UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 1 )*
BALLARD POWER SYSTEMS INC.
-----------------------------------------------------------
(Name of Issuer)
Common Shares
-----------------------------------------------------------
(Title of Class of Securities)
05858H 10 4
-----------------------------------------------------------
(CUSIP Number)
Michael Winkler Holly E. Leese
DaimlerChrysler AG DaimlerChrysler North America Holding
Epplestrasse 225 Corporation
70546 Stuttgart 1000 Chrysler Drive
Germany Auburn Hills, Michigan 48362-2766
Tel: 011-49-711-17-22930 Tel: (248) 512-3984
-------------------------------------------------------------
(Name, Address and Telephone Number of
Person Authorized to Receive Notices
and Communications)
January 12, 2005
-------------------------------------------------------------
(Date of Event which Requires Filing of
this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box
/ /.
NOTE: Schedules filed in paper format shall include a signed original
and five copies of the schedule, including all exhibits. See Rule 13d-7
for other parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class
of securities, and for any subsequent amendment containing information
which would alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
Page 2 of 14 Pages
CUSIP NO. 058584 10 4
--------------------------------------------------------------------------------
1 Name of Reporting Person/I.R.S. Identification No. of above persons
(entities only)
DaimlerChrysler AG
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2 Check the Appropriate box if a member of a group (a) [X]
(b) [_]
--------------------------------------------------------------------------------
3 SEC use only
--------------------------------------------------------------------------------
4 Source of funds (See Instructions)
WC, OO
--------------------------------------------------------------------------------
5 Check box if disclosure of legal proceedings is required pursuant
to items 2(d) or 2(e)
[_]
--------------------------------------------------------------------------------
6 Citizenship or place of organization
Federal Republic of Germany
--------------------------------------------------------------------------------
7 Sole voting power
20,538,503
----------------------------------------------------
8 Shared voting power
NUMBER OF
SHARES 1,547,489
BENEFICIALLY OWNED ---------------------------------------------------
BY EACH REPORTING 9 Sole dispositive power
PERSON
WITH 20,538,503
---------------------------------------------------
10 Shared dispositive power
1,547,489
--------------------------------------------------------------------------------
11 Aggregate amount beneficially owned by each reporting person
22,085,992
--------------------------------------------------------------------------------
12 Check box if the aggregate amount in row (11) excludes certain
shares (See Instructions)
[_]
--------------------------------------------------------------------------------
13 Percent of class represented by amount in row (11)
17.9%
--------------------------------------------------------------------------------
14 Type of reporting person (See Instructions)
CO
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Page 3 of 14 Pages
CUSIP NO. 058584 10 4
--------------------------------------------------------------------------------
1 Name of Reporting Person/I.R.S. Identification No. of above persons
(entities only)
DaimlerChrysler North America Holding Corporation
IRS Identification Number: 22-1760935
--------------------------------------------------------------------------------
2 Check the Appropriate box if a member of a group (a) [X]
(b) [_]
--------------------------------------------------------------------------------
3 SEC use only
--------------------------------------------------------------------------------
4 Source of funds (See Instructions)
OO
--------------------------------------------------------------------------------
5 Check box if disclosure of legal proceedings is required pursuant
to items 2(d) or 2(e)
[_]
--------------------------------------------------------------------------------
6 Citizenship or place of organization
Delaware
--------------------------------------------------------------------------------
7 Sole voting power
-0-
----------------------------------------------------
8 Shared voting power
NUMBER OF
SHARES 1,547,489
BENEFICIALLY OWNED ---------------------------------------------------
BY EACH REPORTING 9 Sole dispositive power
PERSON
WITH -0-
---------------------------------------------------
10 Shared dispositive power
1,547,489
--------------------------------------------------------------------------------
11 Aggregate amount beneficially owned by each reporting person
1,547,489
--------------------------------------------------------------------------------
12 Check box if the aggregate amount in row (11) excludes certain
shares (See Instructions)
[_]
--------------------------------------------------------------------------------
13 Percent of class represented by amount in row (11)
1.3%
--------------------------------------------------------------------------------
14 Type of reporting person (See Instructions)
CO
--------------------------------------------------------------------------------
Page 4 of 14 Pages
This Amendment No. 1 amends, supplements and restates in its entirety the
Statement on Schedule 13D filed on December 10, 2001 ("Schedule 13D") by
DaimlerChrysler AG and DaimlerChrysler North America Holding Corporation (the
"Reporting Persons") with respect to the Common Shares of Ballard Power Systems
Inc., a Canadian corporation.
