EXHIBIT 10.2
B&M Draft
04.26.01
AGREEMENT BETWEEN FINANCIAL INVESTORS
between
GS Capital Partners 2000, L.P. (USA)
GS Capital Partners 2000 Employee Fund, L.P. (USA)
GS Capital Partners 2000 Offshore, L.P. (Cayman Island)
GS Capital Partners 2000 GmbH & Co. Beteiligungs KG
Stone Street Fund 2000, L.P. (USA)
Bridge Street Special Opportunities Fund 2000, L.P.
- hereinafter collectively referred to as "GS" -
and
Allianz Capital Partners GmbH, Theresienstrasse 1 - 5, 00000 Xxxxxx
- hereinafter referred to as "ACP" -
PREAMBLE
WHEREAS ACP and GS are Financial Investors and have agreed to jointly invest
as equity sponsors in XXXXXXXX Vermogensverwaltungsgesellschaft mbH, a German
limited liability company incorporated and existing under the laws of Germany
("INVESTOR NEWCO") pursuant to a shareholders' agreement dated December 31,
2000, notarial deed 162/2000 of the notary public Xxxxxxx Xxxxxxxxxxxx,
Frankfurt am Main, as amended from time to time ("SHAREHOLDERS' AGREEMENT").
WHEREAS Investor NewCo has entered into the Business Combination Agreement,
dated December 30/31, 2000 (notarial deed G 680/2000 of the notary public Xx.
Xxxxx Xxxxx, Frankfurt am Main) as amended from time to time ("BCA"), under
which it shall purchase all shares in Hoechst NewCo II AG which in turn shall
hold 66 2/3% of the shares in Xxxxxx Griesheim GmbH ("MGG").
WHEREAS Allianz AG is the ultimate parent company of ACP and holds a
substantial portion of the shares in Xxxxx XX, a company which competes with
MGG.
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WHEREAS ACP is therefore restricted under applicable antitrust law in the
exercise of its shareholder rights directly or indirectly in MGG as long as
Allianz AG continues to have such shareholding in Xxxxx XX.
WHEREAS the Shareholders' Agreement provides for certain procedures for the sale
or IPO of the shareholding of the Parties in Investor NewCo.
WHEREAS the Parties may syndicate a part of their investment to a third party
financial investor ("THIRD PARTY INVESTOR").
NOW THEREFORE, in consideration of the premises and mutual agreements, covenants
and provisions contained herein, the Parties hereto agree as follows:
ARTICLE 1 - CERTAIN DEFINITIONS
The following terms shall have the meanings as set forth below:
"ACP RESTRICTION PERIOD" means the period from date of this Agreement until
the Expiry of the ACP Restriction Period during which ACP is restricted in
exercising its shareholders' rights in Investor NewCo.
"EXPIRY OF THE ACP RESTRICTION PERIOD" means the date on which ACP is no
longer subject to any restrictions on the exercise of its voting rights in
Investor NewCo under applicable antitrust law.
"FINANCIAL INVESTORS" means collectively the Parties and the Third Party
Investor.
"GOVERNING BODY" means any shareholder committee, supervisory board, advisory
board or shareholders' meeting or any of their sub-committees of Investor
NewCo (except for the Shareholders' Meeting of Investor NewCo) or any of its
subsidiaries.
"PARTIES" means collectively ACP and GS.
"PARTY" means individually ACP and GS.
All other capitalized terms shall have the same meaning as defined in the BCA or
in the Shareholders' Agreement, unless otherwise specified.
ARTICLE 2 - APPOINTMENT AND APPOINTEES OF GOVERNING BODIES
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2.1 During the ACP Restriction Period, GS shall appoint all 3 members of
each of the Governing Bodies (as more specifically provided for in the
Shareholders' Agreement) to be appointed by the Financial Investors
under the Shareholders' Agreement, provided that only 2 members shall
be employees of or otherwise affiliated with GS. None of such members
shall be an employee of or otherwise affiliated with Allianz AG or its
affiliates (within the meaning of Sec. 15 seq. of the German Stock
Corporation Act). All three members shall exercise jointly their votes
as members of the shareholders' committee of Investor NewCo.
