------
7.1 Restrictive covenant
--------------------
If this Agreement is terminated, irrespective of the cause for such
termination, for a period of two years from such termination, the
Buyer shall not, and shall cause each of the Buyer's Group Companies
not to, directly or indirectly, engage, employ, solicit or contact
with the view to his or her engagement or employment any of the
persons listed in Schedule 13.
-----------
7.2 Interim relations
-----------------
7.2.1 Pending Closing the Sellers shall cause that the business of the
Company and of the Subsidiaries and, to the extent possible, of the
Associated Companies is carried out in the ordinary course of business
consistent with past practice so as to maintain the Group as a going
concern.
7.2.2 No dividends shall be made from the Company regarding the fiscal year
1998 or any prior fiscal year.
7.2.3 Pending Closing, a transaction which, given the Company's activities,
is unusual or of a substantial magnitude such as any business
acquisitions or capital expenditures in excess of DKK 5,000,000 shall
require the Buyer's prior written consent. Effective promptly upon
execution, the Buyer shall have the right to nominate one (1) member
of the Company's Board of Directors.
7.3 Further assurances
------------------
Each of the Parties shall execute such documents and take such actions
as may be reasonably required to carry out the provisions of this
Agreement and the transactions contemplated hereby.
8. Remedies
--------
8.1 General
-------
8.1.1 The Sellers, pro rata in proportion to their ownership interests in
the Shares, hereby undertake to indemnify the Buyer for all Losses
actually suffered by the Buyer as a result of any breach of the
representations and warranties or covenants of the Sellers under this
Agreement.
8.1.2 In case of any breach of clauses 5.1.2 (Authority), 5.1.3 (Title to
the Shares) or 5.1.4 (Title to the Management Subscription Rights),
the Buyer shall have as its only and exclusive remedy the right to
rescind this Agreement.
8.2 Claims
------
8.2.1 In order to be valid, any claims made by the Buyer under this
Agreement (hereinafter referred to as a "Claim") shall be notified in
writing to the Sellers as follows:
1. Each Claim shall state its specific grounds and the amount
claimed and shall be accompanied by all written documentation
necessary to reasonably support the Claim, and
2. each Claim shall be notified in writing by the Buyer to the
Sellers no later than 45 days after the Buyer has become aware of
the circumstances giving rise to the Claim.
8.2.2 Claims of a general nature which do not identify the grounds on which
they are based or are not accompanied by the documentation set forth
in 8.2.1 (1) shall not be considered as valid under this Agreement.
Furthermore, failure to give notice of any Claim within the time
period specified in clause 8.2.1 (2) shall automatically result in the
Claim being forfeited by the Buyer.
8.2.3 The Buyer shall not be entitled to make any Claims with respect to any
breach of the Sellers' representations and warranties in Section 5 if,
and to the extent, the basis or potential for such Claims has been
fairly disclosed in the Due Diligence Documentation, fairly disclosed
in any other way by the Sellers or otherwise within the Buyer's
Knowledge as of the execution of this Agreement. To the extent the Due
Diligence Documentation has contained any untrue statement of material
fact or has omitted a material fact necessary in order to make the
statements actually made in the Due Diligence Documentation not
misleading, the existence of such statements in the Due Diligence
Documentation, shall be deemed not to have been disclosed.
8.3 Dead-line for submission of Claims
----------------------------------
The Sellers shall have no liability under this Agreement with respect
to any Claim notified to the Sellers after June 30, 2000 provided,
however, that the Sellers remain liable with respect to any Claim
relating to Tax and environmental issues until June 30, 2004
8.4 Third party claims
------------------
In the event any third party asserts any claim, based on which a Claim
is notified to the Sellers, the Sellers shall have the right, at their
election, risk and expense, to control the defence of such third party
claim by giving notice within 30 days from the date of the Claim
having been notified to the Sellers. The Buyer shall cause the
relevant company to co-operate with the Sellers and with any counsel
appointed by the
Sellers. The Buyer shall cause that such third party claims and any
counterclaims are not settled and that no liability is admitted
without the prior written consent of the Sellers. The Sellers shall
keep the Buyer informed in reasonable detail during the defence of any
such third party claims.
