EXHIBIT D(3)
SHARE EXCHANGE OPTION AGREEMENT
SHARE EXCHANGE OPTION AGREEMENT (the "Option Agreement"), dated as of March 25,
2000, among Forvaltnings AB Ratos (publ.) reg. No. 556008-3585 ("Ratos"), on one
side and Camfil AB, reg. No. 556230-1266 ("Camfil") and the owners of Camfil
listed on Exhibit 1, on the other side (collectively, the "Owners").
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WHEREAS, Ratos, Ratos Acquisition Corp., a Delaware corporation and a wholly
owned subsidiary of Ratos ("Merger Sub"), and Xxxx Company, a Delaware
corporation, intend to enter into an agreement and plan of merger substantially
in the form of the agreement and plan of merger attached hereto as Exhibit 2,
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(the "Merger Agreement") pursuant to which (i) Merger Sub shall acquire all of
the issued and outstanding shares of common stock, par value $0.10, of Xxxx
Company (the "Xxxx Shares") and (ii) Merger Sub shall be merged with and into
Xxxx Company (the "Merger"), the surviving entity hereinafter being referred to
as the "Surviving Corporation";
WHEREAS, Ratos may not wish to retain the issued and outstanding shares of stock
of the Surviving Corporation (the "S.C. Shares") following the Merger, and may
instead prefer to exchange the S.C. Shares for certain shares of Camfil;
WHEREAS, Camfil would be willing to purchase the S.C. Shares from Ratos in
accordance with the terms and conditions of this Option Agreement;
NOW, THEREFORE, the parties hereto agree as follows:
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PUT OPTION, PURCHASE PRICE AND TRANSFER
1.1 Camfil hereby grants Ratos an irrevocable option (the "Put Option") to
require Camfil to purchase the S.C. Shares in exchange for certain shares
of Camfil under the circumstances and subject to the terms and conditions
set forth below.
1.2 Ratos may exercise the Put Option, should it wish to do so, during the
period beginning on the later of (and not before): (i) the date on which
the Xxxx Shares cease to be registered under the Securities Exchange Act of
1934, as amended, and are not traded on any stock exchange, and (ii) the
date on which the Merger has been consummated and the Surviving Corporation
becomes a wholly owned subsidiary within the Ratos group by the filing of
a Certificate of Merger with the Secretary of State of the State of
Delaware pursuant to the Merger Agreement (the "Going Private Conditions"),
and ending on November 15, 2000; provided, however, that if the Going
Private Conditions have not been satisfied on or before October 31, 2000,
Ratos may exercise the Put Option in any event between November 1, 2000 and
November 15, 2000, inclusive. The Put Option and any and all rights
thereunder shall expire and terminate on November 16, 2000, if it has not
been exercised prior to or on such date. Should Ratos choose to exercise
the Put Option, then, subject to the terms and conditions of this Option
Agreement, Camfil shall fulfil its obligation to purchase the S.C. Shares
in exchange for certain Shares of Camfil.
1.3 Once Ratos exercises the Put Option and gives notice of such exercise to
Camfil, (i) the Owners shall cause the Board of Directors of Camfil to pass
all resolutions necessary to give effect to the share exchange contemplated
by the Put Option and (ii) Camfil shall promptly call a meeting of the
shareholders of Camfil, to be held as soon as reasonably and legally
possible (the "Shareholders' Meeting"). At such meeting, the Owners shall
cause to be passed a shareholders' resolution resolving to issue to Ratos
certain shares of Camfil (apportemission); such shares to represent, as
specified in the Aktieagaravtalet dated February 18, 2000 (the
"Aktieagaravtalet"),
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among Ratos, Jan Xxxx Xxxxxx and Xxxxx Xxxxxxx, 20 percent of the issued
and outstanding shares of Camfil and represent 20 percent of the voting
power of all shares of Camfil (the "Camfil Shares"), provided that Ratos
shall have made a capital contribution of at least MSEK 250 to Merger Sub
prior to the Merger.
1.4 Immediately after the date of the Shareholders' Meeting and following the
subscription by Ratos for the Camfil Shares, Camfil shall cause Ratos'
ownership of the Camfil Shares to be registered in Camfil's share register
book (aktiebok). In addition, Camfil shall cause the issuance of the Camfil
Shares to immediately be filed for registration (apportemission) at the
Swedish Patent- and Registration Office (the date of registration being the
"Transfer Date"). On the Transfer Date, Ratos shall transfer the S.C.