2.2 Upon the Expiry of the ACP Restriction Period, ACP shall have the right
to appoint 2 members and GS shall have the right to appoint 1 member of
each of the Governing Bodies. The Parties shall make such appointments
after mutual consultation. ACP may exercise this right hereunder
immediately after the Expiry of the ACP Restriction Period and after
receipt of any EU clearance, if necessary. GS and the Third Party
Investor shall cooperate and do everything necessary to procure these
appointments without delay.
ARTICLE 3 - [Intentionally left blank]
ARTICLE 4 - EXIT
4.1 [Intentionally left blank]
4.2 TRANSFER OF SHARES
Each Financial Investor shall transfer shares in Investor NewCo only in
compliance with (i) all applicable agreements between the Parties, in
particular with the Shareholders' Agreement, and (ii) in compliance
with all provisions of the agreements relating to the financing of
Investor NewCo or any of its affiliates (within the meaning of Sec. 15
seq. German Stock Corporation Act), in particular the Finance
Documents, the Mezzanine Finance Documents, the Exchange Note Documents
and the High Yield Documents (as such terms are defined in the Senior
Credit Agreement to be entered into between, among others, Investor
NewCo and Xxxxxxx Xxxxx International as Global Co-ordinator, and
Xxxxxxx Sachs International, Bayerische Hypo- und Vereinsbank AG, X.X.
Xxxxxx PLC and The Royal Bank of Scotland plc as Joint Lead
Arrangers), hereinafter referred to as the "FINANCING AGREEMENTS". For
the avoidance of doubt it is clarified that any permission to transfer
shares in Investor NewCo under
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the Financing Agreements shall not be deemed a permission to transfer
shares in Investor NewCo under this Agreement.
4.3 [Intentionally left blank]
4.4 [Intentionally left blank]
4.5 DRAG ALONG
At any time after September 30, 2004, either ACP or GS, subject to the
limitations set forth in the following paragraph, can require that the
Financial Investors jointly sell their shares in Investor NewCo upon
the same terms and conditions as apply to the Party imposing such
requirement (provided that in no event can the other party be required
to become subject to a non-compete covenant), subject to satisfaction
of each of the following conditions:
(i) the sale of such shares occurs in compliance with the
Shareholders' Agreement (in particular Sec. 22 and 23) and the
Articles of Association of Investor NewCo, provided that each
Party hereby waives for the purposes of such sale its right to
be offered the shares of the other Party under Sec. 22 subsec.
2 of the Shareholders' Agreement; and
(ii) the proceeds of such sale result for the Party on which such
requirement is imposed in an internal rate of return
(calculated in accordance with Sec. 25 subsec. 3 of the
Shareholders' Agreement but in all events without taking into
account any tax on income or capital gains and treating any
withholding tax on distributions to such party as if they were
not withheld) of more than 30% p.a.; and
(iii) such sale relates to all of the shares of the Financial
Investors; and
(iv) the purchase price for the sale of the shares shall not be
less than the medium between the valuations found by two
reputable international investment banks (one of which shall
be selected by ACP and one of which shall be selected by GS)
(fairness opinions); and
(v) if reasonably requested by GS or ACP (in which case the
Parties shall consider waiving the requirement to obtain one
or both of the fairness opinions under (iv) above), a
competitive or structured solicitation of bids will be
conducted by an investment bank mutually agreed upon between
the Parties, with a view towards determining or confirming the
market value of the shares.
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Notwithstanding the foregoing, GS shall not be entitled to require a
joint sale of the shares of Investor NewCo as provided in this Section
4.5 until after November 1, 2005.
In the event that the realization by the Financial Investors of their
interest in Investor NewCo is sought to be achieved, at the initiative
of either Party, through a sale of all or substantially all of the
assets of Investor NewCo and its direct or indirect subsidiaries (taken
as a whole) or any similar transactions or series of transactions
effected at the level at or below Investor NewCo, the requirements set
forth in (i)-(v) above shall apply to such transactions, mutatis
mutandis.