The Schedule 13D has been filed in paper format, as permitted by the rules and
regulations of the Securities and Exchange Commission. Pursuant to Rule
101(a)(2)(ii) of Regulation S-T of the Securities Act of 1933, as amended, this
Amendment No. 1 to the Schedule 13D amends and restates, as applicable, as of
the date of this Amendment, the entire text of the Schedule 13D in connection
with the Reporting Persons' first filing of an amendment to the Schedule 13D
under the Securities and Exchange Commission's Electronic Data Gathering,
Analysis and Retrieval System.
ITEM 1 - SECURITY AND ISSUER
This Schedule 13D relates to the Common Shares without nominal or par value (the
"Common Shares") of Ballard Power Systems Inc. ("Ballard"), a corporation
incorporated under the CANADA BUSINESS CORPORATIONS ACT whose principal
executive offices are located at 4343 North Fraser Way, Burnaby, British
Columbia, V5J 5J9.
ITEM 2 - IDENTITY AND BACKGROUND
This Schedule 13D is filed jointly by DaimlerChrysler AG ("DaimlerChrysler"), a
corporation incorporated under the laws of the Federal Republic of Germany, and
DaimlerChrysler North America Holding Corporation ("DCNAH"), a corporation
incorporated under the laws of the State of Delaware. DCNAH is a wholly owned
subsidiary of DaimlerChrysler.
DaimlerChrysler is a manufacturing company engaged in the development,
manufacture, distribution and sale of a wide range of automotive products. DCNAH
is a holding company owning all of DaimlerChrysler's North American subsidiaries
and conducting the operations of DaimlerChrysler in North America.
DaimlerChrysler conducts its business in numerous locations throughout the
world, and has no single address of its principal business. DaimlerChrysler's
principal executive offices are located at Epplestrasse 225, 70567 Stuttgart,
Germany and at 1000 Chrysler Drive, Auburn Hills, Michigan, 48326-2766, which
latter address is also the principal business and executive office address of
DCNAH.
Information concerning the name, business address, principal occupation and
citizenship of each executive officer and director of DaimlerChrysler and DCNAH
is attached in Exhibit 1 hereto and incorporated herein by reference.
Neither DaimlerChrysler, DCNAH nor, to the knowledge of DaimlerChrysler or
DCNAH, any of their executive officers or directors have been convicted during
the last five years in a criminal proceeding (excluding traffic violations or
similar misdemeanors). Neither DaimlerChrysler nor DCNAH, nor to the knowledge
of DaimlerChrysler or DCNAH, any executive officer or director of
DaimlerChrysler or DCNAH, during the last five years, was a party to a civil
proceeding of a judicial or administrative body of competent jurisdiction and as
a result of such proceeding was or is subject to a judgment, decree or final
order enjoining future violations of, or prohibiting or mandating activities
subject to, federal or state securities laws or finding any violations with
respect to such laws.
