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Sample Business ContractsHome: Sample Business Contracts:
SHARE PURCHASE AGREEMENT
between
Interbrew S.A.
as Guarantor
Interbrew UK Holdings Limited
as Vendor
Brandbrew S.A.
as Brandbrew
Golden Acquisition Limited
as Purchaser
Coors Worldwide, Inc.
as IP Purchaser
and
Adolph Coors Company
as Purchaser Guarantor
relating to
the acquisition of the shares in Bass Holdings Limited and certain of the
intellectual property rights of Brandbrew S.A.
[SIMMONS & SIMMONS LETTERHEAD]
<PAGE>
CONTENTS
1. Definitions and Interpretation..............................................1
2. Transfer of the BHL Shares, Intellectual Property Rights and Consideration.13
3. Conditions Precedent.......................................................14
4. Pre Completion Undertakings................................................16
5. Completion.................................................................20
6. Completion Working Capital Statement and Intra-Group Debt..................24
7. Post-Completion Undertakings...............................................25
8. Vendor Warranties..........................................................32
9. Limitations On Claims......................................................35
10. Purchasers' Warranties.....................................................40
11. Vendor Indemnities.........................................................41
12. Parent Company Guarantees..................................................45
13. Reorganisation agreements guarantee........................................47
14. Entire Agreement...........................................................49
15. Variation..................................................................50
16. Assignment.................................................................50
17. Confidentiality and Announcements..........................................51
18. Further Assurances.........................................................53
19. Costs......................................................................53
20. Severability...............................................................53
21. Counterparts...............................................................53
22. Notices....................................................................53
23. No Rights Under Contracts (Rights of Third Parties) Act 1999...............57
24. Governing Law, Jurisdiction and Service of Process.........................57
SCHEDULE 1: ANCILLARY AGREEMENTS................................................
SCHEDULE 2: BHL DETAILS.........................................................
SCHEDULE 3: PROPERTIES..........................................................
i
<PAGE>
PART 1: THE CERTIFICATED PROPERTIES.............................................
PART 2: THE UNCERTIFICATED PROPERTIES...........................................
SCHEDULE 4: COMPLETION ACCOUNTS.................................................
PART 1: Preparation of the Completion Accounts..................................
PART 2: Policies, Methods And Practices Applied For The Completion Accounts.....
PART 3: Reference Working Capital Amount........................................
PART 4: COMPLETION ACCOUNTS....................................................
PART 5: Completion Working Capital Statement...................................
PART 6: Completion Working Capital Adjustments.................................
SCHEDULE 5: PURCHASERS' WARRANTIES.............................................
SCHEDULE 6: TAX COVENANT.......................................................
SCHEDULE 7: VENDOR WARRANTIES...................................................
SCHEDULE 8: ALLOCATION OF CONSIDERATION.........................................
SCHEDULE 9: RESIGNING DIRECTORS AND SECRETARIES................................
SCHEDULE 10: PENSIONS..........................................................
SCHEDULE 11: VENDOR'S AWARENESS................................................
SCHEDULE 12: DORMANT GROUP COMPANIES............................................
SCHEDULE 13: INTELLECTUAL PROPERTY MATTERS.....................................
SCHEDULE 14: BRANDS............................................................
SCHEDULE 15: PATENTS...........................................................
SCHEDULE 16: PROPERTY MATTERS..................................................
SCHEDULE 17: ACCOUNTS...........................................................
SCHEDULE 18: EMPLOYEE LISTS.....................................................
PART 1: BBL Band 5 and above and sales and marketing employees..................
SCHEDULE 19: KEY IP.............................................................
ii
<PAGE>
THIS SHARE PURCHASE AGREEMENT is dated 24th December, 2001 and made
BETWEEN:
(1) INTERBREW S.A., (the "Guarantor"), a company incorporated in Belgium
whose registered office is at Grand Place 1, 1000 Brussels, Belgium;
(2) INTERBREW UK HOLDINGS LIMITED, (the "Vendor"), a company incorporated
in England and Wales under company number 3984542 whose registered
office is at c/o Simmons & Simmons, CityPoint, One Ropemaker Street,
London EC2Y 9SS;
(3) BRANDBREW S.A., ("Brandbrew"), a company incorporated in Luxembourg
whose principal place of business is at Rue Carlo Hemmer 4, L-1734,
Luxembourg;
(4) GOLDEN ACQUISITION LIMITED, ("Purchaser"), a company incorporated in
England and Wales under company number 4320727 whose registered office
is at 35 Basinghall Street, London EC2V 5DB;
(5) COORS WORLDWIDE, INC., ("IP Purchaser"), a company incorporated in
Colorado, USA whose principal place of business is at 311 10th Street,
Golden, Colorado, 80401 USA; and
(6) ADOLPH COORS COMPANY, ("Purchaser Guarantor"), a company incorporated
in Colorado, USA whose registered office is at 311 10th Street, Golden,
Colorado, 80401 USA.
BACKGROUND:
(A) The Vendor has agreed to sell and the Purchaser has agreed to purchase
the entire issued share capital of Bass Holdings Limited for the
consideration and upon the terms and subject to the conditions set out
in this Agreement.
(B) Brandbrew has agreed to sell, and IP Purchaser has agreed to purchase,
the intellectual property rights and domain names relating to the
business of the Group (other than certain of such rights relating to
the CAFFREY'S brand) for the consideration and upon the terms and
subject to the conditions set out in this Agreement.
(C) The IP Purchaser, at the time of execution of this Agreement, will
enter into the Caffrey's Assignment pursuant to which it will acquire
the registered Intellectual Property relating to the "CAFFREY'S" brand
outside of the Republic of Ireland which is currently owned by Bass
Holdings Limited.
(D) The Purchaser Guarantor has agreed to guarantee certain obligations of
the Purchasers under this Agreement.
THE PARTIES AGREE THAT:
1. DEFINITIONS AND INTERPRETATION
1.1 In this Agreement, except so far as the context otherwise requires, the
following terms shall have the following meanings:
1
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"ABN Amro Facility" means the multi-currency loan facility provided by
ABN Amro Bank N.V. and others to Interbrew S.A., Interbrew UK Holdings
Limited, Interbrew UK Limited and Interbrew Belgium N.V. dated 10 June
2000 (as amended and supplemented);
"ABN Security Guarantees" means the guarantees provided by members of
the Group to ABN Amro Bank N.V.;
"ABN Share Pledges" means the pledges over the shares of the
Subsidiaries given by BHL, BBL and Barbox Limited (as detailed in the
Subsidiary Details Appendix) to ABN Amro Bank N.V. to secure its
obligations as guarantor under the ABN Amro Facility;
"Agreed Form" means in relation to any document, the document in a form
agreed by the Vendor and the Purchaser and initialled for the purposes
of identification;
"Ancillary Agreements" means the agreements in the Agreed Form which
shall be executed and delivered at Completion and which are set out in
schedule 1;
"Article 141" means Article 141 of the Treaty of Rome or any current or
future legislation which implements Article 141 or which implements any
EC Directive relating to equal treatment. References to the EC shall be
taken to include the European Community (formerly the European Economic
Community) and the European Union;
"Band 4" and "Band 5" means those employees listed or referred to in
the Disclosure Letter under the heading "Band 4" or "Band 5" as the
case may be;
"Barbican Brands" means the brands identified under the heading
"Barbican Brands" in schedule 14;
"Bass Ale Brands" means the brands identified under the heading "Bass
Ale Brands" in schedule 14 (including the Triangle Device);
"Bass Brands" means the Tennent's Brands, the Bass Ale Brands, the
Staropramen Brands and the Barbican Brands;
"Bass Retained Group" means Six Continents PLC and any of its
subsidiaries at the relevant time;
"Bass SPA" means the Sale and Purchase Agreement dated 14 June 2000
between Bass PLC (now known as Six Continents PLC), the Vendor and
others as amended on 03 July 2000;
"Bass Taverns" means Six Continents Retail Limited (formerly Bass
Taverns Limited) (registered no. 24542), whose registered office is at
Cape Hill, PO Box 27, Birmingham, West Midlands BH16 0PQ;
"BBETUS" means the Bass Brewers Executive Top Up Scheme established by
a deed dated 05 April 2001;
"BB(IP)" means Bass Brewers (IP) B.V., a private company limited by
shares incorporated in the Netherlands details of which are set out in
the Subsidiary Details Appendix;
"BB(IP) Loan Agreement" means the loan agreement made between BB(IP)
and BIH and dated 28 September 1999;
2
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"BBL" means Bass Brewers Limited, details of which are set out in the
Subsidiary Details Appendix;
"BBL Directors" means each of Paul Cooke, Christian Edger, Jeremy
Fowden, John Holberry, Mark Hunter, Peter Swinburn, Martin Thomas, Paul
Thomas, Johan Van Biesbroeck and Christian Verougstraete;
"BBPP" means the Bass Brewers Pension Plan established by a deed dated
1 December 2000;
"BBW" means Bass Beers Worldwide Limited, a company registered in
England and Wales under company number 4003563;
"BBW Assets" means the assets and business transferring pursuant to the
BBW BPA;
"BBW BPA" means the business purchase agreement in Agreed Form between
BBW and BBL;
"BBW Warranties" means the warranties in schedule 2 of the BBW BPA;
"Beer" means beers of any description including light, pale or bitter
ale, export or premium ale, mild ale, brown ale, strong ale (including
barley wine), bitter, stout or porter, sweet stout, lager, export or
premium lager (also known as malt lager or malt liquor), strong lager,
premium low carbohydrate beer and low carbohydrate beer and however
fermented, conditioned or packaged and whether or not having an alcohol
content;
"BHL" means Bass Holdings Limited, a company registered in England and
Wales under company number 25675;
"BHL Accounts" means the Reference Accounts as defined in schedule 4;
"BHL Accounts Date" means 30 June 2001;
"BHL Shares" means the entire issued share capital of BHL comprising
8,466,920 ordinary shares of L.1 each;
"BIH" means Bass International Holdings N.V., a company incorporated in
the Netherlands under number 33128095 whose registered office is at
Strawinskylaan, 3105 1077 ZX, Amsterdam, the Netherlands;
"Brodies" means the Vendor's Scottish solicitors of 15 Atholl Crescent,
Edinburgh EH3 8HA;
"Business" means the combination of the "Retained Business" as defined
in the TCB BPA and the "Transferring Business" as defined in the BBW
BPA;
"Business Day" means a day (excluding Saturdays) on which banks
generally are open in London and Brussels for the transaction of normal
banking business;
"Business IP" means:
(A) the Intellectual Property owned by the Group; and
(B) the Target IP
3
<PAGE>
"Caffrey's Assignment" means the assignment of the Caffrey's Rights
between BHL and the IP Purchaser of even date herewith;
"Caffrey's Rights" means the registered Intellectual Property relating
to the Caffrey's brand outside of the Republic of Ireland which is