For the avoidance of doubt, this clause does not apply in the event of
an IPO in which less than 75% of the shares are sold.
4.6 EXERCISE OF RIGHTS UNDER THE SHAREHOLDERS' AGREEMENT
The Shareholders' Agreement extends certain exit rights to the
Financial Investors individually as parties to the Shareholders'
Agreement or jointly as financial investors. The Parties agree that
they will use reasonable best efforts to exercise such rights only
after mutual consultation. In addition, the Financial Investors agree
to exercise certain of such rights only as follows:
4.6.1 RIGHT TO INITIATE A SALE
(a) ACP and, subject to the provisions of Section 4.6.1(b)
below, GS shall be free to exercise their rights under
Sec. 22.2 of the Shareholders' Agreement individually,
provided, however, (i) that the purchaser agrees to be
bound by the terms of this Agreement and assumes as a
joint and several debtor the obligations of the
selling Financial Investor under this Agreement and
the Shareholders' Agreement, (but none of the rights)
and (ii) that such sale does not trigger a Change of
Control under the Financing Agreements, and (iii) if
and to the extent that the other Financial Investor
does not exercise its right to co-sell, the amount of
shares sold shall be limited so as not to preclude the
other Financial Investor from selling at a later time
an equal amount of shares (in which sale the Financial
Investor selling shares in the first place shall not
have a right to co-sell) without triggering a Change
of Control under the Financing Agreements, except that
such limitation shall not apply in the event that the
Financing Banks have waived such potential Change of
Control or have allowed the purchaser in such sale to
be substituted for GS in the definition of a Change of
Control included in the Financing Agreements.
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The requirements in clauses (i), (ii) and (iii) do not
apply to the transaction contemplated by clause 4.5.
(b) Until the earlier of the Expiry of the ACP Restriction
Period and September 30, 2005, GS shall not exercise
its right to initiate a sale under Sec. 22.2 of the
Shareholders' Agreement, unless (i) after giving
effect to such sale GS continues to beneficially own
at least 16% of the shares of Investor NewCo then
outstanding and (ii) the level of control that GS and
its appointees to the Governing Bodies have with
respect to Investor NewCo is not diminished in any
material respect as a result of or in connection with
such sale and no agreement or understanding between GS
and the purchaser shall affect the independence of GS
in taking decisions in the Shareholders' Meeting of
Investor NewCo or of its appointees in the Governing
Bodies.
4.6.2 RIGHT TO DRAG ALONG MIG
The Financial Investors agree that they will support each
other in exercising the rights extended to the Financial
Investors as group to drag along MIG upon the request of the
Financial Investors (Sec. 28.1 of the Shareholders'
Agreement), if such Financial Investor is entitled to drag
along the other Financial Investor under Sec. 4.5. If the
requirements under Sec. 4.5 above are not met, the Financial
Investors can only exercise this right under Sec. 28.1 of the
Shareholders' Agreement as mutually agreed.
4.6.3 COOPERATION
The Parties agree that they cooperate and use their influence
to cause Investor NewCo to take appropriate actions, including
the providing of the necessary information, to enable each
Party to make an informed decision on the rights referred in
Sec. 4.5 and 4.6 above and Sec. 4.7 below.
4.7 IPO
From and after June 30, 2003, ACP shall have the right, and from and
after September 30, 2005, ACP and GS shall each have the right to
require that the other Financial Investors join with it in its demand
to initiate an IPO under Sec. 20 subsec. 1 of the Shareholders'
Agreement. In all events ACP and GS shall reasonably consult with each
other prior to requesting an IPO.
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The Parties shall support each other if either of the Parties requests
a secondary offering under Sec. 20.5 of the Shareholders' Agreement. As
between the Parties, each of the Parties shall have the right to sell a
pro rata amount of their existing shareholding in Investor NewCo
pursuant to any such secondary offering.
4.8 INVESTOR NEWCO AS KGaA
All exit rights granted hereunder shall extend mutatis mutandis to the
shares in Investor NewCo as well as to the shares in its general
partner.
4.9 CLARIFICATION
For the avoidance of doubt it is clarified that Sec. 4.2 above shall
apply to all rights and transfers provided for herein.
