Spa sample agreement

Topics: Due diligence, Freshfields Bruckhaus Deringer, Mergers and acquisitions Pages: 7 (1603 words) Published: March 19, 2014
March 26, 2012

Strictly Private and Confidential

Gregory Dalle
Director, EMEA Mergers & Aquistitions
Credit Suisse Securities (Europe) Limited
One Cabot Square
London E14 4QJ

Paul Klepetko
Director, US Mergers & Aquistitions
Credit Suisse Securities (USA) LLC
Eleven Madison Avenue
New York 10010 3629 NY

Final offer for the acquisition of 100% stake in Ansaldo Sistemi Industriali S.p.A. (“ASI” or the “Company”) Dear Mr. Dalle and Mr. Klepetko
Thank you for your letter dated 13 March 2012 inviting Crompton Greaves Limited (“CG” or “Crompton Greaves” ) to proceed with Phase III of the acquisition of Ansaldo Sistemi Industriali S.p.A. (the “Proposed Transaction”). We are pleased to hereby confirm our interest in the Proposed Transaction and to express our appreciation for the time spent by you and the Company’s management team in making available additional information in an online data room, hosting a meeting with the Company’s CFO, [auditors], general counsel and environmental manager [and allowing us to conduct further site visits]. We are therefore pleased to submit, as per your request, this final offer (the “Final Offer”). This Final Offer replaces the letter sent by Crompton Greaves on 8 February 2012 and sets forth the basic terms and conditions under which Crompton Greaves is willing to make this Final Offer. 1)Valuation of the Company

The total consideration that Crompton Greaves is willing to pay for the acquisition of the Company is equal to EUR [•] million
(equivalent to [•] x FY 2011 Estimated EBITDA)

on a debt-free, cash-free basis and assuming a sufficient net asset value including working capital position at Closing of the Proposed Transaction as necessary for a smooth operation of the business going forward. The purchase price would be paid at the Closing of the Proposed Transaction in cash with immediately available funds. [NOTE: in addition to the above, according to the procedure letter CG should provide a detailed schedule containing any adjustment to derive equity value from the purchase price] 2)Financing

Crompton Greaves intend to pay 100% of the consideration in cash and intends to fund the consideration for the Proposed Transaction thorough a combination of equity and third party debt financing. [We hereby attached as schedule [•] comfort letters from two of several financial institutions with whom we have longstanding relationships. We can confirm that we will have the relevant financing documentation signed in due course and that we will be provided with the relevant financing at closing of the Proposed Transaction.] [NOTE: according to the procedure letter CG should provide copies of the relevant financing documentation as agreed with the relevant banks; if available we should attached the relevant financing agreement(s) in lieu of making reference to the two comfort letters attached to the non-binding offer sent on 8 February.] 3)Transaction documents

We have examined the draft of sale and purchase agreement (the “SPA”) that you have submitted to us, regulating the sale of the 100% stake to the Company and, as per your request, we attached herewith as schedule [•] a marked-up version of the same showing our suggestions for changes and integrations. A complete analysis of the SPA shall be made, once the missing schedules shall be provided to us. 4)Internal approvals

We confirm that the Crompton Greaves’ board of directors has approved the submission of this Final Offer, which is signed in the name and on behalf of Crompton Greaves by a legal representative thereof. There are no internal approvals that Crompton Greaves may require to proceed with the Proposed Transaction. 5)Regulatory implications

Crompton Greaves confirms that it will seek all necessary external approvals that are required for a transaction of this size and nature. As mentioned previously, these may include: a) Regulatory approvals for making investment outside India. Due to existing...
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