currently owned by BHL as defined in the Caffrey's Assignment;
"Caffrey's Warranties" means the Vendor Warranties to the extent they
relate to the Caffrey's Rights;
"CarlingNet Website" means the website whose uniform resource locators
at the date hereof include the domain names "fa-carling.com",
"fa-premier.com" and "carlingnet.com";
"Certificated Properties" means the freehold and leasehold properties,
brief details of which are set out in part 1 of schedule 3 and which
are more particularly described in the Certificates of Title;
"Certificates of Title" means the certificates of title dated 24
December 2001 given by Simmons & Simmons and Brodies in relation to the
Certificated Properties;
"Companies Act" means the Companies Act of 1985, as amended;
"Completion" means completion of the transfer of the BHL Shares, the
Target IP, and the Target Domain Names in accordance with clause 5;
"Completion Accounts" means the accounts prepared in accordance with
paragraph 2 of part 1 of schedule 4 and agreed or determined in
accordance with paragraph 5 thereof;
"Completion Date" means the date on which Completion occurs pursuant to
clause 5;
"Completion Working Capital Amount" means the amount shown as such in
the Completion Working Capital Statement;
"Completion Working Capital Statement" means the statement of adjusted
working capital to be prepared in accordance with paragraph 3 of part 1
of schedule 4 and agreed or determined in accordance with paragraph 5
thereof;
"Confidentiality Letter" means the letter dated 30 October 2001 between
Coors Brewing Company and Interbrew S.A.;
"Costs" means any liabilities, losses, damages, claims, costs
(including legal costs) and expenses (including tax), in each case, of
any nature whatsoever (together with any amounts in respect of
irrecoverable VAT arising thereon);
"Data Room" means all correspondence, documents and other information
in the Data Room Index;
"Data Room Index" means the indices of the contents of the Data Room
which are attached to the Disclosure Letter and signed by the
Purchasers' Solicitors and the Vendor's Solicitors for the purposes of
identification;
"Deferred Consideration" means the deferred consideration (if any)
payable pursuant to clause 7.13;
4
<PAGE>
"Disclosure Letter" means the letter dated 24 December 2001 from the
Vendor's Solicitors to the Purchaser's Solicitors, as amended between
the parties by agreement of even date, in relation to the Vendor
Warranties;
"Dispense Equipment" means all dispense heads, taps, cellar connectors,
pipework, in-line coolers or flow cooling equipment, gas regulators or
mechanical pumps, cleaning equipment and all other equipment (but not
consumable items) of the type used in connection with the retail sale
of Beer;
"Disposal" means:
(1) a sale, transfer, gift, assignment or disposal of any interest
in Relevant Assets (but excluding any licensing or charging of
any such interest in the ordinary course of business) to a
Leading Brewer; or
(2) the entry into any Merger Transaction; or
(3) the issue of securities to a Leading Brewer by the Purchaser
or any of its subsidiary undertakings from time to time or by
any member of the Purchaser Group that owns directly any
Relevant Assets other than shares of the Purchaser; or
(4) a legally binding agreement to do any of the act or things
referred to in sub-clause (1), (2) or (3) above;
"Draft Completion Accounts Pack" shall have the meaning given in
paragraph 5.1 of part 1 of schedule 4;
"Encumbrance" includes any interest or equity of any person (including
any right to acquire, option or right of pre-emption), any mortgage,
charge, pledge, lien, assignment, hypothecation, security interest
(including any created by law) or other security agreement or
arrangements or any agreement to create such interest, agreement or
arrangement;
"Enterprise Operating Agreement" means the management and operating
agreement entered into between BHL and Bass Taverns on 22 August 2000;
"Enterprise Pubs" means every and any of the public houses currently
vested in BHL and known as The Abbey Inn Burton on Trent, Bass House
Basingstoke, The City Hotel Hull, The Heath Inn Hanley and The Sefton
Arms Epsom and "Enterprise Pub" shall be construed accordingly;
"Environmental Claim" means any claim in respect of any breach of the
Environment Warranties;
"Environment Warranties" means the Vendor Warranties set out in
paragraph 23 of schedule 7;
"Group" means BHL and the Subsidiaries;
"Group Company" means any of BHL or the Subsidiaries and "Group
Companies" shall be construed accordingly;
"group undertaking" shall be construed in accordance with section 259
of the Companies Act at the date hereof;
5
<PAGE>
"holding company" shall be construed in accordance with sections 736
and 736A of the Companies Act at the date hereof;
"IM" means the information memorandum prepared on behalf of the Vendor,
dated October 2001;
"Independent Accountants" means the firm appointed pursuant to
paragraph 5.6 of part 1 of schedule 4;
"Intellectual Property" means all patents, trade marks, service marks,
rights in designs, trade or business names, copyright (including rights
in computer software), topography rights, know-how, secret formulae,
recipes and processes, yeast strains, lists of suppliers and customers
and other confidential and proprietary knowledge and information,
rights protecting goodwill and reputation, database rights (whether or
not any of these is registered and including applications for
registration of any such thing) and all rights and forms of protection
of a similar nature to any of the foregoing or having equivalent effect
anywhere in the world;
"Interbrew Group" means Interbrew S.A., its holding companies, its
subsidiaries and any other subsidiaries of its holding company from
time to time;
"Interbrew Financial Period End" means the end of a four week or five
week period used by the Interbrew Group in the UK for the purposes of
internal financial reporting, twelve of which make up a financial year;
"Interbrew Retained Group" means the Interbrew Group excluding the
Group;
"Interbrew Retained Group Company" means any member of the Interbrew
Retained Group at the relevant time;
"Intra-Group Guarantees" means any guarantees, indemnities,
counter-indemnities and letters of comfort of any nature whatsoever
(including the ABN Security Guarantees):
(A) given by any Group Company in respect of a liability of any
Interbrew Retained Group Company (each an "Intra-Group
(Interbrew Retained Group Company) Guarantee"); and/or (as the
context may require)
(B) given by any Interbrew Retained Group Company in respect of a
liability of any Group Company (each an "Intra-Group (Group
Company) Guarantee");
"Intra-Group Debts" shall have the meaning given in paragraph 4 of part
1 of schedule 4;
"Intra-Group Debts Owing" means the Intra-Group Debts owed by Group
Companies or the Joint Venture Companies to Interbrew Retained Group
Companies as at Completion;
"Intra-Group Debts Receivable" means the Intra-Group Debts owed by
Interbrew Retained Group Companies to Group Companies or the Joint
Venture Companies, as at Completion;
"IT Systems" means the information technology used by any member of the
Group or otherwise in the Business including without limitation,
hardware, software, firmware and associated documentation;
6
<PAGE>
"ITTSA" means the agreement between (1) TCB (as Customer) and (2) BBL
(as Provider) relating to the provision of transitional services dated
29 October 2001;
"IUK" means Interbrew UK Limited, a company registered in England and
Wales under company number 3982132;
"Joint Venture Companies" means Tradeteam Limited and Grolsch (UK)
Limited details of which are set out in the Subsidiary Details Appendix
and "Joint Venture Company" means either of them;
"Key IP" means the Registered trade marks specified in schedule 19;
"Leading Brewer" means Carlsberg Tetley PLC or any of its subsidiary
undertakings or parent undertakings from time to time;
"Licences In" means, where used in schedule 7, the Material licences of
Intellectual Property which have been granted by third parties to any
of the Group Companies;
"Licences Out" means, where used in schedule 7, the Material licences
of Intellectual Property which have been granted by any of the Group
Companies to third parties;
"Lost Licence" means any water abstraction licence which relates to, or
is used in relation to, the Business or the Properties and which are
not held by or not validly held by a Group Company;
"Material" means, unless otherwise expressed, material in the context
of the business, operations, assets, liabilities (including, without
limitation, contingent liabilities), financial condition or financial
results of the Group and "Materially" shall be construed accordingly;
"Material Adverse Effect" means any effect that, individually or in the
aggregate with other effects is, or is reasonably likely to be,
materially adverse to the business, operations, assets, liabilities
(including, without limitation, contingent liabilities), financial
condition or financial results of the Group taken as a whole;
"Melio" means Melio Luxembourg International S.a.r.l. a company
incorporated in Luxembourg whose registered office is at 2 Rue de La
Tour Jacob, L-1831, Luxembourg;
"Merger Transaction" means any transaction involving the amalgamation
of the share capital or businesses of Carlsberg Tetley PLC or any of
its subsidiary undertakings from time to time with all or a significant
part of:
(1) the issued shares of any member of the Group whose business or
assets are material in the context of the Group's businesses
taken as a whole; or
(2) the businesses or assets of the Group (taken as a whole)
whereby Carlsberg Tetley PLC or any of its subsidiary undertakings from
time to time and a member of the Purchaser Group each has an ownership
interest in the Business following the completion of the merger
transaction through an equity stake or otherwise;
"Net Debt Schedule" means the schedule prepared in accordance with
paragraph 4 of part 1 of schedule 4 and agreed or determined in
accordance with paragraph 5 of part 1 thereof;
7
<PAGE>
"Normalisation Process Document" means Exhibits 2 and 4 (excluding
pages 3, 4 and 5 of 17) to the discussion of principles document in
Agreed Form as amended by the working capital document in Agreed Form;
"Patents" means the patent applications and registrations listed in
schedule 15;
"Post-Acquisition Domain Names" means any domain name registered in the
name of or held on behalf of an Interbrew Retained Group Company which
was applied for or acquired on or after 22 August 2000 at the
instruction or direction of any Group Company;
"Post-Acquisition IP" means any Registered Intellectual Property owned
by an Interbrew Retained Group Company which was applied for or
acquired on or after 22 August 2000 at the instruction or direction of
any Group Company;
"Properties" means the Certificated Properties and the Uncertificated
Properties;
"Property Agreements" means:
(A) the agreement for the transfer of the lease relating to Anglo
Holt House New Street West Bromwich dated 14 April 2000 and
made between BHL and Bass PLC (now Six Continents PLC);
(B) the agreement dated 30 March 2000 for the transfer of 16
public houses and made between BHL and Bass Taverns;
(C) the Taverns Agreement;
(D) the agreement dated 14 April 2000 for the transfer of the
business carried on from and the freehold property known as
Grinkle Park West Yorkshire and made between BHL and Bass
Taverns;
(E) the Enterprise Agreement being an agreement dated 10 June 1999
made between BHL, Bass Taverns (now Six Continents Retail
Limited), Enterprise Inns PLC pursuant to which BHL agreed to
sell certain public houses to inter alia Enterprise Inns PLC;
(F) the Ingleby Agreement being an agreement dated 2 June 2000
made between BHL and JD Apthorp relating to the sale of
Ingleby Moor, Grinkle Park near Loftus West Yorkshire;
(G) the memorandum dated 01 October 1999 and made between BBL and
Bass Developments Limited relating to the development of
Middle Yard and Station Road, Burton-on-Trent pursuant to
which BBL and Bass Developments Limited share certain
