Offer Memorandum Last day of acceptance dated 30 May 2006 23 June 2006, subject to extension
Concerning the recommended public offer by
de lage landen ®
p a r t n e r s i n f i n a n c e
De Lage Landen Europe Participations B.V.
a private limited liability company (besloten vennootschap met beperkte aansprakelijkheid) registered in Eindhoven, the Netherlands
for all the issued and outstanding ordinary shares in the capital of
ATHLON
H O L D I N G
Athlon Holdmg N.V.
a public limited liability company (naamloze vennootschap) registered in Hoofddorp, the Netherlands The information included in this offer memorandum (the "Offer Memorandum") relates to the firm public offer by De Lage Landen Europe Participations B.V. (the "Offeror") to all holders of issued and outstanding ordinary shares with a nominal value of EUR 0.25 each (the "Shares", holders of such Shares being referred to as "Shareholders") in the share capital of Athlon Holding N.V. ("Athlon" or the "Company") to purchase for cash the Shares held by them, on the terms and subject to the conditions and restrictions contained in this Offer Memorandum (the "Offer"). Capitalised terms in this Offer Memorandum shall have the meanings ascribed to them in chapter 3 ('Definitions').
Shareholders are offered a cash price of EUR 30.25 per Share (the "Consideration"), which Consideration includes the right to dividends (including, but not limited to, the right to dividends in respect of the Financial Year 2005). The Offer is subject to certain conditions and restrictions, as set out, inter alia, in chapter 1 ('Restrictions'), chapter 2 ('Important Information'), chapter 6 ('Invitation to the Shareholders') and chapter 7 ('Explanation and Background to the Offer') (the "Offer Conditions"). The Athlon supervisory board (the "Supervisory Board") and the Athlon executive board (the "Executive Board") unanimously support the Offer and fully recommend the Shareholders to accept the Offer. See chapter 8 ('Recommendation by the Supervisory Board and the Executive Board').
The Acceptance Period will start on 31 May 2006 at 9:00 hours CET and, unless extended, will end on 23 June 2006 at 15:00 hours CET. If the Acceptance Period is extended, the Offeror will make an announcement to that effect, no later than 28 June 2006, with due observance of the provisions of article 9o, paragraph 5 of the Decree. As soon as possible after the Closing Date, but no later than on the fifth Euronext Trading Day thereafter, the Offeror will announce whether or not the Offer has been declared unconditional (gestandgedaan). Announcements will in any event be published in the Daily Official List (Officiële Prijscourant) of Euronext Amsterdam and in Het Financieele Dagblad. See chapter 6 ('Invitation to the Shareholders') and chapter 7 ('Explanation and Background to the Offer').
If and after the Offer has been declared unconditional (gestandgedaan), payment of the Consideration to the Shareholders, who have tendered and delivered their Shares under the Offer, will take place, at the latest, five Euronext Trading Days after the Unconditional Date. See chapter 6 ('Invitation to the Shareholders') and chapter 7 ('Explanation and Background to the Offer'). On 14 June 2006 at 15:00 hours CET, the annual general meeting of Shareholders in 2006, which will also be the general meeting of Shareholders referred to in article 9q of the Decree, will be convened, at which time the Offer, amongst other things, will be discussed. Certain holders of Shares have irrevocably undertaken to tender Shares held by them under the Offer on the terms and conditions of the Offer as described in this Offer Memorandum. The number of Shares committed under the Offer is approximately 56% of the Shares. In addition, all the holders of issued and outstanding cumulative preference shares with a nominal value of EUR 0.25 each (the "Cumulative Preference Shares") have, subject to the Offer being declared unconditional, sold their Cumulative Preference Shares to the Offeror. The committed Shares and Cumulative Preference Shares represent in aggregate approximately 64% of the total issued and outstanding share capital of Athlon on the date of this Offer Memorandum. See chapter 5.6 ('Committed Shares').
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1 RESTRICTIONS
1.1 General
The Offer is not being made, and the Shares will not be accepted for purchase from or on behalf of any Shareholders, in any jurisdiction in which the making or acceptance thereof would not be in compliance with the securities or other laws or regulations of such jurisdiction or would require any registration, approval or filing with any regulatory authority not expressly contemplated by the terms of this Offer Memorandum. Persons obtaining the Offer Memorandum are required to take due note and observe all such restrictions and obtain any necessary authorisations, approvals or consents. None of DLL, the Offeror, nor Athlon, nor any of their advisors accept any liability for any violation by any person of any such restriction. Any person (including, without limitation, custodians, nominees and trustees) who would or otherwise intends to forward this Offer Memorandum or any related document to any jurisdiction outside the Netherlands should carefully read this section before taking any action. The distribution of this document in jurisdictions other than the Netherlands may be restricted by law and therefore persons into whose possession this document comes should inform themselves about and observe such restrictions. Any failure to comply with any such restrictions may constitute a violation of the securities laws of any such jurisdiction.
1.2 United States
The Offer is not being made, directly or indirectly, in or into the United States, or to any U.S. person (as defined in Regulation S under the United States Securities Act of 1933, as amended), or by use of the mails of, or by any means or instrumentality of interstate or foreign commerce of, or any facilities of a national securities exchange of the United States. This includes, but is not limited to, the post, facsimile transmission, telex or any other electronic forms of transmission and telephone. Accordingly, copies of this Offer Memorandum and any related press announcements, acceptance forms and other documents are not being sent and must not be mailed or otherwise distributed or sent in, into or from the United States. Persons receiving this Offer Memorandum and/or such other documents (including, without limitation, custodians, nominees and trustees) must not distribute or send them in, into or from the United States, or use such mails or any such means, instrumentality or facility for any purpose directly or indirectly in connection with the Offer, and so doing may invalidate any purported acceptance of the Offer.
1.3 Australia, Canada and Japan
The Offer is not being made, directly or indirectly, in or into Australia, Canada or Japan and this Offer Memorandum, and any materials related thereto, should not be sent in or into Australia, Canada or Japan, whether by use of the Australian, Canadian or Japanese interstate or foreign commerce, or any facility of a Australian, Canadian or Japanese national securities exchange (including, but without limitation, electronic mail, post, facsimile transmission, telex and telephone), and the Offer cannot be accepted by any such use, means or instrumentality, in or from within Australia, Canada or Japan. Accordingly, copies of this Offer Memorandum and any related materials are not being, and must not be, mailed or otherwise distributed or sent in or into or from Australia, Canada or Japan or, in their capacities as such, to custodians, trustees or nominees holding Shares for Australian, Canadian or Japanese persons, and persons receiving any such documents (including custodians, nominees and trustees) must not distribute or send them in, into or from Australia, Canada or Japan and doing so will render invalid any relevant purported acceptance of the Offer.
1.4 Republic of Italy
The Offer is not being made, directly or indirectly, in or into the Republic of Italy. The Offer and the Offer Memorandum have not been submitted to the clearance procedure of the Commissione Nazionale per le Societa e la Borsa (CONSOB) pursuant to Italian laws and regulations. Accordingly, Shareholders are hereby notified that, to the extent such Shareholders are Italian residents and/or located in the Republic of Italy, the Offer is not available to them and they may not submit for tender of Shares under the Offer and, as such, any tenders received from such persons shall be ineffective and void, and neither the Offer Memorandum nor any other offering material relating to the Offer or the Shares may be distributed or made available in the Republic of Italy.
1.5 United Kingdom
This Offer Memorandum is directed only at persons who (i) are persons falling within Article 49(2) (a) to (d) ("high net worth companies, unincorporated associations, etc.") of The Financial Services and Markets Act 2000 (Financial Promotion) Order 2001 (as amended) (thé "Order") or (ii) are investment professionals as in the meaning of Article 19 of the Order or have professional experience in matters relating to investments or (iii) are outside the United Kingdom (all such persons together being referred to as "Relevant Persons"). This Offer Memorandum must not be acted on or relied on by persons who are not Relevant Persons. The Offer may only be accepted by, and any investment activity to which this communication relates is available only to and will be engaged in only with, Relevant Persons.
