MASTER AGREEMENT
PURCHASE OF ASSETS
AND
BUSINESS
BY AND BETWEEN
VALTRA OY AB
TRACFIN HOLDING OY
PARTEK CARGOTEC HOLDING NETHERLANDS B.V.
PARTEK HOLDING INC.
AND
AGCO CORPORATION
10 SEPTEMBER 2003
Hannes Snellman
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TABLE OF CONTENTS
1. DEFINITIONS.......................................................................................................8
2. SALE AND PURCHASE................................................................................................12
2.1 PURCHASE AND SALE OF THE TARGET ASSETS.....................................................................12
2.2 IMPLEMENTATION OF THE TRANSACTION..........................................................................12
2.3 AGREEMENTS INTEGRATED......................................................................................12
2.4 SELLERS' REPRESENTATIVE....................................................................................12
3. THE TARGET ASSETS AND LIABILITIES................................................................................13
3.1 TARGET ASSETS..............................................................................................13
3.2 STOCK-TAKING...............................................................................................14
3.3 EXCLUDED ASSETS............................................................................................14
3.4 TRANSFER OF TITLE AND POSSESSION...........................................................................14
3.5 LIABILITIES ASSUMED AND EXCLUDED LIABILITIES...............................................................15
3.6 TRANSFER OF RISK...........................................................................................15
4. PURCHASE PRICE...................................................................................................15
4.1 PURCHASE PRICE.............................................................................................15
4.2 PURCHASE PRICE ALLOCATION..................................................................................15
4.3 COMPLETION STATEMENT.......................................................................................16
4.4 VERIFICATION OF COMPLETION STATEMENT.......................................................................16
4.5 INDEPENDENT AUDITOR........................................................................................16
4.6 TRANSFER TAXES.............................................................................................17
4.7 VALUE ADDED TAX............................................................................................17
5. PAYMENT OF THE PURCHASE PRICE....................................................................................17
5.1 PURCHASE PRICE.............................................................................................17
5.2 ADJUSTMENT AMOUNT..........................................................................................17
5.3 NO SET OFF BY BUYER........................................................................................18
6. DUE DILIGENCE REVIEW.............................................................................................18
7. REPRESENTATIONS AND WARRANTIES OF THE SELLERS....................................................................18
7.1 QUALIFICATIONS.............................................................................................18
7.2 REPRESENTATIONS AND WARRANTIES.............................................................................19
7.2.1 Organisation.........................................................................................19
7.2.2 Title and Authority to Transfer the Target Assets....................................................19
7.2.3 Capitalisation.......................................................................................20
7.2.4 Title To and Condition of Assets.....................................................................20
7.2.5 Sufficient Assets....................................................................................20
7.2.6 Consolidated Accounts................................................................................20
7.2.7 Receivables..........................................................................................21
7.2.8 Taxes................................................................................................21
7.2.9 Litigation...........................................................................................22
7.2.10 Real Property........................................................................................22
7.2.11 Permits..............................................................................................22
7.2.12 Environmental Matters................................................................................22
7.2.13 Intellectual Property................................................................................23
7.2.14 Data Processing......................................................................................23
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7.2.15 Product Liability....................................................................................23
7.2.16 Insurance............................................................................................24
7.2.17 Material Contracts...................................................................................24
7.2.18 Agreements with Related Parties......................................................................24
7.2.19 Employee Matters.....................................................................................25
7.2.20 Business Until Signing...............................................................................25
7.2.21 Compliance With Laws.................................................................................25
7.2.22 Information..........................................................................................26
7.3 NO OTHER REPRESENTATIONS AND WARRANTIES....................................................................26
8. COMPLETION.......................................................................................................26
8.1 COMPLETION DATE, LONG STOP DATE AND BREAK-UP FEE...........................................................26
8.2 CONDITIONS PRECEDENT.......................................................................................27
8.3 DELIVERIES AT COMPLETION...................................................................................28
8.4 BEST EFFORTS TO COMPLETE...................................................................................29
8.5 VALTRA TRAKTOR AB (SWEDEN).................................................................................30
9. INDEMNITY........................................................................................................31
9.1 LIABILITY OF THE SELLERS...................................................................................31
9.2 LIMITATIONS................................................................................................31