development profits as are therein mentioned;
"Purchaser Group" means the Purchaser, its holding company, its
subsidiaries and any other subsidiaries of its holding company from
time to time;
"Purchasers" means the Purchaser, Trushelfco (No. 2855) Limited, and
the IP Purchaser;
"Purchasers' Accountants" means Ernst & Young;
"Purchasers' Solicitors" means Slaughter and May of 35 Basinghall
Street, London EC2V 5DB;
8
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"Purchasers' Warranties" means the representations and warranties of
the Purchasers set out in schedule 5;
"Reference Working Capital Amount" means the amount of working capital
determined in accordance with part 3 of schedule 4;
"Reference Working Capital Statement" means the statement of working
capital set out in part 3 of schedule 4;
"Registered" includes registrations and applications for registration;
"Relevant Assets" means all or a Material part of:
(A) the BHL Shares held by members of the Purchaser Group; and/or
(B) the shares of any member of the Group and/or the assets or
shares of the Purchaser; and/or
(C) the business and/or assets of any member of the Group; and/or
(D) the Key IP;
"Relevant Claim" means, save as otherwise expressly provided, any claim
in respect of any breach of a Vendor Warranty or a BBW Warranty or any
claim under the Tax Covenant;
"Relevant Employee" means any past or present employee of any Group
Company;
"relevant Purchaser" means:
(A) the Purchaser, where the BHL Shares are involved and/or where
the relevant company is BHL or any of the Subsidiaries; and
(B) the IP Purchaser, where the Target IP or Target Domain Names
are involved;
"Replies to Enquiries" means the replies to the enquiries relating to
the Certificated Properties in the form annexed to the Certificates of
Title as "Annexure A" given on behalf of BBL to the Vendor's Solicitors
and Brodies;
"Review Period" means the period specified in paragraph 5.3 of part 1
of schedule 4;
"Senior Executives" means the directors of BBL other than the resigning
directors listed in schedule 9;
"Six Continents PLC" means Six Continents PLC a public limited company
registered in England and Wales under company no. 913450 and whose
registered office is at 20 North Audley Street London W1Y 1WE;
"Staropramen Brands" means the brands identified under the heading
"Staropramen Brands" in schedule 14;
"Statutory Accounts" means, in relation to any Group Company:
9
<PAGE>
(A) the audited balance sheet of that Group Company as at the
Statutory Accounts Date; and
(B) the audited profit and loss account of that Group Company for
the period ended 26 August 2000 and for the eighteen week
period ended on the Statutory Accounts Date;
together with any notes, reports, statements or documents made thereon
and annexed or attached thereto as initialled by the Vendor and the
Purchaser for the purposes of identification;
"Statutory Accounts Date" means 30 December 2000;
"Subsidiaries" means the subsidiaries of BHL (excluding the Joint
Venture Companies and including, for the avoidance of doubt, the
dormant companies listed in schedule 12), details of which are set out
in the Subsidiary Details Appendix;
"subsidiary" and "subsidiaries" shall be construed in accordance with
sections 736 and 736A of the
Companies Act at the date hereof;
"Subsidiary Details Appendix" means the Agreed Form appendix setting
out details of the Subsidiaries and Joint Venture Companies;
"subsidiary undertaking" and "parent undertaking" shall be construed in
accordance with section 258 of the Companies Act at the date hereof;
"Target Domain Names" means:
(A) any domain names which Six Continents PLC agreed to transfer
pursuant to the Bass SPA;
(B) the Post-Acquisition Domain Names; and
(C) any other domain names registered in the name of or held on
behalf of an Interbrew Retained Group Company which have in
the 12 months prior to Completion been used exclusively in the
Business;
but excluding in each case any domain name which uses any of the Bass
Brands as part of the domain name and the domain names "redism.com",
"redt.co.uk", "ulsterbrewery.com", "bbnational.co.uk", "bbns.co.uk",
"bbretail.co.uk" and "bbww.com";
"Target IP" means:
(A) the Patents;
(B) any Intellectual Property which Six Continents PLC agreed to
transfer pursuant to the Bass SPA;
(C) the Post-Acquisition IP; and
(D) any other Intellectual Property owned by an Interbrew Retained
Group Company which has in the 12 months prior to Completion
been used exclusively in the Business;
10
<PAGE>
but excluding from (B) and (C) and (D):
(1) any trade mark containing any of the Bass Brands (including
any goodwill or common law rights which are connected or
attached to the same);
(2) any Intellectual Property which relates predominantly or
exclusively to the Bass Brands;
(3) any copyright or database right in respect of the content or
design of the websites which are currently located at
www.redism.com, www.redt.co.uk and www.bass-museum.com;
(4) CTM no. 792663 Great British Pub Company, Russian trade mark
no. 187948 Great British Pub Company, UK trade mark no.
B1356002 AS WE GET IT, UK trade mark no. B991997 OLD CELLAR,
UK trade mark no. B1347122 Old Cellar (device), UK trade mark
no. 423265 Old Cellar, Irish trade mark no. B139406 OLD
CELLAR, and Irish trade mark no. B139123 Old Cellar (device);
and
(5) for the avoidance of doubt, any Intellectual Property owned by
the Group;
"Taverns Agreement" means the agreement dated 14 April 2000 relating to
the transfer by BHL of legal title to certain public houses and made
between BHL and Bass Taverns;
"tax" and "tax authority" shall have the same meanings as they have for
the purposes of the Tax
Covenant;
"Tax Covenant" means the covenant relating to tax set out in schedule
6;
"Tax Warranties" means the Vendor Warranties relating to tax set out in
paragraph 24 (Taxation) of schedule 7;
"TCB" means Tennent Caledonian Breweries Limited (formerly known as
Tennent Caledonian Brewers Limited), a company incorporated in England
and Wales under company number 4301581;
"TCB BPA" means the business purchase agreement dated 29 October 2001
(as amended and supplemented) between BBL and TCB;
"TCB Reorganisation" means the reorganisation of the Group effected
pursuant to the TCB Transaction Documents;
"TCB Transaction Documents" means the documents listed in section N.18
of the Data Room entered into between BBL and TCB (and others) to
effect the TCB Reorganisation;
"Tennent's Brands" means the brands identified under the heading
"Tennent's Brands" in schedule 14;
"Third Party Borrowings" means the aggregate of all borrowings and
indebtedness in the nature of borrowings in relation to which any Group
Company has any liability (present or future, actual or contingent) as
at close of business on the Completion Date other than (1) the capital
sum of approximately E.16m plus interest accruing thereunder owed by
BB(IP) pursuant to the BB(IP) Loan Agreement; (2) any borrowings of the
Joint Venture Companies; (3) Intra Group Debts; and (4) all debts
incurred in the ordinary course of trading including without limitation
trade creditors and duty payments;
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"Title Deeds" means the originals of the deeds (which may include
certified or examined copies of the deeds) relating to the title of any
member of the Group to the Properties which are in the possession or
under the control of any member of the Interbrew Retained Group;
"Total Intra-Group Debt" means the net amount of Intra-Group Debts as
set out in the Net Debt Schedule;
"Tradeteam" means Tradeteam Limited, a company incorporated in England
and Wales under company number 3078367;
"Triangle Device" means the triangle device depicted in UK trade mark
registration no. 1 and any confusingly similar device;
"UK Competent Authority" means the DGFT, the Competition Commission
and/or the Secretary of State for Trade and Industry;
"UK GAAP" means the accounting policies, procedures, methods and
practices generally accepted in the United Kingdom, including all
SSAPs, FRSs and UITF abstracts mandatory for adoption;
"Uncertificated Properties" means the freehold and leasehold
properties, brief details of which are set out in part 2 of schedule 3;
"Unconnected Third Party" means any person who is not a member of the
Purchaser Group for the time being;
"undertaking" shall be construed in accordance with section 259 of the
Companies Act at the date hereof;
"VAT" means value added tax or any similar sales or turnover tax;
"VDD" means the Vendor Due Diligence Report prepared by KPMG in respect
of BHL dated November 2001;
"Vendor's Accountants" means KPMG of 8 Salisbury Square, London EC4Y
8BB;
"Vendor's Solicitors" means Simmons & Simmons of CityPoint, One
Ropemaker Street, London EC2Y 9SS; and
"Vendor Warranties" means the representations and warranties of the
Vendor and Brandbrew set out in schedule 7.
1.2 In this Agreement, unless the context otherwise requires:
(A) references to persons shall include individuals, bodies
corporate (wherever incorporated), unincorporated associations
and partnerships;
(B) the headings are inserted for convenience only and shall not
affect the construction of this Agreement;
(C) references to one gender include all genders;
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(D) any reference to an enactment or statutory provision is, save
as otherwise expressly provided, a reference to it as it may
have been, or may from time to time be, amended, re-enacted
(with or without modification) or consolidated and also
includes any provision that replaces such provision; and
(E) references to any English legal term for any action, remedy,
method of judicial proceeding, legal document, legal status,
court, official or any other legal concept shall, in respect
of any jurisdiction other than England, be deemed to include
the legal concept which most nearly approximates in that
jurisdiction to the English legal term.
1.3 The schedules comprise schedules to this Agreement and form part of
this Agreement and have the force and effect as if expressly set out in
the body of this Agreement and any reference to this Agreement shall
include the schedules. Reference to a clause or clauses or to a party
or parties shall mean clauses of, and a party or the parties to, this
Agreement;
1.4 The Disclosure Letter has such contractual effect as is expressly
provided herein (or therein) and forms part of this Agreement.
2. TRANSFER OF THE BHL SHARES, INTELLECTUAL PROPERTY RIGHTS AND
CONSIDERATION
2.1 BHL SHARES
The Vendor agrees to sell, with full title guarantee, the BHL Shares,
and the Purchaser agrees to purchase the BHL Shares. The BHL Shares
shall be sold and purchased fully paid up and free from any
Encumbrance, together with all rights which, at the date of Completion
or subsequently, attach to them. The BHL Shares shall be sold and
purchased on the terms and subject to the conditions set out in this
Agreement.
2.2 INTELLECTUAL PROPERTY RIGHTS
Brandbrew agrees to sell or procure the sale of; (i) the Key IP free
from any Encumbrance and with full title guarantee; and (ii) the Target
IP (other than the Key IP) and IP Purchaser agrees to purchase the
Target IP. The Target IP shall be sold on the terms and subject to the
conditions set out in this Agreement.
2.3 DOMAIN NAMES
Brandbrew agrees to sell or procure the sale of the Target Domain Names
and IP Purchaser agrees to purchase the Target Domain Names. The Target
Domain Names shall be sold on the terms and subject to the conditions
set out in this Agreement.
2.4 CONSIDERATION
The aggregate consideration payable by the Purchasers for the BHL
Shares, the Target IP and the Target Domain Names shall be the
aggregate of:
(A) L.1,162,000,000.00;
(B) plus or minus (as appropriate) any amount payable in relation
to the Completion Working Capital Statement under clause 6.1;
(C) adjusted by an amount equal to the Total Intra-Group Debt in
accordance with clause 6.3;
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(D) plus any amount payable by the Purchaser pursuant to clauses
7.13 to 7.18 (inclusive); and
(E) plus any amount payable by the Purchaser pursuant to schedule
16.