Page 5 of 14 Pages
ITEM 3 - SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
The source and amount of funds or other consideration for the acquisition of
such Common Shares were as follows (giving effect to the exchange rate of
Canadian dollars ("Cdn.$") or Euros, as the case may be, to U.S. dollars ("US$")
at the date of acquisition, unless otherwise noted):
(a) On August 29, 1997 DaimlerChrysler purchased by private
placement from Ballard 5,770,916 Common Shares (17,312,748
Common Shares after giving effect to a three for one stock
split in June, 1998) at a price of Cdn.$35.00 (approximately
US$25.27) per Common Share for an aggregate subscription price
of Cdn.$201,984,701 (approximately US$145,806,696), which
payment was derived from the transfer by DaimlerChrysler to
Ballard of cash (which came from working capital of
DaimlerChrysler), technology and other assets;
(b) On April 7, 1998 DaimlerChrysler sold 332,155 Common Shares
(996,465 Common Shares after giving effect to a three for one
stock split in June, 1998) to Ford Motor Company ("Ford") at a
price of Cdn.$80.80 (approximately US$56.81) per Common Share,
for an aggregate sale price of Cdn.$26,838,124 (approximately
US$18,870,959);
(c) On November 30, 2001 DaimlerChrysler and DCNAH acquired the
following Common Shares by private placement from Ballard:
(i) DaimlerChrysler acquired an aggregate of 1,348,119
Common Shares, of which 244,570 Common Shares were
acquired in consideration for the sale of a 1.6%
interest in XCELLSIS AG ("XCELLSIS") now Ballard AG
("Ballard AG") (formerly DBB Fuel Cell Engines GmbH
("DBB")) and 1,103,549 Common Shares were acquired at
a price of Cdn.$27.185 (approximately US$17.30) per
Common Share in consideration of the payment of
Cdn.$30,000,000 (approximately US$19,086,300) from
working capital of DaimlerChrysler; and
(ii) DCNAH acquired 1,547,489 Common Shares in
consideration for the transfer to Ballard of a 16.9%
interest in Ecostar Electric Drive Systems L.L.C.
("ECo");
(d) In accordance with the terms of a purchase agreement between
DaimlerChrysler and Ballard dated November 12, 2002 (the "IP
Purchase Agreement"), DaimlerChrysler purchased from Ballard:
(i) 221,357 Common Shares on November 28, 2002 for an
aggregate purchase price of 2,350,000 Euros (approximately
US$2,325,500); and (ii) 221,356 Common Shares on April 4, 2003
for an aggregate purchase price of 2,350,000 Euros
(approximately US$2,325,500). In each case the purchase price
for the Common Shares was 10.62 Euros (approximately US$10.50)
per Common Share, being the Euro equivalent of the average
closing price of the Common Shares on the Toronto Stock
Exchange for the 20 trading days ending on the day before the
date of the IP Purchase Agreement. In each case the payments
were derived from the transfer by DaimlerChrysler to Ballard
of intellectual property relating to research conducted by
DaimlerChrysler regarding Ballard's fuel cell technology; and
(e) On January 12, 2005 DaimlerChrysler purchased by private
placement from Ballard 2,431,388 Common Shares at a price of
Cdn.$12.3386 (approximately US$10.29) per Common Share for an
aggregate subscription price of Cdn.$30,000,000 (approximately
US$25,027,000) from working capital of DaimlerChrysler. The
Common Shares were
Page 6 of 14 Pages
issued to DaimlerChrysler at a price of Cdn.$12.3386 per
Common Share, being the Canadian dollar equivalent of the
average closing price of the Common Shares as reported on the
Nasdaq National Market for the 20 trading days ending three
business days before July 8, 2004, the date on which Ballard
issued the conditional call notice in accordance with the
terms of the Call Agreement and Call Notice described under
Item 6 - "Third Alliance Transaction - Additional Financing"
below.
ITEM 4 - PURPOSE OF TRANSACTION
DaimlerChrysler initially acquired the Common Shares in order to participate in
a global alliance (the "Global Alliance") with Ballard and Ford for the
development, marketing and sale of fuel cell engines and related technology.
Additional Common Shares have been acquired by DaimlerChrysler and DCNAH, as
more particularly described under Item 3 above. The Call Agreement described
under Item 6 below, and the additional Common Shares acquired by DaimlerChrysler
thereunder, were acquired to permit Ballard to enhance its liquidity for the
development of fuel cells and related products as a part of the Global Alliance.