2 IMPORTANT INFORMATION
Shareholders are advised to read this Offer Memorandum carefully and to seek independent advice where appropriate so that a reasoned judgement can be made of the Offer and all that is discussed and described in this Offer Memorandum.
The information included in chapter 8 ('Recommendation by the Supervisory Board and the Executive Board'), chapter 10 ('Annual General Meeting of Shareholders of Athlon'), chapter 11 ('Information regarding Athlon') and chapter 17 ('Financial Statements') of this Offer Memorandum and the corresponding sections in the English and Dutch summaries has been provided solely by Athlon. The information included in chapter 6 ('Invitation to the Shareholders'), chapter 7 ('Explanation and Background to the Offer') and chapter 12 ('Information regarding the Offeror and DLL') of this Offer Memorandum and the corresponding sections in the English and Dutch summaries has been provided solely by the Offeror. The information included in chapter 9 ('Fairness Opinion') has been provided by PricewaterhouseCoopers Advisory N.V. The auditors report in chapter 17.3 ('Auditors report relating to Athlon's consolidated financial information for the financial years 2005, 2004 and 2003') has been provided by KPMG. The information included in the other chapters has been provided by Athlon and the Offeror together.
Athlon and the Offeror are exclusively responsible for the accuracy and completeness of the information contained in this Offer Memorandum and the corresponding sections in the Dutch summary, except for chapter 9 ('Fairness Opinion') for which PricewaterhouseCoopers Advisory N.V. is responsible and chapter 17.3 ('Auditors report relating to the consolidated financial information for the financial years 2005, 2004 and 2003') for which KPMG is responsible, each solely with respect to the information provided by Athlon and the Offeror respectively and jointly for the information provided together. Each of Athlon and the Offeror confirms that, on the date of this Offer Memorandum, the information provided by them as above, and as contained in this Offer Memorandum, is, to the best of their knowledge, true and accurate and there are no other facts the omission of which would make any statement in this Offer Memorandum misleading in any material respect. PricewaterhouseCoopers Advisory N.V. confirms that the information contained in chapter 9 ('Fairness Opinion') is identical to the faimess opinion issued by PricewaterhouseCoopers Advisory N.V. to Athlon. KPMG confirms that the information included in chapter 17.3 ('Auditors report relating to Athlon's consolidated financial information for the financial years 2005, 2004 and 2003') is identical to the auditors report issued by KPMG to Athlon in respect of this Offer Memorandum.
The information included in this Offer Memorandum reflects the situation as at the date of this Offer Memorandum. Under no circumstances may the issue and distribution of this Offer Memorandum be interpreted as implying that the information contained herein is true and accurate at a later date than the date of this Offer Memorandum.
This Offer Memorandum may include forward-looking statements that involve risk and uncertainty. Generally, words such as 'may', 'will', 'expect', 'intend', 'estimate', 'anticipate', 'believe', 'plan', 'seek', 'continue' or similar expressions identify forward-looking statements. Although each of Athlon and the Offeror, each with respect to the statements it has provided, believes the expectations reflected in such forward-looking statements are based on reasonable assumptions and on information that is, to the best of their knowledge, true and accurate as at the date of this Offer Memorandum, no assurance can be given that such projections will be fulfilled, and no representations can be or are made as to the accuracy and completeness of such statements at any time after the date of this Offer Memorandum. Any such forward-looking statements must be considered along with knowledge that actual events or results may vary materially from such predictions due to, among other things, political, economic or legal changes in the markets and environment in which Athlon and/or the Offeror do business, and competitive developments or risks inherent to each of Athlon's and/or the Offeror's business plans. These risks, uncertainties and assumptions may cause the actual results, performance or achievements of Athlon and those of the Offeror, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Moreover, potential investors should not interpret statements regarding past trends or activities as representations that these trends and activities will continue in the future.
Athlon and the Offeror undertake no obligation to update publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise. This statement is
made notwithstanding any such obligations under the Decree and the listing rules of Euronext Amsterdam.
Certain financial and statistical information in this Offer Memorandum has been subject to rounding adjustments and to currency conversion adjustments. Accordingly, the sum of certain data may not conform to the expressed total.
With the exception of the Offeror and Athlon (and without prejudice to the Fairness Opinion of PricewaterhouseCoopers Advisory N.V. and the auditors' reports of KPMG included in this Offer Memorandum), no person is authorised to provide any information or make any representations in connection with the Offer and the information included in this Offer Memorandum. If any such information or representation is provided or made by parties other than Athlon or the Offeror, such information or representation should not be relied upon as having been provided, or made by, or on behalf of, Athlon or the Offeror respectively. Any information or representation not contained in this Offer Memorandum must not be relied upon as having been provided by, or made by, or on behalf of, the Offeror or Athlon.
This Offer Memorandum and the Offer are, and any tender, purchase or delivery of Shares will be, governed by, and construed in accordance with, the laws of the Netherlands. The District Court of Amsterdam (Rechtbank Amsterdam) and its appellate courts shall have exclusive jurisdiction to settle any disputes which might arise out of, or in connection with, this Offer Memorandum, the Offer and/or any tender, purchase or delivery of Shares. Accordingly, any legal action or proceedings arising out of, or in connection with, the Offer Memorandum, the Offer and/or any tender, purchase or delivery of Shares, may be brought exclusively in such courts.
This Offer Memorandum is published in English. A Dutch summary is included in chapter 16 ('Nederlandse samenvatting van het bod'). In the event of any differences, whether or not in interpretation, between the English text of this Offer Memorandum and the Dutch summary, the English text will prevail. Copies of this Offer Memorandum, the current Athlon Articles of Association and the Proposed Athlon Articles of Association, which documents are incorporated by reference in, and form an integral part of, this Offer Memorandum, are available free of charge at the website www.athlonholding.nl and at the offices of Athlon and the Exchange and Paying Agent and can be obtained by contacting Athlon or the Exchange and Paying Agent at the addresses below:
Athlon Exchange and Paying Agent Athlon Holding N.V. Rabo Securities
Wieger Bruinlaan 98 Amstelplein 1 2132 AX Hoofddorp 1096 HA Amsterdam the Netherlands the Netherlands P.O. Box 196 P.O. Box94640 2130 AD Hoofddorp 1090 GP Amsterdam the Netherlands the Netherlands
Telephone: +31 23 567 5700 Telephone: +31 20 462 4602 Fax: +31 23 561 4748 Fax: +31 20 460 4949
Email: athloninfo@athlonholding.nl Email: prospectus@rabobank.com
Digital copies of this Offer Memorandum are also available on the website of Euronext Amsterdam: www.euronext.com (Dutch residents only).
Morgan Stanley & Co. Limited is acting as financial advisor exclusively to the Offeror and to no one else in connection with the Offer, and will not regard any other person (whether or not a recipient of this Offer Memorandum) as a client in relation to the Offer and will not be responsible to anyone other than the Offeror for providing the protections afforded to the clients of Morgan Stanley & Co. Limited or for providing advice in relation to the Offer.
Rabo Securities is acting as financial advisor exclusively to the Offeror and to no one else in connection with the Offer and is not responsible to anyone other than the Offeror for providing the protections afforded to the clients of Rabo Securities or for providing advice in relation to the Offer. Catalyst Advisors B.V. is acting as sole financial advisor exclusively to Athlon and to no one else in connection with the Offer and is not responsible to anyone other than Athlon for providing the
protections afforded to the clients of Catalyst Advisors B.V. or for providing advice in relation to the Offer.
PricewaterhouseCoopers Advisory N.V. is acting as provider of the Fairness Opinion exclusively to Athlon and to no one else in connection with the Offer and is not responsible to anyone other than Athlon for providing the protections afforded to the clients of PricewaterhouseCoopers Advisory N.V. or for providing advice in relation to the Offer.