2.5 The allocation of the consideration referred to in clause 2.4(A) as
between the BHL Shares, the Target IP and the Target Domain Names and
(in the case of the BHL Shares) as adjusted by clauses 2.4(B) and
2.4(C) is set out in schedule 8. Each amount payable to the Vendor
pursuant to clauses 2.4(D) and 2.4(E) shall be allocated to the amount
payable for the BHL Shares.
2.6 TAXES
In respect of United Kingdom or United States stamp duty or other
documentary or transfer taxes payable in relation to this Agreement or
the transfer of the BHL Shares pursuant to this Agreement, the
Purchasers shall be responsible for the payment of such amount of stamp
duty or other documentary or transfer taxes as determined by the
relevant tax authority whether by the process of adjudication under
sections 12 and 12A of the Stamp Duty Act 1891 or otherwise. Without
prejudice to the foregoing, the relevant Purchaser shall pay the amount
of such duty or other documentary or transfer tax (including any
interest or penalties) should it be necessary for any of the parties to
this Agreement to enforce the provisions of this Agreement or the
transfer of the BHL Shares pursuant to this Agreement in the United
Kingdom or the United States of America. For the avoidance of doubt
this clause 2.6 does not apply in respect of Bass Beers Worldwide SA
(PTY) Limited which is dealt with under the BBW BPA.
2.7 ADJUSTMENTS
Any payment made to the relevant Purchaser by the Vendor pursuant to
any claim in respect of any breach of the Vendor Warranties (other than
to the extent that the Vendor Warranties relate to the Target IP) or
any claim under the Tax Covenant shall, so far as possible, be made by
way of adjustment to the consideration payable for the transfer of the
BHL Shares. Any payment made to the IP Purchaser by Brandbrew in
respect of the Vendor Warranties relating to the Target IP shall, so
far as possible, be made by way of adjustment to the consideration
payable for the Target IP.
2.8 VAT
Any sum payable under this Agreement is exclusive of any amount in
respect of applicable VAT.
3. CONDITIONS PRECEDENT
3.1 The Vendor covenants with the Purchasers to use its best endeavours to
secure the acceptance by the Secretary of State for Trade and Industry
(the "Secretary of State") of undertakings (the "Undertakings")
pursuant to Section 88 of the Fair Trading Act 1973 (the "FTA") for the
purpose of remedying or preventing the adverse effects specified in the
report of the Competition Commission on the acquisition by Interbrew SA
of the brewing interests of Bass PLC (Cm 5014, January 2001) by no
later than 31 January 2002.
3.2 PRE-APPROVAL OF PURCHASERS
The obligations of the parties to complete the transfer of the BHL
Shares, the Target IP and the Target Domain Names shall be conditional
upon:
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(A) revocation of the Merger Report (Interbrew SA and Bass PLC)
(Interim Provision) Order 2001 (SI 2001/318) made on 8
February 2001; and
(B) the Director General of Fair Trading (the `DGFT') approving,
under the terms of the Undertakings, the Purchasers as
purchasers of the BHL Shares and the Target IP and the Target
Domain Names.
3.3 FULL CO-OPERATION IN OBTAINING DGFT APPROVAL OF THE PURCHASERS
In order to ensure that the condition precedent in clause 3.2 is
fulfilled:
(A) the Vendor undertakes to use all best endeavours to, and the
Purchasers undertake to provide such assistance to the Vendor
in connection with any dealing, or submission to, the DGFT as
is required by the Vendor in order to, obtain the approval of
the DGFT of the Purchasers as the purchasers of BHL and the
Target IP and the Target Domain Names;
(B) the Purchasers will at all times co-operate with the Vendor in
providing to the DGFT such information as may be necessary
with a view to ensuring that the conditions in clause 3.2 are
fulfilled as soon as is reasonably practicable and shall
provide the Vendor with copies of any proposed communication
to the DGFT made pursuant to this clause 3.3 and take due
consideration of any comments that the Vendor may have in
relation to such communication, provided that a Purchaser
shall not be required to provide the Vendor with any of the
Purchasers' confidential information or business secrets; and
(C) the Vendor will provide to the DGFT such information as may be
necessary with a view to ensuring that the conditions in
clause 3.2 are fulfilled as soon as is reasonably practicable
and shall provide the Purchasers with copies of any proposed
communication to the DGFT made pursuant to this clause 3.3 and
take due consideration of any comments that the Purchasers may
have in relation to such communication, provided that the
Vendor shall not be required to provide the Purchasers (or any
of them) with any confidential information or business secrets
relating to the Interbrew Retained Group.
3.4 The obligations of the parties to complete the transfer of the BHL
Shares, the Target IP and the Target Domain Names shall be conditional
upon the Caffrey's Assignment having become unconditional.
3.5 TERMINATION PROVISIONS
If Completion has not occurred on or before 28 February 2002, each of
the Vendor and the Purchasers shall have the right to terminate this
Agreement by written notice to the other and this Agreement (other than
this clause 3.5, clause 9.21, clause 9.22, clause 14 (Entire
Agreement), clause 15 (Variation), clause 17 (Confidentiality and
Announcements), clause 19 (Costs), clause 22 (Notices), clause 23 (No
Rights Under Contracts (Rights of Third Parties) Act 1999) and clause
24 (Governing Law, Jurisdiction and Service of Process) shall terminate
and no party shall have any claim hereunder of any nature whatsoever
against any other party save in respect of their accrued rights and/or
liabilities arising from any prior breach of this Agreement.
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4. PRE COMPLETION UNDERTAKINGS
4.1 GENERAL MATTERS
Pending Completion, the Vendor shall procure that, save with the prior
written consent of the Purchaser:
(A) each Group Company shall carry on its business in the ordinary
and usual course;
(B) each Group Company shall maintain a level of working capital
and trade inventory, consistent with historical levels for
that Group Company and at that time of year;
(C) subject to the terms of the Confidentiality Letter, the
Purchasers' representatives and the proposed lenders shall be
allowed, upon reasonable notice and during normal business
hours, reasonable access to the Properties, to the executives
at the level of Band 4 and to such executives at other levels
as the Purchasers may reasonably request (and, to the extent
the Vendor is reasonably able to do so, executives from the
Joint Venture Companies and the Vendor's advisers), and to the
books and records of each Group Company, (including, without
limitation, all statutory books (in the case of Group
Companies only), minute books (in the case of Group Companies
only), leases, contracts, supplier lists and customer lists)
and to the books and records of the Interbrew Retained Group
Companies relating to the Business IP together with the right
to take copies;
(D) no dividend or other distribution (within the meaning of
section 209, 210 or 418 of the Income and Corporation Taxes
Act 1988 (the "Taxes Act")) shall be declared, paid or made by
any Group Company to any Interbrew Retained Group Companies;
(E) no share or loan capital (nor options, rights to subscribe or
other rights in respect thereof) shall be allotted or issued
or agreed to be allotted or issued by any Group Company and no
Group Company shall undergo a reduction in capital or redeem
or repurchase any share or loan capital;
(F) no Group Company shall create or agree to create or permit any
Encumbrances over all or any part of its assets save for liens
arising in the ordinary course of business;
(G) no Group Company shall employ any new executives or terminate
the employment or office of any existing executives in Band 4
or above and no change shall be made in the redundancy
practices of any Group Company including the benefits other
than salary payable to any executive on redundancy;
(H) no general salary increases for any employee shall be made
outside the ordinary course of the annual review to take
effect from 1 January 2002, and no change shall be made by any
Group Company in the terms of employment of any executives at
the level of Band 4 or above where the change would increase
such an executive's total remuneration package, in each case
including pension fund commitments (other than changes
required by law);
(I) no employees of any Group Company shall be transferred to the
Interbrew Retained Group Companies and no employees of the
Interbrew Retained Group Companies shall be transferred to any
Group Company;
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(J) no Group Company shall enter into any new contract or new
commitment (or make a bid or offer which may lead to a
contract or commitment) which would have an annualised total
value of L.2,000,000 or more;
(K) no Group Company shall agree to any variation of any existing
contract to which that Group Company is a party having an
annualised total value of L.2,000,000 or more where the
variation changes the annualised value of the said contract by
10% or more;
(L) no Group Company shall acquire or dispose of, or agree to
acquire or dispose of, any business or any asset either (1)
where such acquisition or disposal would require the approval
of an Executive Vice President of Interbrew S.A. under
policies applied at the date hereof, or (2) outside the
ordinary and usual course of business;
(M) no Group Company shall enter into any borrowing, which
expression for this purpose shall not include (1) indebtedness
existing between Group Companies, or (2) indebtedness existing
between Group Companies and the Interbrew Retained Group
Companies, in each case provided such indebtedness arises in
the ordinary course and in accordance with limits subsisting
at the date of this Agreement;
(N) no Group Company shall enter into any contract with any member
of the Interbrew Retained Group;
(O) no Group Company shall engage in any factoring of receivables
other than pursuant to and in accordance with the TCB
Transaction Documents;
(P) no Group Company shall fail to take any action required to
maintain any of its insurances in force or knowingly do
anything to make any policy of insurance void or voidable or
make at its own initiative any material change in the terms of
the insurance covering the activities of that Group Company,
or cancel any such insurance save that some insurance
policies, being part of a global insurance program of the
Interbrew Group, including general and product liability
insurance, property insurance, travel insurance and executive
risk insurance will be cancelled or cease to cover the Group
Company as from Completion;
(Q) no change shall be made (and no consent to any change shall be
given by any Group Company (other than Bass Brewers Pensions
Limited)) to the terms of the BBPP or the BBETUS other than
where such change is required by law or to maintain their
contracted-out or their tax exempt approved status and no
power or discretion shall be exercised by any Group Company
(other than Bass Brewers Pensions Limited) under the terms of
the BBPP and the BBETUS and no consent shall be given by any
Group Company (other than Bass Brewers Pensions Limited) to
the exercise of any such power or discretion except where such
exercise is required by law or to maintain the contracted-out
or tax exempt approved status of the BBPP and the BBETUS. To
the extent within the Vendor's control, the existing
investments of the BBPP as at the date of this Agreement shall
not be changed;
(R) no Group Company shall enter into any agreement, contract,
arrangement or transaction in relation to the CarlingNet
Website;
(S) no Group Company shall knowingly create or waive a third party
right which would have a Material Adverse Effect on the
current use of any Certificated Property for
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the business of the Group or a Material Adverse Effect on the
current use of any Uncertificated Property for the business of
the Group;
(T) no Group Company shall alter the provisions of its Memorandum
or Articles of Association or adopt or pass further
regulations or resolutions inconsistent therewith;
(U) no Group Company shall discontinue or cease to operate all or
a material part of its business;
(V) no Group Company shall pass any resolutions in general meeting
or by way of written resolution, including, without
limitation, any resolution for winding-up, or to capitalise
any profits or any sum standing to the credit of share premium
account or capital redemption reserve or any other reserve;
(W) no Group Company and no member of the Interbrew Retained Group
shall waive, release, charge, grant or transfer any rights
with respect to any Material Business IP or Target Domain
Names or domain names owned by any Group Company, or abandon
or allow to lapse any Business IP or Target Domain Names or
domain names owned by any Group Company;
(X) no Group Company shall make any change to the accounting
procedures or principles by reference to which its accounts
are drawn up, other than changes required by law or UK GAAP
(as the same applies from time to time); and
(Y) no Group Company shall dispose of or agree to dispose of any
Property or agree to acquire an interest in any property
except that any Group Company may enter into any of the
following transactions or arrangements (or any agreements in
that regard):-
(1) the surrender of the Lease of Longfield House,
Headingley Office Park, Leeds, and payment of a
surrender premium of not more than L.600,000
exclusive of VAT;
(2) the extension of the term of the Lease for blocks 2,
3 and 4 Headingley Office Park, Leeds with an
increase in rent not exceeding L.100,000 per annum;
(3) the taking of a Lease of a customer technical support
store in Lincolnshire at a rent not exceeding
L.4,000 per annum;
(4) the sale of land at Shobnall Maltings in
approximately the area edged green on the Certificate
of Title relating to that Property;
(5) the assignment, underletting or surrender of any or
all of the Properties at Unit 3, Gibbons Lane, London
E15, Unit 2, The Parks, Haydock and Unit 2, Lochside
Court, Dumfries;
(6) any actions required to perfect or regularise or
satisfy legal requirements (or those of the
appropriate land registry) in connection with the
transfer of Wellpark Brewery, Glasgow and "Smiths"
car park Barrack Street, Glasgow to TCB and Omagh
Depot and the Ulster Brewery to Bass Ireland Limited;
and
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(7) the grant of a lease of part of the Uncertificated
Property known as Rocksborough House, Solihull, to
BBW.