8.5 Losses
------
Any Loss for which a Claim is notified to the Sellers shall be
calculated in accordance with the laws and general rules of law of
Denmark subject to the following principles:
1. the effect of any Tax benefit or saving by the Buyer, the Company
or by any of the Subsidiaries shall be deducted when calculating
the Loss;
2. the amount of any compensation or other recovery (including
without limitation insurance proceeds) actually paid to the
Buyer, the Company and/or the Subsidiaries shall be deducted when
calculating the Loss. If a Claim has been settled by the Sellers
and the relevant company subsequently recovers any payment or
compensation with respect to such Claim the Buyer shall pay to
the Sellers the amount so recovered;
3. the occurrence of or increase of a Loss being the direct
consequence of any changed law or accounting principles adopted
subsequent to the Closing Date shall be disregarded;
4. the occurrence of or the increase of a loss being the result of
any act or omission on the part of the Buyer, the Company and/or
the Subsidiaries subsequent to the execution of this Agreement
shall be disregarded;
5. any indemnification to be made by the Sellers shall equal the
amount of the Loss actually sustained by the Company or by the
Subsidiaries with-
out taking into consideration any multiple based on price
earnings or similar ratios;
6. in calculating whether or not a Loss exceeds the thresholds in
clause 8.6, Losses sustained in foreign currencies shall be
converted into DKK at the time when the Claim is made;
7. an amount equal to the amount by which any provision made in the
Consolidated 1998 Accounts is proved to have been overstated, is
set-off in the total Loss, if any, suffered;
8.6 Principles for determining the indemnification
----------------------------------------------
8.6.1 The Sellers shall only be liable for indemnification provided that
1. the aggregate Claims exceed DKK 45,000,000 (fortyfive million
Danish Kroner) and then including the portion of the aggregate
Claims below such amount, and
2. only individual Claims exceeding DKK 2,000,000 (two million
Danish Kroner) such as notified and calculated in accordance with
the terms of this Agreement shall be considered when determining
whether or not the threshold equal to DKK 45,000,000 is exceeded.
8.6.2 The maximum indemnification claimable against the Sellers shall in no
event exceed DKK 400,000,000 (four hundred million Danish Kroner).
8.7 Mitigating matters
------------------
8.7.1 The Buyer shall, and shall cause that the Company and the
Subsidiaries, use all reasonable efforts to mitigate any Loss for
which a Claim is notified to the Sellers.
8.7.2 In the event of a Claim in respect of a matter which in the Sellers'
reasonable opinion is capable of cure, the Sellers shall have the
right, exercisable upon written notice to the Buyer, to attempt to
cure within a reasonable period of time the matter resulting in the
Claim.
8.8 Exclusive remedies
------------------
8.8.1 Except as specifically provided for in this Agreement the Sellers do
not make any representation nor give any warranty to the Buyer.
8.8.2 Except as otherwise specifically provided for in this Agreement the
remedies provided for in Section 8 shall be the exclusive remedies of
the Buyer with respect to any breach of any representation or warranty
made by the Sellers or covenant undertaken by the Sellers in this
Agreement. In particular the Buyer hereby renounces any right that it
may have, or subsequently acquire, under the laws of Denmark to
otherwise rescind this Agreement or to claim a proportional reduction
of the Purchase Price (in Danish "forholdsmaessigt afslag").
9. Other Provisions
----------------
9.1 Entire Agreement
----------------
This Agreement supersedes any oral or prior written agreement or
understanding between the Parties, undertaking, representation and
warranty of any kind with respect to all matters referred to in this
Agreement.
9.2 Confidentiality
---------------
9.2.1 Information acquired by the Parties regarding each other or regarding
any Group Company in connection with the negotiations for, entering
into, and the consummation of this Agreement shall be deemed to be
confidential information, which the Parties are, without limit
of time, not entitled to use or pass on to any third party except
1. with prior written consent of the other Parties;
2. as may be required by law, applicable accounting or stock
exchange regulations or order of a court of competent
jurisdiction; and
3. to its auditors, legal counsel and other advisors who are
required by law or written agreement to observe secrecy.
Any disclosure pursuant to clause 9.2.1 (2) requires prior notice to
and consultation with the other Parties.
9.2.2 For purpose of this clause, the requirement as to observe
confidentiality shall not apply to any information which
1. was available to the general public at the time of its
disclosure;
2. becomes available to the general public other than as a result of
any non-compliance with this clause;
3. is provided to the disclosing party by a third party who is
lawfully in possession of such information and who has a lawful
right to disclose it;
4. was in the possession of the disclosing party at the time of the
execution of the Confidentiality Agreement signed by the Buyer;
or
5. was independently developed by the disclosing party.
9.2.3 Each Party shall cause their respective employees, agents and
representatives not to disclose to any third party or to use or
exploit for any purpose whatsoever
any such information which the Party itself is prohibited from
disclosing or using pursuant to this clause 9.2.
9.3 Publicity
---------
9.3.1 The Parties have jointly prepared a press release and information to
the employees affected by the transaction contemplated, Schedule 14,
-----------
and ▇▇▇▇▇▇▇▇▇ has prepared a statement to the Copenhagen Stock
Exchange in the form set forth in Schedule 15.
-----------
9.3.2 The Parties agree that the terms and conditions of this Agreement
shall not be made public except as may be required by applicable law
or regulation.
9.4 Severalibility
--------------
9.4.1 This Agreement shall be interpreted insofar as possible in accordance
with the laws of Denmark. Should one or more of the provisions of this
Agreement cease to apply or be modified as a result of invalidity,
voidability or for other reason this shall not affect the validity of
the remaining provisions of this Agreement.
9.4.2 If one or more of the provisions of this Agreement are held to be
contrary to the rules of the laws of Denmark or the laws of any
jurisdiction which cannot be dispensed with by agreement, the Parties
agree that the provision(s) shall be modified and shall apply with
such contents as may be validly agreed and that the remaining
provisions of this Agreement shall still be applicable.