HISTORY OF GLOBAL ALLIANCE
The history of the Global Alliance is as follows:
1. On August 29, 1997, DaimlerChrysler formed the Global Alliance with
Ballard by purchasing a 25% interest in Ballard and by investing
approximately Cdn.$207,000,000 (approximately US$149,427,090 at then
current exchange rates) in DBB in exchange for a 66.67% interest in
DBB. Ballard purchased a 33.33% interest in DBB. DBB was to develop
fuel cell systems for use in DaimlerChrysler's vehicles in conjunction
with research and development on fuel cells being conducted by Ballard
directly.
2. On April 7, 1998, Ford joined the Global Alliance. In connection with
this transaction, Ford invested approximately Cdn.$600 million
(approximately US$421,884,000 at then current exchange rates) by
purchasing a 15% interest in Ballard and a 21.78% interest in DBB and
creating ECo, in which Ford would develop electric drives for use in
Ford vehicles in conjunction with fuel cell research and development
being conducted by Ballard. In connection with this transaction,
DaimlerChrysler sold 332,155 Common Shares (996,465 Common Shares after
giving effect to a three for one stock split in June, 1998) to Ford,
DCNAH purchased a beneficial 16.9% interest in ECo and Ford purchased a
21.78% interest in DBB.
3. On November 30, 2001, Ford and DaimlerChrysler consolidated their fuel
cell development activities by transferring their interests in XCELLSIS
(formerly DBB) and ECo to Ballard and by investing further capital in
Ballard in consideration for the issue of Common Shares to
DaimlerChrysler, DCNAH and Ford (the "Third Alliance Transaction").
FUTURE PLANS
As part of the Third Alliance Transaction, DaimlerChrysler and Ballard agreed
that 7,613,212 Common Shares would be issued to DaimlerChrysler in exchange for
the remaining 49.9% interest in XCELLSIS (now Ballard AG). Assuming issuance of
such shares, DCX would own, directly and indirectly, 29,699,202 Common Shares
representing approximately 22.7% of the outstanding Common Shares of the Issuer
(based on 130,879,601 outstanding Common Shares). New ownership arrangements are
being negotiated for Ballard AG which would modify these arrangements and which,
if completed, would
Page 7 of 14 Pages
result in an overall decrease in ownership of Common Shares by DaimlerChrysler.
With the exception of these negotiations, at the present time neither
DaimlerChrysler nor DCNAH have any additional plans or proposals that relate to
or would result in actions or circumstances enumerated in Item 4 of Schedule
13D.
ITEM 5 - INTEREST IN SECURITIES OF THE ISSUER
(a) - (b)
DaimlerChrysler owns the direct legal and beneficial ownership interest and the
sole right to vote and dispose of 20,538,503 Common Shares of Ballard. DCNAH
owns an additional 1,547,489 Common Shares. As the parent company of DCNAH,
DaimlerChrysler is the indirect beneficial owner of such Common Shares.
Accordingly, DaimlerChrysler and DCNAH have shared dispositive and voting power
over the 1,547,489 Common Shares held by DCNAH. DaimlerChrysler's overall
interest in Ballard amounts to 22,085,992 Common Shares, representing
approximately 17.9% of the issued and outstanding Common Shares of Ballard
(calculated on the basis of 118,778,844 outstanding Common Shares, as confirmed
by Ballard).
DaimlerChrysler acquired its original 5,770,916 Common Shares (17,312,748 Common
Shares after giving effect to a three for one stock split in June, 1998) on
August 29, 1997 at a price of Cdn.$35.00 (approximately US$25.27 at then current
exchange rates) per Common Share pursuant to an Original Alliance Agreement (the
"Original Alliance Agreement") dated August 29, 1997 between, inter alia,
Ballard and DaimlerChrysler. DaimlerChrysler paid cash from its working capital
and transferred intellectual property and other assets as consideration for the
purchase of such Common Shares.