4.2 Without limitation to clause 4.1, pending Completion, the Vendor shall
procure that the Purchaser receives, at the same time as their delivery
to the relevant directors, copies of all board papers given to
directors of BBL and, in addition, it shall procure that no Group
Company shall take or omit to take any action or do or fail to do any
act or thing referred or which, in accordance with past practice of the
Group, would ordinarily be referred to the board of BBL for approval
without prior consultation with, and the express approval of, the
Purchaser.
4.3 Nothing in clause 4.1 or otherwise in this Agreement shall prevent:
(A) any Group Company from taking any steps required to be taken
by it in order to complete or give effect to the Ancillary
Agreements, the TCB BPA or the TCB Transaction Documents or
enforcing the terms thereof;
(B) BBL from entering into an amendment agreement in Agreed Form
in connection with the supply and distribution agreement dated
22 August 2000 between (1) Six Continents Retail Limited and
(2) Bass Brewers Limited (the "6C Supply and Distribution
Agreement") for the purposes of confirming continuity of the
supply of certain drinks products under the 6C Supply and
Distribution Agreement and any consequential arrangements; or
(C) BBL from entering into a side letter agreement in Agreed Form
in connection with the following distribution agreements
between BBL and TCB relating to:
(1) the distribution of Staropramen in England and Wales;
(2) the distribution of Tennent's Extra and Tennent's
Pilsner in England and Wales;
(3) the distribution of Bass Mild to Six Continents
Retail, on trade wholesale and the independent on
trade in England and Wales;
(4) the distribution of Tennent's lager in England and
Wales;
(5) the distribution of Bass Best Scotch to Six
Continents Retail, on trade wholesale and the
independent on trade in England and Wales; and
(6) distribution of Draught Bass to Six Continents
Retail, on trade wholesale and the independent on
trade in England and Wales.
4.4 INTRA-GROUP GUARANTEES
(A) The parties acknowledge their intention that the guarantee
provided by ACE in relation to the Group's custom bond
insurance (the "ACE Guarantee") shall continue following
signature of this Agreement.
(B) The Guarantor and the Purchasers agree to use all reasonable
endeavours following signature of this Agreement to facilitate
the release on Completion of:
(1) the composite guarantee to The Royal Bank of Scotland
pIc dated 11 October 1994 in respect of which BBL is
subject; and
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(2) the ACE Counter Indemnity in respect of which the
Vendor is subject.
4.5 The Vendor agrees to procure that BBW shall act so as to give effect to
the provisions of Annex 2.
5. COMPLETION
5.1 Following satisfaction of the last condition in clause 3, completion of
the transfer of the BHL Shares, the Target IP and the Target Domain
Names shall take place as follows:
(A) At any time on or prior to 18 February 2002 the Vendor shall
serve a written notice on the Purchaser requiring that such
completion shall take place on a date not less than 4 Business
Days after the date of service of such notice on the Purchaser
provided that the date for such completion stipulated in the
notice shall be a Saturday on or prior to Saturday 23 February
2002.
(B) The transfer of the BHL Shares, the Target IP and the Target
Domain Names shall be completed at the offices of the Vendor's
Solicitors (or at such other venue as may be agreed in writing
between the Vendor and the Purchaser).
(C) Save as provided otherwise the events referred to in the
following sub-clauses of this clause 5 shall take place on
Completion. Immediately prior to the occurrence of such
events, completion of the Caffrey's Assignment shall take
place (pursuant to the terms of such agreement) and the Vendor
shall demand repayment by BHL of an aggregate amount of the
Intra-Group Debts owing by BHL to the Vendor equal to the
total amount of monetary consideration received by BHL from
the IP Purchaser upon completion of the transactions the
subject of the Caffrey's Assignment.
5.2 The Vendor shall deliver or cause to be delivered to the Purchaser (for
itself and, where relevant, as agent on behalf of each other
Purchaser):
(A) duly executed transfers into the name of the Purchaser in
respect of all of the BHL Shares, together with the relevant
share certificates;
(B) share certificates or bearer warrants in respect of all of the
issued shares in the capital of each of the Subsidiaries and
all of the issued shares in the capital of each of the Joint
Venture Companies owned by the Group (unless such shares are
in uncertificated form);
(C) the certificates of incorporation (including any certificate
of incorporation on change of name), the common seals, all
minute books, share registers and share certificate books
(with any unissued share certificates) and other statutory
books of each Group Company incorporated in the United Kingdom
(which shall be written up to but not including the Completion
Date);
(D) a copy of the minutes (certified by a duly appointed officer
as true and correct) of meetings of the board of directors (or
equivalent) of the Vendor, the Guarantor and Brandbrew,
authorising the execution of and the performance by the
Vendor, the Guarantor and Brandbrew of their respective
obligations under this Agreement and each of the other
documents to be executed by any of them pursuant hereto;
(E) the Certificates of Title;
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(F) the Title Deeds (in so far as any of them are held by
Interbrew Retained Group Companies) or a letter of instruction
to the firm of solicitors holding the original Title Deeds and
documents (in so far as any of them are held by solicitors of
the Interbrew Retained Group Companies) that they are to be
held to the order of one of the Purchasers or as it may
direct;
(G) each of the Ancillary Agreements (other than the Caffrey's
Assignment) duly executed by the relevant Interbrew Retained
Group Companies which are parties thereto;
(H) releases of the ABN Security Guarantees and the ABN Share
Pledges;
(I) letters acknowledging repayment, pursuant to Clause 5.4(B) of
all Intra-Group Debts Owing; and
(J) a certificate (signed by a duly appointed officer of each of
the Vendor and Brandbrew) certifying that the Vendor
Warranties are accurate in all material respects and not
misleading as of the Completion Date as though a reference to
the Completion Date were substituted for any express or
implied reference to the time of this Agreement.
5.3 The Purchaser shall deliver or cause to be delivered to the Vendor:
(A) each of the Ancillary Agreements (other than the Caffrey's
Assignment) duly executed by one or more of the Purchasers or
any relevant member of the Purchaser Group which are parties
thereto;
(B) copies of minutes of the Purchaser (certified by a duly
appointed officer as true and correct) and of the IP Purchaser
and the Purchaser Guarantor, authorising the execution of and
performance by them of their obligations under this Agreement
and each of the other documents to be executed by them
pursuant hereto; and
(C) letters acknowledging repayment, pursuant to clause 5.4(A) of
all Intra-Group Debts Receivable.
5.4 At Completion:
(A) The Vendor shall procure that each Interbrew Retained Group
Company which owes any part of the Intra-Group Debts
Receivable at Completion repays such outstanding debt which it
owes in the manner provided for in clauses 5.5(C), 5.8 and
5.9.
(B) The Purchaser shall procure that each Group Company which owes
any part of the Intra-Group Debts Owing at Completion repays
such outstanding debt which it owes in the manner provided for
in clauses 5.5(B), 5.6 and 5.7.
5.5 Subject to clause 5.6 the Purchaser shall cause the amount of
L.1,162,000,000.00 to be paid to the Vendor or any persons(s) nominated
by the Vendor by electronic funds transfer to the bank account or
accounts of the Vendor or such other person so nominated before
Completion. Such payment shall consist of the aggregate of the
following payments:
(A) a payment by the Purchaser to the Vendor, as consideration
(subject to later adjustment pursuant to clauses 2.4(B),
2.4(D) and 2.4(E)) for the BHL shares, the Target IP and the
Target Domain Names, of the amount specified in clause 2.4(A)
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as adjusted by clauses 2.4(C) and 6.3 but so that the
aggregate payment does not exceed L.1,162,000,000.00;
(B) repayment, pursuant to clause 5.4(B), by the Purchaser as
agent for each Group Company which owes any part of the
Intra-Group Debts Owing, of such outstanding debt (to the
extent of such outstanding debt); and
(C) repayment, pursuant to clause 5.4(A), by the Vendor, as agent
for each Interbrew Retained Group Company which owes any part
of the Intra-Group Debts Receivable at Completion (or on its
own account, to the extent that it is the Interbrew Retained
Group Company which owes such debt), of such outstanding debt
(to the extent of such outstanding debt)
in each case for value as at Completion. If Completion is not a
Business Day then any sum referred to in clause 5.7 must be paid so
that the recipient has the benefit of such funds on the date of
Completion.
5.6 Where Completion shall not take place until Saturday 26 January 2002
there shall be deducted from the amounts payable by the Purchaser
pursuant to Clause 5.5 an amount equal to US$500,000. In the event that
Completion shall not take place until after Saturday 26 January 2002 in
addition to the amount of US$500,000 aforesaid there shall also be
deducted an additional sum of US$500,000 multiplied by the number of
complete weeks after Saturday 26 January 2002 on which Completion takes
place.
5.7 The Purchaser shall enter into a loan agreement with each Group Company
as the agent of which it makes a repayment of any part of the
Intra-Group Debts Owing pursuant to clause 5.4(B) to record that, as a
result of such repayment by the Purchaser as agent of each such Group
Company, each such Group Company owes to the Purchaser an amount equal
to such part of the Intra-Group Debts Owing repaid by the Purchaser as
its agent.