9.5 Notices
-------
All the notices between the Parties concerning matters arising out of
this Agreement shall be sent by ordinary post or fax and be confirmed
by registered letter within 48 hours after transmission to the
following addresses unless these are changed to another address with a
notice of at least 5 days:
For the Sellers: Bent ▇▇▇▇▇▇▇▇▇▇, Managing Director
▇. ▇▇▇▇▇▇▇▇▇ Holding A/S
Sankt ▇▇▇▇▇ ▇▇▇▇▇ ▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ K
Denmark
(Fax No. ▇▇▇ ▇▇ ▇▇ ▇▇ ▇▇)
with a copy to: Bjorn ▇▇▇ ▇▇▇▇▇▇, Partner
EQT Partners A/S
▇▇▇▇▇▇▇▇▇▇ ▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇
▇▇▇▇▇▇▇
(Fax No. ▇▇▇ ▇▇ ▇▇ ▇▇ ▇▇)
For the Buyer: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, Chairman
York International Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America
(Fax No. ▇▇▇ ▇▇▇-▇▇▇▇)
with a copy to: ▇▇▇▇ ▇. ▇▇▇▇▇, Vice President
York International Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America
(Fax No. ▇▇▇ ▇▇▇-▇▇▇▇)
9.6 Binding effect and no assignment
--------------------------------
9.6.1 This Agreement shall be binding upon and inure to the benefit of the
Parties and their respective successors.
9.6.2 This Agreement may not be assigned in whole or in part by any Party
without the consent of the other Parties or by operation of law.
9.7 Expenses
--------
9.7.1 Any and all share transfer taxes and stamp duties payable as a result
of this Agreement and the transactions contemplated hereby shall be
divided equally (50/50) between the Buyer and the Sellers.
Notification and payment of the share transfer tax payable to the
Danish tax authorities shall be made within 4 weeks of the execution
of this Agreement.
Within two weeks of signing of this Agreement the Buyer and EQT shall
pay to ▇▇▇▇▇▇▇▇▇ their part of the share transfer taxes payable.
▇▇▇▇▇▇▇▇▇ will arrange for
timely notification and payment of the Danish share transfer tax.
9.7.2 Each Party shall bear the fees and other expenses payable to their own
advisors incurred in connection with negotiating, delivering and
consummating this Agreement.
9.8 Waiver and amendments
---------------------
This Agreement may be amended and the terms hereof may be waived only
by written instrument signed by the Parties or in the case of a
waiver, by the Party waiving its rights under this Agreement.
9.9 Survival
--------
Sections 9 (Other Provisions) and clauses 5.1.2 (Authority), 6.1.1
(Organisation and qualification), 6.1.2 (a) and (b) (Authority), 7.1
(Restrictive covenant) and 8.8 (Exclusive remedies) shall survive
termination of this Agreement irrespective of the cause of such
termination.
9.10 Headings
--------
The headings inserted are for convenience and reference only and shall
not be used to construe or interpret this Agreement.
9.11 Governing law and arbitration
-----------------------------
9.11.1 This Agreement and any dispute or claim arising out of or in
connection with this Agreement shall be governed by and construed in
accordance with the laws of Denmark.
9.11.2 With exception of any dispute to be finally resolved in accordance
with Schedule 8, any dispute or claim arising out of or in connection
with this Agreement shall be finally settled in accordance with the
"Rules of
procedure of the Danish Institute of Arbitration (Copenhagen
Arbitration)".
The Court of Arbitration shall be composed of three arbitrators. The
Buyer and the Sellers (jointly) shall each appoint one arbitrator and
the Copenhagen Arbitration shall appoint the third arbitrator who
shall be the chairman of the Court of Arbitration. If a Party has not
appointed an arbitrator within 30 days of having requested or received
notice of the arbitration, such arbitrator shall be appointed by the
Copenhagen Arbitration.
The place of arbitration shall be Copenhagen.
The language of the arbitration shall be English.
The Court of Arbitration shall award the Parties legal costs and
divide the costs payable to the Court of Arbitration in proportion to
the Court of Arbitration ruling in favour of the claims and statements
made by the Parties.
9.12 Schedules
---------
Schedule 1: List of direct investors.
Schedule 2: Associated Companies.
Schedule 3: Consolidated 1998 Accounts.
Schedule 4: Due Diligence Documentation.
Schedule 5: Sellers' Knowledge.
Schedule 6: Management.
Schedule 7: Management Subscription Rights.
Schedule 8: Shareholders' End of March Adjustment.
Schedule 9: Subsidiaries.
Schedule 10: Escrow Agreement.
Schedule 11: Division of Shares.
Schedule 12: Insurance policies.
Schedule 13: Persons comprised by the restrictive covenant.
Schedule 14: Press release and employee information.
Schedule 15: Statement to the Copenhagen Stock Exchange.
10. Signatures
----------
This Agreement has been executed in three original copies and one copy
has been given to each of the Parties.
Copenhagen, March 27, 1999
For ▇. ▇▇▇▇▇▇▇▇▇ Holding A/S For York International
Corporation:
___________________________ __________________________
On behalf of the direct investors listed in Schedule 1.
For EQT Scandinavia Ltd.:
___________________________