Shares to Camfil such that, on the Transfer Date, ownership of all shares
of the Surviving Corporation shall be transferred from Ratos to Camfil. The
aforementioned share transfers by Camfil and Ratos shall constitute full
payment for the shares received by each party, in the case of Camfil, such
being the S.C. Shares, and in the case of Ratos, such being the Camfil
Shares.
1.5 Should they be issued to Ratos pursuant to the terms of this Option
Agreement, the Camfil Shares shall be entitled to any and all dividends
declared by Camfil for the fiscal year 2000 on the same basis as the
dividends paid to other shareholders of Camfil holding shares of the same
class.
2. REPRESENTATIONS, WARRANTIES AND COVENANTS
2.1 The Owners represent and warrant that they collectively control at least 67
percent of the shares and voting rights of the stock of Camfil, and that
all resolutions of Camfil shareholders required to be passed by this Option
Agreement will be passed when approved by shareholders of Camfil
controlling at least 67 percent of the stock and the voting rights of the
stock of Camfil.
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2.2 Camfil and the Owners separately represent and warrant that it, in the case
of Camfil, and they, in the case of the Owners, has or have full and
complete information regarding the Surviving Corporation. The Owners and
Camfil have approved all provisions of the Merger Agreement, the Offer and
the Merger and all measures taken in order to perfect and conclude the
Offer and Merger contemplated by the Merger Agreement.
2.3 Camfil and the Owners hereby waive all present and future claims they may
have against Ratos individually or as a group in respect of the
interpretation and enforcement of the provisions of the Merger Agreement.
2.4 From the Transfer Date forward, Camfil shall assume all of the obligations
of Ratos and Merger Sub under or relating to the Merger Agreement; neither
Ratos nor Merger Sub, nor any of their respective affiliates (other than
Camfil should Camfil become an affiliate of Ratos on the Transfer Date),
shall have any obligations under, nor be subject to any liabilities
relating to, the Merger Agreement from the Transfer Date forward.
2.5 Camfil shall not declare any dividend for its 1999 fiscal year in excess of
MSEK 20.
3. COSTS AND EXPENSES
3.1 Should less than 50.1 percent of the Xxxx Shares be tendered into the Offer
or should Merger Sub fail to purchase at least 50.1 percent of the Xxxx
Shares pursuant to the Offer for any reason other than the failure of Ratos
to make a capital contribution of MSEK 250 to Merger Sub according to
Section 1.3 of the Aktieagaravtalet, Camfil shall pay 80 percent and Ratos
shall pay 20 percent of all of the costs and expenses related to the Offer
and the Merger Agreement (collectively, the "Costs"), including any and all
costs associated with: (i) the due diligence investigation of Xxxx Company
by Ratos, Camfil and their representatives; and (ii) the preparation for
and facilitation
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of the transactions contemplated by the Merger Agreement, such costs to
include the fees and expenses of PricewaterhouseCoopers LLP, Ohrlings
PricewaterhouseCoopers AB, Xxxxxxxx & Xxxxxxxx and any outside consultant
or agent retained by Xxxxxxxx & Xxxxxxxx, Erneholm & Xxxxxx XX and
Advokatfirman Xxxxx Xxxxxxx Xxxxxx. Costs and expenses of the employees of
Ratos and Camfil to be paid by each party respectively. Should Ratos fail
to make a capital contribution of MSEK 250 to Merger Sub according to
Section 1.3 of the Aktieagaravtalet and provided this shall cause the
Merger not to be consummated pursuant to the Merger Agreement, Ratos shall
pay 100 percent of the Costs.
4. INDEMNIFICATION BY CAMFIL
4.1 Subject to Section 4.3 of this Option Agreement, Camfil shall indemnify,
defend and hold Ratos and its officers, directors, employees, agents and
representatives, as well as Ratos' successors, assigns, subsidiaries and
affiliates, and their respective officers, directors, employees, agents and
representatives (the "Ratos Indemnified Parties") harmless from and against
any and all losses, damages, claims, liabilities, costs and expenses
including reasonable legal fees and expenses directly or indirectly based
upon, arising out of, resulting from or relating to: (i) the Merger
Agreement or any of the transactions contemplated thereby, including the
Offer and the Merger; and (ii) the breach by Camfil or any of the Owners of
any of the provisions of this Option Agreement.