5.8 Any amount received by the Vendor pursuant to clause 5.5(B) shall be
received:
(A) to the extent that the Vendor is the Interbrew Retained Group
Company to which the Intra-Group Debts Owing are owed, by the
Vendor on its own behalf; and
(B) to the extent that the Vendor is not the Interbrew Retained
Group Company to which the Intra-Group Debts Owing are owed,
by the Vendor as agent of the respective Interbrew Retained
Group Companies to which such respective parts of the
Intra-Group Debts Owing are owed
and the Vendor shall enter into a loan agreement with each Interbrew
Retained Group Company as the agent of which it receives a repayment of
any part of the Intra-Group Debts Owing pursuant to clause 5.5(B) to
record that, as a result of such repayment received as agent of each
such Interbrew Retained Group Company, the Vendor owes to each such
Interbrew Retained Group Company an amount equal to such part of the
repayment of Intra-Group Debts Owing received by the Vendor as its
agent.
5.9 The Vendor shall enter into a loan agreement with each Interbrew
Retained Group Company as the agent of which it makes a repayment of
any part of the Intra-Group Debts Receivable pursuant to clause 5.5(C)
to record that, as a result of such repayment by the Vendor as agent of
each such Interbrew Retained Group Company, each such Interbrew
Retained Group Company owes to the Vendor an amount equal to such part
of the Intra-Group Debts Receivable repaid by the Vendor as its agent.
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5.10 Any amount received by the Purchaser pursuant to clause 5.5(C) shall be
received by the Purchaser as agent of the respective Group Companies to
which such Intra-Group Debt Receivable is owed and the Purchaser shall
enter into a loan agreement with each Group Company as the agent of
which it receives a repayment of debt pursuant to clause 5.5(C) to
record that, as a result of such repayment received as agent of each
such Group Company, the Purchaser owes to each such Group Company an
amount equal to such part of the repayment of Intra-Group Debts
Receivable received by the Purchaser as its agent.
5.11 The events relating to the completion of the sale of the BBW Assets set
out in the BBW BPA shall take place as provided therein.
5.12 The Vendor shall procure that meetings of the directors, or of the
shareholders, as appropriate, of the Group Companies are held at which
the following business is transacted:
(A) the directors of BHL shall approve for registration (subject
to being duly stamped) the transfer of the BHL Shares referred
to in clause 5.2(B);
(B) the situation of the registered office of each Group Company,
which is currently situated at any Interbrew Retained Group
Company address, shall be changed to that of the registered
office of the Purchaser or a member of the Purchaser Group or
to such other address as the Purchaser shall notify to the
Vendor in writing prior to Completion; and
(C) the persons listed in schedule 9 shall resign as directors
and/or secretaries of the relevant Group Companies and shall
sign as a deed a letter in the Agreed Form and such persons as
shall be notified to the Vendor by the Purchasers prior to
Completion shall be appointed, with effect from the end of the
meeting, as directors of the relevant Group Companies.
The Vendor shall procure that minutes of each duly held board meeting
(certified by a duly appointed officer as true and correct) and the
resignations and letters referred to are delivered to the Purchasers'
Solicitors.
5.13 The Vendor shall procure the present auditors of the Group Companies to
resign their office as such and provide a letter notifying their
resignation, acknowledging they have no claim against any Group Company
and containing a statement pursuant to section 394(1) of the Companies
Act that there are no circumstances connected with their ceasing to
hold office which they consider should be brought to the attention of
any members or creditors.
5.14 The Tax Covenant shall come into full force and effect at Completion.
5.15 The provisions of schedule 10 (Pensions) shall come into full force and
effect at Completion.
5.16 The provisions of schedule 13 (Intellectual Property Matters) shall
come into full force and effect at Completion other than those
expressed to take effect from the date of this Agreement which shall
come into full force and effect on the date of this Agreement.
5.17 INSURANCE
With effect from Completion and for a period of not less than 2 years
following Completion, the Purchaser shall procure that each Group
Company shall maintain policies of insurance
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with no less favourable coverage than those offered by or for the
benefit of the Group Companies as existing at the date hereof and in
particular all such policies shall be on a "claims made" basis rather
than an "occurrence" basis.
5.18 NO DELAY IN COMPLETION
Notwithstanding any other provision of this clause 5, if the Vendor is
unable to deliver to the Purchaser on the Completion Date (in any case
other than in respect of BHL, BBL, Tradeteam, Grolsch (UK) Limited, BHR
International BV, BB(IP), Barbox Limited and Pubs 247 Limited which
shall be so delivered):
(A) all of the share certificates in respect of the Subsidiaries
referred to in clause 5.2(B); or
(B) each of the items referred to in clause 5.2(C),
save that in respect of BB(IP) and BHR International BV any documents
required by a notary to perfect the releases of the ABN Security
Guarantees and ABN Share Pledges shall not be required to be delivered
on Completion, but on the next Business Day thereafter but, for the
avoidance of doubt, this will not in any way affect the Vendor's
obligations under clause 5.2(H) to deliver releases in respect of
BB(IP) and BHR International BV.
Completion shall nevertheless take place in accordance with clause 5.1
provided that the Vendor notifies the Purchaser no fewer than 3
Business Days in advance of the Completion Date of the items it will be
unable to deliver on Completion and, delivers on Completion to the
Purchaser appropriate assurances or undertakings, in a form or forms
approved by the Purchaser no fewer than 2 Business Days before
Completion, in respect of those share certificates or other items which
it is unable so to deliver (including, without limitation, indemnities
in respect of lost share certificates) in order to ensure their
delivery (or, as the case may be, replacement) as soon as reasonably
practicable following Completion.
6. COMPLETION WORKING CAPITAL STATEMENT AND INTRA-GROUP DEBT
6.1 COMPLETION WORKING CAPITAL STATEMENT
The Vendor and the Purchasers agree that they will follow the
procedures described in schedule 4 in preparing the Completion Working
Capital Statement. If the Completion Working Capital Amount is greater
than the Reference Working Capital Amount, the Purchaser shall pay the
amount of the difference to the Vendor by way of adjustment to the
consideration for the BHL Shares. If the Completion Working Capital
Amount is less than the Reference Working Capital Amount, then the
Vendor shall pay the amount of the difference to the Purchaser by way
of adjustment to the consideration for the BHL Shares.
6.2 PAYMENT AND INTEREST
The payment of the amount so determined pursuant to, or referred to in,
clause 6.1 shall be paid to the relevant payee, within five (5)
Business Days of the date on which such amount is agreed or determined
pursuant to schedule 4. Any such amount shall attract interest at the
same rate as the prevailing base rate of Lloyds TSB pIc from (but
excluding) the Completion Date until (and including) the date of
payment.
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6.3 INTRA-GROUP DEBT
If the Intra-Group Debts Receivable are greater than the Intra-Group
Debts Owing, the amount left after deducting the Intra-Group Debts
Owing from the Intra-Group Debts Receivable shall be added to the
consideration for the BHL Shares, pursuant to clause 2.4(C) (to the
extent of such amount). Whereas, if the Intra-Group Debts Owing are
greater than the Intra-Group Debts Receivable, the amount left after
deducting the Intra-Group Debts Receivable from the Intra-Group Debts
Owing, shall be deducted from the consideration for the BHL Shares,
pursuant to clause 2.4(C), (to the extent of such amount).
7. POST-COMPLETION UNDERTAKINGS
7.1 GUARANTEES
The relevant Purchaser agrees that it shall use all reasonable
endeavours to obtain the unconditional and absolute release of each
Interbrew Retained Group Company from any Intra-Group (Group Company)
Guarantee to which it is a party on or as soon as practicable following
Completion and, pending such release, to indemnify the relevant
Interbrew Retained Group Company against all amounts paid by it
pursuant to any such Intra-Group (Group Company) Guarantee in respect
of any liability of any Group Company or any Interbrew Retained Group
Company in respect of any liability of any Group Company (and all Costs
incurred in connection with such liability) whether arising before or
after Completion (provided that the Guarantor shall procure that the
relevant Interbrew Retained Group Company shall, to the extent
reasonably practicable, consult with the relevant Purchaser prior to
making any such payment).
7.2 The Vendor agrees that it shall use all reasonable endeavours to obtain
the unconditional and absolute release of each Group Company from any
Intra-Group (Interbrew Retained Group) Guarantee to which it is a party
on or as soon as practicable following Completion and, pending such
release, to indemnify the relevant Group Company against all amounts
paid by it pursuant to any such Intra-Group (Interbrew Retained Group)
Guarantee in respect of any liability of any Interbrew Retained Group
Company (and all Costs incurred in connection with such liability)
whether arising before or after Completion (provided that the Purchaser
Guarantor shall procure that the relevant Group Company shall, to the
extent reasonably practicable, consult with the Vendor prior to making
any such payment).
7.3 The Vendor agrees that it shall use its reasonable endeavours to assist
the Purchaser in procuring the release of each Group Company from any
guarantee given for the benefit of Six Continents PLC or any of its
subsidiaries, by, upon the Purchaser's request (and subject to being
fully indemnified in respect of all Costs), exercising its rights under
clause 7.3 of the Bass SPA and, pending such release, agrees to
indemnify the relevant member of the Group against all amounts paid by
it pursuant to any such guarantee in respect of any liability of Six
Continents PLC and/or any of its subsidiary undertakings whether
arising before or after Completion (provided that the relevant member
of the Group shall, to the extent reasonably practicable, consult with
the Vendor prior to making any such payment).
7.4 The Purchaser agrees that it shall use its reasonable endeavours to
assist the Vendor in complying with and discharging its obligations
under clause 7.2 of the Bass SPA, by (and subject to being fully
indemnified in respect of all Costs) procuring the release of Six
Continents PLC or any of its subsidiaries from any guarantee given by
them for the benefit of the Group and, pending such release, agrees to
indemnify the Vendor against all amounts paid by it pursuant to its
obligations under the said clause 7.2 in respect of any
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liability of any Group Company arising after Completion (provided that
the Vendor shall, to the extent reasonably practicable, consult with
the Purchaser prior to making any such payment).
7.5 ACCESS
(A) The Purchasers shall procure that after Completion each Group
Company provides the Vendor and its advisers with such access
(during normal office hours and on reasonable notice) to the
senior employees, accounts, working papers and other financial
information of the relevant Group Company as is reasonably
necessary for the purposes of:
(1) preparing the Guarantor's annual report and accounts;
(2) preparing any Interbrew Retained Group Company's tax
returns or accounts;
(3) complying with any legal, regulatory or compliance
requirements, in each case in the United Kingdom or
elsewhere;
(4) dealing with any insurance claims involving the
Vendor, whether made before or after Completion;
(5) the preparation by any Interbrew Retained Group
Company of any financial information required in
connection with the listing of shares or any debt
security of any member of the Interbrew Retained
Group on any securities exchange, investment
exchange, quotation system or other recognised
trading market; or
(6) compliance by any Interbrew Retained Group Company
with clause 7.4 of the Bass SPA.
In addition, the Purchasers shall procure that each Group
Company provides to the Vendor and its advisers such access to
information which such Group Company possesses and is entitled
to provide to the Vendor and its advisers relating to any
issue affecting Interbrew Retained Group Companies and
currently the subject of legal proceedings or which after
Completion becomes the subject of legal proceedings (other
than Relevant Claims), over the period that any such legal
proceedings are outstanding.