9.3 CERTAIN INDEMNIFICATIONS...................................................................................33
9.4 THIRD PARTY CLAIMS.........................................................................................34
9.5 RECOVERY...................................................................................................35
9.6 LITIGATION IN BRAZIL.......................................................................................35
10. REPRESENTATIONS AND WARRANTIES OF THE BUYER...................................................................35
10.1 ORGANISATION...............................................................................................35
10.2 POWER AND AUTHORITY OF BUYER...............................................................................35
10.3 SUFFICIENT FINANCING.......................................................................................35
10.4 NO BREACH BY SELLERS.......................................................................................36
11. COVENANTS.....................................................................................................36
11.1 BUSINESS UNTIL COMPLETION..................................................................................36
11.2 NON-COMPETITION, NON-SOLICITATION..........................................................................37
11.3 CONFIDENTIALITY............................................................................................38
11.4 UNENFORCEABILITY...........................................................................................38
11.5 CONTINUED SERVICES.........................................................................................38
11.6 CONTRACT ARRANGEMENTS......................................................................................39
12. CERTAIN UNDERTAKINGS..........................................................................................39
12.1 REVIEW OF THE TARGET BUSINESS..............................................................................39
12.2 TRANSACTION COSTS..........................................................................................40
12.3 CO-OPERATION UNDERTAKING...................................................................................40
12.4 COMPETITION FILING.........................................................................................40
12.5 BANK ACCOUNTS..............................................................................................40
12.6 NO CLAIMS AGAINST KEY EMPLOYEES............................................................................40
12.7 HISTORICAL FINANCIAL STATEMENTS............................................................................40
12.8 FURTHER ASSURANCES.........................................................................................41
13. EMPLOYEES.....................................................................................................41
13.1 TRANSFER OF EMPLOYEES......................................................................................41
13.2 ACCRUED LIABILITIES........................................................................................41
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14. ORDERS AND TENDERS............................................................................................41
15. FORCE MAJEURE.................................................................................................42
16. MISCELLANEOUS.................................................................................................42
16.1 NOTICES....................................................................................................42
16.2 APPENDICES INCORPORATED....................................................................................42
16.3 HEADINGS...................................................................................................43
16.4 ASSIGNMENT.................................................................................................43
16.5 PARENT COMPANY RESPONSIBILITY..............................................................................43
16.6 ENTIRE AGREEMENT...........................................................................................43
16.7 INTERPRETATION.............................................................................................43
16.8 NO WAIVER..................................................................................................44
16.9 GOVERNING LAW..............................................................................................44
16.10 SETTLEMENT IN GOOD FAITH................................................................................44
16.11 DISPUTE RESOLUTION......................................................................................44
16.12 AMENDMENTS..............................................................................................44
16.13 SURVIVAL OF REPRESENTATIONS AND WARRANTIES..............................................................44
16.14 PROVISIONS SEVERABLE....................................................................................45
16.15 PUBLICITY...............................................................................................45
16.16 COUNTERPARTS OF THE AGREEMENT...........................................................................45
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LIST OF APPENDICES
APPENDIX
1.1 Accounting principles
1.2 Accounts of the Business Sellers and the Subsidiaries dated 31
December 2002
1.13 Calculation of the Completion Accounts Value
1.19 Consolidated Accounts of the Business Sellers and the
Subsidiaries dated 31 December 2002
1.20 Consolidated Interim Accounts of the Business Sellers and the
Subsidiaries dated 30 June 2003
1.21 List of Subsidiaries directly held by the Sellers
1.47 List of the direct and indirect subsidiaries of the Sellers
1.50 List of the business conducted by the Business Sellers and the
Subsidiaries
2.2(i)-(iii) The Completion Agreements
(i) the Real Property Agreements
(ii) the Share Purchase Agreements
(iii) the Asset Purchase Agreements
3.1(a) List of real property owned by the Business Sellers
3.1(b) List of shares and participations owned by the Sellers
3.1(c)(ii) List of intellectual property rights owned by either
of the Business Sellers on the Completion Date.
3.2 Stock-taking procedure particulars
3.3 List of excluded assets
3.5 Excluded Liabilities
4.2 Purchase Price Allocation
7.2.1 Copies of the articles of association and the trade register
entries of the Sellers and the Subsidiaries
7.2.2 (b) Direct Subsidiaries, exceptions
7.2.2 (f) List of certain approvals
7.2.3 Capitalisation
7.2.6 Certain subsidiaries
7.2.9 Litigation
7.2.11 Permits
7.2.12 Exceptions from Environmental Permits
7.2.13 List of intellectual property rights owned by the Business
Sellers and the Subsidiaries
7.2.14 Data Processing, exceptions
7.2.15 List of product liability claims filed against the Business
Sellers
7.2.17 List of Material Contracts
7.2.18 List of agreements with Related Parties
7.2.19 (a) List of Key Employees
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7.2.19 (b) Key Employee bonus arrangements
7.2.19 (c) Deferred compensation arrangements etc.