3 DEFINITIONS
"Acceptance Period"
"Admitted Institution" AFM"
"AGM"
"Athlon" or the "Company"
"Athlon Articles of Association" "Boards"
"CET"
"Closing Date"
"Commencement Date" "Consideration"
"Cumulative Preference Shares" "Daily Official List"
DLL"
"DSSA 1995" "DSSD" or "Decree" "Dutch Civil Code" "EUR"
"Euronext Amsterdam" "Euronext Trading Day"
The period during which Shareholders may tender their Shares to the Offeror under the Offer, which period starts on 31 May 2006 at 9:00 hours CET and ends on the Closing Date at 15:00 hours CET
An admitted institution {aangesloten instelling), as defined in article 1 of the Securities Giro Act (Wet giraal effectenverkeer) The Netherlands Authority for the Financial Markets (Autoriteit Financiële Markten)
The Annual General Meeting of Shareholders in 2006, which meeting will be combined with the General Meeting of Shareholders referred to in article 9q of the Decree
Athlon Holding N.V., a Dutch public limited liability company (naamloze vennootschap) incorporated under Dutch law, with its statutory seat in Hoofddorp, the Netherlands, and/or one or more of its group companies, as described in article 2:24b of the Dutch Civil Code and its affiliates
The articles of association (statuten) of Athlon, as most recently amended
The Supervisory Board and the Executive Board collectively Central European Time
The Euronext Trading Day on which the Acceptance Period ends, being 23 June 2006, unless extended in accordance with article 9o, paragraph 5 of the Decree, in which case the Closing Date will be such later time and date
The date on which the actual Offer is made, being 30 May 2006 A cash amount of EUR 30.25 for each Share validly tendered (or defectively tendered provided that such defect has been waived by the Offeror) and delivered (geleverd) under the terms and conditions of the Offer, which amount includes the right to dividends (including, without being limited to, the right to dividends in respect of the Financial Year 2005)
The issued and outstanding cumulative preference shares in the share capital of Athlon with a nominal value of EUR 0.25 each The Daily Official List (Officiële Prijscourant) of Euronext Amsterdam
De Lage Landen International B.V., a Dutch private limited liability
company (besloten vennootschap met beperkte aansprakelijkheid) that is the sole shareholder of the Offeror, with its statutory seat in Eindhoven, the Netherlands, and/or one or more of its group companies, as the case may be
The Dutch Securities Supervision Act 1995 (Wet toezicht effectenverkeer 1995), as amended from time to time
The Dutch Decree on the Securities Supervision 1995 (Besluit toezicht effectenverkeer 1995), as amended from time to time The Dutch Civil Code (Burgerlijk Wetboek), as amended from time to time
Euro, the legal European currency of the European Monetary Union
Euronext Amsterdam N.V. or Eurolist by Euronext Amsterdam, as the context requires
"Exchange and Paying Agent" "Executive Board" "Fairness Opinion" "Financial Year 2003" "Financial Year 2004" "Financial Year 2005" "General Meeting of Shareholders" "KPMG"
Material Adverse Change
"Merger Code" "Offer"
"Offer Conditions" "Offer Memorandum" "Offeror"
"Post Acceptance Period"
"Proposed Athlon Articles of Association"
Rabo Securities
The board of managing directors (raad van bestuui) of Athlon The fairness opinion in respect of the Offer rendered by PwC and set out in chapter 9 ('Fairness Opinion') of this Offer Memorandum
The financial year of Athlon ended 31 December 2003 The financial year of Athlon ended 31 December 2004 The financial year of Athlon ended 31 December 2005 The general meeting of shareholders of Athlon
KPMG Accountants N.V., a public limited liability company (naamloze vennootschap met beperkte aansprakelijkheid) incorporated under Dutch law, with its statutory seat in Amstelveen, the Netherlands
Any change, development, fact, event, violation or consequence (any such item individually a "Change") which, individually or together with other Changes, would reasonably be expected to: (i) be materially adverse to the business, the equity capital, the
operational or net profit, or the possibilities to achieve corporate growth objectives of Athlon, including its subsidiaries and other participations, except for a Change that was known to DLL as a result of the written information provided by Athlon in the dataroom to which DLL was given access; or
(ii) materially restrict the Offeror from consummating the transactions contemplated in this Offer Memorandum The 2000 Merger Code of the Netherlands Social and Economic Council (SER-besluit Fusiegedragsregels 2000)
The firm public offer (vast openbaar bod) made by the Offeror on all Shares, as described in this Offer Memorandum
The conditions precedent to declaring the Offer unconditional (gestandgedaan), as set out in chapter 6.3 ('Offer Conditions') This offer memorandum setting out the terms of the Offer, dated 30 May 2006
De Lage Landen Europe Participations B.V., a Dutch private limited liability company (besloten vennootschap met beperkte aansprakelijkheid) that is a wholly-owned subsidiary of DLL, with its statutory seat in Eindhoven, the Netherlands, and/or one or more of its group companies, as the case may be
The period, if any, after the Unconditional Date, during which the Shareholders that have not tendered their Shares under the Offer will be given the opportunity to do so, in the same manner and under the same conditions as set out in the Offer Memorandum The Articles of Association of Athlon, which are subject to the Offer being declared unconditional (gestandgedaan) and are to be submitted for adoption to the AGM and, if adopted, will be effective at the Settlement Date
"PricewaterhouseCoopers Advisory N.V." "Rabo Securities" "Settlement Date" "Share(s)" "Shareholder(s)" "SME" "Supervisory Board"
"Total Issued Share Capital of Athlon"
"Translease"
"Unconditional Date"
"WMZ 1996"
PricewaterhouseCoopers Advisory N.V., a public limited liability company (naamloze vennootschap met beperkte-aansprakelijkheid) incorporated under Dutch law, with its statutory seat in Amsterdam, the Netherlands
The equity (linked) investment bank division of Coöperatieve Centrale Raiffeisen- Boerenleenbank B.A., acting under the name "Rabo Securities"
The date on which, in accordance with the terms and conditions of the Offer, the Offeror shall pay the Consideration to the Shareholders who have validly tendered (or defectively tendered provided that such defect has been waived by the Offeror) and delivered (geleverd) their Shares under the Offer, being no later than the fifth Euronext Trading Day after the Unconditional Date, subject to the Offer being declared unconditional (gestandgedaan)
One or more issued and outstanding ordinary share(s) in the share capital of Athlon with a nominal value of EUR 0.25 each One or more holders of Share(s), before or after the Offer, as the case may be
Small and Medium Enterprises
The board of supervisory directors (raad van commissarissen) of Athlon
The total issued and outstanding share capital of Athlon at the date of this Offer Memorandum, comprising all of the Shares and all of the Cumulative Preference Shares
De Lage Landen Translease B.V., a Dutch private limited liability company (besloten vennootschap met beperkte aansprakelijkheid) with its statutory seat in Nijmegen, the Netherlands, which is the wholly-owned subsidiary of DLL that operates DLL's car leasing business
The day on which the Offer is declared unconditional (gestandgedaan) by the Offeror, being no later than 15:00 hours CET on the fifth Euronext Trading Day following the Closing Date
The Dutch Act on Disclosure of Major Holdings in Listed Companies (Wet melding zeggenschap in ter beurze genoteerde vennootschappen 1996), as amended from time to time
4 TABLE OF CONTENTS
1 Restrictions 1.1 General 1.2 United States