DaimlerChrysler disposed of 332,155 Common Shares (996,465 Common Shares after
giving effect to a three for one stock split in June, 1998) to Ford on April 7,
1998 at a price of Cdn.$80.80 (approximately US$56.81 at then current exchange
rates) per Common Share pursuant to a New Alliance Agreement (the "New Alliance
Agreement") dated April 7, 1998 between, inter alia, Ballard, Ford and
DaimlerChrysler. DaimlerChrysler sold the Common Shares to Ford for a cash
payment of Cdn.$26,838,124 (approximately US$18,870,959 at then current exchange
rates).
DaimlerChrysler and DCNAH acquired an aggregate of 2,895,608 Common Shares on
November 30, 2001. The transaction was effected through an Acquisition and Plan
of Merger Agreement among, inter alia, DaimlerChrysler, Ballard, DCNAH and Ford
dated October 2, 2001, which closed in Vancouver, British Columbia, Canada on
November 30, 2001. DaimlerChrysler purchased 1,348,119 of such Common Shares in
consideration for the sum of Cdn.$30,000,000 (approximately US$19,086,300 as at
November 30, 2001) and a 1.6% interest in XCELLSIS and DCNAH purchased 1,547,489
Common Shares in exchange for a 16.9% interest in ECo.
DaimlerChrysler acquired 221,357 Common Shares on November 28, 2002 and 221,356
Common Shares on April 4, 2003, in accordance with the terms of the IP Purchase
Agreement, in each case in consideration for the transfer by DaimlerChrysler to
Ballard of intellectual property relating to research conducted by
DaimlerChrysler regarding Ballard's fuel cell technology.
To the knowledge of DaimlerChrysler and DCNAH, no executive officer or director
of DaimlerChrysler or DCNAH owns any Common Shares of Ballard.
Page 8 of 14 Pages
(c)
DaimlerChrysler acquired 2,431,388 Common Shares on January 12, 2005 by private
placement, pursuant to the Call Agreement and Call Notice described under Item 6
- "Third Alliance Transaction - Additional Financing" below.
Except as set forth in this paragraph (c), to the best of the knowledge of the
Reporting Persons, none of the persons named in response to paragraph (a) has
effected any transactions in the Common Shares during the past 60 days.
(d) - (e)
Not applicable.
ITEM 6 - CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR
RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER
PREVIOUS CONTRACTUAL ARRANGEMENTS
When DaimlerChrysler made its first investment in Ballard, it entered into the
Original Alliance Agreement. In connection with that agreement DaimlerChrysler
purchased approximately a 25% interest in Ballard and a 66.67% interest in DBB.
That agreement governed the rights with respect to DaimlerChrysler's interest in
Ballard by (i) preventing Ballard from owning greater than 25% of the issued and
outstanding share capital of Ballard except in the event of certain takeover
bids by third parties; (ii) providing DaimlerChrysler the right to participate
in future equity financings to maintain its percentage ownership of Ballard; and
(iii) preventing DaimlerChrysler from disposing of its interest in DBB prior to
December 31, 1999.
The Original Alliance Agreement was terminated and replaced by the New Alliance
Agreement on April 7, 1998. In connection with that transaction, the New
Alliance Agreement and the Articles of Ballard provided that DaimlerChrysler and
Ford, through shareholdings in the jointly-owned company, DBF Pref Share
Holdings Inc. ("DBF"), were entitled to nominate directors of Ballard based on
the number of Common Shares owned by the parties. This right entitled
DaimlerChrysler to nominate two directors of Ballard. Under the New Alliance
Agreement, DaimlerChrysler further agreed: (i) not to make any further
acquisition of the Common Shares of Ballard without the written consent of
Ballard; and (ii) not to sell, assign or otherwise dispose of the Common Shares
of Ballard, other than to affiliates of DaimlerChrysler, prior to December 31,
2000. DaimlerChrysler and Ford also had certain anti-dilution rights in the New
Alliance Agreement which entitled them to the right to purchase such number of
additional Common Shares of Ballard in connection with any issue of Common
Shares of Ballard to allow DaimlerChrysler and Ford to maintain their percentage
ownership of Ballard.