ARTICLE 5 - EXERCISE OF VOTING RIGHTS
5.1 Except as otherwise provided below, after the Expiry of the ACP
Restriction Period the Financial Investors shall pool their votes in
the Shareholders' Meeting of Investor NewCo, and in addition thereto to
the extent legally permissible, the votes of their appointees in the
Governing Bodies. They will consult with each other sufficiently prior
to any Shareholders' Meeting of Investor NewCo or meeting of the
Governing Bodies to find a common position on the actions and
resolutions to be considered. Should the Financial Investors fail to
agree on the joint exercise of their voting rights on a particular
subject matter, the Financial Investors shall exercise their voting
rights and shall instruct their appointees to the Governing Bodies to
exercise their voting rights in accordance with the suggestions made by
ACP.
5.2 The provisions of Sec. 5.1 above shall not apply to any actions and
resolutions which require a 75% or higher majority vote or approval of
the applicable Governing Body after giving effect of the provisions of
the Shareholders' Agreement. This Sec. 5.2 does not apply to actions
and resolutions as to which Sec. 5.3 (5) below applies, irrespective of
the threshhold set forth in Sec. 5.3 (5) below. The provision in Sec.
14.2 sentence 2 of the Shareholders' Agreement shall remain unaffected.
5.3 Notwithstanding Sec. 5.1 above, the Financial Investors agree that,
after the Expiry of the Restriction Period, the Financial Investors
shall mutually agree in advance on their common position with respect
to any action, approval, authorization or decision taken by or
submitted to the
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Shareholders' Meeting of Investor NewCo or to any of the Governing
Bodies regarding any of the following matters:
(1) any removal, replacement or appointment of any individual as
the Chief Executive Officer of MGG or the Chief Financial
Officer of MGG;
(2) the exercise or discharge by Investor NewCo, MGG or any Xxxxxx
Group Company of any right or obligation under, or the waiver
or amendment of any provision of, any of Sections 4.22, 4.23,
4.24, 4.26 or 6.16 of the BCA (or any relevant definitions
contained in Sec. 1 of the BCA), and any other actions or
decisions by or on behalf of Investor NewCo, MGG or any Xxxxxx
Group Company relating to any of the matters referred to in
such Sections of the BCA;
(3) any actions or decisions by Investor NewCo, MGG or any Xxxxxx
Group Company under or relating to the MGG Compliance Program
(as defined in the BCA);
(4) any actions, transactions or decisions by Investor NewCo, MGG
or any Xxxxxx Group Company which could reasonably be expected
to involve the engagement by any of such entities, including
without limitation through any acquisition or investment, in
any Undesired Business Activities (as defined in the BCA) or
any activities which, due to legal or regulatory developments
subsequent to the date hereof, GS reasonably requests be
treated as Undesired Business Activities;
(5) any acquisition of or investment in any asset, entity or
business (other than an existing Xxxxxx Group Company) by
Investor NewCo, MGG or any Xxxxxx Group Company for
consideration (including the direct or indirect assumption of
liabilities) in excess of Euro 100,000,000.
Should the Financial Investors fail to agree on a common position on a
particular action or resolution relating to any of the matters
described in this Sec. 5.3(1)-(5), they shall vote their shares and
cause their appointees on the Governing Bodies to vote against such
particular action or resolution.
5.4 Subject to compliance with the last paragraph of Section 4.5, if ACP
proposes adoption of a resolution under Sec. 16 subsec. 2 (e) of the
Shareholders' Agreement (sale of shares in MGG), GS agrees to vote
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in favor of such resolution, regardless of whether prior or after the
Expiry of the ACP Restriction Period.