1.3 Australia, Canada and Japan 1.4 Republic of Italy 1.5 United Kingdom 2 2 IMPORTANT INFORMATION 3 3 DEFINITIONS 6 4 TABLE OF CONTENTS 9 5 SUMMARY 11 5.1 The Offer 11 5.2 Rationale for the Offer 11
5.3 Financing of the Offer 11 5.4 Recommendation by the Supervisory Board and the Executive Board 12
5.5 Overview of Shares held directly or indirectly by members of the Board 12
5.6 Committed Shares 12 5.7 Offer Conditions, Acceptance Period, declaring the Offer unconditional, extension
and settlement 12 5.8 The Offeror 13 5.9 Liquidity and delisting 14
5.10 Legal structure of Athlon following the Offer 14
5.11 Future dividend policy 15 5.12 Organisational and social consequences 15
5.13 Announcements 15 5.14 Envisaged timetable 16 6 INVITATION TO THE SHAREHOLDERS 17
6.1 Consideration 17 6.2 Acceptance by Shareholders 17
6.3 Offer Conditions 18 6.4 Acceptance Period 19 6.5 Declaring the Offer unconditional (gestanddoening) 19
6.6 Extension 20 6.7 Settlement 20 6.8 Dividends 20 6.9 Commission 20 6.10 Restrictions 20 6.11 Announcements 20 7 EXPLANATION AND BACKGROUND TO THE OFFER 21
7.1 Introduction 21 7.2 Committed Shares 21
7.3 Overview of Shares held directly or indirectly by members of the Boards 22
7.4 Substantiation of the Consideration 22
7.5 Rationale for the Offer 23 7.6 Liquidity and delisting 24 7.7 Legal structure of Athlon following the Offer 24
7.8 Future dividend policy 26 7.9 Organisational and social consequences 26
7.10 Future composition of the Boards 26
7.11 Employee option plan 27 7.12 Financing of the Offer 27 7.13 Certain arrangements between Athlon and the Offeror 27
8 RECOMMENDATION BY THE SUPERVISORY BOARD AND THE EXECUTIVE
BOARD 28
9 FAIRNESS OPINION 29 10 ANNUAL GENERAL MEETING OF SHAREHOLDERS OF ATHLON 31
11 INFORMATION REGARDING ATHLON 33 11.1 General and business information 33 11.2 Change in accounting treatment for customer relationship value 34
11.3 Management and employees 35
11.4 Capital and Shares 36 11.5 Proposed Athlon Articles of Association 36
12 INFORMATION REGARDING THE OFFEROR AND DLL 37
12.1 Incorporation of the Offeror 37 12.2 The registered office and Chamber of Commerce of Registration of the Offeror 37
12.3 Management board of the Offeror 37 12.4 Capital and shares of the Offeror..: 37 12.5 General Information about DLL 37 13 DECLARATIONS PURSUANT TO THE DECREE 38
14 OTHER INFORMATION 39 14.1 Available documents 39 14.2 Exchange and Paying Agent 39
15 PRESS RELEASES 40 15.1 Press release - 22 March 2006..; 40
15.2 Press release - 21 April 2006 45 15.3 Press release - 12 May 2006 46 16 NEDERLANDSE SAMENVATTING VAN HET BOD 59
17 FINANCIAL STATEMENTS 70 17.1 Financial statements for the Financial Year 2005 70
17.2 Consolidated and condensed financial statements for the Financial Years 2004 and
2003 124 17.3 Auditors report relating to Athlon's consolidated financial information for the financial
years 2005, 2004 and 2003 128
5 SUMMARY
This summary is qualified in its entirety by, and should be read in conjunction with, the more detailed information appearing elsewhere in this Offer Memorandum. Shareholders are advised to review the Offer Memorandum in detail and to seek independent advice where appropriate in order to reach a reasoned judgement in respect of the contents of the Offer Memorandum and the Offer itself. Unless the context requires otherwise, capitalised terms used in this Offer Memorandum shall have the meanings set out in chapter 3 ('Definitions').
5.1 The Offer
For each Share tendered under the terms and conditions of the Offer, the Offeror offers the Consideration of EUR 30.25 in cash, which is inclusive of the right to dividends (including, without being limited to, the right to dividends in respect of the Financial Year 2005).
The Consideration of EUR 30.25 per Share represents an attractive price to the Shareholders and represents:
(i) 16.8% premium over Athlon's closing share price on 21 March 2006, the last trading day prior to the first and joint public announcement by DLL and Athlon that the expectation was justified that agreement could be reached on the Offer;
(ii) 23.3% premium over Athlon's average closing share price for the last 30 days prior to and including 21 March 2006; and
(iii) 32.2% premium over Athlon's average closing share price for the last 90 days prior to and including 21 March 2006; and
(iv) a premium of 40.5% to the average closing share price over the last 12 months prior to and including 21 March 2006.
See also chapter 7.4 ('Substantiation of the Consideration'). 5.2 Rationale for the Offer
Along with maintaining its leading position in the international vendor-finance market, DLL aims to enhance its position and market-share in international car leasing markets by expanding its operations in those markets. Although the car leasing markets in the Netherlandis and the United Kingdom are mature, the car leasing markets in the rest of Europe offer opportunities for growth. DLL has taken the view that the acquisition of established businesses, such as that of Athlon, is necessary for it to realize its objective of increased market-share. Through integration and consolidation, such acquisitions will also create economies of scale.
Combining the car leasing businesses of Athlon and Translease will create a strong vehicle through which DLL can, through organic growth and further acquisitions, develop its presence in car leasing markets outside the Netherlands in which Athlon currently operates, as well as in car leasing markets in Central Eastern Europe in which Athlon does not currently operate.
The business models of Athlon and Translease complement each other. Athlon focuses primarily on corporate clients, taking 'operational excellence' as a starting point; its business premise is "good service at low cost". Translease focuses on the SME market and operates on the basis of 'customer intimacy'. Both business models are proven concepts in the Dutch market.
The combination of Athlon and Translease will create a business that, amongst other things: (i) is one of the market leaders in the Netherlands; (ii) is able to service the full range of corporate and SME clients of Coöperatieve Centrale Raiffeisen-Boerenleenbank B.A., also known as "Rabobank Nederland"; and (iii) has the direct potential, through existing synergy opportunities, to improve returns and/or realize value creation in areas such as funding, back-office, information technology, housing, and purchasing and cross-selling of vendor-finance and car leasing.
5.3 Financing of the Offer
The Offeror will finance the Offer from existing cash resources within the company group to which the Offeror belongs.
5.4 Recommendation by the Supervisory Board and the Executive Board
The Supervisory Board and the Executive Board have duly considered the strategic, financial and social aspects of the Offer and have reached the conclusion that the Offer is in the best interests of Athlon, the Shareholders and other stakeholders in Athlon.
The Supervisory Board and the Executive Board are of the opinion that the Offer is fair to the Shareholders. In this respect, reference is made to the Fairness Opinion, as included in chapter 9 ('Fairness Opinion') of this Offer Memorandum. The Supervisory Board and the Executive Board therefore fully support the Offer and unanimously recommend the Offer to the Shareholders for acceptance.
5.5 Overview of Shares held directly or indirectly by members of the Boards
At the date of this Offer Memorandum, 12,328 Shares, representing approximately 0.05% of the Total Issued Share Capital of Athlon are held, directly or indirectly, by members of the Executive Board. Mr O. Heijn is the only member of the Supervisory Board that owns Shares; his shareholding in Athlon amounts to 84,262 Shares, representing approximately 0.37% of the Total Issued Share Capital of Athlon. See chapter 5.6 ('Committed Shares').
As at the date of this Offer Memorandum, the members of the Executive Board have, in aggregate, options in respect of 395,340 ordinary shares in Athlon.