(B) The Vendor shall procure that after Completion each member of
the Interbrew Retained Group provides the Purchasers and their
respective advisers with such access (during normal office
hours and on reasonable notice) to the senior employees,
accounts, working papers and other financial information and
employees of members of the Interbrew Retained Group as is
reasonably necessary for the purposes of:
(1) preparing the Purchaser Guarantor's annual report and
accounts;
(2) preparing any tax returns or accounts of any Group
Company;
(3) complying with any legal, regulatory or compliance
requirements, in each case in the United Kingdom or
elsewhere;
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(4) dealing with any insurance claims involving any Group
Company, whether made before or after Completion; or
(5) the preparation by any member of the Purchaser Group
(including the Group) of any financial information
required in connection with bank financing or the
listing of shares or any debt security of any member
of the Purchaser Group (including the Group) on any
securities exchange, investment exchange, quotation
system or other recognised trading market.
In addition, the Guarantor shall procure that each Interbrew
Retained Group Company provides to the Purchaser and its
advisers such access to information (including tax opinions)
about any reorganisation that may have taken place prior to
the 22 August 2000 acquisition of BHL by the Vendor as they
may reasonably request and to any other information in each
case which such Interbrew Retained Group Company possesses and
is entitled to provide to the Purchaser and its advisers
relating to any issue affecting Group Companies and currently
the subject of legal proceedings or which after Completion
becomes the subject of legal proceedings (other than Relevant
Claims), over the period that any such legal proceedings are
outstanding
For the avoidance of doubt (A) and (B) above shall continue
without limit in time.
7.6 BASS SPA INDEMNITY
The Purchaser and the Purchaser Guarantor acknowledge that the Vendor
along with other Interbrew Retained Group Companies owe various
obligations to Six Continents PLC and Six Continents Holdings Limited
under the Bass SPA specifically in relation to the CarlingNet Website,
the Call Option Deed dated 25 August 1996 between Carlsberg A/S and BHL
(the "Call Option Deed"), the BB(IP) Loan Agreement and a
reorganisation guarantee (the "Reorganisation Guarantee") in relation
to the Bass Reorganisation Agreements.
7.7 The Purchaser shall promptly do or procure that each member of the
Group and the Purchaser Group promptly does all such things as may be
reasonably required by the Guarantor or the Vendor from time to time
for the purpose of assisting any Interbrew Retained Group Company to
fulfil its obligations under the Bass SPA, including, without
limitation, the Reorganisation Guarantee, subject to such member of the
Purchaser Group being indemnified on an after tax basis for all
reasonable Costs incurred directly or indirectly as a consequence of
complying with this clause.
7.8 The Purchaser and the Purchaser Guarantor hereby agree to indemnify and
undertake to pay to the Vendor, an amount equal to any Costs incurred
by any Interbrew Retained Group Company due under the Bass SPA in
respect of:
(A) the Deferred Consideration (as defined in the Bass SPA)
relating to the CarlingNet Website;
(B) the Call Option Deed; and
(C) the Reorganisation Guarantee set out in clause 14 of the Bass
SPA,
where such Cost is directly incurred as a result of any action or
inaction following Completion by the Purchaser or any member of the
Purchaser Group (including the Group).
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7.9 BB(IP) LOAN AGREEMENT
The Purchaser agrees that it shall procure the repayment of the loan
set out in the BB(IP) Loan Agreement on the date on which repayment is
due (and not before) and satisfy all obligations thereunder. The
Purchaser further undertakes and agrees to procure that, subject to the
terms of clause 7.12 no member of the Purchaser Group (including,
following Completion, the Group) shall repay the BB(IP) Loan Agreement
before the repayment date specified therein. The Purchaser undertakes
that it will use all reasonable endeavours to ensure that neither it
nor any member of the Purchaser Group (including, following Completion,
the Group) shall, subject to the terms of clause 7.12, take any action
after Completion (including any action in relation to the CARLING brand
or any action by way of repayment of the BB(IP) Loan Agreement) which
will constitute a breach of or otherwise invalidate the Dutch tax
ruling (a copy of which has been provided to the Purchasers' Solicitors
and the Purchaser's Accountants) (the "Dutch Ruling") which was
obtained when the CARLING brand was transferred by BIH to BB(IP) on 29
September 1999.
7.10 The Vendor undertakes to the Purchaser to indemnify it and hold it
harmless against (i) the cost of repayment of the principal amount of
EUR 16,049,640 payable under the BB(IP) Loan Agreement by the Purchaser
pursuant to clause 7.9, (ii) all interest payments actually paid by
BB(IP) to BIH pursuant to Article 3(1) of the BB(IP) Loan Agreement and
(iii) all Costs of the Purchaser or any member of the Group arising out
of (x) any breach by BB(IP) or any member of the Group of any provision
of the BB(IP) Loan Agreement on or following 22 August 2000 and prior
to Completion or (y) any requirement imposed on BB(IP) by BIH in
accordance with the BB(IP) Loan Agreement to accelerate the repayment
of that principal amount by reason of the acquisition by the Purchaser
of the BHL Shares.
7.11 Nothing in these clauses 7.9, 7.11 or 7.12 shall operate in any way to
restrict the freedom of the Purchaser or any other member of the
Purchaser Group (including following Completion the Group) to transfer
at any time the shares of BB(IP) or the assets of BB(IP) (or any of
them including the CARLING brands) provided however that in respect of
any such transfer the Purchaser agrees to notify the Vendor of the
transfer and to use all reasonable efforts to prevent the Dutch Ruling
from being breached or invalidated and in the case of the transfer to a
third party outside the Purchaser Group (including following Completion
the Group) which leads to a breach or invalidation of the Dutch Ruling
or which results in a repayment of the BB(IP) Loan Agreement, the
Purchaser agrees to indemnify the Vendor as agent for any other
Interbrew Retained Group Company against any consequential tax charge
imposed by the Dutch authorities on BIH and payable by any Interbrew
Retained Group Company under the Bass SPA.
7.12 Nothing in these clauses 7.9, 7.11 or 7.12 shall prevent any member of
the Purchaser Group (including following Completion the Group) from at
any time repaying the loan the subject of the BB(IP) Loan Agreement if
such member notifies the Vendor of such intention and at the same time
pays to the Vendor as agent for any Interbrew Retained Group Company
(by way of compensation for damages) the tax charged in relation to
such repayment by the Dutch tax authorities.
7.13 DEFERRED CONSIDERATION
The Purchaser hereby covenants with the Vendor that the Purchaser shall
pay to the Vendor a sum equal to 10% of the consideration received
(after deduction of (i) the reasonable costs of the Disposal, and (ii)
any tax for which the Purchaser or any Group Company is or will be
liable in respect of such Disposal) by any member of the Purchaser
Group (including the Group) from the Leading Brewer (the "Additional
Consideration") by
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way of additional consideration for the BHL Shares, if within the
period of three years from Completion, a Disposal is made by any member
of the Purchaser Group. The provisions of this clause 7.13 and of
clauses 7.14 to 7.16 (inclusive) are subject to clauses 7.17 to 7.19
(inclusive).
7.14 The Purchaser hereby covenants that it shall ensure that:
(A) any Disposal falling within clause 7.13 above, shall be made
by way of an agreement in writing, such agreement to provide
for completion of such Disposal to take place at a specified
time and place on a specified date;
(B) in respect of any Disposal falling within clause 7.13 above,
the Purchaser shall pay the Additional Consideration to the
Vendor within 5 Business Days of receiving the cash proceeds
of such Disposal; and
(C) in the event that any part of the consideration for any
Disposal falling within clause 7.13 above is in non-cash form,
the fair market value of such non-cash consideration shall be
determined by such independent chartered accountant as shall
be appointed by agreement between the parties, and failing
such appointment, such person as shall be appointed by the
President for the time being of the Institute of Chartered
Accountants for England and Wales (on application made by
either the Purchaser or the Vendor), who shall act as expert
not arbitrator, and the Purchaser shall make cash funds
available to pay such additional consideration to the Vendor
within 5 Business Days following such determination.
7.15 The Purchaser shall notify the Vendor within 2 Business Days of
entering into an agreement in respect of any conditional or
unconditional Disposal falling within clause 7.13 above, such
notification to include the consideration payable by the Purchaser in
respect of such Disposal.
7.16 Any payments of Additional Consideration to be made to the Vendor
pursuant to clause 7.13 above shall be made in pounds sterling by way
of electronic transfer into the account the Vendor shall have notified
in advance to the Purchaser.
7.17 The Purchaser may, with respect to any Disposal or proposed Disposal
(the "Relevant Transaction"), at any time prior to its being obliged to
make payment to the Vendor under clause 7.14(B) above in respect of the
Relevant Transaction, offer the opportunity (the "Option") to the
Vendor to enter into a transaction the subject matter and terms of
which are in all material respects the same as those of the Relevant
Transaction. The Purchaser hereby covenants with the Vendor that it
shall at all times act in good faith in relation to its obligations
under this clause 7.16, and in particular (without prejudice to the
generality of the foregoing) the Purchaser shall not include in the
terms of any such Option any provision the predominant purpose of which
is to place the Vendor at a material disadvantage in terms of the
commercial viability of, or ability to take up, the Option when
compared with the Leading Brewer. If, within the period of 15 Business
Days of the Purchaser offering such an opportunity to the Vendor (or
such longer period as the parties may agree), the Vendor has not
accepted such offer in writing (on an unconditional basis, save only as
regards (i) any necessary consent of the DGFT under the undertakings to
be given by the Vendors and or the Guarantor to the Secretary of State
for Trade and Industry pursuant to section 88(2) of the FTA; and (ii)
any necessary regulatory consent, on terms satisfactory to the Vendor
(acting reasonably)), the Purchaser and each member of the Purchaser
Group shall be entitled to proceed with the Relevant Transaction and
shall have no liability to the Vendor under clauses 7.13 to 7.16. If,
within such period, the Vendor accepts the offer and that acceptance is
subject only to one or more of the
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conditions referred to above, the Purchaser and the Vendor shall
co-operate in good faith to execute binding documentation with respect
to the Relevant Transaction (subject only to such conditions) provided
that the Purchaser may at any time notify the Vendor in writing of its
decision not to pursue the Relevant Transaction with the Vendor. The
Purchaser shall in such circumstances only incur liability to the
Vendor under clauses 7.13 to 7.16 in the event that it subsequently
enters into the Relevant Transaction. Such documentation shall include
obligations on the Vendor to progress the satisfaction of any necessary
permitted regulatory condition using all reasonable endeavours provided
that the Vendor shall not be obliged to accept any approval or
clearance of the Relevant Transaction subject to any undertakings,
conditions, modifications or assurances that are not reasonably
acceptable to the Vendor and the Purchaser.
7.18 Clauses 7.13 to 7.16 shall not apply to any act or transaction that
would (but for this clause 7.18) constitute a Disposal provided, and to
the extent, that it is entered into or carried out in accordance with
the Management Action Plans as set out in the Data Room at reference
B.6.