7.2.19 (d) Notices or claims regarding non-compliance with any employment,
labour or related laws
9.3 (b) Valtra do Brazil Dispute
13.1 List of Employees of the Business Sellers transferring to the
Buyer
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MASTER AGREEMENT
This Master Agreement on Purchase of Assets and Business, has been
entered into on September 10, 2003, by and between
(i) Valtra Oy Ab, a company organised and existing under the laws
of Finland (the "SELLER");
(ii) Tracfin Holding Oy, a company organised and existing under the
laws of Finland (the "SUBSIDIARY BUSINESS SELLER");
(iii) Partek Cargotec Holding Netherlands B.V., a company organised
and existing under the laws of the Netherlands ("PARTEK
CARGOTEC");
(iv) Partek Holding Inc., a company organised and existing under
the laws of the State of Nevada (the "US SELLER");
(v) AGCO Corporation, a company organised and existing under the
laws of the State of Delaware, (the "BUYER"); and
(vi) KONE Corporation, a public listed company organised and
existing under the laws of Finland (the "GUARANTOR");
(each a "PARTY"; collectively the "PARTIES"; the Parties set out in
items (i) to (iv) the "SELLERS"; the Seller and the Subsidiary Business
Seller collectively the "BUSINESS SELLERS" the Parties set out in items
(iii) to (iv) the "SHARE SELLERS")
WITNESSETH:
WHEREAS, the Business Sellers and the Subsidiaries are engaged in,
inter alia, the production, exportation, importation, distribution,
sale and service of agricultural tractors and engines for agricultural
tractors world-wide.
WHEREAS, the Sellers own all of the assets of the Guarantor's group of
companies engaged in the production, exportation, importation,
distribution, sale and service of agricultural tractors and
agricultural tractor engines and forming the Target Assets and Target
Business.
WHEREAS, the US Seller owns all of the issued and outstanding shares in
Valtra USA, Inc., a company organised and existing under the laws of
the State of Illinois (the "US SUBSIDIARY").
WHEREAS, the Seller, Partek Cargotec and the US Seller own directly or
indirectly all of the issued and outstanding shares in the Subsidiaries
(as defined below).
WHEREAS, the Guarantor is the ultimate parent company of the Sellers
and in that capacity shall, procure the due performance of all the
obligations of the Sellers under this Agreement.
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WHEREAS, the Buyer, desires to purchase and
acquire the Target Assets and the Target
Business, and the Sellers wish to sell such
Target Assets and Target Business to the Buyer
for the consideration and upon the terms and
subject to the conditions set out in this
Agreement.
NOW, THEREFORE, the following is agreed:
1. DEFINITIONS
In this Agreement, unless expressly otherwise
stated or provided, or unless the context
otherwise requires, the following terms shall
have the following meaning, the singular (where
appropriate) shall include the plural and vice
versa and references to Appendices and Sections
shall mean Appendices and Sections of this
Agreement.
1.1 "ACCOUNTING PRINCIPLES" shall mean the accounting principles set out in Appendix 1.1.
1.2 "ACCOUNTS" shall mean the audited or reviewed profit and loss statement and
balance sheet of each of the Business Sellers and the Subsidiaries for
the year ended 31 December 2002, including the notes thereto, as well as
the auditors' statutory reports related thereto, attached hereto as
Appendix 1.2.
1.3 "ADJUSTMENT AMOUNT" shall have the meaning set out in Section 4.1.
1.4 "THIS AGREEMENT" shall mean this Master Agreement on Purchase of Assets and Business and
the Appendices and Enclosures hereto.
1.5 "ASSET PURCHASE AGREEMENT" shall mean the agreement regarding the sale and purchase of the Business
Assets to be entered into between the Seller and Subsidiary Business
Seller respectively and the Buyer as set out in Section 2.2.
1.6 "BUSINESS ASSETS" shall have the meaning set out in Section 3.1 (c).
1.7 "BUSINESS SELLERS" shall have the meaning set out in the introductory paragraph.
1.8 "BUYER" shall have the meaning set out in the introductory paragraph.
1.9 "BUYER AFFILIATE" shall mean any other entity directly or indirectly controlling,
controlled by, or under direct or indirect control of the Buyer.
1.10 "BUYER'S AUDITORS" shall mean KPMG.
1.11 "BUYER'S KNOWLEDGE" shall mean the actual knowledge of Messrs. Robert Ratliff, Stephen
Lupton and the financial and legal advisors of the Buyer engaged in the
Transaction.
1.12 "COMPLETION" shall mean the completion of the transactions contemplated by this