5.6 Committed Shares
Subject to the Offer being declared unconditional, all major Shareholders, being the following Shareholders known to Athlon as at 1 March 2006 (being the most recent date on which the major Shareholders were determined for the purposes of Athlon's 2005 annual report) that hold, or together with other shareholders in the same company group hold, 5% or more of the Total Issued Share Capital of Athlon, Breedinvest B.V., Delta Deelnemingen Fonds N.V., Delta Lloyd Levensverzekering N.V., Delta Lloyd Schadeverzekering N.V., Fortis Verzekeringen Nederland B.V., Gestion Deelnemingen V B.V., N.V. Interpolis BTL, N.V. Interpolis Schade, Natexis Lease S.A. and T.W.E. Beheer B.V., together with Onroerend Goed Beheer- en Beleggingsmaatschappij A. van Herk B.V., the members of the Executive Board and the sole member of the Supervisory Board that holds Shares, have irrevocably committed themselves to tendering all Shares held by each of them under the Offer and on the same terms and subject to the same conditions as the Offer. Such commitments represent a total of 10,418,005 Shares, representing approximately 56% of the Shares and approximately 46% of the Total Issued Share capital of Athlon at the date of this Offer Memorandum.
Subject to the Offer being declared unconditional, all holders of Cumulative Preference Shares, being Breedinvest B.V., Delta Lloyd Levensverzekering N.V., and Fortis Verzekeringen Nederland B.V., have, subject to the Offer being declared unconditional, sold all Cumulative Preference Shares held by each of them to the Offeror. These Cumulative Preference Shares represent approximately 18% of the Total Issued Share Capital of Athlon.
Accordingly, the holders of Shares and Cumulative Preference Shares have, in aggregate, irrevocably committed themselves to tendering or selling (as the case may be), subject to the Offer being declared unconditional, such number of Shares and Cumulative Preference Shares as represents approximately 64% of the Total Issued Share Capital of Athlon.
None of the holders of Shares that have committed themselves to tender such Shares held by them under the Offer, or the holders of Cumulative Preference Shares that have, subject to the Offer being declared unconditional, sold their Cumulative Preference Shares to the Offeror, have received from the Offeror any relevant information regarding the Offer that is not included in this Offer Memorandum.
5.7 Offer Conditions, Acceptance Period, declaring the Offer unconditional, extension and settlement
Offer Conditions
The Offer shall be declared unconditional (gestandgedaan) if the Offer Conditions as set out in chapter 6.3 ('Offer Conditions') are fulfilled or, if permitted by applicable law, waived by the party entitled to waive such Offer Condition.
Acceptance Period
The Acceptance Period begins on 31 May 2006 at 9:00 hours CET and ends, subject to extension in accordance with article 9o, paragraph 5 of the Decree, on 23 June 2006 at 15:00 hours CET. See chapter 6.4 ('Acceptance Period').
Shares tendered on or prior to the Closing Date may not be withdrawn, subject to the right of withdrawal of any tender during any extension of the Acceptance Period, in accordance with the provisions of article 9o, paragraph 5 of the Decree.
If one or more of the Offer Conditions is not fulfilled, the Offeror may, subject to the provisions of article 9o, paragraph 5 of the Decree, extend the Acceptance Period until all such Offer Conditions have been satisfied or, where appropriate, waived. During an extension of the Acceptance Period, any Shares previously tendered and not withdrawn will remain subject to the Offer, subject to the right of each Shareholder to withdraw the Shares he or she has already tendered in accordance with the provisions of article 9o, paragraph 5 of the Decree. See chapter 6.6 ('Extension').
If all Offer Conditions are satisfied or, where appropriate, waived, the Offeror will accept all Shares that have been validly tendered (or defectively tendered provided that such defect has been waived by the Offeror) and not previously withdrawn, pursuant to the terms of the Offer and in accordance with the procedures set forth in chapter 6.2 ('Acceptance by Shareholders').
Declaring the Offer unconditional (gestanddoening)
The Offer shall be subject to the fulfilment of the Offer Conditions, as set out in chapter 6.3 ('Offer Conditions'). The Offer Conditions in subclauses (a) through (h) of chapter 6.3 serve for the benefit of the Offeror and the Offeror has the right, (either in whole or in part) at any time by written notice to Athlon, to waive such Offer Conditions. The Offer Condition in subclause (i) of chapter 6.3 serves for the benefit of both the Offeror and Athlon, and may only be waived by the Offeror together with Athlon. The Offer in subclause (j) of chapter 6.3 cannot be waived. See chapter 6.3 ('Offer Conditions').
The Offeror will determine within five Euronext Trading Days following the Closing Date, such date being the Unconditional Date, whether the Offer Conditions have been fulfilled or are to be waived by the Offeror and will announce whether (i) the Offer has been declared unconditional (gestandgedaan), (ii) there is still uncertainty as to the fulfilment of any of the Offer Conditions, or (iii) the Offer is terminated, as a result of the Offer Conditions not having been fulfilled or waived by the Offeror, all in accordance with article 9t, paragraph 4 of the Decree. See chapter 6.5 ('Declaring the Offer unconditional (gestanddoening)').
Extension
The Offeror may extend the Offer past the Closing Date, in which case all references in this Offer Memorandum to the "Closing Date" or "15:00 hours CET, on 23 June 2006" shall, unless the context requires otherwise, be moved to the latest date and time to which the Offer has been so extended. The Shareholder's bank or stockbroker may set an earlier deadline for communication by the Shareholders in order to permit the bank or stockbroker to communicate their acceptances to the Exchange and Paying Agent in a timely manner.
If the Acceptance Period is extended such that the obligation pursuant to article 9t of the Decree to announce whether the Offer has been declared unconditional (gestandgedaan) is postponed, a public announcement to that effect shall be made not later than the third Euronext Trading Day following the initial Closing Date, in accordance with the provisions of article 9o, paragraph 5 of the Decree. See chapter 6.6 ('Extension').
Settlement
In the event that the Offeror announces that the Offer is declared unconditional (gestandgedaan), the Shareholders who have tendered and delivered their Shares for acceptance pursuant to the Offer will receive, if and when appropriate, within five Euronext Trading Days following the Unconditional Date the Consideration in respect of each Share validly tendered (or defectively tendered provided that such defect has been waived by the Offeror) and delivered (geleverd). See chapter 6.7 ('Settlement').
5.8 The Offeror
The Offeror, a private limited liability company (besloten vennootschap met beperkte aansprakelijkheid), with its statutory seat in Eindhoven, the Netherlands, was incorporated under
Dutch law on 25 April 2006. The Offeror is a direct wholly owned subsidiary of DLL, a private limited liability company incorporated under Dutch law, with its registered office in Eindhoven, the Netherlands. See chapter 12 ('Information regarding the Offeror and DLL').
5.9 Liquidity and delisting
The purchase of Shares by the Offeror pursuant to the Offer, among other things, will reduce the number of Shareholders and the number of Shares that might otherwise trade publicly and could adversely affect the liquidity and market value of the remaining Shares not tendered.
Should the Offer be declared unconditional (gestandgedaan), the Offeror intends to procure that Athlon's listing on Euronext Amsterdam will be terminated as 'soon as possible thereafter. This would further adversely affect the liquidity of any Shares not tendered. In addition, the Offeror may initiate any of the procedures as set out in chapter 7.7 ('Legal structure of Athlon following the Offer'), including procedures which might result in termination of the listing of the Shares (including Shares not being tendered).
5.10 Legal structure of Athlon following the Offer
The Offeror reserves the right to use any legally permitted method to obtain ownership of 100% of the Shares and/or the business of Athlon and its subsidiaries. For this purpose the Offeror will consider, depending inter alia on the number of Shares obtained by the Offeror as a result of the Offer, various options, including, but not limited to, a squeeze-out procedure (uitkoopprocedure), as referred to in article 2:92a of the Dutch Civil Code, a legal merger (juridische fusie) between Athlon and the Offeror or a company belonging to the same group as the Offeror in accordance with articles 2:309 and 2:334 of the Dutch Civil Code (which articles refer to a so-called "triangular merger" pursuant to which the shareholders of the disappearing company would become shareholders of a group company of the surviving company), a de-merger as specified in article 2:334a of the Dutch Civil Code, or a liquidation or sale of all or substantially all of the assets of Athlon or any combination of the aforementioned. The Offeror and Athlon reserve the right to have the Offeror, or a company belonging to the same group, contribute assets to Athlon against the issuance of Shares, while at the same time pre-emptive rights (voorkeursrechten) of other Shareholders shall be excluded, all in accordance with Dutch law and the Athlon Articles of Association at that time.