7.19 TRADETEAM
The Purchaser hereby covenants and undertakes with the Vendor that the
Purchaser will procure that no member of the Purchaser Group (including
the Group) will in any way block, impede, object to, interfere with or
prevent the transfer of the delivery logistics operations of IUK (or
any other Interbrew Retained Group Company) to Tradeteam, if Tradeteam
has independently accepted and approved any such proposed transfer.
7.20 RESTRICTION ON SOLICITATION OF EMPLOYEES
During the period from the date of this Agreement to 6 months after
Completion, the Guarantor and the Purchaser Guarantor agree and shall
procure that:
(A) the Interbrew Retained Group shall not take into employment
any person who was employed by the Group at or at any time
following 01 September 2001; and
(B) the Purchaser Group (including the Group) shall not take into
employment any person who was employed by TCB, Bass Ireland
Limited or BBW, not being an "Employee" for the purposes of
the BBW BPA at, or at any time following 01 September 2001;
unless the Vendor and the Purchaser agree in writing that such a
transfer can take place, other than in respect of Chris Paden or David
Randall previously of BBL.
7.21 With respect to:
(A) employees employed in the United Kingdom classified in Band 5
or above or set out in part 1 of schedule 18; or
(B) in respect of:
(1) any employee of TCB or Bass Ireland Limited employed
in the United Kingdom or Ireland; or
(2) any employee of BBW, not being an "Employee" for the
purposes of the BBW BPA;
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classified in Band 5 or above (or its equivalent) or as set
out in part 2 of schedule 18,
the provisions of clause 7.20 shall be read as if the reference to six
months therein was a reference to one year.
7.22 PENSION INDEMNITY
The Purchaser undertakes to pay to the Vendor, by way of adjustment so
far as possible to the consideration payable for the BHL Shares, an
amount equivalent to all liability to pay benefits which may be
suffered or incurred by the Vendor or any Interbrew Retained Group
Company arising out of or in connection with:
(A) BBETUS;
(B) the promises relating to Iain Napier's pension entitlement as
set out in letters dated 12 June 2000, 20 July 2000, 18
December 2000, 22 March 2001 and 01 June 2001;
but only so far as provision has been made in the Completion Accounts
in respect of clauses 7.22(A) and 7.22(B) above and such liability to
pay benefits has not been incurred by the Purchaser or any Group
Company.
The Vendor undertakes to pay to the Purchaser, by way of adjustment so
far as possible to the consideration payable for the BHL Shares, an
amount equivalent to all Costs which may be suffered or incurred by the
Purchaser or any Group Company arising out of or in connection with the
exercise by Iain Napier of his early retirement option pursuant to the
letters described in clause (B) above.
Any payment to be made pursuant to this clause 7.22 shall be made not
more than one month after a written demand from one party to the other.
7.23 INTERBREW LONG TERM INCENTIVE PLAN (THE "LTIP")
The Vendor undertakes to procure that the board of directors of
Interbrew SA exercises its discretion under the rules of the LTIP so
that subscription rights granted to directors or employees of a Group
Company remain exercisable in accordance with the rules of the LTIP.
7.24 LOST LICENCES
(A) The Vendor shall indemnify the Purchaser (for itself and on
behalf of any Group Company) in respect of any Costs resulting
or arising directly or indirectly from:-
(1) the failure to validly hold a Lost Licence;
(2) the invalidity or termination of any Lost Licence;
(3) carrying on business before and after Completion in
all respects as if all Lost Licences were validly
held by the relevant Group Company;
(4) obtaining or procuring supplies of water, beer or
other relevant products, materials, supplies or
services from alternative sources (for the avoidance
of doubt to include brewing) in order to compensate
for any unavailability of
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abstracted water or other rights resulting directly
or indirectly from a Lost Licence ("Alternative
Sourcing").
(B) The Purchaser shall procure that BBL and the Purchaser shall
fully consult in good faith with the Vendor before taking any
major strategic decision in relation to Alternative Sourcing.
(C) The parties acknowledge that, save where not reasonably
avoidable having regard to the available options for
Alternative Sourcing, the Purchaser or any Group Company
should not by virtue of any Alternative Sourcing be placed in
any materially better position than if the relevant Lost
Licence issue had not arisen. Accordingly, the amount of Costs
recoverable by the Purchaser or any Group Company in relation
to Alternative Sourcing shall be reduced to the extent of any
such material improvement which is reasonably avoidable on
that basis. Where there is more than one Alternative Sourcing
strategy reasonably available to the Purchaser (none of which
would give rise to any uncompensated harm to BBL) then BBL
will adopt the least cost alternative or if it adopts a higher
cost alternative then the indemnity in sub-clause 7.24(A)
shall be limited to the Costs of the lowest such alternative.
For the avoidance of doubt the least cost alternative on such
basis could be to cease production at the relevant brewery.
Where the Purchaser or any Group Company is making a claim in
respect of Alternative Sourcing under the indemnity in
sub-clause 7.24(A)(3) or sub-clause 7.24(A)(4) then the claim
shall be made under sub-clause 7.24(A)(4) and the provisions
of this sub-clause 7.24(C) shall apply.
(D) Any consultation under this clause shall be subject to any
applicable laws preventing or restricting consultation.
(E) The Purchaser shall, upon reasonable prior notice from the
Vendor at any time after Completion and at the cost and
expense of the Vendor, make application for any Lost Licence
to be (at the Vendor's option), (1) validly rectified to
record the relevant Group Company as the duly entitled holder
or (2) validly transferred to the relevant Group Company or
(3) re-applied for in the name of the relevant Group Company
(provided that the Licence is granted on the same or no less
favourable terms as the Lost Licence). This sub-clause 7.24(E)
is without prejudice to sub-clauses 7.24(A) to 7.24(D) above
which shall apply whether or not directions are given under
this sub-clause 7.24(E). Moreover, the indemnity in sub-clause
7.24(A) shall apply to all acts or omissions of the Purchaser
or any Group Company taken or not taken pursuant to this
sub-clause 7.24(E).
(F) Subject to sub-clause 7.24(D) and appropriate arrangements to
preserve confidentiality, the parties agree that BBL shall
provide the Vendor at the Vendor's cost with any information
reasonably relevant to a decision on a course of action taken
under sub-clause 7.24(E) (including plans for closure).
(G) For the avoidance of doubt the Costs recoverable under this
indemnity shall not include those Costs which result from a
decision to cease production at the Alton Brewery other than
by reason of a Lost Licence.
8. VENDOR WARRANTIES
8.1 As at the time of execution of this Agreement (and as at Completion by
reference to the events and circumstances then existing and as if any
express reference in any of the Vendor Warranties to the date of this
Agreement were a reference to Completion) the
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Vendor represents and warrants to the Purchaser in the terms of
Schedule 7 (but only insofar as such warranties relate to the Group
Companies) and to the IP Purchaser (in the terms of the Caffrey's
Warranties), and Brandbrew represents and warrants to the IP Purchaser
(but only insofar as such warranties relate to the Target IP) in the
terms of the Vendor Warranties subject to:
(A) any matter fairly and reasonably disclosed in the Disclosure
Letter (or treated by the Disclosure Letter as being
disclosed);
(B) any information contained in the documents listed in the Data
Room Index, all such information being deemed to be disclosed
to the Purchasers to the extent it constitutes a fair and
reasonable disclosure;
(C) any matter or thing hereafter expressly required to be done or
omitted to be done pursuant to this Agreement; and
(D) the limitations and qualifications set out in clause 9.
8.2 In the case of any Vendor Warranties which are deemed to be given only
so far as the Vendor or Brandbrew is aware, the Vendor or Brandbrew (as
the case may be) shall in each case be deemed to be aware only of those
facts, matters and circumstances actually known to the individuals
whose names are set out in schedule 11 in relation to the Vendor
Warranties specified against each individual's name (and no other
persons), or which would be known to such individuals had they made due
and careful enquiry within the Group of the appropriate personnel and
without any implication that such enquiry extends to the carrying out
of searches and enquiries of any public or other body or authority or
any third party.
8.3 Subject to clause 16, the Vendor Warranties shall be enforceable by the
Purchaser against the Vendor only in respect of the BHL Shares, by the
IP Purchaser against the Vendor only in respect of the Caffrey's
Rights, and by the IP Purchaser against Brandbrew only in respect of
the Target IP.
8.4 The Vendor acknowledges that the relevant Purchasers have entered into
this Agreement in reliance upon the Vendor Warranties.
8.5 Save as expressly otherwise provided, the Vendor Warranties shall be
separate and independent and shall not be limited by reference to any
other paragraph of schedule 7 or by anything in this Agreement.
8.6 TAX GROSS-UP
(A) All sums payable under this Agreement (including, for the
avoidance of doubt and without limitation the Tax Covenant and
including, for the avoidance of doubt and without limitation,
all sums paid by the Vendor, Brandbrew or the Guarantor under
this Agreement to any tax authority on behalf of the Purchaser
or the IP Purchaser) shall be paid free and clear of all
deductions or withholdings whatsoever save as may be required
by law.
(B) If the Vendor, Brandbrew or the Guarantor is required by law
to make any deductions or withholdings from any of the sums
payable as mentioned in sub-clause (A) above, then to the
extent that the deductions or withholdings are Grossed-Up
Withholdings, the payment in question shall be increased to
such sum as will, after the Grossed-Up Withholdings leave the
recipient with the same
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amount as it would have been entitled to receive in the
absence of any such requirement to make such Grossed-Up
Withholdings.
(C) If the Vendor, Brandbrew or the Guarantor is required by law
to pay any additional amounts pursuant to sub-clause (B)
above, the recipient of such increased payment shall use all
reasonable efforts (at the direction and cost of the Vendor,
Brandbrew or the Guarantor as appropriate) to obtain
repayment, credit or relief for the tax withheld or deducted
(keeping the Vendor, Brandbrew or the Guarantor, as
applicable, fully informed). Upon obtaining any such
repayment, credit or relief the recipient shall refund to the
Vendor, Brandbrew or the Guarantor (as applicable) the amount
of repayment, credit or relief so obtained, up to the amount
by which the payment pursuant to this Agreement was increased
in respect of Grossed-Up Withholdings pursuant to sub-clause
(B) above.
(D) If any sum payable to the Purchaser and/or the IP Purchaser as
mentioned in sub-clause (A) above pursuant to the Warranties
or the Tax Covenant shall be subject to a tax liability, then
to the extent that such tax liability is a Grossed-Up Tax
Liability imposed upon the Purchaser or the IP Purchaser, as
applicable, (having made all reasonable efforts to minimise
such liability), the Vendor, Brandbrew or the Guarantor (as
applicable) shall be under the same obligation to make an
increased payment in relation to that Grossed-Up Tax Liability
as if that Grossed-Up Tax Liability were a Grossed-Up
Withholding required by law.
8.7 For the purpose of clause 8.6 above:
(A) "Grossed-Up Withholdings" means any deduction or withholding
required to be made pursuant to:
(1) the laws in force from time to time in Luxembourg or
Belgium; or
(2) any other law applicable, other than the law of the
United States of America, in respect of payments made
by one company resident for tax purp |