DaimlerChrysler and Ballard entered into a Pooling Agreement in conjunction with
the Original Alliance Agreement. At the closing of the transactions contemplated
by the New Alliance Agreement, DaimlerChrysler entered into an Amended and
Restated Pooling Agreement among Ballard, DaimlerChrysler, Ford and DBF dated
April 7, 1998 pursuant to which DaimlerChrysler and Ford agreed that, as long as
they maintained their interest in DBF, and thereby maintained their right to
nominate directors of Ballard through this interest, they would not and would
ensure that no affiliates or related parties, vote or grant to any other person
the right to vote any Ballard Common Shares on a vote to elect or remove
directors of Ballard. The agreement was terminated in connection with the Third
Alliance Transaction.
Page 9 of 14 Pages
THIRD ALLIANCE TRANSACTION
The Third Alliance Transaction created the following restrictions relating to
Ballard share capital and voting:
(a) RESTRICTED VOTING PROVISIONS. DaimlerChrysler and Ford continue to own
an interest in DBF. DBF, in turn, owns Class A Shares of Ballard on
behalf of DaimlerChrysler and Class B Shares of Ballard on behalf of
Ford. So long as DaimlerChrysler and Ford maintain their interest in
DBF and DBF owns the Class A and Class B Shares, the Third Alliance
Agreement dated November 30, 2001 among, inter alia, Ballard,
DaimlerChrysler, Ford and DCNAH (the "Third Alliance Agreement") and
the Articles of Ballard entitle them to appoint directors of Ballard
based on that interest. DaimlerChrysler is currently entitled to
appoint three directors to the Board of Directors of Ballard. However,
the Third Alliance Agreement and Ballard's Articles provide that as
long as Class A Shares of Ballard are outstanding, DaimlerChrysler will
be prohibited from voting its Common Shares of Ballard to elect or
remove directors or to change the rights and restrictions attached to
the Class A Shares and Class B Shares of Ballard. However,
DaimlerChrysler may, in its discretion, provide a proxy to vote in
favour of the election of directors nominated by management of Ballard.
(b) LIMITED VOTING PROVISIONS. Both the Third Alliance Agreement and the
rights and restrictions attached to the Class A Shares for the benefit
of DaimlerChrysler and Class B Shares for the benefit of Ford state
that as long as DaimlerChrysler and Ford, or either of them, own a
certain percentage of Common Shares, among other things, certain
decisions of the Board of Directors of Ballard may not be undertaken
without the approval of one more than a majority of the Board of
Directors who are entitled to vote and do vote on the matter, including
at least one of the directors appointed by either DaimlerChrysler or
Ford. If any director appointed by DaimlerChrysler or Ford is absent or
abstains, except in certain circumstances, a simple majority will
suffice, which majority need not include one of the directors appointed
by DaimlerChrysler or Ford. This voting limitation applies to, among
other things: (i) the sale of substantially all of the assets of
Ballard; (ii) an amalgamation, arrangement or statutory reorganization
of Ballard with another entity; (iii) an amendment to Ballard's
articles and to those by-laws that are inconsistent with the Third
Alliance Agreement; (iv) approval of the annual budget or business plan
or any change to the agreed upon strategic framework which guides
Ballard's strategic planning; (v) capital investment or sales not
provided for in the annual budget which initially exceed Cdn.$15
million (US$9,543,150 as at November 30, 2001); and (vi) investments in
third parties not provided for in the annual budget which initially
exceed Cdn.$15 million.
(c) EQUITY PARTICIPATION RIGHTS. The Third Alliance Agreement states that
if Ballard undertakes an equity offering, DaimlerChrysler has the right
to purchase a sufficient number of Common Shares to enable it to
maintain a 23.32% equity ownership interest in Ballard. This right will
increase if Ford elects not to fully participate in its corresponding
right to maintain a 19.18% interest in Ballard, to the extent that Ford
does not purchase the securities available to it under that right and
provided the combined percentage interest of Ford and DaimlerChrysler
in Ballard following such purchase does not exceed 42.5% of Ballard's
Common Shares.