At any time after the Offer has been declared unconditional (gestandgedaan), it may be decided that Athlon will be converted into a private limited liability company (besloten vennootschap met beperkte aansprakelijkheid). Simultaneously with a conversion of Athlon into a private limited liability company, the majority shareholder of Athlon may adopt further amendments to the Athlon Articles of Association, which may include an abolition of the Supervisory Board.
As a further result of Athlon, or the surviving entity in a legal merger, being an unlisted company, statutory or other provisions applicable in the governance of public or listed companies will not apply to Athlon, or the surviving entity, and the rights of minority shareholders will be limited to the compulsory rights under the Dutch Civil Code.
In the event that the Offeror has acquired 95% or more of the issued and outstanding share capital of Athlon following the Settlement Date, the Offeror might, as soon as possible, initiate such squeeze-out procedure, in order to acquire the remaining Shares not tendered and not held by the Offeror or Athlon.
In the event that the Offeror has declared the Offer unconditional (gestandgedaan) and has not acquired 95% or more of the outstanding share capital of Athlon following the Settlement Date, such that it is not possible to initiate the squeeze-out procedure in accordance with article 2:92a of the Dutch Civil Code, the Offeror, subject to the approval of the Supervisory Board, may shortly thereafter by simple majority of the General Meeting of Shareholders vote to effect a legal merger (juridische fusie) between the Offeror, or a company belonging to the same group as the Offeror, and Athlon, in which the latter is the disappearing entity. In the event that the legal merger is effected, Shareholders who have not tendered their Shares under the Offer will become, by operation of law, shareholders in the surviving entity alongside the existing shareholders in the surviving entity, or (in the event of a triangular merger) will become shareholders in such group company. If, after a legal merger is effected, the majority shareholder of the surviving entity holds 95% or more of the capital of the surviving entity, such majority shareholder may initiate a
squeeze-out procedure in accordance with article 2:92a of the Dutch Civil Code in relation to any shares in the surviving entity not held by such majority shareholder.
In the event of a legal merger, an independent auditor will be appointed to examine the proposed legal merger and will be asked to certify that in his opinion the proposed exchange ratio for the Shares is reasonable. Such auditor will be appointed by the Supervisory Board.
Any exchange ratio between shares in Athlon and in the surviving entity will require the approval of the Supervisory Board and a vote in favour by the independent members of the Supervisory Board, as referred to in chapter 7.10 ('Future Composition of the Boards').
Furthermore, the Offeror and Athlon reserve the right to have the Offeror contribute assets to Athlon against the issuance of shares in the capital of Athlon, while at the same time pre-emptive rights (voorkeursrecht) of other Athlon Shareholders may be excluded or to sell all or substantially all of the assets of Athlon, directly or indirectly, following a transfer of those assets to a subsidiary of Athlon first, which may or may not be followed by a distribution of proceeds to the Shareholders, all in accordance with Dutch law and the' Athlon Articles of Association in force at the relevant time.
Finally, the Offeror reserves the right to submit proposals to the Shareholders in order to alter the company structure and the capital structure of Athlon and/or intended to achieve an optimal financial or other structuring, including amendments to the Athlon Articles of Association, a liquidation, a demerger as specified in article 2:334a of the Dutch Civil Code or, as already referred to above, a sale of all or substantially all of the assets of Athlon, which may or may not be followed by a distribution of proceeds to the Shareholders,, ajl in accordance with Dutch law and the Athlon Articles of Association. Such a distribution may take the form of a distribution out of reserves, an interim dividend, a dividend or, in the event that the Company is also liquidated, a liquidation distribution. Furthermore, the corporate governance rules applicable to Athlon at the date of this Offer Memorandum may be amended in accordance with the (consequences of the) Offer. This would be done in order to align the company structure of Athlon with the group's new holding and financing structure that will materialise once the Offer has been declared unconditional (gestandgedaan).
See also chapter 7.7 ('Legal structure of Athlon following the Offer') 5.11 Future dividend policy
The Offeror expects to significantly amend Athlon's dividend policy should the Offer be declared unconditional (gestandgedaan). Given that the Consideration includes the right to dividends (including, without being limited to, the right to dividends in respect of the Financial Year 2005), no dividend will be proposed with respect to the Financial Year 2005 at the AGM and all profits for 2005 of Athlon will be added to the reserves.
5.12 Organisational and social consequences
The new combination will operate as a separate division within DLL. In the Netherlands, the car leasing businesses of Athlon and Translease will be combined into one car leasing company. The back-office activities of both Dutch car leasing activities will be fully integrated. The car leasing division will be managed by a management team consisting of three members, being N.M.P. van den Eijnden, J. Slootweg (members of the Executive Board) and R.C. Vermaal (a member of the executive board of Translease). The management team of the car leasing division will report to the executive board of DLL. One of the members of the executive board of DLL will become responsible for the car leasing division. DLL will pursue Athlon's announced initiative to divest Athlon's car body repair business division.
The Offer as such is not expected to have any significant adverse effect on the existing levels and conditions of employment within Athlon. To the extent that job losses will occur, and where no suitable alternative position within DLL is available for the relevant employee(s), a social plan will apply.
See also chapter 7.10 ('Future composition of the Boards') 5.13 Announcements
Announcements contemplated by the foregoing paragraphs will be issued by press release and will be published in Het Financieele Dagblad and the Daily Official List. Subject to any applicable requirements of Dutch public offer regulations and without limiting the manner in which the Offeror
may choose to make any public announcement, the Offeror will have no obligation to communicate any public announcement other than as described above.
5.14 Envisaged timetable Expected Date and Time (CET)
30 May 2006
09:00 hours, 31 May 2006 15:00 hours, 14 June 2006
15:00 hours, 23 June 2006, subject to extension No later than five Euronext Trading Days after the Closing Date
No later than five Euronext Trading Days after the Unconditional Date
Event
Publication of advertisement announcing the availability of the Offer Memorandum and the commencement of the Offer, in accordance with article 9o, paragraph 2 of the Decree
Commencement of the Acceptance Period under the Offer AGM, at which meeting the Offer, among other matters, will be discussed in accordance with the provisions of article 9q, paragraph 1 of the Decree
Closing Date
Deadline for Shareholders wishing to tender Shares Unconditional Date
The date on which the Offeror shall publicly announce whether the Offer is declared unconditional (gestandgedaan), being no later than five Euronext Trading Days after the Closing Date, in accordance with article 9t, paragraph 4 of the Decree
Settlement Date
The date on which, in accordance with the terms and conditions of the Offer, the Offeror shall pay the Consideration to the Shareholders who have validly tendered (or defectively tendered provided that such defect has been waived by the Offeror) and delivered (geleverd) their Shares under the Offer, being no later than the fifth Euronext Trading Day after the Unconditional Date, subject to the Offer being declared unconditional (gestandgedaan)
6 INVITATION TO THE SHAREHOLDERS
The Offeror makes a recommended public cash offer for all the Shares. The Shareholders are advised to review this Offer Memorandum (including all documents incorporated by reference herein) and in particular chapter 1 ('Restrictions') and chapter 2 ('Important Information') thoroughly and completely and to seek independent advice where appropriate in order to reach a reasoned judgement with respect to the Offer and this Offer Memorandum. With due reference to all statements, terms, conditions and restrictions included in this Offer Memorandum, Shareholders are hereby invited to tender their Shares under the Offer in the manner and subject to the terms and conditions set out below.
6.1 Consideration
For each Share tendered under the terms and conditions of the Offer, the Offeror offers the Consideration of EUR 30.25 in cash, which is inclusive of the right to dividends (including, without being limited to, the right to dividends in respect of the Financial Year 2005).