ARTICLES 6 - SYNDICATION
The Parties agree that they intend to syndicate shares in Investor NewCo subject
to the limitations of the Shareholders' Agreement and the Equity Commitment
Letter. The Parties shall mutually agree on the terms and conditions of such
syndication. In the event of any such syndication, the Parties shall transfer to
one or more third party investor(s) an equal amount of shares (as between ACP
and GS). The Financial Investors agree that they will negotiate with the third
party investors along the following lines:
(i) third party investor has no right to initiate a sale or an IPO,
(ii) third party investor can be dragged by ACP and GS if they sell jointly,
(iii) third party investor shall have a tag-along right if one of the
Financial Investors sells its shares in Investor NewCo in accordance
with the Shareholders' Agreement,
(iv) third party investor shall pool any voting rights, and the votes of
any appointees, if any, to the Governing Bodies with and subject such
voting to the lead of GS during the ACP Restriction Period and
thereafter of ACP.
The Parties agree that any third party investor shall only acquire shares in
Investor NewCo upon substantially the same overall economic terms as apply to
the investments of and commitments of GS and ACP to or with respect to Investor
NewCo.
ARTICLE 7 - FEES
7.1 The advisory fees of unrelated parties (law firms, CPAs, environmental,
etc.) resulting from the transaction described in the preamble of the
Shareholders' Agreement shall be borne by Investor NewCo or, to the
extent legally possible, by MGG.
7.2 The advisory fee of Xxxxxxx Sachs International charged to MIG
resulting from the transaction described in the preamble of the
Shareholders' Agreement shall be borne by MGG.
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7.3 If any of ACP or GS wants to charge a fee for their transaction
services rendered to Investor NewCo in the context of the transactions
contemplated by the BCA such fee shall be mutually agreed between the
Parties. Such fees shall be borne by Investor NewCo.
ARTICLE 8 - TRANSACTIONS WITH AFFILIATES
GS agrees that prior to the Expiry of the ACP Restriction Period, in the event
that any transaction, agreement or engagement between Investor NewCo or any MGG
Group Company and any affiliate of GS (other than Investor NewCo or any MGG
Group Company) is to be voted upon by any Governing Body, GS shall inform ACP in
advance of such vote and of the matter to be voted upon.
ARTICLE 9 - MISCELLANEOUS
9.1 AMENDMENT
This Agreement shall not be terminated, modified or amended unless in
writing, notarized by law if required and agreed to by all Parties
affected thereby.
9.2 NOTICES
Any notices to be given by any party pursuant to this Agreement shall
be in writing and shall be sufficiently served if sent by prepaid post
or courier, or by facsimile transmission or by e-mail and shall be
deemed to be given when received in legible form and shall be sent to
the addressees set forth on page 1 of this Agreement or to such other
address for the attention of such other person as may from time to time
be notified by any party to the other parties by written notice in
accordance with the provisions of this Section. If requested the
recipient of any notice shall promptly confirm its receipt upon such
receipt.
9.3 BINDING EFFECT
This Agreement supersedes all prior negotiations, statements and
agreements of the Parties hereto with respect to the subject matter of
this Agreement, and shall be binding upon and inure to the benefit of
the respective successors and assigns of the Parties hereto. The Letter
Agreement of December 30, 2000 is replaced by this Agreement.
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9.4 [Intentionally left blank]
9.5 HEADINGS
The headings of the various articles and sections of this Agreement
have been inserted for convenience of reference only and shall not be
deemed to be a part of this Agreement.
9.6 GOVERNING LAW AND VENUE
This Agreement is established under and shall be read and construed in
accordance with the laws of the Federal Republic of Germany with
exclusive venue at Frankfurt am Main. All service of process can be
made to and all notices to shall be deemed received by GS if received
by Hengeler Xxxxxxx Xxxxxxx Xxxxx, Frankfurt am Main, attention Xx.
Xxxxx Xxxxx.
9.7 SEVERABILITY
The invalidity or unenforceability of any provisions of this Agreement
in any jurisdiction shall not affect the validity, legality or
enforceability of the remainder of this Agreement in such jurisdiction
or the validity, legality or enforceability of any provision of this
Agreement in any other jurisdiction, it being intended that all rights
and obligations of the Parties hereunder shall be enforceable to the
fullest extent permitted by law.
Above deed was read aloud to the appeared in presence of the Deputy
Notary, approved by them and signed by them and the Deputy Notary in
their own hand as follows:
/s/ [SIGNATURE] /s/ [SIGNATURE]
/s/ [SIGNATURE]