(d) RESTRICTED SHARE TRANSFERS. DaimlerChrysler and DCNAH are restricted
from selling all of the Common Shares that they currently own except
for 1,103,549 Common Shares issued for cash consideration in the Third
Alliance Transaction and any acquired thereafter (other than those
Common Shares DaimlerChrysler may purchase as consideration for the
sale of 49.9% of XCELLSIS, and the 442,713 Common Shares issued to
DaimlerChrysler pursuant to the IP
Page 10 of 14 Pages
Purchase Agreement referred to in Item 3(d) above) (the "Ballard Base
Shares") for a period of six years from November 30, 2001, the closing
date of the Third Alliance Transaction, except to Ford or in the event
of a takeover bid from a third party. DaimlerChrysler may only sell its
non-Ballard Base Shares during the six year period with the consent of
Ballard. DaimlerChrysler and Ford have also granted to each other a
right of first refusal with respect to the sale of any of their
respective Ballard Base Shares while the Third Alliance Agreement is in
effect.
(e) STANDSTILL. Except as set forth below, DaimlerChrysler may not purchase
any additional Common Shares if the purchase would cause its interest,
combined with that of Ford, to exceed 42.5% of Ballard's outstanding
Common Shares. Ford and DaimlerChrysler have agreed that prior to a
purchase by either Ford or DaimlerChrysler of Common Shares the
purchaser will give the other party 14 business days' notice. If,
however, for a period of four years from the date of the Third Alliance
Agreement: (i) DaimlerChrysler and Ford, or either of them, make a
takeover bid that would result in them owning all of Ballard's
outstanding Common Shares; or (ii) a takeover bid is made by a third
party and DaimlerChrysler and Ford, or either of them, make a competing
takeover bid for at least the number of Common Shares offered by such
third party; then an acquisition of Common Shares may be made. In the
fifth and sixth years, DaimlerChrysler may also make a takeover bid
that would result in it, individually or with Ford, owning no less than
two-thirds of Ballard's outstanding Common Shares. After six years,
DaimlerChrysler and Ford, or either of them, may jointly make a
takeover bid provided they acquire not less than the greater of an
additional 20% of the outstanding Common Shares or such number of
Common Shares so that they own 50% of all outstanding Common Shares.
After six years DaimlerChrysler may also, in certain circumstances and
if it still holds its Ballard Base Shares and Ford does not, make a
takeover bid if it acquires in excess of 10% of the outstanding share
capital of Ballard.
(f) ADDITIONAL FINANCING. The Third Alliance Agreement provided that if and
when Ballard undertook equity offerings in the next three years,
DaimlerChrysler agreed to invest up to a maximum of Cdn.$30 million
(approximately US$19,086,300 as at November 30, 2001) as part of such
offerings. On December 31, 2003 DaimlerChrysler entered into an
agreement (the "Call Agreement") with Ballard, Ford and DBF Pref Share
Holdings Inc. ("DBF") replacing this element of the Third Alliance
Transaction. This agreement provided that Ballard could require each of
DaimlerChrysler and Ford to subscribe for, take up, purchase and pay
for a specified number of Common Shares. On July 8, 2004, Ballard
conditionally exercised its rights under the Call Agreement in
connection with a proposed restructuring of the Third Alliance
Agreement. On December 16, 2004 Ballard provided each of Ford and
DaimlerChrysler with a notice (the "Call Notice") electing to treat the
conditional call as being unconditional. The transactions contemplated
by the Call Agreement and the Call Notice were completed on January 12,
2005. Ballard has agreed to register the Common Shares issued to
DaimlerChrysler pursuant to the Call Agreement upon request by
DaimlerChrysler no earlier than January 12, 2006.