6.2 Acceptance by Shareholders
Acceptance by Shareholders holding Shares through an Admitted Institution
Shareholders who hold their Shares through an Admitted Institution are requested to make their acceptance known via their bank or stockbroker no later than 15:00 hours CET on the Closing Date. The Shareholder's bank or stockbroker may set an earlier deadline for communication by the Shareholders in order to permit the Shareholder's bank or stockbroker to communicate their acceptances to the Exchange and Paying Agent in a timely manner.
The Admitted Institutions may tender Shares for acceptance only to Rabo Securities and only in writing. In tendering the acceptance, the Admitted Institutions are required to declare that (i) they have tendered the Shares in their custody, (ii) each Shareholder who accepts the Offer irrevocably represents and warrants that the Shares tendered by him are being tendered in compliance with the restrictions set out in chapter 1 ('Restrictions') and (iii) they undertake to transfer these Shares to the Offeror within three Euronext Trading Days, if and after the Offer has been declared unconditional (gestandgedaan).
Subject to article 9o, paragraph 5 of the Decree, the tendering of Shares in acceptance of the Offer shall constitute irrevocable instructions to block any attempt to transfer the Shares tendered, so that on or prior to the Settlement Date no transfer of such Shares may be effected, other than to Rabo Securities on or prior to the Settlement Date if the Offer has been declared unconditional (gestandgedaan) and the Shares have been accepted for purchase, and other than to debit the securities account in which such Shares are held on the Settlement Date in respect of all of the Shares tendered, against payment by Rabo Securities of the Consideration per Share in respect of those Shares.
Undertakings, representations and warranties by tendering Shareholders
Each Shareholder tendering Shares pursuant to the Offer, by such tender, undertakes, represents and warrants to the Offeror, on the date that such Shares are tendered through to, and including, the Settlement Date, subject to the proper withdrawal of any tender, in accordance with article 9o, paragraph 5 of the Decree, that:
(i) the tender of any Shares constitutes an acceptance by the Shareholder of the Offer, on and subject to the terms and conditions of the Offer;
(ii) such Shareholder has full power and authority to tender, sell and deliver (leveren) the Shares tendered by it; such Shareholder has not entered into any other agreement with any party other than the Offeror to tender, sell or deliver (leveren) the Shares (together with all rights attaching thereto) that such Shareholder has tendered under the Offer; and the Offeror will acquire the tendered Shares with full title guarantee and free and clear of all third party rights and restrictions of any kind; and
(iii) such Shares are being tendered in compliance with the restrictions as set out in chapter 1 ('Restrictions') and the securities and other applicable laws or regulations of the jurisdiction in which such Shareholder is located or of which it is a resident, and no registration, approval or filing with any regulatory authority of such jurisdiction is required in connection with the tendering of such Shares.
Shares tendered on or prior to the Closing Date may not be withdrawn, subject to the right of withdrawal of any tendered Shares during any extension of the Acceptance Period in accordance with the provisions of article 9o, paragraph 5 of the Decree. During any such extension of the Acceptance Period, any Shares previously tendered and not withdrawn will remain subject to the Offer.
6.3 Offer Conditions
The Offer shall be declared unconditional (gestandgedaan) if the Offer Conditions, as set out below, are fulfilled or, if permitted by applicable law, waived by the party or parties entitled to waive them.
The obligation of the Offeror to declare the Offer unconditional (gestandgedaan) is subject to the following Offer Conditions being satisfied on or before the Closing Date:
(a) The Executive Board has proposed and the general meeting of shareholders of Athlon has duly resolved, subject to the Offer having been declared unconditional (gestanddoening) by the Offeror, (i) to amend the articles of association (amongst others with respect to the abolishment of the structure regime) and (ii) the appointment of the Supervisory Board members as proposed and the discharge of the current Supervisory Board members and the Executive Board members that shall resign;
(b) the tendering of such number of Shares that:
(i) these Shares, together with the Shares directly or indirectly held by the Offeror, represent at least 95% (ninety-five per cent.) of Athlon's total issued and outstanding ordinary share capital as at the Closing Date; and
(ii) these Shares, together with the Shares directly or indirectly held by the Offeror and the Cumulative Preference Shares that have been sold to the Offeror, subject to the Offer being declared unconditional, represent at least 95% (ninety-five per cent.) of Athlon's Total Issued Share capital as at the Closing Date;
(c) no Material Adverse Change has occurred;
(d) no circumstance has occurred, indicating that a third party has the intention to or is preparing, has prepared or made a public offer for the Shares or any shares to be issued by Athlon, or an offer for (a substantial part of) the assets of Athlon and there has been no indication that a third party has obtained the right to acquire, or has agreed to acquire or take up, or has acquired Shares or shares to be issued by Athlon, or (a substantial part of) the assets of Athlon;
(e) between the Commencement Date and the Closing Date, Athlon has not committed itself in any way to the payment of any dividend or any other distribution, whether or not in the form of shares, nor will Athlon have paid out any dividend or any other distribution, whether or not in the form of shares;
(f) Athlon, the Executive Board, the Supervisory Board and/or their members have not breached the merger protocol between the Offeror and Athlon dated 21 March 2006, resulting in such material negative consequences that it can no longer reasonably be expected from the Offeror to declare the Offer unconditional;
(g) no action, proceeding or litigation relating in any manner to the Offer is instituted or threatened in any court or by any governmental agency or authority that (i) seeks to annul or delay the consummation of the Offer; or that (ii) might impair the Offeror's ability to proceed with the Offer;
(h) no order, stay, judgment, verdict or decree is issued by any court, government, governmental authority or other regulatory or administrative authority, or any statute, regulation or governmental order shall have been proposed, enacted, enforced or deemed applicable to the Offer, any of which would or might restrain, prohibit or delay consummation of the Offer or impair the contemplated benefits of the Offer to the Offeror;
(i) (i) with the exception of the competition approvals provided for in (ii) below, all unconditional approvals, licences, exemptions and permissions of domestic and international authorities and/or third parties (including, without being limited to, the statement of no object by the Dutch Central Bank) required in connection with the Offer and the envisaged change of control have been obtained and are effective;
(ii) all mandatory pre-completion and competition approvals of domestic and international authorities required in connection with the Offer and the envisaged change of control have been obtained and are effective;
(iii) in relation to the matters referred to in (i) and (ii) above, all waiting periods pursuant to applicable regulations during which domestic or international authorities and/or third parties may oppose the Offer or the envisaged change of control of Athlon, or can take or announce steps, which could impede the Offer and the envisaged change of control or in any other way result in material adverse repercussions for Athlon, DLL or the Offeror in connection with the Offer have expired; and
(iv) in relation to the matters referred to in (i) and (ii) above, neither domestic nor international authorities have taken or announced steps which could impede the Offer or the envisaged change of control or in any other way result in material adverse repercussions for Athlon, DLL or the Offeror in connection with the Offer; and
(j) no notification has been received from the AFM that the Offer conflicts with any of the stipulations of Chapter Ha of the DSSA 1995, within the meaning of article 32(a) DSSD, stipulating that a security institution shall not co-operate with the completion and settlement of the Offer.
The Offer Conditions in subclauses (a) through (h) serve for the benefit of the Offeror and the Offeror has the right, (either in whole or in part) at any time by written notice to Athlon, to waive such Offer Conditions. The Offer Condition in subclause (i) serves for the benefit of both the Offeror and Athlon, and may only be waived by the Offeror together with Athlon. The Offer in subclause (j) cannot be waived.
Subject to the Offer Conditions set out above, the Offeror reserves the right to accept any tender for acceptance, even if it has not been effected in such manner as set out above under chapter 6.2 ('Acceptance by Shareholders').