4.2 Camfil shall pay to the applicable Ratos Indemnified Party any amounts to
which such party is entitled as indemnification hereunder not later than 60
days after a claim for such indemnification is submitted to Camfil or, if
such claim is the subject of arbitration hereunder, not later than 60 days
after the claim is settled by arbitration according to Section 7 of this
Option Agreement. An Indemnification Claim by a Ratos Indemnified Party
shall be submitted in writing to Camfil at the address set forth in Section
8 of this Option Agreement.
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4.3 Notwithstanding Section 4.1, the aggregate liability of Camfil for any and
all claims or losses arising in connection with the Merger Agreement or
this Option Agreement payable to any Ratos Indemnified Parties shall be
limited to MSEK 250.
5. MISCELLANEOUS
For the purpose of this Option Agreement terms and references, to the
extent not defined herein, shall have the same meaning as set forth in the
Merger Agreement.
6. JOINT CONVENANTS
6.1 No announcement concerning the transaction contemplated by this Option
Agreement, or any matter ancillary thereto, shall be made by any party
hereto except upon prior notice to and in consultation with the other
party, provided that nothing herein shall prevent either party from making,
in consultation with the other party, any announcement or filing required
by applicable law or regulation or by the rules and regulations of any
stock exchange on which it is listed.
6.2 The Parties shall not, and shall cause their respective Affiliates not to,
disclose any Confidential Information of the other party, unless: (i)
required to do so by law, (ii) required to do so by any applicable stock
exchange regulations, (iii) such disclosure is required to be made in
connection with the ordinary course of business, or (iv) such disclosure
has been consented to by the other party, which consent shall not be
unreasonably withheld. This section 6.2 shall continue for a period of
three (3) years after the date of this Option Agreement.
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7. ARBITRATION
7.1 This Option Agreement shall be governed by and construed in accordance with
the laws of Sweden without any reference to its conflict of laws principles
(excluding the law 1987:822 on International Sales and the law 1990:931 on
Sale of Goods).
7.2 Any dispute or claim arising out of or in connection with this Option
Agreement, involving Ratos, Camfil, any of their respective subsidiaries or
affiliates or the Owners, or the breach, termination or invalidity thereof,
shall be finally settled by arbitration in accordance with the Swedish
Arbitration Act (Lag (1999:116 om skiljeforfarande)). The place of
arbitration shall be Stockholm and the language to be used in the arbitral
proceedings shall be Swedish.
8. NOTICES
Any notices and other communication to be provided hereunder shall be
provided in accordance with the following notice information:
If to Ratos, to:
Xx. Xxxx Xxxxxxxx
Forvaltnings AB Ratos (publ.)
Xxx 0000
XX-000 00 Xxxxxxxxx, Xxxxxx
If to Camfil or the Owners, to:
Mr. Jan Xxxx Xxxxxx or Xx. Xxxxx Xxxxxxx
Camfil AB
Xxxxxxxxxxxxx 0
XX-000 00 Xxxxx, Xxxxxx
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IN WITNESS WHEREOF, this Option Agreement has been duly executed and delivered
by a duly authorized officer of each of Ratos and Camfil and by each Owner as of
the date hereof.
FORVALTNINGS AB RATOS
(PUBL.)
By: _________________________
Name:
Title:
CAMFIL AB
By: _________________________
Name:
Title:
_______________________ ______________________________
Name: Name:
_______________________ ______________________________
Name: Name:
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EXHIBIT 1
The following owners of shares of Camfil AB are included as "Owners" under the
aforementioned Share Exchange Option Agreement:
Mr. Jan Xxxx Xxxxxx 500,000 A Shares 1,960,000 B Shares
Xx. Xxxxx Xxxxxxx 500,000 A Shares 1,960,000 B Shares
Xx. Xxxxx Xxxxxx 180,000 B Shares
Mr. Xxx Xxxxxx 180,000 B Shares
Ms. Xxxx Xxxxxx 180,000 B Shares
Xx. Xxxxxxx Xxxxxxx 180,000 B Shares
Xx. Xxxx Xxxxxxx 180,000 B Shares
Xx. Xxxxx Xxxxxxx 180,000 B Shares
Mr. [Gosoa] Xxxxxx 2,000,000 B Shares