A more detailed description of the contractual arrangements contained in the
Third Alliance Agreement with respect to the matters disclosed in Item 4 and
Item 6 of this Schedule 13D was attached as Exhibit 3 to the Schedule 13D, and
is hereby incorporated herein by reference. The Articles of Amendment of Ballard
containing the rights and restrictions attached to the Class A Shares and Class
B Shares of Ballard were attached as Exhibit 4 to the Schedule 13D, and is
hereby incorporated herein by reference. As discussed above in Item 4,
DaimlerChrysler and Ballard agreed that 7,613,312 Common Shares would be issued
to DaimlerChrysler after November 30, 2001 for the remaining 49.9% interest in
XCELLSIS (now Ballard AG). For the purpose of the provisions of the Third
Alliance Transaction described in paragraphs (a) to (f) above, except where
expressly noted, DaimlerChrysler is deemed to beneficially
Page 11 of 14 Pages
own such 7,613,212 Common Shares. However, as noted under Item 4 - "Future
Plans" above, new ownership arrangements are being negotiated for Ballard AG
which would modify these arrangements.
ITEM 7 - MATERIAL TO BE FILED AS EXHIBITS
The following exhibits are filed in connection with this Amendment No. 1 to the
Schedule 13D:
Exhibit 1. Directors and Executive Officers of DaimlerChrysler and DCNAH.
Exhibit 2. Agreement of DaimlerChrysler and DCNAH to file Schedule 13D
jointly, dated January 18, 2005.
Exhibit 3. Contractual Arrangements of the Third Alliance Transaction
contained in the Third Alliance Agreement with respect to
matters disclosed in Item 4 and Item 6, incorporated by
reference to Statement on Schedule 13D filed December 10,
2001.
Exhibit 4. Form of Articles of Amendment of Ballard dated November 30,
2001 containing the rights and restrictions attached to Class
A Shares and Class B Shares of Ballard, and filed pursuant to
the CANADA BUSINESS CORPORATIONS ACT, incorporated by
reference to Statement on Schedule 13D filed December 10,
2001.
Exhibit 5. Call Agreement dated December 31, 2003 between Ballard,
DaimlerChrysler, Ford and DBF Pref Share Holdings Inc.
Page 12 of 14 Pages
SIGNATURE
After reasonable inquiry and to my best knowledge and belief, I certify that the
information set forth in this statement is true, complete and correct.
Dated as of January 18, 2005.
DAIMLERCHRYSLER AG
By: /s/ Wolfgang Bauder
---------------------------------
Name: Dr. Wolfgang Bauder
Title: Senior Counsel
By: /s/ Wolfgang Herb
---------------------------------
Name: Dr. Wolfgang Herb
Title: Associate General Counsel
Page 13 of 14 Pages
SIGNATURE
After reasonable inquiry and to my best knowledge and belief, I certify that the
information set forth in this statement is true, complete and correct.
Dated as of January 18, 2005.
DAIMLERCHRYSLER NORTH AMERICA HOLDING CORPORATION
By: /s/ Byron C. Babbish
---------------------------------
Name: Byron C. Babbish
Title: Assistant Secretary
Page 14 of 14 Pages
INDEX TO EXHIBITS
Exhibit No. Description
----------- -----------
1 Directors and Executive Officers of DaimlerChrysler and DCNAH.
2 Agreement of DaimlerChrysler and DCNAH to file Schedule 13D
jointly, dated January 18, 2005.
3 Contractual Arrangements of the Third Alliance Transaction
contained in the Third Alliance Agreement with respect to
matters disclosed in Item 4 and Item 6 (incorporated by
reference to Statement on Schedule 13D filed December 10,
2001.
4 Form of Articles of Amendment of Ballard dated November 30,
2001 containing the rights and restrictions attached to Class
A Shares and Class B Shares of Ballard, and filed pursuant to
the CANADA BUSINESS CORPORATIONS ACT (incorporated by
reference to Statement on Schedule 13D filed December 10,
2001.
5 Call Agreement dated December 31, 2003 between Ballard,
DaimlerChrysler, Ford and DBF Pref Share Holdings Inc.