6.4 Acceptance Period
The Acceptance Period begins on 31 May 2006 at 9:00 hours CET and ends, subject to extension in accordance with article 9o, paragraph 5 of the Decree, on 23 June 2006 at 15:00 hours CET. If one or more of the Offer Conditions set out in chapter 6.3 ('Offer Conditions') is not fulfilled, the Offeror may, subject to the provisions of article 9o, paragraph 5 of the Decree, extend the Acceptance Period until all such Offer Conditions have been fulfilled or, where appropriate, waived. See also chapter 6.6 ('Extension'). During an extension of the Acceptance Period, any Shares previously tendered and not withdrawn will remain subject to the Offer, subject to the right of each Shareholder to withdraw the Shares that it has already tendered.
If all Offer Conditions are satisfied or, where appropriate, waived, the Offeror will accept all Shares that have been validly tendered (or defectively tendered provided that such defect has been waived by the Offeror) and not previously withdrawn pursuant to the terms of the Offer in accordance, for the Shares, with the procedures set out in chapter 6.2 ('Acceptance by Shareholders').
6.5 Declaring the Offer unconditional (gestanddoening)
The Offer shall be subject to the fulfilment or waiver (as the case may be) of the Offer Conditions in accordance with chapter 6.3 above.
Unless the Acceptance Period is extended, the Offeror will determine within five Euronext Trading Days following the Closing Date, such date being the Unconditional Date, whether the Offer Conditions have been fulfilled or are to be waived by the Offeror and will announce whether (i) the Offer has been declared unconditional (gestandgedaan), (ii) there is still uncertainty as to the fulfilment of any of the Offer' Conditions, or (iii) the Offer is terminated, as a result of the Offer Conditions not having been fulfilled or waived by the Offeror or, in the case of the Offer Condition set out in subclause 6.3(i), waived by Athlon and the Offeror together, all in accordance with article 9t, paragraph 4 of the Decree.
The announcement, if any, by the Offeror that there is still uncertainty as to the fulfilment of any of the Offer Conditions, does not mean that any Shareholder will have the right to withdraw any tender of Shares or that any tender of Shares shall be deemed to be automatically withdrawn.
6.6 Extension
The Offeror, at its sole discretion, may extend the Offer past the Closing Date, in which case all references in this Offer Memorandum to the "Closing Date" or "15:00 hours, CET, on 23 June 2006" shall, unless the context requires otherwise, be moved to the latest date and time to which the Offer has been so extended. A Shareholder's bank or stockbroker may set an earlier deadline for communication by the Shareholders in order to permit the Shareholder's bank or stockbroker to communicate their acceptances to the Exchange and Paying Agent in a timely manner.
If the Acceptance Period is extended such that the obligation pursuant to article 9t of the Decree to announce whether the Offer has been declared unconditional (gestandgedaan) is postponed, a public announcement to that effect shall be made no later than the third Euronext Trading Day following the initial Closing Date, in accordance with the provisions of article 9o, paragraph 5 of the Decree.
During any such extension of the Acceptance Period, any Shares previously tendered and not withdrawn will remain subject to the Offer. In accordance with article 9o, paragraph 5 of the Decree, Shares tendered on or prior to the original Closing Date may, during the period to which the Acceptance Period has been extended, be withdrawn.
6.7 Settlement
In the event that the Offeror announces that the Offer is declared unconditional (gestandgedaan), Shareholders who have tendered and delivered their Shares for acceptance pursuant to the Offer will receive within five Euronext Trading Days following the Unconditional Date (the "Settlement Date") the Consideration in respect of each Share validly tendered (or defectively tendered provided that such defect has been waived by the Offeror) and delivered (geleverd), at which point, dissolution or annulment of a Shareholder's tender or delivery (levering) shall not be permitted. 6.8 Dividends
The Offer is inclusive of dividend rights (including, without being limited to, the right to dividends in respect of the Financial Year 2005). Consequently, no dividend will be proposed with respect to 2005 at the AGM and all profits for 2005 of Athlon will be added to the reserves.
6.9 Commission
Admitted Institutions shall receive from Rabo Securities on behalf of the Offeror a commission in the amount of EUR 0.0419 in respect of each Share validly tendered (or defectively tendered provided that such defect has been waived by the Offeror) and delivered (geleverd), up to a maximum of EUR 10,000 per Shareholder tender. The commission must be claimed from the Offeror through Rabo Securities within 30 days of the Unconditional Date. No costs will be charged to the Shareholders by the Offeror or Athlon for the delivery and payment of the Shares.
6.10 Restrictions
The Offer is being made with due observance of such statements, conditions and restrictions as are included in the Offer Memorandum. The Offeror reserves the right to accept any tender under the Offer, which is made by or on behalf of a Shareholder, even if it has not been effectuated in such manner as set out above.
6.11 Announcements
Announcements contemplated by the foregoing paragraphs will be issued by press release and will be published in Het Financieele Dagblad and the Daily Official List. Subject to any applicable requirements of Dutch tender offer regulations and without limiting the manner in which the Offeror may choose to make any public announcement, the Offeror will have no obligation to communicate any public announcement other than as described above.
7 EXPLANATION AND BACKGROUND TO THE OFFER
7.1 Introduction
On 22 March 2006, DLL and Athlon jointly announced that the expectation was justified that agreement could be reached in connection with an offer by DLL, or a company designated by DLL, for the Shares, subject to the fulfilment of certain terms and conditions. Since then, a definitive agreement has been reached with respect to the Offer, certain terms of which agreement are reflected in this Offer Memorandum.
On 21 April 2006, DLL and Athlon issued a press release in which they confirmed that, further to the joint press release by DLL and Athlon on 22 March 2006, preparations were well underway for the intended recommended public offer by DLL for all Shares in Athlon for a cash consideration of EUR 30.25 per ordinary share, which offer price is to include the right to dividends (including, without being limited to, the right to dividends in respect of the Financial Year 2005).
7.2 Committed Shares
Subject to the Offer being declared unconditional, all major Shareholders, being the following Shareholders known to Athlon as at 1 March 2006 (being the most recent date on which the major Shareholders were determined for the purposes of Athlon's 2005 annual report) that hold, or together with other shareholders in the same company group hold, 5% or more of the Total Issued Share Capital of Athlon, Breedinvest B.V., Delta Deelnemingen Fonds N.V., Delta Lloyd Levensverzekering N.V., Delta Lloyd Schadeverzekering N.V., Fortis Verzekeringen Nederland B.V., Gestion Deelnemingen V B.V., N.V. Interpolis BTL, N.V. Interpolis Schade, Natexis Lease S.A. and T.W.E. Beheer B.V., together with Onroerend Goed Beheer- en Beleggingsmaatschappij A. van Herk B.V., the members of the Executive Board and the sole member of the Supervisory Board that holds Shares, have irrevocably committed themselves to tendering all Shares held by each of them under the Offer on the same terms and subject to the same conditions as the Offer. Such commitments represent a total of 10,418,005 Shares, representing approximately 56% of the Shares and approximately 46% of the Total Issued Share Capital of Athlon at the date of this Offer Memorandum.
Subject to the Offer being declared unconditional, all holders of Cumulative Preference Shares, being Breedinvest B.V., Delta Lloyd Levensverzekering N.V. and Fortis Verzekeringen Nederland B.V., have sold their Cumulative Preference Shares to the Offeror. These shares represent approximately 18% of the Total Issued Share Capital of Athlon.
Accordingly, the holders of Shares and Cumulative Preference Shares have in aggregate irrevocably committed themselves to tendering, or sold to the Offeror subject to the Offer being declared unconditional, such number of Shares and Cumulative Preference Shares as represents approximately 64% of the Total Issued Share Capital of Athlon.
None of the holders of Shares that have committed themselves to tender such Shares held by them under the Offer, or the holders of Cumulative Preference Shares that have, subject to the Offer being declared unconditional, sold their Cumulative Preference Shares to the Offeror, have received from the Offeror any relevant information regarding the Offer that is not included in this Offer Memorandum.
